This article is from the In-Depth Report The Future of Nuclear Power

Can Nuclear Power Compete?

Newly approved reactor designs could reduce global warming and fossil-fuel dependence, but utilities are grappling with whether better nukes make market sense

Solar is more predictable, and with certain forms of energy storage may even be dispatchable, providing power during cloudy periods or during high-demand hours after sunset. Current solar facilities reflect the sun’s rays off of curved mirrors to heat water or mineral oil, but experimental systems use materials such as molten salt, which could run far hotter and be stored in insulated tanks for hours or days. Other companies are building massive arrays of photovoltaic cells that convert sunlight directly into electricity.

Generally, however, large solar and wind projects—the kind most likely to be cost-effective—are built in deserts or on remote mountaintops or plains, far from population centers that need the power. So transmission lines must be built to connect supply with demand. “You’re talking about immense amounts of transmission,” says John Rowe, chair of Exelon, one of the nation’s largest utilities. “It requires a really huge grid. I don’t see us going that way anytime soon.” Indeed, a recent Energy Department study concluded that wind could meet 20 percent of American needs by 2030 but would require a new transmission system costing $60 billion or more. Nuclear reactors can be located far closer to consumers and would require more modest additions to the existing grid.

Efficiency Could Forestall Reactors
One of the strongest competitors nuclear power faces is energy efficiency. Improvements in efficiency, driven by the need to reduce greenhouse gas emissions, could for many years offset increases in demand from a growing population with higher living standards, forestalling the need for reactors.

In December 2007 consulting firm McKinsey & Company determined that the U.S. could cut its output of global warming gases by more than 11 percent using conservation steps that were better than free: they would pay for themselves and earn a profit. These “negative cost opportunities” would require little or no technology innovation, the report said. And emissions could be cut by another 17 percent with efficiency improvements that had only a moderate cost.

Amory Lovins, a well-known efficiency expert, has long referred to such opportunities as being better than a free lunch, “lunch that someone pays you to eat.” But the steps are often not taken. One reason is that efficiency is usually number 11 on people’s top 10 to-do lists. For example, a high-efficiency air conditioner costs more than a standard model but will earn back the difference, in electricity savings, in a season or two. Yet many purchasers do not care, especially if they are landlords or builders who will never pay the electric bill.

Other steps might minimize convenience, even those that border on slothfulness. Lots of home appliances, for example, continue to draw power when the switch is “off” so that they are always warmed up and can come back to life instantly. Experts sometimes call this constant draw a “vampire load.” Around the house, all those vampires add up, but hardly anybody knows or cares. As Richard D. Duke, an energy expert at the Natural Resources Defense Council, quips, “What consumer, when buying a TiVo, is going to demand that the manufacturer make the standby power consumption a criteria? Nobody.”

Build before Memory Runs Out
Although individual consumer actions can help, major changes in carbon output will likely require better electricity-generation technologies, retiring much of the coal-fired capacity and replacing it with the most cost-effective combination of modern reactors, renewables and even clean coal. Around the country, players in the electricity business—regulated utilities, independent merchant generators, and municipal suppliers—are placing bets on which options will be the winners.

The competition is a bit like a high school track meet, however, in which competitors’ starting lines are staggered around the track. Nuclear has the longest path, because it takes more time to obtain site and building permits and to clear safety reviews. Yet anybody even thinking of a new reactor must pony up the entry fee—the cost of submitting an application and conducting preliminary studies. Given the uncertainties in future demand, carbon regulation and the price of fossil fuels, exploring the nuclear option makes business sense. Whether to actually build is another question.

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