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Will there be a second act for the US nuclear power industry?

Nuclear energy has long been the US’s largest source of carbon-free power. The industry’s future likely rests on new reactor designs that proponents say will slash costs and boost safety.

If the current schedule holds, this November could mark a milestone for the US nuclear power industry. That month is expected to see the christening of the first new nuclear reactor in the US in more than 30 years.

The Vogtle expansion project comprises the construction of two new Westinghouse AP1000 reactors at an existing nuclear power generating station in Waynesboro, Georgia. The project, backed by $12bn in loan guarantees from the US Department of Energy, will add a total of 2,200MW of power to the grid. The second new reactor is scheduled to come online in November 2022.

Even if builders meet the November 2021 deadline to start the first unit – far from certain, given the project’s history of delays – the achievement may not herald a rebirth so much as a pivot for the industry. Like so many recent nuclear power projects built around the globe, the Vogtle expansion is behind schedule and over budget. Originally planned at $14bn, the two new reactors will instead cost ratepayers at least $25bn. The project could also be the last of its kind in the US.

nuclear-plant
The nuclear plant on Three Mile Island in Middletown, Pennsylvania. (Photo by Andrew Caballero-Reynolds/AFP via Getty Images)

If there is to be a second wave of US nuclear energy deployment, it will be downsized. Under this emerging vision, instead of building massive, gigawatt-scale units, like the new reactors at Vogtle, developers would install prefabricated reactors small enough to be transported to a project site by truck or rail.

The small reactors could be installed as stand-alone units or clustered, offering the flexibility to add new electricity generating capacity incrementally. Even a large cluster is estimated to require less land than today’s nuclear plants. Start-up NuScale Power, for instance, could build a 920MW power plant comprising these so-called small modular reactors (SMRs) on just 35 acres compared with nearly 500 acres for a conventional nuclear power plant with the same capacity, finds the Idaho National Laboratory. Backers in industry and government believe SMRs will be cheaper and safer than existing technologies.

Federal regulators are expected to make a final decision in August on certification of the first US small modular reactor design. NuScale Power, which is seeking the approval, aims to build an SMR power plant at the Idaho National Laboratory before the end of the decade.

Nuclear’s carbon-free power lead at risk

In the last ten years, US nuclear power plants have consistently delivered around 800 billion kilowatt-hours of electricity to the grid each year, or 20% of the nation’s power generation. Commercial nuclear power generating stations operate in 30 US states with a total generating capacity of 98GW. In 2019, a dozen states generated more than 30% of their electricity from nuclear power plants.

However, nuclear power’s decades-long run as the largest carbon-free source of electricity in the US is coming to an end as soon as next year.

Nuclear plants’ survival is threatened by cheap natural gas, solar and wind power. At the end of 2020, nuclear’s steady 20% share of the US power generation mix had been nearly doubled by natural gas (39%) and matched the falling share held by coal (20%) and the surging share held by renewables (20%).

“Existing US nuclear power generating plants operate under increasingly competitive market conditions brought on by relatively low natural gas prices, increasing electricity generation from renewable energy sources, and limited growth in electric power demand,” finds the US Energy Information Administration (EIA).

The US nuclear industry is also challenged by the advanced age of existing plants. The mean age of a US nuclear power plant is nearly 40 years. An owner can apply to the US Nuclear Regulatory Commission to renew a plant’s operating license for up to 20 years at a time. Plants in this ageing fleet still operate at full power 93% of the time during the year, the highest of any US power source. Whether the plants can continue to operate without losing money is another matter entirely.

In states with regulated electricity markets, owners can seek approval from regulators to recover the full cost of operating plants from ratepayers. In deregulated states, with retail choice for electricity, nuclear plants instead aim to recover their costs from wholesale electricity markets. However, in recent years, electricity prices in those markets have slumped. In response, five US states – Connecticut, Illinois, New Jersey, New York and Ohio – have established subsidies, such as requiring utilities to buy zero-emission credits from nuclear plants, to keep their in-state reactors running.

The trends are clear. Unless policymakers find a way to safely extend the run of existing plants or add cost-competitive next-generation nuclear capacity to the grid, the nation could lose one of its most important sources of carbon-free power.

The industry is poised for its largest-ever annual capacity retirement in 2021, if more than 5GW of nuclear generation, one reactor in New York state and four in Illinois, shutter this year as has been proposed, warns the Energy Department.

Pivot to small modular reactors

In a bid to revive nuclear’s fading fortunes in the US, industry start-ups and the federal government are collaborating to commercialise new reactor designs that proponents say will be cheaper and safer than existing technology.

US nuclear companies are likely to look to overseas markets to sell the 1,000MW reactors typical of the US’s first wave of nuclear power deployment. At home, manufacturers are focused on developing SMRs, the successful deployment of which would enable nuclear generating capacity to be installed in modules ranging from dozens to hundreds of megawatts, or to be used in applications such as desalination, industrial process heat applications, and hydrogen production.

By going small and upending conventional construction techniques – SMRs would be prefabricated indoors – developers of advanced nuclear technologies hope to avoid the chronic cost overruns and delays that have dogged the industry. Like existing nuclear reactors, SMRs are fission reactors. The energy released when a large atom splits in two is harnessed to heat water into steam that drives a power-generating turbine. Light-water, gas, liquid metal and molten salt have all been floated as potential reactor coolants in SMR designs.

With such a big focus on climate change and climate mitigation efforts across US government agencies, I expect renewed discussion on how best to value the non-carbon-emitting attributes of nuclear power going forward. Jane Nakano, Center for Strategic and International Studies.

SMRs are designed to be inherently safer than the existing nuclear fleet with the use of passive design features that do not require human intervention or an off-site power source in an emergency.

“You design a reactor so that under abnormal conditions what will naturally happen is that it would shut down safely and be cooled safely,” says Ashley Finan, director of the National Reactor Innovation Center at Idaho National Laboratory. “That is because of basic physics and design, rather than because you are running a pump, or somebody switched a switch or opened the door.”

Finan cites the example of the Fukushima disaster in Japan. In the wake of the earthquake and tsunami, the nuclear power plants there shut down properly as designed, but even after a reactor shuts down, it still produces heat. If the heat is not removed, the core can melt.

“With the Fukushima-design, reactors required active pumping of water through the core, and that active pumping required off-site power,” she says. “Given the disaster, there was no off-site power available.”

According to Finan, SMRs are also being designed to use fuel more efficiently, which could generate less waste. “They can create more energy for a given amount of fuel, which means they use less fuel,” she says.

By using less fuel, SMRs can extend the refuelling cycle. Existing nuclear power plants must be shut down for refuelling every one-and-half to two years. Some of the new reactors designed to use a higher-quality fuel like uranium 235 are “able to run the reactor for much longer and refuel every five or ten years, or even longer,” says Finan.

Demonstrating and deploying advanced reactors

Key federal support for next-generation nuclear power technology comes from the Department of Energy (DOE)’s Advanced Reactor Demonstration Program. In October 2020, DOE awarded $160m in initial funding under the programme to two companies, TerraPower LLC and X-energy, for the construction of two new advanced nuclear reactors set to come online by 2027. Each company received $80m under the cost-shared partnerships.

TerraPower’s Natrium sodium-cooled fast reactor, which includes thermal energy storage, is designed to do something conventional nuclear plants are not: provide flexible power generation. X-energy’s Xe-100 gas-cooled reactor is likewise suited for flexible power generation as well as process heat applications.

At Idaho National Laboratory, Oregon-based NuScale Power aims to build the US’s first small modular nuclear power plant, the Carbon Free Power Project, in partnership with Utah Associated Municipal Power Systems (UAMPS), a public power consortium. The DOE approved a multi-year $1.355bn cost-share award for the project in October 2020. A total of 27 UAMPS members are participating in the project, which is scheduled to begin generating power in 2029 and be fully operational by 2030.

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“The size of the plant is being evaluated,” says the consortium’s LaVarr Webb. “It could range from six modules to 12 modules. Each module will produce 77MW of electricity. UAMPS is currently developing an application to the US Nuclear Regulatory Commission to build and operate the plant.”

The power modules would be “a fully factory-fabricated small modular reactor,” says NuScale Power’s chief strategy officer Chris Colbert. Because the company is “using a safer, smaller and scalable version of pressurised water technology” that has been in use for five decades, “there’s lots of operational experience about what works, what doesn’t work, materials and designs and fuels available to us we can leverage going forward,” he adds.

Biden, Congress and the path forward

Democrats and Republicans in Congress, as well as the Biden administration, appear committed to preserving a place for nuclear power in the US energy mix.

During his presidential campaign, Joe Biden pledged to “identify the future of nuclear energy” and to establish a new research outfit, the Advanced Research Projects Agency on Climate, whose remit would include tackling nuclear power’s cost, safety and waste disposal issues. The goal is to deploy “advanced nuclear reactors that are smaller, safer, and more efficient at half the construction cost of today’s reactors”.

The Energy Act of 2020, which was approved by Congress just before Christmas last year, boosted federal support for advanced nuclear technologies. The bill authorises up to $55m annually through 2025 to support the commercialisation of “proliferation resistant” and “passively safe” advanced nuclear reactors. It also renewed the Energy Department’s Advanced Reactor Demonstration Program, with Congress authorised to spend up to $455m annually. The Advanced Research Projects Agency-Energy was also authorised to support nuclear waste clean-up and management projects.

On 2 March 2021, senior Democrats on the House Energy and Commerce Committee reintroduced legislation that could help to keep nuclear power on the grid. The CLEAN Future Act would establish a federal Clean Electricity Standard as a means to achieve Joe Biden’s 2035 carbon-free power sector target. During his campaign, Biden had pledged support for a “technology-neutral Energy Efficiency and Clean Electricity Standard for utilities and grid operators”, which could help nuclear power plants remain viable.

A modest price on carbon would help nuclear remain competitive. The EIA finds that with adoption of a $15 per tonne of CO2 (t/CO2) fee, pegged to increase by 5% annually, US nuclear capacity increases to 106GW in 2050. At $25t/CO2, nuclear capacity increases to 145GW in the same year.

Biden’s government-wide commitment to climate action looks set to ensure nuclear energy remains part of the country’s decarbonisation strategy.

“With such a big focus on climate change and climate mitigation efforts across US government agencies, I expect renewed discussion on how best to value the non-carbon-emitting attributes of nuclear power going forward,” says Jane Nakano, senior fellow, Center for Strategic and International Studies.

“It is clear that as a nation we are going to be taking climate change seriously,” adds NRIC’s Finan. “We will see a strong programme in advanced nuclear energy. We will also see increased attention to solving our nuclear waste challenges. That is going to be critical to a successful, scalable nuclear solution to climate change. That is nuclear as part of the solution, not the only solution. It is one tool in the tool chest.”

Energy Monitor is publishing a series of articles about nuclear power and the energy transition to mark the tenth anniversary of the Fukushima Daiichi disaster in Japan. The earthquake and tsunami led to a sea change in the role of nuclear power around the world. In Japan, nuclear plants made up less than 5% of the electricity mix last year, down from 30% before Fukushima. In Germany, the accident led to the immediate shutdown of eight nuclear plants and the definitive decision to exit nuclear power entirely by 2022. Ten years later, as countries face up to the climate crisis, Energy Monitor examines the role of nuclear power in the energy transitions in Japan, the US, China, France, and the EU.

Other articles in this series:

Justin Gerdes

Senior correspondent, US, Justin Gerdes is an experienced energy journalist based in the San Francisco Bay Area.