Sobering report laments shrinking size, clout of U.S. nuclear sector

Low natural gas prices, financing hurdles, failure to find a permanent repository for high-level nuclear waste, reactions to the Fukushima accident in Japan, and other factors are hastening the day when existing U.S. reactors become uneconomic, while making it tougher to build new ones.

That’s the sobering bottom line from a recent report on U.S. nuclear energy sector the Center for Strategic & International Studies (CSIS). The Nuclear Energy Institute (NEI) issued a July 11 statement praising the report, and including a link to the document.

The report says the United States could face “a substantial contraction of commercial nuclear energy in the coming years.”

In addition, state and federal mandates and various subsidies for renewable energy—particularly wind—create market distortions in the electricity sector that contribute to undermining the economic viability of nuclear power, CSIS finds.

“Two generations after the United States took this wholly new and highly sophisticated technology from laboratory experiment to successful commercialization, our nation is in danger of losing an industry of unique strategic importance and unique promise for addressing the environmental and energy security demands of the future,” CSIS said.

Declining U.S. nuclear power role has many implications

The report also says shrinking the U.S. nuclear power footprint will likely hurt nuclear-related university research, the U.S. Navy’s nuclear submarine program and hurt U.S. ability to shape global standards for nuclear safety and security.

In addition to expanding public education about nuclear power, the CSIS study also endorses deployment of small modular reactors, especially at military bases.

The CSIS Commission on Nuclear Energy in the United States is made up of senior public and private sector officials from across the political spectrum who agree that nuclear energy is an important part of this country’s energy mix and that the United States is losing ground as other countries proceed with planned expansions of their nuclear sectors.

Some of the familiar names among the CSIS nuclear energy commission include Lt. Gen. Brent Scowcroft, a Washington, D.C., policy insider who co-chaired the Blue Ribbon Commission on America’s Nuclear Future; two former NRC Chairmen, Dale Klein and Richard Meserve; ex-Constellation Energy CEO Mayo Shattuck III; retiring Duke Energy (NYSE:DUK) Chairman and CEO James Rogers and now-retired Tennessee Valley Authority (TVA) President and CEO Tom Kilgore.

AFL-CIO Building and Construction Trades Department President Mark Ayers was part of the group “until his untimely death in April 2012,” according to the document.

“The decline of the U.S. nuclear energy industry could be much more rapid than policymakers and stakeholders anticipate,” CSIS said in the report.

“Instead, current market conditions are such that growing numbers of units face unprecedented financial pressures and could be retired early,” CSIS, said in the report.

The outlook is much different in China, India, Russia, and other countries, where governments are looking to significantly expand their nuclear energy commitments.

“Without a strong commercial presence in new nuclear markets, America’s ability to influence nonproliferation policies and nuclear safety behaviors worldwide is bound to diminish,” according to the CSIS report.

“In this context, federal action to reverse the U.S. nuclear industry’s impending decline is a national security imperative. The United States cannot afford to become irrelevant in a new nuclear age,” CSIS said.

According to World Nuclear Association figures, Russia accounts for 37% of the new nuclear reactors planned and under construction. China is second with 28%; Korea is a distant third with 10%; France is fourth at 8% and the United States is next at 7%.

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.