Testimony to the California Senate Energy, Utilities & Communications Committee
Dr. Burton Richter
Chair, Nuclear Energy Working Group of the
California’s Energy Future (CEF), study by the
California Council on Science and Technology
Oct. 26, 2010
Mr. Chairman, members of the committee, thank you for the opportunity to testify on the role nuclear energy might play in achieving the goals of AB-32 to decrease greenhouse gas emissions while supplying the state with the electricity required for its economy. The California Commission on Science and Technology (CCST) has been conducting a study called California’s Energy Future (CEF) on how to achieve the long-range goal of reducing emissions by 2050 to 80% below those of the year 1990. I have submitted a brief statement by Dr. Jane C. S. Long, co-chair of the CEF study, on the goals and methods of the study and ask that it be included in the record of this hearing. I summarize her statement as follows.
The CEF study identifies a set energy system portraits, descriptions of the entire energy system, which would meet the 2050 goal and provide secure, economical energy for California. By 2050 California’s population is expected to grow from about 38 million to about 60 million and the economy is expected to grow as well. The demand for energy will likely double under business as usual, but to meet the 2050 emissions goal of 20% of 1990 emissions we need to go from emitting 475 billion tons of carbon-dioxide equivalents per year (CO2e/yr) today to about 80 billion tons per year. The net result is that we will likely have to approximately double our electricity production while at the same time de-carbonizing the electricity sector, which means nearly eliminating the use of fossil fuels, except where the greenhouse gases can be captured and sequestered.
The CEF study assumes the implementation of aggressive efficiency measures in buildings, transportation, and industry, and moving from burning fuel for transportation and heat to using electricity, and looks at a variety of ways to simultaneously de-carbonizing and double electricity production using various combinations of nuclear power, fossil fuel with carbon capture and storage (CCS), and renewable energy. Our report, to be completed early next year, will describe these energy system portraits and compare them from a variety of perspectives. One of these produces 67% of the required electricity from nuclear power, the remainder being provided by renewable energy as required by the California Air Resources Board’s (CARB) renewable portfolio standard. Preliminary results indicate that this nuclear mode will be one of the most advantageous target energy systems in terms of using known technology, cost, and reliability, with minimal environmental impact.
I led the nuclear energy part of the CEF study, and have submitted our report for the record here. My co-authors include Dr. Long herself, Dr. R.J. Budnitz of Lawrence Berkeley National Lab who is to testify later about safety issues, Prof. Per Peterson, Chair of the Nuclear Engineering Department at U.C. Berkeley, and Jan Schori, former Director of the Sacramento Municipal Utility District. The report examines the potential of nuclear energy to meet the bulk of California’s electricity demand in the year 2050 where nuclear energy supplies 67% of electricity (50 gigawatts of nuclear electricity) and renewables supply 33%, as required by the CARB. While the technical issues are minimal, there are legislative and public acceptance barriers that have to be overcome to restart nuclear reactor construction in California.
I address the legislative barriers first. The background paper prepared by the Committee staff for this hearing says that under California law, the California Energy Commission (CEC) cannot certify a nuclear power plant for operation within California until the federal government has demonstrated and approved:
- A technology for the construction and operation of nuclear fuel rod reprocessing plants; and
- A demonstrated technology or means for the disposal of high-level nuclear waste.
Reprocessing can separate spent nuclear fuel into its components which can then be treated differently. Some components can be reused while others are disposed of. Some think this simplifies waste disposal while others think is an expensive diversion. The technology for reprocessing already exists and is in routine use for the nuclear power sector in, for example, France, Japan, and Russia. Reprocessing has been done in the past by the US to separate plutonium for our weapons program. Further, the U.S. is at present committed to the “once-through” fuel cycle where used fuel rods are to be disposed of in a long term repository, and not reprocessed. The first requirement is a non-issue.
The second legislative requirement that a geological repository for long-term isolation of spent reactor fuel be licensed is the real issue. The only difference between reprocessed and unreprocessed fuel is the required isolation time; hundreds of thousands of years for once-through fuel to only thousands for reprocessed and appropriately treated fuel components. Dr. Budnitz will discuss the repository issue as well as safety issue in his testimony. I will only note that other counties have repositories, and those were approved using a system of consultation with the region where they were to be located, rather than imposing a solution from the top down as our Congress did with Yucca Mountain.
A Blue Ribbon Commission, appointed by the Secretary of Energy at the direction of the President, is to report next year on the repository issue, and if Yucca Mountain is really off the table, no repository can be licensed for some time. There is an interim solution called dry cask storage which is in use at most of the US reactor sites including California’s. Recent studies have concluded that these huge steel and concrete casks can last for 50 to 100 years, giving time to locate a site and license a facility for long-term isolation from the environment.
The real issue would seem to me to be public acceptance. Surveys seem to find a majority of the public favors nuclear power, but probably in someone else’s back yard. The issue is concern about accidents and radioactivity. I leave the safety issue to Dr. Budnitz, and focus on radioactivity. We all live in a bath of natural radiation that comes from cosmic rays raining down on our planet from the larger universe, natural radioactivity from materials all around us including the very walls of the building where this hearing is being held, and medical treatment and diagnoses. The radiation at the site boundary of a nuclear power plant is negligible in comparison. Even the Three Mile Island accident gave a radiation dose to the public less than what would have been added to natural exposure by a move from the low land of Pennsylvania to the high land of Denver where the cosmic ray intensity is larger. The nuclear power plants of the US give a radiation dose to the public less than one-ten-thousandth of natural background.
It is worth noting that there are large potential benefits to the localities where nuclear plants are sited. Tax rates in California are set by the State Board of Equalization, typically at 1% of the cost of a plant, and collected locally. By current estimates this would amount to $50 million per year per gigawatt of electrical capacity (GWe). In addition, about 500 permanent jobs are created per GWe. Since it is likely that there will be several reactors at each site, the potential benefits are large.
Turning to technology, the CEF study found that there are no technical barriers to large-scale deployment of nuclear power in California. The large reactors moving through the U.S. licensing procedures have all been built in other parts of the world, and the expectation is that three designs will be approved in the next couple of years. Even cooling water availability in California is not a problem. Reactors can be cooled with reclaimed water or with forced air, though air cooling is less efficient and would increase nuclear electricity prices by 5% to 10% because that much of the plants electrical output would be needed to run the fans. The problem in the US is that no reactor has been built in decades and building one here will require recreating some of the technical infrastructure needed. That is more an issue of cost than technology.
Since no new nuclear power plants have been built in the US for decades, the cost of nuclear electricity can only be estimated today. There are, however, 104 nuclear power plants operating in the US today. Thus, operations, maintenance and fuel costs are known well, but the dominant cost, the amortization of construction costs, is uncertain. We do know the capital costs in Asia and, to a lesser extent, in Europe. The costs of the last eight plants turned on in Japan and Korea, corrected for inflation at 3% per year, would give $2800 per kilowatt as today’s overnight capital costs. The Asian plants are typically built in about 4 years, but it will certainly take longer here until there is more experience in building these plants, and therefore capital costs will be higher. In addition, loan guarantees will probably be required to get a reasonable interest rate on new plants, at least until there is experience that will convince the market that nuclear plants can be built on time and on budget.
One serious issue with large nuclear plants is the huge initial capital outlay required; a total capital requirement of $7 to $8 billion for a large plant. Only the largest utilities will be able to get the necessary financing and that may slow the deployment of new nuclear reactors here. This high capital requirement has sparked considerable interest in small, modular reactors that have much lower cost per module and where modules can be added as needed. These SMRs are in the design stage and none is ready for licensing. Optimistically, the earliest that one might turn on is 2020.
The real economic question is the expected cost of nuclear electricity. In the CCST report we summarized the conclusions of seven independent estimates of the levelized cost of nuclear electricity. Of the seven, six are consistent with an electricity cost of 6¢ to 8¢ per kilowatt-hour (KWh) with Federal loan guarantees to hold interest rates down. One comes in at 16¢ to18¢ per KWh, but their methodology is unclear. Our conclusion is that six to eight cents per KWh with loan guarantees is the best estimate today (discussed in more detail in section II of the of the CCST report with references).
Recently, some of the utilities that have been seeking approval for nuclear plants seem to have begun backing away. The reason has less to do will nuclear issues than with the decrease in the cost of natural gas; down in 2010 to about half of what it had been in 2008. Today the lowest cost electricity is estimated to come from a combined-cycle, natural-gas fired power plant. The reason for the crash in gas price is the horizontal drilling and fracturing technology that has made shale gas so plentiful and so cheap. The real issue should be the expected electricity price from various generation technologies eight to ten years from now. The utilities have to make their own calls on that, including their guesses on future emission fees.
There have been some concerns expressed about the availability of uranium fuel for a greatly expanded world reactor fleet. Periodic estimates are made by the Nuclear Energy agency of the OECD and the International Atomic Energy Agency. The most recent is that there is sixteen million tons of natural uranium available at a price of no more than $130 per kilogram and much more than that available at a higher price. Sixteen million tons is enough to fuel 1300 new gigawatt-sized reactors for the full 60 years of their lifetime. In addition, uranium itself is only a small part of the coast of reactor fuel which in total today adds only about one-half cent per KWh to the cost of nuclear electricity. There should be no problem with uranium availability for the foreseeable future. Even large increases in uranium costs have only a small effect on nuclear power costs.
I close with some personal comments. I have read AB-32 and find it well crafted. It sets goals for greenhouse gas reduction and directs the California Air Resource Board to make regulations that will make “…maximum feasible and cost effective…” reductions in emissions to meet the goals of the bill. Nuclear generated electricity can make a great contribution to this goal because it is cost effective compared to other approaches. For example, the California program aimed at a million solar roofs by 2020 will cost more than $15 billion including the subsidies given by the state and federal governments. For half the cost, we could eliminate twice as much greenhouse gases by building one nuclear power plant. Nuclear is also more efficient in land use. Paving the entire San Onofre site with 15% efficient solar cells would produce a peak output of about 2% and an average output of less than one-half percent of the nuclear operation.
It is time to get this technology back on the road.
