Why Older Nuclear Power Plants Remain 'Cash Cows' Despite Fukushima

[kristopher]

April 29, 2011
Why Older Nuclear Power Plants Remain 'Cash Cows' Despite Fukushima
By PETER BEHR of ClimateWire

There are no new nuclear plants in the foreseeable future for Exelon Corp., the largest U.S. reactor operator. Old plants, though, are a different story.

Exelon's proposed acquisition of Baltimore-based Constellation Energy, announced yesterday, would add five nuclear reactors at three plants to the 17 reactors at 10 plants that the Chicago-based company already runs. Exelon's total nuclear capacity would climb from 17,047 megawatts to nearly 19,000 if the projected $7.9 billion deal is completed.

"They can buy them much more cheaply than they can build them," said Ellen Vancko, nuclear project manager for the Union of Concerned Scientists.

Although the disastrous accident at Japan's Fukushima Daiichi nuclear complex may lead to new regulations and higher costs for owners of existing U.S. reactors, that risk did not sidetrack merger negotiations between Exelon and Constellation, which began months before the March 11 earthquake and tsunami.

The reason, industry representatives and critics agree, is that the existing plants remain very profitable...

http://www.nytimes.com/cwire/2011/04/29/29climatewire-why-older-nuclear-power-plants-remain-cash-c-11850.html?pagewanted=all

Trust me, if you are interested in how this industry uses its muscle to ensure itself a place in our energy system, you'll want to read this. - K

[Kolesar]

1. Surplus wind power in Exelon's home service area puts pressure on its nuclear plants ...

... to reduce output, and that strikes directly at the profitability of nuclear operations, some analysts said.

[kristopher]

2. They also helped torpedo Md's effort to boost offshore wind in the Atlantic.

They are doing and will do anything they can to preserve the current system of centralized generation. They become an even stronger social and political force when they are operating fission plants than when they are operating coal plants.

Did you read the follow on article at the end of the first? They expect a 2-5 year lull in their efforts to build new plants, during which time they intend to focus on convincing regulators to extend the lifespan existing plants (designed to last 40 years) out to 80 years.

[Kolesar]

11. The "industry" wont' be able to stop photovoltaics once they become just a little bit cheaper...eom

[kristopher]

12. When what happened in the US was central to what happened in the world...

...the US energy structure determined what the future will bring. Now that dynamic has completely changed. Mid-year 2010 China provided $17B in loan guarantees to 3 solar manufacturers to expand their manufacturing capacity, which should put them at about 35GWp of manufacturing capacity by mid year 2011. The more manufacturing capacity, the lower the costs as they compete for market share. Unfortunately our entrenched centralized system keeps the bulk of our seed money focused on nuclear, coalCCS and petroleum.

[PamW]

3. Chicago may be the "windy city" but....

Surplus wind power in Exelon's home service area puts pressure on its nuclear plants
==================================================

Exelon's home service area is the Commonwealth Edison ( of which Exelon is the parent
company ) which services Chicago and northern Illinois.

Chicago may be nicknamed the "windy city", but that actually refers to the politicians..

Exelon is able to generate electricity at about 2.03 cents per kilowatt-hour with
its nuclear power plants:

http://www.exeloncorp.com/energy/generation/nuclear.aspx

I'm not aware of any wind farm that can provide electricity for as little as 2 cents
per kw-h. A surplus of a higher priced commodity is not going to put pressure on
Exelon's low priced nuclear.

Besides, I thought the "party line" on DU was that nuclear was too expensive to make
money, and here it is being called a "cash cow".

PamW

[kristopher]

4. You're mistaken.

Wind has zero fuel costs, it therefore has the capability of bidding into the system at $00.0, ensuring that all of it's uncommitted product is first in the queue of sellers. That means any entity with fuel cost is under greater cost pressure to compete.

[PamW]

5. WRONG again!!

Wind has zero fuel costs, it therefore has the capability of bidding into the system at $00.0,
=============================

You've sunk to a new low. Wind power may have zero "fuel" costs.

However, you don't get wind turbines for free. There is also a "capital" cost.

I don't know what your profession is. I used to think you were some type of
economist. However, a real economist wouldn't make a blunder this bad.

The cost of wind power includes both "fuel" cost and capital cost. Because the
capital cost is non-zero, you can't go into the market bidding a cost of $0.00

Last I looked, the busbar cost of wind power was about 5 cents per kw-hr, or
about 2.5X as expensive as nuclear.

Unreal!!

PamW

[kristopher]

6. You are remarkably brash for such an uninformed person.

Try these google terms:
wind marginal costs bidding system

The first hit will be: "Wind power in power systems" By Thomas Ackermann on Pg 395.

[PamW]

7. How convenient.

The first hit will be: "Wind power in power systems" By Thomas Ackermann on Pg 395.
=====================

OK - I found that book on Google books and attempted to go to page 395.

Unfortunately, the paging arrow skips from page 285 to page 410.

How convenient. If you don't have anything to back up what you are
claiming; just say so.

Don't send me on a wild goose chase.

Here's something you probably haven't thought of - why don't your enclose
a quote of the relevant section in one of your posts.

Still don't want to "own" your words, do you?

PamW

[kristopher]

9. When you google those search term and click the first link as specified

It takes you to the page cited 395.

[PamW]

8. I see nothing nefarious in that article.

Trust me, if you are interested in how this industry uses its muscle to ensure itself a place in our energy system, you'll want to read this. - K
================

I see nothing nefarious in that article. Exelon is just being a business.
It's looking for profits where it can find them.

I can see where increasing output on an existing plant is less financially
risky than attempting to build a new power plant.

I see nothing wrong with that. As a scientist who knows the physics of
nuclear reactors, it's not the power level per se that controls or determines
the safety; but the temperatures. If one steps up the cooling of the reactor,
then one can increase the power without increasing the temperatures.

The temperatures and their reactivity feedbacks determine safety.

BTW, there is an error in the article when it states:

Exelon said its generating plants returned average margins of 3.76 cents per kilowatt-hour last year, despite lower power prices, and two-thirds of Exelon's overall generation capacity comes from nuclear plants.


Actually, Exelon's nuclear generation capacity comprises 93% of its capacity; not "two-thirds":

http://www.exeloncorp.com/energy/generation/generation.aspx

PamW

[kristopher]

10. It's a noble scientific venture; no, it's a profit seeking business...

You are one confused pup.