NRC 20-Yr Plant Extensions

[Susan Gawarecki <loc@icx.net>]

This article came to me electronically today, although the news is
obviously dated I hadn't heard about it.  Would this be considered a
"pro-nuclear power" decision by the existing administration? 

My personal opinion of the major party candidates is that they are both
very comfy with the petroleum industry, which gives them plenty of
incentive to ignore the nuclear power question.  As a geologist, I think
this would be very good for my [original] profession!

The biggest problem with an energy policy is that it forces the
candidates to make difficult trade-offs, as all forms of energy
generation (not to mention transmission) have environmental or political
consequences.  I'm sure they find it easier to just not deal with it.
 
Please note that the opinions expressed in the article below (or that of
the activist organization that distributed it) do not necessarily
reflect the opinions of me or my organization.

Regards,
Susan Gawarecki

NRC 20-Yr Plant Extensions - Patching Nuclear Power
J.A. Savage, Albion Monitor
September 25, 2000

In a hushed quest to allow an expected 85 percent of the nation's
nuclear reactors to live beyond mandatory retirement, the nuclear
industry talked the federal government into allowing a generic 20-year
extension on the life of reactors. The public only has until October
16 to let the Nuclear Regulatory Commission (NRC) know what it thinks of
the government's plan to allow license renewal instead of
decommissioning.

According to the NRC, the only public meeting on the re-licensing plan
has been held at its Maryland headquarters. The government's
process effectively shuts out any public input on extending plant
licenses, said Public Citizen senior policy analyst Jim Riccio. "Most of
the public is not aware of the issues until they land in their laps, by
way of their local nuclear plant."

Here's where the "generic" part of re-licensing comes in. Instead of
having an "in my backyard" approach for concerned citizens, the
generic license extension puts the onus in a generic somewhere-else
land. "By making something generic, they don't have to deal with
the public," Riccio added.

What few nuclear critics are hip to the industry/government move, are
focusing on safety issues. "During the early stage of life and the
late stage, the failure rate for both man and machines is generally
higher than during middle age; the reliability of both man and machines
is generally lower during the early and late stages. The prudent and
proper course of action is to retire aging nuclear plants before they
reach the point where reliability drops off markedly," notes Dave
Lochbaum, Union of Concerned Scientists' nuclear safety engineer. The
nuclear industry claims it deserves generic safety rules for
re-licensing because its safety track record has only gotten better over
the years, now that its reactors are in middle age.

In a fortunate acronym for nuclear critics, the generic re-licensing
program is called "GALL"- -for Nuclear Power Plant Generic Aging
Lessons Learned. The "generic" part appears most important to both
industry and government.

"Aging is the same no matter if the [reactor] maker is GE, Westinghouse
or Combustion Engineering," said Electric Power Research Institute
manager of life-cycle management, John Carey, who added that the weather
surrounding a particular reactor is the only difference.

Long known as an aging problem is the brittleness of the metal enclosing
the reactor core. The reactor gets bombarded with electrons for
years and the metal becomes brittle. EPRI, for one, believes that
brittleness is not a problem. "Many plants even at 60 years won't reach
that [threshold] level of embrittlement. There's probably none that will
at 40," said Carey.

While most of the government's and critics' attention is focused on
reactor safety during aging, the industry's impetus admittedly has to
do with short-term financial gains that come with a second license and
the value added to a plant for resale.


"In a deregulated, competitive business, a fully depreciated nuclear
plant (beyond its original 40-year license) is a tremendous asset. It
can sell its power at marginal cost, which is very competitive. Such a
plant would have significant profit potential," notes the industry
group Nuclear Energy Institute. In other words, once ratepayers have
paid off the construction investment, the primary expense of nuclear
plants disappears and the only ongoing costs to owners are fuel, safety
expenditures and staffing. Less tangible opportunity costs like
guaranteed ecological preservation are not a part of the calculations.

The NRC's attempt at generic guidelines for license renewal had been
sitting around in various stages since the early 1990s. It was
goosed into action, though, when Baltimore Gas & Electric's
(Constellation) Calvert Cliffs became the first facility to ask for a
20-year extension. Calvert Cliffs (in the NRC's back yard) was approved
this March. Duke's Oconee plant in North Carolina followed suit in May.

License renewal does not come without a price, however, as keeping that
license means an owner has to invest in anti-aging technology - a.k.a.
capital investments.

Like plastic surgery fixes the fissures and sags in an aging body,
keeping a past-prime nuke in shape "depends on how much money you
have," Carey. For instance, replacing a steam generator, a typical aging
problem, costs about $150 million. Shareholders might be loath to
invest that kind of capital in an old plant. But, the beauty of
re-licensing is that any such investment can be amortized over an extra
20 years, even if the plant owners do not plan to run the plant that
long. Thus, license renewal tucks in the short-term operating costs of
nuclear plants.

Public Citizen's Riccio, says that the 20 year extension "shifts the
risk of future operation from the stockholder to the ratepayer." Riccio
believes that the specter of early shutdowns with their attendant
stranded asset risk is driving re-licensing. Fitch ICBA analyst Ellen
Lapson explained the early shutdown scenario, "Towards the end of the
life of a plant, if there's no re-licensing then there's less reason
to invest capital."

Using the medical metaphor again, that means there's a choice between
euthanasia (decommissioning) because the patient is too expensive to
keep up and take the risk of having to pay all those exorbitant hospital
bills, or pump more money into the patient--say an aging pop singer, a
la Diana Ross--in the expectation the survival will allow payback when
the star makes a comeback tour.

A 20-year extension also "enhances the value of the plant if [owners]
decide to get out of the business," said Bob Wood, NRC senior
licensing financial policy advisor. He added that no owner had confessed
that intent directly.

But the industry's unstated intent appears known to the NRC. "GenCos are
snatching up economically uncompetitive facilities," noted
Christopher Grimes, NRC chief of license renewal and standardization.

But economics can also kill a re-license. Yankee Rowe, a poster-child
nuclear facility, scrapped its plans to live beyond middle age
because it would have cost too much money just to prove to the NRC that
it could do the repairs needed for re-licensing. EPRI's Carey
blamed it on the small size of the plant and the economics of energy in
New England. 

The other economic benefit to plant owners is that when a plant gets a
20-year life extension, payments into its decommissioning fund
also gets drawn out another 20 years, allowing another decrease in
short-term operating expenses, noted Fitch's Lapson.

Like a boomer turning 40, the limit for what constitutes old-age in a
nuke was "arbitrary," said the NRC's Grimes. "In the Atomic Energy
Act of 1956, everybody said 40 years ought to be enough," said Grimes,
adding that the arbitrary number was based on financing available to
owners. "We looked into what might be life-limiting aging effects. In
1991 the first rule was issued on aging effects. It concluded Mother
Nature doesn't care how long the NRC's license term is."

Citizen's Awareness Network - Central New York
(315) 475-1203
162 Cambridge St., Syracuse, NY 13210
nonukes@rootmedia.org www.nukebusters.org
-- 
.....................................................
Susan L. Gawarecki, Ph.D., Executive Director
Oak Ridge Reservation Local Oversight Committee
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