TVA dives deep in nuclear ventures, but critics worried

Feb 28 - McClatchy-Tribune Regional News - Anne Paine The Tennessean, Nashville

The Tennessee Valley Authority eagerly raises its hand for nuclear projects that others shy away from.

It's been completing nuclear reactors while for-profit electricity producers hang back, and as early as April could decide to construct another one.

The public power producer creates tritium to boost the explosive power of the nation's warheads at one of its nuclear plants. It wants to test mini-nuclear reactors, an untried concept.

Before this decade ends, TVA could begin accepting shipments of fuel made from bomb-grade plutonium from dismantled nuclear weapons. It says the fuel could save ratepayers money while reducing weapons stockpiles.

But critics say TVA's pro-nuclear stance is endangering both the safety and the pocketbooks of ratepayers in Tennessee.

"It's really an overenthusiastic, institutional bias," said Stephen Smith, a longtime TVA watchdog who is executive director of the Southern Alliance for Clean Energy.

"It's a combination of their unique federal position, longtime bias within the agency, and they seem to be pushed by members of the state's congressional delegation to take these risks."

His group is among those that say TVA, which supplies relatively inexpensive electricity to Tennessee and parts of six other states, should maximize energy efficiency and alternative energy before continuing what they say is a rush to large, costly nuclear projects.

TVA's vision for 2020 is to lead the nation in new nuclear production, which fits in with the Obama administration's interest in nuclear power and has strong backing from Sen. Lamar Alexander.

"Nuclear is a technology available now that can safely and reliably produce large amounts of electricity without the emissions associated with fossil fuels," TVA spokesman Terry Johnson said in an e-mail.

"Nuclear power is also very reliable and can provide the electricity we depend on to power homes, businesses and industries across the TVA region."

TVA, which gets about 30 percent of its electricity from nuclear power, has a total of six reactors at three plants, including Sequoyah, 18 miles north of Chattanooga; Browns Ferry in northern Alabama; and Watts Barr, 60 miles southwest of Knoxville.

In 2013, the independent federal corporation expects to turn on the first new nuclear reactor in the nation in 17 years, completing the long-mothballed Watts Bar second reactor for $2.5 billion.

The TVA board could vote in April on whether to complete an older-design nuclear reactor begun in the 1970s at TVA's Bellefonte site in northern Alabama. The price tag could run to $4 billion.

First wave cost billions

Don Safer, president of the Tennessee Environmental Council board, says the agency is in an unfortunate hurry to spend billions of dollars for complex nuclear reactor projects ridden with security issues, just to boil water to make steam.

Ratepayers are being put at undue financial risk, he says, as happened with a massive nuclear building program TVA took on in the 1960s, '70s and '80s.

The drive crashed amid cost overruns and safety problems, leaving the agency with more than $20 billion in debt and only a few of the planned reactors built.

TVA officials say close analysis is being done today on all of its projects.

"To assure that project risks are understood and managed to the best of our ability, thorough reviews are conducted and independent verifications are typically done by risk management consultants," Johnson said.

Unlike a private utility, TVA has the advantage of not having to justify a project to an oversight agency or ask permission to raise its rates to pick up the tab for what it does.

Although the federal government does not explicitly guarantee the debt, there is an assumption among lenders that U.S. taxpayers would pay if a bailout is needed.

A taxpayer guarantee has begun to spur some private utilities to build new reactors. Congress approved about $18 billion in loan guarantees, and President Barack Obama is proposing more.

TVA has a variety of nuclear-related projects -- outside of making electricity -- that it says are done in the national interest.

Making tritium, which enhances the explosive power of nuclear warheads, is one. It takes place at the current reactor at Watts Bar but could be expanded to other TVA reactors.

Johnson said TVA's mission includes being a national leader in technological innovation, low-cost power and environmental stewardship, as well as supporting national defense.

TVA is unique as an electric power producer in its close relationship with the Department of Energy and the Oak Ridge National Laboratory.

TVA built a massive coal plant to provide power for the secret Manhattan project at Oak Ridge to develop nuclear weapons in the 1940s and has been the electricity provider for the DOE's Paducah, Ky., plant, where uranium is enriched for use as nuclear fuel.

The Oak Ridge complex, where toxic residues still remain, is also the seat of much government-funded energy and other research, part of which has been nuclear-related.

The money and work represent jobs and economic development to East Tennessee, as do nuclear reactor building projects wherever they're planned.

Plutonium repurposed

Construction jobs also are a selling point for a Department of Energy project in South Carolina in which TVA could play a key role.

A $5 billion plant is under construction that would take plutonium from U.S. nuclear weapons, under an agreement with Russia, and make it into a nuclear fuel called mixed oxide fuel, or MOX.

Without a user of it, the federal project would be useless, and TVA has entered an agreement with DOE for it.

"TVA does consistently show up as the resort of last option for questionable Department of Energy programs," said Tom Clements, with Friends of the Earth, a federation of grass-roots environmental groups.

"For-profit utilities don't want to get involved in certain activities. Utilities want the cheapest fuel, and uranium is the cheapest."

Activists have pressed to stop that plant's construction, saying moving weapons-grade plutonium around and processing it only opens up more chances of terrorist attacks or theft of the material.

It's removed from weapons in Texas, would go to South Carolina for processing and then could be shipped to TVA, to a plant in Tennessee or Alabama or both.

Once it's used in a reactor, its potential for weaponry is removed and it's too radioactive for thieves, according to TVA.

The National Nuclear Security Administration, an independent group within DOE, says the fuel from weapons can be handled safely with extra care and that it would cost no more than uranium fuel, perhaps less. TVA officials say either way, they would not pay more for it.

"Any extra expense to produce and use MOX is a cost associated with the reduction of the number of nuclear weapons and would be borne by the U.S. government," Johnson wrote.

The only investor-owned utility that has taken any part in the MOX project is Duke Energy in North Carolina, which ran test batches of a similar kind, not made from weapons materials, before dropping out.

"TVA is the backstop," Edwin Lyman, a physicist with Union of Concerned Scientists, said, adding that it's the DOE's "trash pit."

In Duke Energy's case, the structures that held the fuel had enlarged inside the reactor over time, creating concerns.

The National Nuclear Security Administration said the utility dropped out not because of the fuel, but because of business issues, including a delay in when the fuel could ultimately be delivered.

TVA is looking closely at the situation and the prospects of lower fuel costs for its ratepayers, Johnson said. The agency doesn't require the promise of a quick, short-term gain that a private utility can need.

"When projects may have value to the nation and TVA's customers or stakeholders, TVA thoroughly evaluates them prior to making decisions to pursue them," he said.

TVA is already saving money for ratepayers by using a fuel blended from highly enriched uranium removed from Russian weapons, he said.

The fuel provides about 10 percent of the nuclear-generated electricity in this country, with for-profit utilities using it too, according to federal officials.

TVA wants mini-nukes

In recent years, TVA has said it would like to take part in several other nuclear projects, including building small reactors and a reprocessing plant for nuclear waste.

"These programs all involve considerable risk, which makes private utilities much less interested in taking them on," Lyman said.

At a time when many utilities are focused on adding natural gas plants that are less costly to build and can be up and running in a couple of years, small reactors -- dubbed mini-nukes -- are a controversial concept. They would be manufactured in a factory and shipped to a site.

"One has never been built," said Ken Glozer, a consultant who worked for the federal Office of Management and Budget for decades.

In that position, he watched as federal officials worried over TVA's financial state in the midst of its previous nuclear building program.

The mini-nukes, which would produce about 10 percent as much electricity as standard reactors, are promoted by vendors as cheap and quick to put up. No design has been approved by the Nuclear Regulatory Commission.

Glozer said any utility that jumped into those at this point would be navigating on "wild-eyed speculation."

TVA has another take.

Cost of a small reactor hasn't been determined, but TVA and the nuclear industry expect that the cost would be competitive, Johnson wrote.

Among several that TVA is looking into building, one would supply power to DOE's Oak Ridge site, with the federal government paying the cost of the power consumed, he said.