New York—A “transformational” year in political support for nuclear energy, continued operational excellence at America’s 104 reactors, and increasingly supportive federal policies have the nuclear energy sector poised to play a pivotal role in the nation’s economic and environmental successes in the 21st century, Wall Street financial analysts were told here today.
“We have nothing less than a new political mandate for nuclear energy,” the Nuclear Energy Institute’s president and chief executive officer, Marvin Fertel, told analysts who attended an NEI-sponsored briefing. “The phrase ‘strong political support’ understates our position. 2009 was a transformational year for nuclear energy in Washington.”
Fertel recounted the favorable developments that underscore congressional and administration support for expanding nuclear energy. These included this week’s announcement of a conditional loan guarantee commitment for the construction of two reactors in Georgia and the recent State of the Union address in which President Obama offered what Fertel described as “unequivocal” support for nuclear energy. In that speech, President Obama issued a call for “a new generation of safe, clean nuclear power plants in this country” at the top of a list of clean-energy technologies that the nation needs.
“Those of you who watched the speech will remember that the reference to nuclear power was one of the few statements that brought the entire chamber—Democrats and Republicans—to their feet,” Fertel said.
Additionally, the administration, in its fiscal year 2011 budget request, proposed tripling the volume of federal loan guarantees available for new nuclear energy facilities, to $54.5 billion from $18.5 billion.
Fertel noted that a host of independent analyses of climate change legislation passed last year by the House of Representatives all project a major expansion of nuclear energy capacity over the next 30 to 50 years to meet rising electricity demand while preventing emissions of greenhouse gases. See this link, http://www.nei.org/publicpolicy/nuclearenergyandclimatechange/, for details on the analyses of the Waxman-Markey climate change legislation.
“All mainstream analyses of climate change showed that reducing carbon emissions would require a portfolio of technologies, that nuclear energy must be a part of the portfolio, and that major expansion of nuclear generating capacity over the next 30 to 50 years would be essential,” Fertel said.
Nuclear power plants in 31 states generate more than 70 percent of the U.S. electricity that comes from carbon-free sources, even though the 104 reactors constitute only about 11 percent of the installed electric generating capacity.
According to preliminary data, 2009 was another exemplary year for the nuclear industry. Nuclear energy surpassed all other electricity sources with an estimated industry-average capacity factor of 90.5 percent, down only six-tenths of a percentage point from 2008. Nuclear power plants also generated approximately 800 billion kilowatt-hours of electricity last year, the third-highest level ever. This was accomplished in a year with 66 refueling outages.
Plans for major capital projects, including new nuclear projects, have slipped by a few years, Fertel acknowledged, partly in response to lower-than-expected electricity demand and partly in response to near-term financial pressure on energy companies. But the electric sector’s long-term fundamentals and the industry’s long-range plans have not changed, he said.
Progress toward new nuclear plant construction continues at the measured pace industry has predicted for several years. The first wave of new nuclear plant construction, which should see reactors on line in 2016 and 2017, will deliver four to eight plants.
Still, there is unambiguous evidence that the U.S. nuclear supply chain is recovering, Fertel said. Companies are investing in new facilities to manufacture components, and the number of U.S. companies who earned the certificates needed to manufacture nuclear-grade equipment has increased by approximately 25 in the past two years.
“We are putting in place assets that will deliver carbon-free electricity, generate earnings and provide a hedge against future environmental restrictions. At a time when most industries are shedding jobs, we are creating them, as the nuclear supply chain expands to meet global and domestic demand for equipment and services,” Fertel said.
To access NEI’s presentation to analysts, click here: http://www.nei.org/resourcesandstats/documentlibrary/reliableandaffordableenergy/presentations/nuclear-energy-2010-a-new-political-mandate/.