Nuclear Power:

NEI's Peterson addresses plans for new nuclear power in U.S. and abroad

With new interest in constructing nuclear power plants in Europe and the United States, proponents are pitching the power source as a key solution to global warming. Will European nations turn to nuclear power to lower their carbon dioxide emissions and comply with the Kyoto Protocol? What about continued opposition to nuclear waste storage sites such as Yucca Mountain? And will regulatory and financial hurdles stymie plans to build new nuclear facilities in the United States? Scott Peterson, vice president of communications at the Nuclear Energy Institute, answers these questions and more.


Brian Stempeck: Hello and welcome to OnPoint. I'm Brian Stempeck. Joining us today is Scott Peterson. He's the vice president of communications at the Nuclear Energy Institute. Scott thanks a lot for being here today.

Scott Peterson: Good morning. Thank you.

Brian Stempeck: Right now, as we speak, the climate change meetings are ongoing in Montreal and you have a contingent up there. How's NEI working to pitch nuclear as a solution to global warming?

Scott Peterson: Well, we really think that there's no more important time right now for the world and the United States to consider a nuclear energy as part of the solution to reducing carbon and improving our air quality. And at the same time, meeting the incredible appetite that the world is going to have for electricity. Over the next 20 years come in the U.S. alone, we're going to have a 45 to 50 percent growth in electricity demand. And we must meet that growth in a way that takes advantage of the diversity of resources that we have in the electricity sector, but also in a way that reduces emissions. So we think nuclear energy is a vital part of that strategy, not only for the U.S., but for the world.

Brian Stempeck: Now there's been a very mixed reaction when it comes to how the Europeans in particular are reacting to nuclear power. Basically you have countries like Germany, which has said they want to face out their current reactors, not build any new ones. On the other side of spectrum you have France with plenty of reactors. And you have the U.K. which is saying that it wants to build new nuclear plants. How do you reconcile those differences? Does it seem like this is going to be a solution for all countries or just a handful of countries?

Scott Peterson: I think what meetings like the Montreal conference is doing is prompting nations to consider their options. We see the French, the U.K. and the Fins looking at building new reactors. The Germans, at the same time, have a phase out that's government mandated, but they're not phasing out reactors very quickly. And they're actually looking at perhaps keeping those reactors online for the future. That was part of the government coalition that was looking at it as part of the last elections. So I think generally what you have globally right now is this resurgence of nuclear energy as not only a clean electricity source, but as the clean air policy mechanism. We're seeing that particularly in the United States, not only with the Bush administration and the role nuclear energy plays in the voluntary program the administration has set up, but also the bipartisan support in Congress that we've seen this year ranging from the energy policy act that was passed in August and provisions to jumpstart new plant construction here in the U.S. And even in the environmental community, which is now really focusing on supporting nuclear energy or at least giving nuclear energy a second look.

Brian Stempeck: Well get to some of the things that Congress is doing a minute, but for now I want to focus on one thing that actually happened in Germany. I think was last month where we saw a number of German protesters block nuclear waste shipments coming out of France. It seems like the waste question is just as thorny there as it is United States. How is that being resolved over in Europe? And then talk about how that relates what's happening in the United States.

Scott Peterson: Sure, there are different ways that nations approach taking care of the byproduct of nuclear energy and that's used nuclear fuel. The French reprocess in terms of - they recycle the fuel. So they use the uranium over and over again until it's basically spent. And then they take that remaining byproduct and they dispose of it in a disposal facility. That is not yet built. What the Germans are doing is going to underground disposal in a specially engineered facility. That's their solution. And that's our solution in the U.S. right now. The Department of Energy has the responsibility to dispose of all of the fuel from our 103 reactors in the U.S. That's a policy that the Congress mandated in 1982. And consumers in the U.S. who use electricity from nuclear power plants have contributed $24 billion since 1983 to pay for that program. Unfortunately DOE is about seven years behind right now. They are looking at a repository site in Nevada, in the desert. It looks like a good site right now based on about $6 billion worth of science, which is a tremendous scientific and engineering project. Unfortunately they're a bit behind in preparing that facility. But what the resurgence of nuclear energy is doing, even in the U.S., is prompting a re-examination of what we should be doing with used nuclear fuel. Right now we only use about 5 percent of the energy content in that fuel. So now Congress and the industry is looking at perhaps doing what the French do and that's recycling the fuel, getting the most energy content out of that fuel before, at the end of the day, we send it to Yucca Mountain and the repository there.

Brian Stempeck: I was going to ask about that. Are you still optimistic that Yucca Mountain is the best solution right now? It seems like, as you said, DOE is way behind, there are a number of barriers that have yet to be addressed. Can you give us a timeline in terms of when you're expecting Yucca Mountain to go into operation? I mean originally it was 2010. That doesn't seem like it's going to happen.

Scott Peterson: Well if you just look at the science that's behind that site designation, there have been thousands of world-class scientists that have been studying that site for years and years. So we're very confident in the scientific pedigree of that site if you will, that it's the right place to build a repository underground, about 1,000 feet underground, where all of this fuel will be secure for the long term. What we're in really is a political battle right now to move that process along. DOE is preparing a license application that it will have to submit to the Nuclear Regulatory Commission just the way the industry submits licenses for nuclear power plants. They're moving along in that process, but they're taking the time to do it right and file a quality application. And we support that process. So while they're not meeting their commitment as they were supposed to a 1998 we think that it's more important to provide a quality application to the NRC. We would like that process, obviously, to move as fast as possible. We would expect the DOE would file a license application somewhere late next year or early 2007.

Brian Stempeck: As the process kind of drags on, is it time to look at different alternatives? I mean you mentioned what's happening in France and Germany with some of the nuclear reprocessing. Is that something it's time to put a little bit more interest in?

Scott Peterson: Well we're already seen that up in the Senate right now with Pete Domenici looking at recycling as an alternative to near-term waste management, and again, recycling the fuel to get the maximum energy content out of that. But even with recycling or other fuel treatments solutions you need a repository at the end of that process. So Yucca Mountain is still a viable project. It's still an important project. So that at the end of the day when we're finished using all of the intense energy in that fuel we have a place to put it that's scientifically safe, it's safe for the environment and it's safe for the people of Nevada.

Brian Stempeck: Now we saw Senator Domenici, he was a major proponent of nuclear power during the last energy bill that we saw pass last summer. Along with those incentives that were included in the bill how close are you to seeing a company in the United States build a new nuclear plant? It's a question everybody wants to ask. There's a number of coalitions working on this. How far out do you think we are?

Scott Peterson: There's a tremendous amount of work going on in the industry right now to really explore the new licensing process that's in place at the nuclear regulatory commission to make sure it's disciplined. That we can license plants in a time certain. There are about 10 companies right now looking at that process with the idea of testing it and then beginning construction of new plants if that process tests out well. That construction could begin somewhere in the 2007, 2008 timeframe, take four to five years to build a new generation of reactors that's safer than today's reactors. Because they rely on advance technologies, as in other industries, that improve over time. Today's reactors are safer than they've ever been. They are the most efficient power plants on the grid today operating at about 90 percent efficiency. So we've really gotten the most we can in terms of energy production out of today's units. What we want to do is build the next generation of reactors, take advantage of new safety and engineering features and begin a new generation that's going to not only meet that 40 to 55 percent electricity demand, but also provide clean air energy for consumers.

Brian Stempeck: Now we saw Congress include a bunch of tax incentives in the last energy bill. What else are you looking to see them do as the months go on and you see these coalitions moving on these new plants?

Scott Peterson: Well I think incentives are important to jumpstart companies looking at that. And that's certainly been the case since the energy bill passed in August. There have been about 4 or 5 companies that have come forward and said, "Yeah, we want to look at building new reactors." Because they're looking long term, 10 years down the path to meet the consumer needs electricity. And we've built natural gas plants largely for the last 10 years and very little other kind of generation. So these companies are looking at new large scale generation. Whether it's coal or nuclear, the incentives are important. Getting some resolution to what we're going to do with the used fuel is certainly important from a public standpoint and from a policy standpoint. So we support the efforts that are going forward there. We also think it's important that as the international community, and even as United States looks at clean air policy, that those policies recognize the role that nuclear energy plays already in reducing carbon and reducing other emissions. The general public thinks that. About 79 percent of the public thinks that nuclear energy ought to be recognized in environmental and energy policy on both the state and federal level. We did some research with the public in May and we got that very high figure back from them. So there's starting to be a high recognition, even among now the public, that nuclear energy has a role to play not only in energy, production but in clean air policy.

Brian Stempeck: Now what about when it comes to Wall Street and some of the investors? That's another major question is, beyond just addressing the regulatory concerns and the nuclear waste question, it's going to take investors if this is an economically viable proposition. Has that been done yet? I mean I know it's not quite at that point yet. That's usually little bit further down the line when you start building these plants, but what's been done to convince Wall Street that this is a realistic case?

Scott Peterson: Well the investment community has been very close in terms of following the trends that have been going on in our industry. Six years ago I think a lot of the investment community would have said we're starting to see a scale back of nuclear energy, what are we going to do with fuel when our plant's closing? That is totally shifted. We've got a 180-degree turn around in Wall Street's view of nuclear energy today mostly because companies are operating plants well. And with the investment incentives coming out of the Congress, with new plants announcing that they're looking at projects there is this wave of enthusiasm that's now back at Wall Street for new nuclear power plants. What we have to do, as an industry, is prove to them that we can build new plants in a time certain. Get it through the licensing process in a disciplined way and also build these on schedule and on cost. And that's going to be our challenge as we bring the first new plants online.

Brian Stempeck: This year we also saw something basically in the McCain-Lieberman bill, climate change bill, the first time we saw nuclear incentives included in that bill as well, which really kind of split the environmental community. As NEI, I know you're working also, the nuclear industry is coming out with a major new PR campaign that's coming out the next few months. What's the message you're trying to get out in terms of convincing the general public and convincing environmental groups that nuclear power is something that they should sign on for?

Scott Peterson: Well we really want to make them aware that there is one electricity source that provides clean air, that efficient and that provides reliable electricity in large volumes. The only source that does that today is nuclear energy. So when you're looking at a diverse electricity portfolio that's important for our nation for energy security purposes, to insulate us against fuel shocks in any one part of the sector, we really have to have nuclear energy as one of the keystones of that energy policy. It is today producing 20 percent of our electricity, second only to coal. But we really want to drive awareness that when you look at that triangle of benefits, clean, reliable and affordable, that we want to drive policy to make sure that nuclear energy grows and maintains at least the market share we have today in the electricity sector. I'm very happy to say that there is growing public awareness of the clean air benefits of nuclear energy. And the public takes the clean air benefits of electricity production very seriously. It's the top attribute they have to the way electricity is produced. So we see a growing recognition, over the last two to three years of the public's understanding of the clean air benefits of nuclear energy. We're seeing that on the Hill also. We just want to drive that to a much higher level.

Brian Stempeck: All right Scott. We're out of time. Thanks a lot for being on the show today.

Scott Peterson: Thanks you very much.

Brian Stempeck: I'm Brian Stempeck. This is OnPoint. Thanks for watching.

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