Utility to build nuclear plants
Westinghouse units would be first ordered in U.S. since '78
Thursday, October 27, 2005
By Jim McKay, Pittsburgh Post-Gazette
In a move that could end a long drought in the domestic construction of nuclear power plants, Duke Power yesterday said it was making plans to build two reactors designed by Monroeville-based Westinghouse Electric.
The news that Duke has chosen Westinghouse's newest reactor design, the AP1000, for possible construction in its service territory of North and South Carolina was greeted with excitement at the company's headquarters campus.
"This is very good news. It's a significant step,'' said Westinghouse spokesman Vaughn Gilbert, who noted that it was too early to speculate on local jobs. "It's hard to quantify [employment], but the people who developed and designed the AP1000 and who will continue to engineer it are all here in Monroeville."
Charlotte, N.C.-based Duke has not yet placed an order or signed a contract for the reactors, but said it was preparing an application to the Nuclear Regulatory Commission that it will submit within 24 to 30 months. That application process alone can cost approximately $30 million to do.
If the regulatory process stays on schedule and Duke agrees to proceed with the project, construction could begin by 2010, Westinghouse President and Chief Executive Officer Steve Tritch said. Duke cited 2015 as a potential completion date.
Construction of the last new reactor in the United States was completed in 1996, and there have been no new nuclear plants ordered since 1978, a year before the accident at the Three Mile Island plant near Harrisburg dealt a disastrous blow to the industry. Three Mile Island, the most serious accident in U.S. commercial nuclear history, led to heightened regulatory oversight and sweeping changes in nuclear power plant operations.
According to the Nuclear Energy Institute, there are now 105 commercial nuclear power plants producing electricity in the United States, located at 65 sites in 31 states. Together they supply about 20 percent of the nation's electricity.
Orders for Westinghouse-designed plants would have economic benefit for Pittsburgh since the company uses local vendors including Emerson Process Management Power & Water Solutions, which designs and builds sophisticated Ovation-brand control and software systems for power plants.
"It would be really good news for us,'' said Robert L. Yeager, president of the Emerson control unit at the RIDC park in O'Hara. "We have been working with Westinghouse for quite a while on the plant computer design for the AP1000. Obviously, the more AP1000s they sell, the more Ovation technology we deliver. The bottom line is it's great for us."
The AP1000 technology, which is capable of generating about 1,100 megawatts of electricity, is the first of the latest generation of advanced light water nuclear reactors to receive design approval from the NRC. None of Westinghouse's competitors are that far along in the licensing process. The previous generation, dubbed Generation III by the NRC, was developed in the 1990s
Brew Barron, Duke Power's chief nuclear officer, said the advanced stage of the Westinghouse licensing process gave it an edge over competing designs from General Electric and France's Areva Group, the two main competitors to Westinghouse around the world. GE's latest design is a 1,500 megawatt Economic Simplified Boiling Water Reactor (ESBWR).
It also helped Westinghouse that two existing Duke-operated nuclear stations, the McGuire and Catawba plants, already use the pressurized water reactor technology that is the basis of the AP1000, which is described as passive gravity-aided technology that cuts down on the quantity of pumps, valves, wiring and piping used by existing nuclear plants.
"All three of the designs are good reactors. They would run faithfully and reliably,'' Mr. Barron said. "Because of our extensive experience with Westinghouse ... we are very comfortable with being able to fold a new facility using the same technology into the operations of our current nuclear fleet."
Jay Apt, executive director of Carnegie Mellon University's Electricity Industry Center and a distinguished professor in engineering and public policy, said the Duke announcement could give Westinghouse a boost in its bid to sell reactors to China.
China is reviewing bids for four nuclear plants, which would likely be built in twos and could cost $2.2 billion to $2.7 billion a pair to build. Westinghouse is among the leading bidders, and China anticipates building several more after the first four are under way.
"For Westinghouse, they must regard [this] as a very good vote of confidence in their new design," Mr. Apt, a former astronaut, said. "This is a chance of bolstering their opportunity."
The Shaw Group, based in Baton Rouge, said its nuclear services unit will join with Westinghouse to provide engineering support for Duke's licensing application to the NRC.
Shaw and Westinghouse are already working together, along with Mitsuibishi Heavy Industries of Japan, on the proposals to build four of the AP1000 reactors in China.
Duke, which provides electricity to more than 2 million customers in the Carolinas, said it must build new capacity to serve the 40,000 to 60,000 new customers it adds every year.
"We project strong growth in our base load demand over the next 10 to 15 years,'' Mr. Barron said.
Duke, which already operates three nuclear generating stations, eight coal-fired plants, 31 hydroelectric stations and numerous combustion turbine units, has yet to select a site for the new nuclear plants, but expects to do that by the end of the year. It is looking at some 14 locations in the Carolinas, some of which it already owns.
Mr. Barron said the company is also looking at other types of facilities including coal and combined-cycle facilities that could be used to meet its growing load demand between now and the construction of new nuclear facilities
The recently passed federal Energy Policy Act of 2005 includes numerous incentives intended to encourage the development of new nuclear plant capacity.
Mr. Barron, of Duke, said the incentives act did not drive the decision announced yesterday. He said the evaluation for the projects began a year ago before the Energy Policy Act was finalized .
"It's a good option for our customers. It's not dependant on the various aspects of the energy act," he said.
A consortium of eight U.S. utilities, under the banner of NuStart Energy Development, in September announced potential sites where one or more of its corporate members might put a new reactor. The potential projects involve both GE and Westinghouse designs.
One of those applications involves a site adjacent to NuStart member utility Entergy's Grand Gulf Nuclear Station in Port Gibson, Miss. The GE reactor is the preferred technology for that project.
The Westinghouse design was picked for a second NuStart project, which is proposed for the Tennessee Valley Authority's (TVA) unfinished Bellefonte plant in Scottsboro, Ala.
The NuStart industry group plans to submit license applications to the NRC for review in late 2007 and early 2008. The licenses could be issued as soon as 2010 following a two-to-three years review process.
"With NuStart's announcement of the two sites, a U.S. nuclear renaissance is clearly within reach," Andy White, president and CEO of GE Energy's nuclear business, said at the time.
Separately from that NuStart project, Entergy said it will simultaneously develop an application to potentially build and operate a second GE designed reactor, this one adjacent to tis River Bend nuclear power plant near St. Francisville, La.