South Carolina state owned nuclear facility is not ready to commit itself to building two new nuclear reactors in the state citing fears that increased costs would prove to be too much a burden for customers to handle. For that precise reason, the facility said that it would not be in a position to ask its board for improved pay hikes to help construct the reactors. And as if that was not enough, the South Carolina governor is on the search for a new buyer that would be in a financial position to finish the remaining part of the project.
This is the most recent upheaval or rather, weird scenario in the nuclear power industry which in fact, has not less than nine lives dating back to the meltdown at Three Mile Island in the year 1979 and after that, the complete core meltdown at the Japanese Fukushima plant in the year 2011.
However, in this particular case scenario, safety issues are not the concern. Financial issues have taken root with the original allocated budget of $11 billion expected to double after three years of delayed start of operations. The whole financial saga is compounded by the bankruptcy of the Westinghouse Electric Company which is the main technology supplier to the project.
However, the question remains. Will this particular development play an integral role in affecting the nuclear industry which has not less than five such plants close since the year 2013. And will the same have an impact in the future for six such other reactors in the coming years?
On that front, there is a massive debate that is swinging in different state capitols whether customers should be allowed to subsidize carbon-free power and nuclear energy to deal with climate change matters. This school of thought is highly disregarded by environmental organizations as well as coal and natural gas groups that strongly believe that more emphasis should be laid on matters renewable energy.
Currently, nuclear power provides not less than 16% of the country’s electricity as well as 63% of carbon-free energy. Sadly, going by the current state of things, not less than 6% of the existing nuclear power could be brought down. For a big number of utilities and their state providers, the construction as well as approval of natural gas plants that are combined-cycle means a better sense of security when matters related to finances are concerned as opposed to going for the nuclear route.
However, choosing such a path presents a two-way case-scenario: investing too heavily on cheap natural gas production and at the same time, posing a substantial risk to the climate and the environment. According to Santee Cooper who is currently owning 45% of the South Carolina project, it is dropping out of production, and in the past, it has unsuccessfully tried to convince other utilities to inherit its share. The remaining 55% is owned by South Carolina Gas and Electric.
The inheritance has even caught the attention of the governor who is in contact with neighboring utilities to consider to assume command of the V.C Nuclear Summer Station that has other subsidiaries named Duke Energy, Dominion Energy as well as Southern Company. However, in the same breath, Scana Corporation CEO told South Carolina legislators that he is yet to be convinced that building the one-plant option makes any economic sense. Scana is the parent company to South Carolina Gas and Electric.
In the year 2008, Santee Copper and SCG&E wanted to do their nuclear presence expansion that currently supplies 55% of South Carolina’s electricity. Together with Southern Corporation which is currently building two reactors in Georgia, they went for Toshiba Corporation’s subsidiary Westinghouse to help them designed an advanced reactor.
Unluckily for them, in the year 2017, Westinghouse declared bankruptcy which sent a lot of shivers in the nuclear sector. As much as Toshiba agreed to make $2.2 billion payment to the South Carolina utilities, the compensation was not adequately enough to complete the deal. On the same breath, Toshiba also made a huge sacrifice and agreed to make a similar payment to Southern Corporation though it later said that it would complete it’s Vogtle plants though on a delayed time frame that is going to be more expensive.
However, one question still pops up in many people’s minds. Is the cost to ratepayers for finishing the V.C Summer nuclear station more important than the price the environment will pay for failing to complete it?
According to an article written on the Environmental Progress by Michael Light and Mark Nelson, if the plant’s investors and policy makers start construction again, the plant would most probably reduce the electricity share that is received from coal from 21% in the year 2016 to around 3% and therefore, allowing the massive and abrupt retirement of all coal capacities. The additional nuclear reactors would produce not less than 18 terawatt hours of annual electricity annually and in the process, replace South Carolina’s electricity consumption from coal.
With the expected retirement of the Diablo Canyon that is owned by Pacific Gas and Electric that supplies not less than 8% of South California’s electricity, the state’s carbon reaction goals will be brought to an end. By more production of natural gas, then it simply means that more carbon dioxide emissions are released into the atmosphere. Experts have also refuted claims that solar and wind energy could replace the retiring nuclear units.
In such a dilemma, all marketers are put against all forms of subsidized energy and instead, opt for lower cost carbon-free electricity. Already, New York and Illinois have taken the pro-active step. To follow in the steps very soon is New Jersey, Connecticut, and Pennsylvania.
In the long run, this step will call for a radical penalization of all companies that have too much carbon emission which does not add any value to clean power. Again, nuclear power finds itself in a tight spot because it can decide to quietly go away or push and overcome all the hurdles to create a potentially bright future for everyone and while at it, add a lot of value to the environment.