Edison Con? San Onofre Nuclear Plant Owner Proposes Reactor Restart

Containment domes or shell game? (Aerial view of San Onofre Nuclear Generating Station by Jelson25 via wikipedia)

Southern California Edison (SCE), the operator of the troubled San Onofre Nuclear Generating Station (SONGS), has proposed to restart one of the facility’s two damaged reactors without repairing or replacing the parts at the root of January’s shutdown. The Thursday announcement came over eight months after a ruptured heat transfer tube leaked radioactive steam, scramming Unit 3 and taking the entire plant offline. (Unit 2, offline for maintenance, revealed similar tube wear in a subsequent inspection; Unit 1 was taken out of service in 1992.)

But perhaps more tellingly, Edison’s plan–which must be reviewed by the Nuclear Regulatory Commission–was issued just weeks before the mandated start of hearings on rate cuts. California law requires an investigation into ratepayer relief when a facility fails to deliver electricity for nine months. Support of the zombie San Onofre plant has cost California consumers $54 million a month since the shutdown. It has been widely believed since spring that Unit 3 would likely never be able to safely generate power, and that the almost identical Unit 2 was similarly handicapped and would require a complete overhaul for its restart to even be considered.

Yet, calls for more immediate rate rollbacks were rebuffed by Edison and ignored by members of the California Public Utilities Commission (CPUC). Despite studies that showed SONGS tube wear and failure was due to bad modeling and flawed design, and a company pledge to layoff of one-third of plant employees, San Onofre’s operators claimed they were still pursuing a restart.

Thursday’s proposal for that restart does not directly engage any of the concerns voiced by nuclear engineers and watchdog groups.

When SONGS installed new turbines in 2010 and 2011, it did not replace “like with like”–that would have required a costly custom machining of parts no longer routinely manufactured. Instead, San Onofre’s owners moved to “uprate” their generators–cramming in more transfer tubes to increase output–with the nuclear industry equivalent of “off the shelf” parts. It was a transparently profit-driven decision, but more crucially, it was a major design change that should have required a lengthy license-amendment process at the NRC.

Federal regulators, however, took on faith industry assurances that changes were not that big a deal, and approved San Onofre’s massive retrofit without an extensive investigation into the plan.

What is now understood to have happened is that the design of new parts for San Onofre was based on flawed computer models that failed to anticipate new fluid dynamics, increased vibration, and more rapid wear in the numerous thin, metal, heat transfer tubes. It’s a flaw that presumably would have turned up in a more rigorous regulatory review, and, again, a problem not directly addressed by Edison’s restart plan.

Rather than repair or replace the tubes and turbines, San Onofre’s owners propose to simply plug the most severely degraded tubes in Unit 2 and then run that reactor at 70 percent power. After five months, Unit 2 would be shut down and inspected. (There was no plan offered for the future of Unit 3.)

Why 70 percent? Edison said it believes that would lessen vibration and decrease the rate of wear on the heat transfer tubes. Does that make any scientific sense? Not in the eyes of nuclear engineer Arnie Gundersen, who has produced three studies on San Onofre’s problems:

Restarting San Onofre without repairing the underlying problems first turns Southern California into a massive science experiment. Running at the reactor at a 30 percent reduction in power may not fix the problems but rather make them worse or shift the damage to another part of the generators. It’s a real gamble to restart either unit without undertaking repairs or replacing the damaged equipment.

S. David Freeman, former head of the Los Angeles Department of Water and Power, as well as the Tennessee Valley Authority, and now a senior advisor to Friends of the Earth, is even more pointed:

Neither of the reactors at San Onofre are safe to operate. While Edison may be under financial pressure to get one up and running, operating this badly damaged reactor at reduced power without fixing or replacing these leaky generators is like driving a car with worn-out brakes but promising to keep it under 50 miles an hour.

That is the scenario now before the NRC. An experimental roll of the dice within 50 miles of 8.4 million California residents, offered up with a “trust us” by the same folks who got the modeling dangerously wrong last time, versus multiple studies calling into question the viability of a plant that already has a long history of safety and engineering problems. Regulators are at least talking as if they understand:

“The agency will not permit a restart unless and until we can conclude the reactor can be operated safely,” NRC Chairman Allison Macfarlane said. “Our inspections and review will be painstaking, thorough and will not be rushed.”

The right words, but hardly reassuring ones given the commission’s past actions (or inactions) on San Onofre and numerous other dangerous events across the nation’s aging nuclear fleet.

The sting that keeps on stinging

But does NRC approval really matter to Southern California Edison, at least in the short run?

Operating only one of San Onofre’s reactors at two-thirds of its proposed output for five months sometime next year–which is the best-case scenario–does not provide a meaningful addition to California’s near- or long-term energy outlook. (California officials are already making plans for another year without San Onofre.) In addition, San Onofre has other problems to address, such as aforementioned staffing issues, new seismic evaluations required in the wake of the Fukushima disaster, newfound safety lapses, and ongoing concerns about the quality of the concrete used to plug 28-foot holes in both reactors’ containment domes (the holes were cut for installation of the new turbines, inquiries about the strength and durability of the concrete were made a year ago, but, to date, the NRC has not released a report).

But Thursday’s proposal does provide Edison with a modicum of cover going into an October 9 public information session and the upcoming debate over whether California consumers should still have to pay for a power plant that provides no power.

Indeed, billing for services not rendered could be considered a profit center for the US nuclear industry. San Onofre is but one case; ratepayers in Florida are also familiar with the scam.

The same day SCE submitted its SONGS plan, attorneys for the Florida Public Service Commission (PSC), Progress Energy and Florida Power & Light (FPL), appeared before the Florida Supreme Court to defend an “advance fee” that has allowed the utilities to soak Sunshine State ratepayers for upwards of $1 billion. The money collected, and additional fees approved last year by the PSC, are slated for the construction of new nuclear reactors in Levy County and at Turkey Point.

The court challenge was brought by the Southern Alliance for Clean Energy, which contends there is little evidence Progress or FPL can or ever really intend to build the new facilities. Indeed, FPL has spent some of its takings on existing operations, while Progress has blown hundreds of millions of dollars trying to repair its Crystal River nuclear plant, which has been offline since 2009, and likely will never return to service.

What do attorneys for the utilities say when challenged on these points? That their intent is borne out by the fact that both are still seeking construction and operating licenses from the Nuclear Regulatory Commission.

There is no indication NRC approval on those projects is imminent (in fact, no NRC approvals of any projects are imminent), nor are there any guarantees that the projects could be fully financed even with licenses and all that ratepayer cash.

But, be it for future fantasies or current failures, from Florida to California, electricity consumers are paying higher prices to perpetuate the myth of a nuclear renaissance and balance the books of the nuclear industry. . . while industry officials, lobbyists and favored politicians pocket a healthy share.

And not satisfied with that cushy arrangement, San Onofre’s operators are also pushing for permission to move its ratepayer-financed decommissioning fund into riskier investment properties. The industry promises this will bring higher yields, but, of course, it also chances bigger losses–and it guarantees larger fees, which would be passed on to Southern California consumers upon CPUC approval.

None of these actions–not the investment games, the rate hikes or the experiment with San Onofre’s damaged reactor–are actually about providing a steady supply of safe, affordable energy. These are all pecuniary plays. Across the country and across the board, nuclear operators seem more interested in cashing in than putting out.

More prudent for governments and utility commissions, and more beneficial for ratepayers, of course, would be to stop paying the vig to nuclear’s loan sharks, stop throwing good money after bad in a sector that is dying and dangerous, and start making investments in truly clean, truly renewable, and increasingly far more economical 21st Century energy technologies.

Until that happens, the most profitable thing about nuclear power will continue to be the capacity to charge for a service that might never be provided. Private utilities have understood this for a long time; ratepayers are becoming painfully aware of it, too. The question is, when will government regulators and utility commissions understand it–or at least fess up to being in on the con?

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Stop the Madness! Or at least learn more about it. Join me on Saturday, October 13, at 5 PM Eastern time (2 PM Pacific) when I host an FDL Book Salon chat with Joseph Mangano, author of Mad Science: The Nuclear Power Experiment.

NRC Halts License Approvals Pending New Guidelines on Nuclear Waste

A nuclear spent fuel pool. (photo: NRCgov)

The US Nuclear Regulatory Commission announced Tuesday it would suspend the issuing of new reactor operating licenses, license renewals and construction licenses until the agency crafted a plan for dealing with the nation’s growing spent nuclear fuel crisis. The action comes in response to a June ruling by the US Court of Appeals that found the NRC’s “Waste Confidence Decision”–the methodology used to evaluate the dangers of nuclear waste storage–was wholly inadequate and posed a danger to public health and the environment.

Prior to the court’s ruling, the Commission had evaluated licensing and relicensing with the assumption that spent fuel–currently stored on site at nuclear power plants in pools and dry casks–would soon be moved to a central long-term waste repository. As previously noted, that option was once thought to be Yucca Mountain, but after years of preliminary work and tens of millions of dollars wasted, Yucca was found to be a poor choice, and the Obama Department of Energy and the NRC ended the project. The confirmation of new NRC Chair Allison Macfarlane–considered a nuclear waste expert and on record as a Yucca Mountain critic–focused even more attention on the country’s lack of realistic plans for safe, permanent waste storage.

The release from the Nuclear Regulatory Commission [PDF] put it this way:

Waste confidence undergirds certain agency licensing decisions, in particular new reactor licensing and reactor license renewal.

Because of the recent court ruling striking down our current waste confidence provisions, we are now considering all available options for resolving the waste confidence issue, which could include generic or site-specific NRC actions, or some combination of both. We have not yet determined a course of action.

In recognition of our duties under the law, we will not issue licenses dependent upon the Waste Confidence Decision or the Temporary Storage Rule until the court’s remand is appropriately addressed.

What this means in real terms remains to be seen. No licenses or renewals were thought imminent. Next up were likely a decision on extending the life of Indian Point, a short drive north of New York City, and a Construction and Operation License for Florida’s Levy County project, but neither was expected before sometime next year. Officially, 19 final reactor decisions are now on hold, though the NRC stressed that “all licensing reviews and proceedings should continue to move forward.”

Still, this should be read as a victory for the originators of the suit that resulted in the June ruling–the Attorneys General of Connecticut, New Jersey, New York and Vermont in coordination with the Prairie Island Indian Community of Minnesota and environmental groups represented by the National Resources Defense Council–and most certainly for the millions of Americans that live close to nuclear plants and their large, overstuffed, under-regulated pools of dangerous nuclear waste. Complainants not only won the freeze on licensing, the NRC guaranteed that any new generic waste rule would be open to public comment and environmental assessment or environmental impact studies, and that site-specific cases would be subject to a minimum 60-day consideration period.

While there is still plenty of gray area in that guarantee, the NRC has (under pressure) made the process more transparent than most similar dealings at the agency. The commission has also, at least for the moment, formally acknowledged that the nation’s nuclear reactor fleet faces a very pressing problem.

The US has 72,000 tons of radioactive waste and generates an additional 2,000 tons every year. Spent fuel pools at individual sites are already so full they pose numerous threats, some eerily similar to the ongoing disaster at Fukushima. Dry cask storage poses other problems and much additional expense. And regional interim waste storage facilities, an idea possibly favored by Macfarlane, is problematic for many reasons, not the least of which is that no sites have yet been designated or built.

But nuclear plant operators, already burdened by the spiraling costs of a poorly maintained and aging inventory, are desperate to have the federal government take the waste problem off their backs–and off their books. Whether that is even technically feasible, let alone politically of fiscally possible, remains to be seen. But the NRC has at least recognized–or at least been forced to recognize–that the nuclear industry should not be allowed to create waste indefinitely without a plan to safely secure what is already on hand.

Nuclear “Renaissance” Meets Economic Reality, But Who Gets the Bill?

Crystal River Nuclear Generating Plant, Unit 3, 80 miles north of Tampa, FL. (photo: U.S. NRC)

Crystal River is back in the news. Regular readers will recall when last we visited Progress Energy Florida’s (PEF) troubled nuclear reactor it was, shall we say, hooked on crack:

The Crystal River story is long and sordid. The containment building cracked first during its construction in 1976. That crack was in the dome, and was linked to a lack of steel reinforcement. Most nuclear plants use four layers of steel reinforcement; Crystal River used only one. The walls were built as shoddily as the dome.

The latest problems started when Crystal River needed to replace the steam generator inside the containment building. Rather than use an engineering firm like Bechtel or SGT–the companies that had done the previous 34 such replacements in the US–Progress decided it would save a few bucks and do the job itself.

Over the objections of on-site workers, Progress used a different method than the industry standard to cut into the containment building. . . and that’s when this new cracking began. It appears that every attempt since to repair the cracks has only led to new “delamination” (as the industry calls it).

Sara Barczak of CleanEnergy Footprints provides more detail on the last couple of years:

The Crystal River reactor has been plagued with problems ever since PEF self-managed a steam generation replacement project in September 2009. The replacement project was intended to last 3 months, until PEF informed the Commission that it had cracked the containment structure during the detensioning phase of the project. PEF subsequently announced that the CR3 reactor would be repaired and back in service by the 3rd quarter of 2010…then by the 4th quarter of 2010…and then by the first quarter of 2011. On March 15, 2011 PEF informed the Commission that it had cracked the reactor again during the retensioning process and subsequently told the Commission that it estimated repair costs of $1.3 billion and a return to service in 2014. Shortly thereafter, the Humpty Dumpty Crystal River reactor suffered yet another crack on July 26, 2011.

That July crack was later revealed to be 12-feet long and 4-feet wide–and here, at least when it came to notifying the Nuclear Regulatory Commission, “later” means much later. . . like four months later.

The issue, of course–as anyone with a lifetime crack habit will tell you–is that this all gets very expensive. Not only is there the cost of the repairs. . . and the repairs to the repairs. . . and the repairs to the repairs to the repairs. . . there is the cost of replacing the energy that was supposed to be supplied to PEF customers by the crippled reactor.

And then there is the cost of the new reactors. . . .

Wait, what?

Yes, based on the amazing success they have had managing Crystal River–and something called a “determination of need,” which was granted in 2008–Progress Energy holds out hope of someday building two of those trendy new AP1000 nuclear reactors at another Florida site, this one in Levy County.

And who is expected to pick up the tab? Who is on the hook, not just for repairs and replacement energy at Crystal River, but for PEF keeping its options open at Levy? Well, not surprisingly in “privatize profits, socialize risk” America, the plan was to stick Florida ratepayers with the bill (again Footprints provides the numbers):

Customer bills for instance, were expected to increase by $16/mo. in 2016; $26/mo. in 2017 and a whopping $49/mo. in 2020. Initially, Progress expected the proposed reactors to cost $4-6 billion each, coming online beginning in 2016. Just a few years later, the estimated costs have skyrocketed to over $22 billion and the online date, if the reactors ever even come online, has bumped back to 2021 and 2022. And the Office of Public Counsel believes that PEF may not intend to complete the reactors until 2027, if at all. The company has spent over $1 billion dollars on the Levy nuclear reactors and has yet to commit to build them. And the company is entitled to recover all its preconstruction and carrying costs from its customers before even a kilowatt of electricity is produced. In fact, even if the project is never completed PEF can recover all its construction costs from customers courtesy of the 2006 anti-consumer “early cost recovery” state law…essentially a nuclear tax scheme.

But now, as of this week, there is a new plan. . . stick Florida ratepayers with the bill:

The state Public Service Commission on Wednesday unanimously approved an agreement that will increase the power bills of Progress Energy Florida customers — who already pay among the highest rates in the state.

It is supposed to be a win for consumers.

The deal includes a $288 million “refund” of money customers were to pay to replace power from the crippled Crystal River nuclear plant, which has been offline since fall 2009 and might never return to service.

PSC staff concluded that customer rates still would increase. The average Progress customer’s bill on Jan. 1 is expected to increase $4.93 a month per 1,000 kilowatt hours of usage, from $123.19 to $128.12, subject to adjustments for fuel costs.

That’s a “win” for Floridians, it seems, because they are paying out something less for Progress Energy’s mistakes–at least in the near term. But even that caveat is subject to scrutiny:

While the agreement provides a replacement power cost refund over 3 years of $288 million to PEF customers (due to the CR3 outage) – it comes packaged with a base rate increase of $150 million and it precludes the parties from challenging up to $1.9 billion (yes, billion) fuel and replacement power costs from 2009 to 2016.

And that’s not all. Also in the agreement is a requirement that PEF start (yes, that is start) the latest repairs on Crystal River by the end of 2012; if they do not, Progress has to “refund” an additional $100 million to consumers. Missing, however, from the agreement is any new estimate (given the latest revelations, not to mention any post-Fukushima upgrades required) of the cost should PEF actually try to remedy all of Crystal River’s problems–and perhaps even more glaring, questions remain as to who will pay (and how much it will cost) should PEF decide to stop throwing good money after bad and decommission Crystal River reactor 3.

Also missing from the calculation is any determination of what PEF’s insurance will cover–Crystal River’s insurer stopped paying out in early 2011, and they have yet to decide if they will pay anything more. . . at all.

The agreement also fails to put an end to what is now becoming a regular part of the nuclear power finance scam–collecting public money for plants that will never be built. As the Southern Alliance for Clean Energy (SACE, which is affiliated with CleanEnergy Footprints) observed when it opted not to sign on to the Florida rate agreement:

PEF hasn’t committed to actually building the Levy Co. reactors. Having customers pay for the company just to maintain the “option” at a later date to build reactors is unfair to today’s customers – and runs counter to the Commission’s “intent to build” standard. The agreement allows the company to collect another $350 million from customers, presumably for pursuing their Nuclear Regulatory Commission license (without any prudency review) for reactors it hasn’t committed to build? In fact, the agreement contemplates that the company will cancel its engineering and procurement contracts as well, further demonstrating the unlikelihood of project completion.

If something sounds familiar here, it should. Southern Company has been using heaping helpings of Georgia ratepayer money to do all kinds of preliminary work on their Vogtle site, purportedly the future home of two new AP1000 reactors, just granted a combined construction and operating license by the NRC in January.

The big difference so far between Levy and Vogtle has been Southern’s ability to line up some financing for its Georgia construction–thanks to $8.33 billion in federal loan guarantees granted the project by the Obama administration almost two years in advance of the NRC approval.

PEF does not have this kind of guarantee, but that did not stop them from trading on the possibility:

Progress Energy Florida officials said Thursday that President Obama’s plan to offer federal loan guarantees to encourage investment in nuclear power plant construction will be a strong incentive to move forward with the company’s proposed Levy County plant.

The project, however, is facing delays of between 20 to 36 months due to economic and regulatory problems, making the plant’s future uncertain despite the company’s insistence the project isn’t cancelled.

“It (the loan guarantee program) will definitely play a role in that decision (whether to continue with the project). It is one of many, but a very important one,” said Progress Energy spokesman Mike Hughes.

That was in 2010, right after President Obama announced the new Department of Energy loan program–but two years later, PEF has not secured a federal guarantee, and so has not secured any financing. . . and thus has also not committed to ever building the Levy plant. But none of that has stopped Progress from collecting money from Florida consumers just to keep hope alive, as it were. And none of that has apparently stopped any of Florida’s public service commissioners from telling PEF that this practice is just jake with them.

Even with NRC approval and some federally guaranteed money, it is still not a sure bet that the Vogtle AP1000 reactors will ever come on line. PEF’s Levy project has no license and no loan guarantee.

The folks at Progress Energy are not stupid–at least not when it comes to short-term financial gain–they know how very slim their chances are of ever pushing even a single kilowatt out of Levy County, but they also know where the profit is in the nuclear power game. It is not, quite obviously, in the construction of nuclear power plants–rife as that process is with lengthy delays and massive cost overruns–and it is not, some might be surprised to learn, so much in electric generation, given that plants in the US are now suffering “unusual events” that force one or more of them offline pretty much every week. Unusual events cost money–in parts and labor, and in time lost to repairs and inspections–and, as has been demonstrated at Crystal River, there is the cost of replacement energy.

No, the real profits in the nuclear racket come from the ability to collect on services not rendered and a product not delivered, or at least not delivered regularly. Because the system backstops the financing of nuclear facilities while also allowing plant operators to pass both real and anticipated costs onto ratepayers, many American taxpayers are poised to pay twice for nuclear power plants that don’t produce power.

And it would be remiss to close without adding a few more points.

Much has been made of the failure of solar panel manufacturer Solyndra, which also received aid from the federal government in the form of loan guarantees. Solyndra ultimately got $527 million from the government; contrast that with what has been granted to Southern for Vogtle. Or, starker still, look at the entire alternative energy loan program, now projected to cost out at under $3 billion, and then look back to 2010, when Barack Obama pledged $54.5 billion to the DOE loan guarantee program designed to foster investment in nuclear power.

In addition, while the government will actually recoup most of the money lost on Solyndra when the factory and inventory are auctioned off, the “leftovers” from a failed nuclear plant–even the parts that are not contaminated with radioactivity–are much harder (if not impossible) to move.

The focus of this story has been on the costs–because the case of Progress Energy Florida is such a glaring example of how nuclear operators fleece America–but the fact that a company so focused on the bottom line, regardless of its effect on public safety, is still allowed to play with something as dangerous as a damaged nuclear power plant should not be overlooked. Alas, as was exposed last year, nuclear regulators and the nuclear industry seem to agree that safety should be addressed with an eye toward cost. So, while Crystal River is a scary mess, the reactor in question is actually offline right now. The same cannot be said, for example, about Ohio’s Davis-Besse plant, which has cracking problems of its own, but was allowed by the NRC to restart in January–over the vociferous objections of industry watchdogs, engineers, and Rep. Dennis Kucinich (D-OH).

And then there is Palisades, on the shores of Lake Michigan, where numerous events and releases of radioactivity in the last year caused the Nuclear Regulatory Commission to issue a downgrade of the plant’s safety rating–but the NRC did not order the plant to shut down. Palisades is owned by Entergy Nuclear, who was recently cited for “buying reactors cheap, then running them into the ground.” In addition to Palisades, Entergy owns nine other plants–Arkansas Nuclear One, Nebraska’s Cooper Nuclear Station, Fitzpatrick in upstate New York, Grand Gulf in Mississippi, Indian Point, just north of New York City, Pilgrim, outside of Boston, River Bend and Waterford, both in Louisiana, and Vermont Yankee.

The case of Vermont Yankee is especially upsetting. Yankee is a GE boiling water reactor, similar to the model that failed so catastrophically at Fukushima–but the NRC voted to extend its operating license just days after the Tohoku quake. The state of Vermont had a better idea, declaring that the nuclear plant should shut down by March 21, 2012. However, in January, federal district court judge J. Garvan Murtha ruled Entergy could ignore Vermont’s order and continue operating. The state is appealing the ruling, but in the meantime, Yankee continues to operate. . . and continues to leak tritium into the groundwater, and into the Connecticut River.

It is not clear who will be paying for any attempt to clean up the Vermont Yankee leak–though one can guess–nor is it clear what will happen to new nuclear waste produced after March 21, since the Vermont statehouse has forbidden any new waste storage on the site. Indeed, storing used nuclear fuel is a nationwide problem that poses real dangers in the near term, and will likely cost billions of public dollars in the long term.

And that’s the bottom line–the real bottom line–for the industry’s oft-ballyhooed “nuclear renaissance.” Plant operators and captured regulators can try to obscure the safety concerns with diversionary dustups and magical thinking, but economic realities, like facts, are stubborn. Without huge injections of public money, nuclear power simply cannot continue to function–and the public is in no mood for another multi-billion dollar government bailout.