The Decline of Nuclear Power in the United States: An Overview
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Despite the optimistic projections in various articles regarding the integration of nuclear power with renewable energy sources, the reality suggests a different narrative. Nuclear facilities are shutting down, and new developments are nearly non-existent. Notably, incidents like Chernobyl and Fukushima are not the primary factors driving this decline. The World Nuclear Association provides extensive data on the current landscape of nuclear energy in the U.S., which can be quite overwhelming to sift through.
> The majority of the current nuclear capacity in the U.S. originates from reactors constructed between 1967 and 1990. Since 1977, there have been no new reactor constructions until 2013, primarily due to the attractiveness of natural gas and extended construction timelines exacerbated by public opposition and safety concerns following the Three Mile Island incident in 1979.
Source: Nuclear Power in the USA, updated 8/2022, World Nuclear Association
The increase in U.S. nuclear capacity has largely stemmed from enhancements in existing plants. The average capacity factor rose from 50% in the early 1970s to 90% by 2002, with a record high of 94% in 2019, compared to 32% for wind and 22% for solar energy (EIA data). The nuclear industry invests approximately $7.5 billion annually for maintenance and upgrades.
Most of the reactors were developed by regulated utilities, often state-owned, allowing them to incorporate capital costs into their rate base and amortize against electricity sales. Consumers bore the financial risk associated with these investments. In deregulated states, shareholders now face any capital overruns while selling power in competitive markets. Low natural gas prices currently hinder the potential for new nuclear projects, with a recovery to $8/GJ or /MMBtu deemed necessary for renewed confidence in these regions.
Feel free to skip to the conclusion if you wish to avoid extensive data analysis.
Current Reactor Designs
The Nuclear Regulatory Commission (NRC) certifies designs, permitting a generic reactor type, such as the Westinghouse AP1000, to be built anywhere in the U.S. after completing site-specific licensing.
Actively Marketed Designs Approved by the NRC:
- Westinghouse AP1000: The first Generation III+ reactor to receive certification, designed to be constructed in 36 months. Four units are operational in China, with two under construction in the U.S.
- NuScale SMR: A demonstration unit of a 60 MWe integral PWR planned for Idaho, with future deployment of 12-module power plants in western states. The NRC has approved a 77 MWe version.
- Oklo Inc. Microreactor: A 1.5 MWe design using supercritical CO2 gas, initially accepted by the NRC but later rejected due to security concerns.
- GE Hitachi BWRX-300: A licensing application submitted to the NRC for a design leveraging the ESBWR framework, which the company claims is the most innovative BWR since 1955.
- Holtec SMR-160 PWR: Licensing procedures were initiated with the NRC for a 160 MWe demonstration unit at the Savannah River Site, supported by the DOE.
Withdrawn Designs:
- GE Hitachi ABWR: Several units in operation and under construction in Japan, but Toshiba withdrew its design certification renewal in mid-2016.
- US EPR: An adaptation of the Areva EPR design, the application is currently suspended, although units are under construction in Finland, France, and the UK.
Projects Suspended or Canceled:
Many large units face uncertainty, with some projects having incurred significant sunk costs. Eighteen additional projects have been either suspended or canceled, including units from Detroit Edison, Dominion, and TVA.
Canceled Licenses:
Since 2008, around 30 reactors have either been canceled or withdrawn their NRC licenses, affecting various companies and designs.
Premature Shutdowns
Thirteen reactors have ceased operations before their licenses expired, resulting in over 11,000 MW of generating capacity being shut down prematurely. An additional 23,000 MW were scheduled for early retirement but were subsequently reprieved.
The decision to terminate a project due to rising construction costs is one matter; shutting down an operational reactor, which could have its license extended, is another. Changes in regulatory environments have also influenced these decisions, with one plant closing due to new environmental laws necessitating costly upgrades.
In the nuclear sector, there are two economic classes: regulated and open market (merchant) reactors. Regulated plants are insulated from market conditions, while merchant plants are affected by fluctuations in electricity prices driven by low natural gas rates and renewable subsidies. Although many states incentivize green power, existing nuclear plants often do not qualify as green despite their zero greenhouse gas emissions.
Conclusion
While Chernobyl and Fukushima loom large in public consciousness, economic factors are the primary threat to nuclear power's future. Between 1992 and 2005, the U.S. saw the addition of 270,000 MW from natural gas, compared to only 14,000 MW from nuclear. The lengthy timelines and high costs associated with nuclear construction deter investments, especially when compared to natural gas plants that can be operational in a fraction of the time.
Tax incentives for solar and wind energy are further depressing wholesale electricity prices, forcing many merchant reactors into financial losses. The fundamental economics of construction and operation are challenging the viability of nuclear power, and even with advancements in design and licensing, the sector remains on the back foot compared to solar energy's rapid cost reduction.
Solar power, unlike nuclear, requires minimal operational oversight and has lower maintenance demands. Offshore wind projects also face competitiveness challenges due to high construction costs.
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