Carolyn Heising, a professor in the Department of Industrial and Manufacturing Systems Engineering , wrote a guest column for The Des Moines Register about the power of nuclear plants and clean energy. The column was originally printed on February 4, 2010.
What the administration does about loan guarantees for building new nuclear power plants in the next few weeks may tell us about its resolve to combat climate change and create jobs in clean-energy production.
That President Obama supports the growth of safe nuclear power was made emphatically clear from his ringing endorsement in the State of the Union address.
To give nuclear power’s revival a chance of success, however, a strong jump-start from the government will be required. No new plants can be built – and jobs created – unless the administration follows through with loan guarantees that significantly reduce the cost of private financing. Congress has approved $18.5 billion in loan guarantees, but differences over the terms of the loans between White House budget officials and the Department of Energy have delayed their release.
The Nuclear Regulatory Commission is actively reviewing applications to build and operate 22 nuclear power plants. This is on top of the 104 U.S. reactors now in operation.
The continued interest in building new nuclear plants, more than a year after the financial crisis rocked the economy – and sent the unemployment rate into double digits – says interesting things about the importance of nuclear power.
First, it reflects nuclear power’s key role as a source of affordable electricity. Although the capital cost of building a new plant is high, the production cost of nuclear power over a plant’s lifetime is marginally lower than coal and one-fourth the cost of natural gas. For consumers, the availability of nuclear-generated electricity provides a substantial savings compared to fossil fuels and even higher-cost renewable energy. Both wind and solar energy require back-up power from high-priced natural gas.
Second, the strong market for nuclear power reflects the confidence of electric utilities that their nuclear plants are safe and reliable. All of the safety data collected annually by the Atlanta-based Institute of Nuclear Power Operations show a steady improvement in a areas including performance, industrial safety and unplanned automatic reactor shutdowns.
Third, nuclear power is environmentally benign. Nuclear plants don’t pollute the air or emit greenhouse gases. Additional plants will help reduce carbon emissions and improve air quality, while supplying electricity.
But there also is a fourth reason for nuclear power’s importance, one that relates to the economy. Building new plants generates jobs, provides an economic stimulus and is a key source of revenue for government at all levels. It’s estimated that a nuclear power plant requires about 1,800 jobs during construction, plus 400 to 700 jobs during the operation of the plant. Construction of a plant generates three times as many jobs in nearby communities and generates about $430 million a year in economic output and $40 million a year in labor income. A nuclear plant provides $20 million annually in state and local tax revenue and federal tax payments of $75 million.
It’s estimated that constructing a new generation of nuclear plants – 45 reactors – along with the start-up of nuclear suppliers of plant components such as reactor vessels and heat exchangers would produce 350,000 well-paying jobs.
According to Bechtel Corporation, nuclear power offers the greatest opportunity for job creation because more labor is required to develop and build 1,000 megawatts of nuclear capacity than any other energy technology.
That’s worth considering the next time someone questions the economic value of nuclear power and its potential for putting hundreds of thousands of people back to work. But the lack of financing for new plants is the most serious constraint on nuclear power’s recovery. Issuing loan guarantees is the stimulus nuclear power needs.