Dive Brief:
- The Biden administration touted several nuclear-related events and announcements last week, including a White House summit on domestic nuclear deployments, a new working group to address nuclear construction delays and project cost overruns and a request for information to inform reactor deployments on multiple U.S. Army bases, as evidence of its commitment to the domestic nuclear industry.
- The flurry of activity coincided with the May 29 release of an Institute for Energy Economics and Financial Analysis report casting doubt on the role of small modular reactors in near-term efforts to transition away from fossil fuels.
- “First-of-a-kind nuclear construction, like other mega-projects, [is] difficult, and the most memorable experiences are with projects that are over-budget and over-schedule,” said Marc Nichol, executive director of new nuclear at the Nuclear Energy Institute. “But, in the past, new nuclear plants have been built on-time and on-budget, and we can do it again.”
Dive Insight:
Following the summit, Nichol and other nuclear advocates hailed the administration’s commitment to the industry.
“This event is the clearest evidence yet that the entire executive branch … is aligned to support a rapid expansion of nuclear energy,” American Nuclear Society Executive Director and CEO Craig Piercy told ANS’s Nuclear Newswire after attending the summit.
But the summit “was also a challenge to the nuclear industry to move faster and deliver,” Piercy said.
The new working group will bring together “project developers, engineering, procurement and construction firms, utilities, investors, labor organizations, academics and [non-governmental organizations]” to facilitate cost-effective nuclear deployments and “[ensure] that learnings translate to cost savings for future construction,” the administration said in a fact sheet detailing its recent nuclear initiatives.
Despite U.S. Department of Energy Loan Programs Office Director Jigar Shah’s claim that Georgia Power’s Vogtle Unit 4 cost 30% less to build than Vogtle Unit 3, both reactors took roughly the same amount of time to complete and arrived seven years behind schedule, said David Schlissel, director of resource planning analysis for IEEFA.
The Vogtle expansion also booked $17 billion in cost overruns, the Associated Press reported last year. Southern Co., Georgia Power’s corporate parent, will absorb $2.6 billion of its $10.2 billion share of the excess and pass the remaining $7.6 billion on to ratepayers under a December settlement approved by the Georgia Public Service Commission.
The recent history of the U.S. nuclear industry is one of “overpromising and underproducing,” Schlissel said. “You have to take every promise they make, every claim they make, with a giant grain of salt.”
Deployment costs and schedules for four small advanced reactors operating or under construction in Russia, China and Argentina have dramatically exceeded original projections, IEEFA’s SMR report found. China’s 150-MWe Shidao Bay 1 high-temperature gas-cooled reactor tripled its original budget, while Russia’s two 35-MW floating reactors came in 300% over budget. Planners envisioned four years of construction for Shidao Bay 1 and three years for the Russian reactors, but the projects wound up taking 12 and 13 years, respectively, IEEFA said.
In Argentina, a 32-MWe demonstration reactor under construction since 2013 is already 600% over budget and isn’t expected to begin operations until 2027, IEEFA said. That project was expected to require four years to build.
Cost estimates have also ballooned for U.S. advanced reactor designs yet to begin construction, according to IEEFA. Projected costs for NuScale’s SMR design, which the Nuclear Regulatory Commission certified in January 2023, rose from $9,964/kW in 2015 to $21,561/kW in 2023, while cost estimates for X-energy’s 80-MWe reactor design ranged from $14,844/kW to $17,969/kW in 2023, up from $4,507/kW in 2017, IEEFA said.
Escalating costs led to the cancellation in November of NuScale’s first commercial power project, a 462-MW facility to be built at Idaho National Laboratory.
“What we need to do now due to the threat of climate change” is invest in wind, solar and battery storage, which is cheaper and less time-consuming to deploy than nuclear, Schlissel said. “That is the option that has the biggest impact in the shortest period of time.”
But analyses like IEEFA’s tell an incomplete story about nuclear energy’s costs and future role in the domestic energy mix, Nichol said.
“The studies that conclude that nuclear shouldn’t be a significant part of the energy system either don’t try to match power usage and generation hour by hour and over a geographical area, or they consider isolated average costs [and not] the total system costs that are more directly related to what the consumers pay,” he said. “The vast majority of studies and experts agree that the best way to create a clean, reliable and affordable energy supply is through a diverse mix of generation sources that includes nuclear energy.”
As with other new technologies, “the key to getting to predictable cost and schedule [for new nuclear] is the deployment of multiple projects of a standard design,” Nichol said.
