Navigant Research Blog

Hurricane Highlights Nuclear Plants’ Vulnerabilities

— November 1, 2012

As Hurricane Sandy reached the height of its fury on Monday night, October 29, the Oyster creek nuclear plant in southern New Jersey went on “alert” – the third-highest of four levels of emergency action for nuclear generating stations in the United States.

The oldest operating nuclear plant in the country, Oyster Creek is about 40 miles north of Atlantic City, just a mile from Barnegat Bay, an inlet off the Atlantic Ocean.  It has been plagued for years by environmental protests and lawsuits, mostly relating to the hot water it discharges into the bay.  It’s the same design as the ill-fated reactors at Fukushima-Daiichi in Japan that were inundated in the March 2011 earthquake and tsunami.  Oyster Creek is scheduled to be shut down in 2019.

In anticipation of the storm, emergency crews from the Nuclear Regulatory Commission were dispatched to Oyster Creek, along with eight other nuclear plants on the Eastern Seaboard.  Officials with the federal government and with Exelon, the nation’s largest producer of nuclear power and operator of Oyster Creek, were less concerned about damage to the reactor itself than about keeping the spent fuel rods, stored in a large pool onsite, from overheating.  Intake structures and pumps take water from the creek and pump it through the plant to cool off both the reactor core and the spent fuel.  While there is backup power for the reactor cooling system, there’s none for the spent-fuel pool.

“Exelon … was concerned that if the water rose over 7 feet it could submerge the service water pump motor that is used to cool the water in the spent fuel pool,” reported Reuters.  In fact, the flood peaked at nearly 7-and-a-half feet, above the threshold, but the pump motors continued operating.

Vulnerable systems like this are in place at nuclear plants across the country, where fuel rods are often stored in large pools that must be supplied with a constant source of fresh water.  Without that supply, the pool could boil in a day thanks to the residual heat of the radioactive fuel rods.  That almost happened at Fukushima-Daiichi, and the spent-fuel pool at that plant remains at risk today.  Nuclear industry spokespersons were full of assurances in the last few days that such a thing could never happen in this country.  An Exelon spokesman said the company’s nuclear facilities have “multiple and redundant” cooling systems.  U.S. nuclear power is “a whole different ballgame” than the Japanese industry, maintained Tom Kauffman of the Nuclear Energy Institute.

It could in fact happen here, and judging from the high levels of water at Oyster Creek it nearly did.  A disaster of this magnitude highlights the central flaw of conventional nuclear reactors, which are largely based on technology nearly a half-century old (Oyster Creek went critical in December 1969).  As I explain in SuperFuel: Thorium, the Green Energy Source for the Future, nuclear plants are controlled by elaborate engineering systems, with backup diesel generators and supposedly fail-proof systems, to keep the reactor and the spent fuel pools cool in emergencies.  The nature of Sandy-caliber disasters, though, is that such systems often fail.  Our nuclear fleet is one major flood away from a full-on disaster, and major floods are getting more common yearly.  Meanwhile, inherently safe reactor technology, like the liquid-fuel thorium reactor, cannot melt down or overheat due to the design and the physics of the machine.

We’ve been hearing reassurances like the ones this week from the nuclear power industry for decades, but the machines themselves just keep getting older.


BrightSource a Bright Spot for Cloudy Solar Power Industry

— October 29, 2012

Earlier this year I wrote that the concentrated solar power (CSP) industry – which uses a solar thermal technology that has important advantages over solar photovoltaic panels, particularly for utility-scale projects – was reaching a “make or break point.” Judging from the recent news from CSP provider BrightSource Energy, the breaking point hasn’t been reached, and CSP just might make it big.

BrightSource, which uses a “solar tower” structure to heat water into steam, which is then used to produce electricity, announced it has received a new round of funding totaling $80 million.  Headed by Alstom and VantagePoint Capital Partners, the investors include Draper Fisher Jurvetson, Goldman Sachs, Chevron Technology Ventures, and BP Ventures.

As my colleague Peter Asmus has pointed out, BrightSource has a unique technology, an impressive lineup of investors (that also includes Google Ventures and industrial heavyweight Bechtel), and a healthy backlog of power purchase agreements (PPAs) with utility customers including Pacific Gas and Electric and Southern California Edison.  BrightSource’s Ivanpah project in the Mojave Desert will be the largest concentrated solar power installation in the world, totaling 392 megawatts at completion.  As we explained in our 2011 report, Concentrated Solar Power, BrightSource has also added energy storage (in the form of molten salt) to its CSP technology. “Storage significantly improves the value” of solar- thermal systems, Michael Peevey, the president of the California Public Utilities Commission, said at meeting this week at which two new BrightSource PPAs with utilities were approved. “Ratepayers’ long-term interest will be best served in my view by beginning to invest now in advanced technologies,” Peevey added.

In April 2011, BrightSource received a $1.6 billion loan guarantee from the U.S. Department of Energy.  The Oakland, California company provides a stark contrast to solar providers A123 and Solyndra, both of which went bankrupt after receiving federal funding under the Obama Administration’s clean energy stimulus.  So why isn’t Obama the candidate touting the success of BrightSource?

Part of the answer seems to be that the Obama campaign simply believes that clean energy, including advanced solar power, is too hot an issue (excuse the pun) to bring up between now and the election on Nov. 6.  Bringing up one success story – and a provisional one, at that, since BrightSource’s future is by no means assured – will not do much to counter Republican charges that the U.S. government should not be in the position of subsidizing clean energy at all.

That’s too bad, because BrightSource and the CSP technology it’s helping pioneer could provide an important boost for the beleaguered solar power industry in the United States.  As opposed to making and selling solar panels, a low-price, low-margin business, BrightSource’s big CSP installations are not easy for overseas rivals to duplicate.  And the company’s business model, supplying competitive, renewable energy to large utilities that are under government mandates to obtain one-third of their power from renewable sources by the end of the decade, assures it of a large and stable customer base.  BrightSource also has varied revenue streams: it built a 29 megawatt facility for Chevron in Coalinga, California to make steam for enhanced oil recovery.

According to documents filed with the SEC in preparation for a planned IPO earlier this year, BrightSource’s PPAs total more than $4 billion in long-term revenue.  In April BrightSource, citing adverse market conditions, called off its public offering, in a move that was seen at the time as another blow to the struggling solar power industry, indeed to the U.S. cleantech industry as a whole.  Given more recent developments, that now looks like a smart move.


Dangerous Myth of ‘Energy Independence’ Persists

— October 19, 2012

A new report commissioned by clean-energy VC firm Claremont Creek Ventures gives a hopeful version of the future of energy in the United States.  The U.S. can achieve full energy independence by 2025, the report (carried out by graduate students at the University of Michigan’s Erb Institute for Global Sustainable Enterprise) claims.

“With the right mix of technology, smart policy, and the collective intelligence of talented people – the same principles that got the United States to the moon in the 1960s – we can secure our energy future,” said Nat Goldhaber, managing director of Claremont Creek Ventures.

Getting to the moon was probably cheaper.  As shown in the chart below, this blessed state would be achieved mostly by replacing crude oil imports with natural gas, Canadian supplies of “tight” oil (i.e., shale oil), and the replacement of 10% of the internal combustion engine vehicles on the road today with electric vehicles.

(Source: Claremont Creek Ventures)

That last projection is most unlikely, according to the latest Pike Research report on Plug-in Electric Vehicles.  By 2020, we forecast, sales of all electric vehicles, including hybrids, plug-in hybrids, and battery electric vehicles, will be just over 400,000, or 2% of total light duty vehicle sales.  It will likely take another decade or more for EVs to reach 10% penetration.

As for replacing nearly 5 quads (a “quad” is a unit of energy equal to a quadrillion BTU) worth of crude products with Canadian shale oil, that brushes aside a barrel full of questions around politics and sustainability.  The real question here, though is: Do we really want to be energy independent?

Typically the term “energy independence” is used to mean “totally self-reliant for all domestic consumption of energy; free of imports.”  In both economic and sustainability terms, that is not the ideal state.  What America needs is not energy independence but energy diversity and security.

In purely economic terms, islanding ourselves from the global energy markets would mean we would almost certainly pay more for energy – the price of natural gas is artificially low in this country right now not only because we have abundant new domestic supplies of shale gas, but also because of the price difference between natural gas from fields in Gulf Coast and Rocky Mountain states, and gas from Europe.  Unlike the market for crude oil, the natural gas market is not fully globalized yet, mostly because of the difficulty and expense of compressing or liquefying NG for transport.  This state of affairs is temporary, and that’s a good thing: rational, transparent market structures benefit everyone in the long term, and being the low-cost source of energy is not a recipe for long-term prosperity.  As for crude oil, the price – in political capital, in dollars, in environmental sustainability, and in the opportunity cost of not developing alternative resources – of importing oil from low-cost overseas producers is likely to remain lower than the true price of extracting dirty shale oil and shipping it by pipeline south to Oklahoma and the Gulf Coast.

When people say “energy independence,” what they often mean is “stopping imports from the Persian Gulf.”  It’s important to remember that, as the graph below shows, imports from Saudi Arabia, at about 1.2 million barrels a day (mbbl/d), accounted for less than 14% of U.S. crude oil imports in 2011.  The other top five importers to the United States are Canada (at 2.2 mbbl/d, by far our largest source of crude), Mexico, Venezuela, and Nigeria.

(Source: EIA)

There are reasons of morality, economics, and statecraft to reduce imports from all of those countries, with the possible exception of Canada.  But, speaking plainly, we will pay a financial price for doing so.  And so far, neither politicians nor the American public have shown a willingness to pay that price.

“Even though it may feel good to say that we’re on track to be a net exporter of energy, it has not had the benefits we were promised,” wrote Andrew Holland, a senior fellow at the nonpartisan American Security Project, earlier this year on the release of the Project’s annual white paper, “America’s Energy Choices.” “Our consumers are still stuck paying the global price for oil – set by the whims of speculators and the most recent threat of war in Iran. Our energy supply is still insecure, economically unstable, and environmentallyunsustainable.”

All of those qualities – security, economic stability, and sustainability – are way more important than mere “energy independence.”


A Pair of MIT Scientists Try to Transform Nuclear Power

— September 27, 2012

Leslie Dewan and Mark Massie are Ph.D. students in nuclear engineering at MIT.  For most of their peers, the options upon graduating are pretty simple: teach, or work for one of the national labs.  Dewan and Massie, though, decided on an unconventional path: like a couple of Stanford grads, they’ve formed a start-up.  Incorporated in 2011, it’s called Transatomic Power, and its mission is to transform the nuclear power industry.

Transatomic’s product is called a “Waste Annihilating Molten Salt Reactor.” If you’ve read my book, SuperFuel, you’ll recognize it as an update on an old reactor technology that was pioneered at Oak Ridge National Laboratory, in the 1950s and 60s.  SuperFuel focused on another type of molten salt reactor, a Liquid Fluoride Thorium Reactor, or LFTR.  Dewan and Massie’s design is fuel-agnostic in the sense that it can run on either uranium or thorium; as the name implies, its signal feature is that it can consume spent fuel from conventional light-water reactors.  Transatomic joins a growing list of start-ups, including Flibe Energy, that are trying to revolutionize nuclear power by bringing back alternative fuels, including thorium, and alternative reactor designs.

(A quick note on the uranium fuel cycle: Most uranium in the ground is the isotope uranium-238 (U238), which is not fissile, and thus is no good for producing power.  Conventional reactors require fuel in which the percentage of the isotope U235 has been enriched up to 3% to 5%, or “reactor-grade” uranium.  Uranium that is enriched to around 20% U235 is weapons-grade.  That’s why it’s a relatively easy step for countries with enrichment capability, like Iran, to build nuclear weapons programs.  Thorium requires no enrichment.)

‘A Leapfrog Move’

“Nuclear power is in a cul de sac,” Russ Wilcox, the CEO and co-founder of Transatomic, told me in a phone interview.  “The nuclear industry knows it’s in trouble, it’s not quite sure what to do, and it’s just trying to survive for the moment.  It’s a fabulous time to do a leapfrog move.”

Wilcox was one of the founders of E Ink, which commercialized electronic paper materials originally developed at MIT’s Media Lab and ended up licensing the technology to Amazon, for the Kindle, to Barnes & Noble’s Nook, and so on.  E Ink was sold to Taiwanese company Prime View for nearly half a billion dollars in 2009. Transatomic’s plan is to build a prototype reactor in 5 years, commercialize the technology in 15 years, and have reactors come online by around 2030.  The company doesn’t plan to build and operate nuclear power plants, but to license its reactor technology.

Molten salt reactors (MSRs) can achieve much higher burn-up factors than conventional uranium reactors.  In other words, while conventional reactors harness only around 3% of the available energy in a given volume of uranium, MSRs can capture much higher percentages – up to 98%, according to Transatomic (I should note that the nuclear experts I consulted for SuperFuel believe that burn-up factors of 50% are more realistic).  Beyond that, the company is not releasing details of its patented reactor technology.

Liquid-fuel reactors, such as MSRs, also offer inherent safety advantages: because the fuel is liquid, it expands when heated, thus slowing the rate of nuclear reactions and making the reactor self-governing.  Also, they’re built like bathtubs, with a drain in the bottom that’s blocked by a “freeze plug.”  If anything goes wrong, the freeze plug melts and the reactor core drains in to a shielded underground container.  Essentially, if Transatomic’s design works as advertised, MSRs could solve the two problems that have bedeviled the nuclear power industry: safety and waste.

Noting that China plans to build a liquid-fuel reactor (likely powered by thorium) within 5 years, Wilcox says that he and Dewan and Massie – currently the entire staff of Transatomic – would prefer to build the prototype MSR in the United States, but will consider another country if the licensing or financing proves too difficult here.  (The Nuclear Regulatory Commission recently licensed a two-reactor nuclear plant in Georgia, the first new reactors to be licensed in this country since 1978.  The reactors are conventional light-water uranium powered models.)

In SuperFuel I noted that the nuclear power industry has a generational problem: most of the leading executives in the industry are now in their 60s.  It will take a new generation of scientists and technologists to spark a revival in nuclear power technology.  Transatomic Power is an encouraging sign that this is beginning to happen.


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