One key factor is the price of loans. If a plant runs $5 billion in “overnight” costs and the money is spent over five years, interest on capital during the period of construction—the utility’s version of a home builder’s construction loan—could add hundreds of millions or even billions of dollars. To help, the federal government offered the nuclear industry loan guarantees worth $18.5 billion. It quickly received applications for more than $100 billion in funding.
Another factor is just how long that construction period will be. American builders could base their estimates on reactors built recently in Asia, but no one really knows how a project in Texas or Florida might compare with one in Japan or South Korea. If two or three reactors, such as Wallace’s, could get built in the U.S., the issues would become much clearer. Legislation that provides a predictable price for carbon emissions for the next few decades would also bring clarity.
The country needs a better way to manage nuclear waste as well. The federal government signed contracts with the electric utilities in the early 1980s that promised to take spent nuclear fuel off their hands beginning in 1998. But today, 10 years beyond that deadline, the Energy Department has only applied for a license to build one controversial waste repository, at Yucca Mountain in Nevada. Estimates of the opening date range from 2017 to never. An interim plan, such as long-term storage in aboveground casks in a few areas that are dry and sparsely populated, might be within reach. Many plants around the country have maxed out temporary storage in their spent-fuel pools, forcing them to put waste into huge, dry casks. Filled with inert gas to prevent rust, the casks are moved out to concrete pads surrounded by barbed wire, which look a little like basketball courts at maximum security prisons.
Still, advocates say the reactors are inevitable. At Areva, the company that Wallace’s firm has partnered with, the chief executive, Anne Lauvergeon, scoffs at the idea that there is any other choice. Could coal plants sequester their carbon? “It’s not ready at all,” she says. “You don’t know anything about the cost, and the technology doesn’t exist.” In the meantime, world demand is galloping ahead. Her company will build in China, she points out, and would like to build the first reactors in the Persian Gulf.
In the U.S., many power industry experts doubt that more than a few reactors will be built, at least until company executives see how the first ones go. But potential reactor builders sense that the world has changed enough to consider going back into business, with designs that are optimized and standardized versions of what they built more than 20 years ago. And people like Michael Wallace want to get going while those companies’ engineers still remember how.