News & Events

The release of a new study prepared for the Union of Concerned Scientists, “Big Risks, Better Alternatives,” overstates the cost and risk of two new nuclear projects in the Southeast. Specifically, the study examines the potential costs of the Vogtle project in Georgia and the Levy project in Florida.  

Below, we take a closer look at the study’s claims.

Claim #1:

The report claims that energy efficiency and renewable energy alternatives “are not only capable of meeting the projected growth in demand for each state [Georgia and Florida] at a lower cost than adding new nuclear capacity, but they also provide the benefit of reducing each state’s greenhouse gas emissions.”

The Facts:

In fact, costs estimates by the U.S. Energy Information Administration in 2011 show that new nuclear generation will have an (average) levelized cost lower than most popular renewable alternatives:

• Advanced nuclear  - $113.90 per megawatt hour
• Advanced coal with carbon capture and sequestration - $136.20 per megawatt hour
• Solar PV - $210.70 per megawatt hour
• Offshore wind - $243.20 per megawatt hour
• Onshore wind - $97 per megawatt hour, but Southeastern states are considered poor locations¹ 
• Solar thermal - $311.80 per megawatt hour.² 

Southern Co. estimates that residential customers using 1,000 kilowatt-hours per month would see a monthly increase of only about $10 in 2018, when both Vogtle units are fully operational. The company also estimates that by 2030 electricity demand will increase by 27 percent in the Southeast.³ It will be difficult by then to meet electricity demand with a mix of only renewable generation and efficiency measures. In addition, nuclear energy production emits no greenhouse gases and has lower life-cycle emissions than most renewable technologies.⁴ 

Claim #2:

The report says, “If history is our guide, these cost estimates are likely to increase dramatically over time.”

The Facts:

New infrastructure projects always carry an element of risk; however, recent changes in the regulation and financing of nuclear projects are helping ensure plants are built on schedule and on budget:

• A New, More Efficient Licensing Process. The U.S. Nuclear Regulatory Commission has changed its licensing process to provide for the resolution of all safety and environmental issues before construction begins, reducing uncertainty and helping ensure continuity during construction and initial operation. Today’s licensing process provides for issuance of a combined construction permit and operating license before construction begins.

• Recovery of Financing Costs During Construction. Southern Company, the operator of the Vogtle site, said that using recovery of financing costs during construction will reduce the “in-service cost” of the plant by nearly $2 billion (30 percent).⁵ As a result, total rate increases to cover the plant’s cost will be nearly 3 percent lower.

• Standardized Designs. While past nuclear power plant designs contained common technologies, there were many differences in overall reactor design. Today, manufacturers use standard designs which are being pre-approved by the NRC.

• Stable Fuel Costs. The stable cost of nuclear fuel has the potential to relieve cost uncertainty caused by swings in coal and natural gas prices.

The two new reactor projects underway in the United States—the Vogtle facility in Georgia and SCANA’s V.C. Summer facility in South Carolina—are on schedule and on budget. SCANA projected last year that its new reactors will come in at $1 billion under budget.⁶

For more information on the cost of nuclear energy generation, see “The Cost of New Generating Capacity in Perspective.”

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¹ http://www.eia.gov/cneaf/solar.renewables/ilands/fig13.html
² EIA, Annual Energy Outlook 2011, April 2011.
³ http://www.southerncompany.com/nuclearenergy/plan.aspx
⁴ http://www.nei.org/resourcesandstats/documentlibrary/protectingtheenvironment/graphicsandcharts/comparisonoflifecycleemissions/
⁵ http://www.georgiapower.com/about/financing.asp
⁶ http://www.scana.com/NR/rdonlyres/1E283315-4F31-4A3B-B6F6-0970BC81290E/0/SCG_Q310EarningsPresentationFinal.pdf, page 9