Energy In Georgia Part II: Powering The State

Increased governmental incentives, rising natural gas prices and concern over global warming are dri

The first person to tame and domesticate energy was most likely a hominid who shambled back to his ancient campsite clutching a flaming branch, lit from a pile of sun-fired underbrush, or perhaps lava from a volcanic eruption.

Today’s domestic energy is generated in multimillion-dollar plants, fueled by coal, gas or, quite often, the splitting of atoms.

Nuclear energy, an industry that was almost killed in the United States following the Three Mile Island fiasco, seems to be poised for a major revival, and that’s the focus of this second part in our three-part series about energy in Georgia.

Last month we looked at liquid natural gas and its role in Georgia’s energy portfolio. Next month we’ll check out alternative and renewable forms of energy, and the need for conservation and greater efficiency in an age when energy demand is outpacing our population growth.

“I think we really are in an energy crisis,” says Mike Garrett, CEO of Georgia Power, whose customer base grows by 40,000 a year. “When we’re talking about meeting the growing energy needs of Georgia, we’ve got to have a plan and a back-up plan, because the law of supply and demand doesn’t take a day off.”

The Plant Vogtle turbine building, large enough to be measured in football fields, is hot and loud, screaming like the inside of a jet engine. Behind us in the containment buildings, nuclear reactors heat pressurized water, ultimately creating the steam to drive the turbine’s giant propeller blades, which spin the generator.

“And this is where electricity comes from,” says Jeff Gasser, shouting above the roar as controlled lightning bolts outside to the transformers, then into the grid that underpins modern civilization.

The electricity flows out from here, a surging, invisible river of energy washing over Georgia. Together, Vogtle’s two reactors can produce about 2,400 megawatts of electricity – more than 11 percent of the state’s needs, or enough juice to power almost 2 million homes.

“It takes a large heat source to make a large amount of electricity,” says Gasser, chief nuclear officer for Southern Nuclear Operating Company, the Southern Company subsidiary that runs Vogtle. “In this case, the heat comes from split uranium atoms in the reactor vessel.”

One black uranium fuel pellet, the size of a fingertip, provides as much energy as 149 gallons of oil, 17,000 cubic feet of natural gas and more than 1,700 pounds of coal. But unlike those fossil fuels, which generate the bulk of Georgia’s and the nation’s electricity, nuclear power reactors like Vogtle’s do not emit greenhouse gases – which is why proponents of nuclear power are touting it as the logical answer to address global warming and feed our ever-growing appetite for electricity.

The environmental angle is one of the charms now being wielded by the energy industry to breathe life back into nuclear energy, especially since a handful of notable conservationists, such as Britain’s James Lovelock (author of The Revenge of Gaia) and Greenpeace co-founder Patrick Moore (now estranged from the organization) are supporting nuclear power as a means to counter global warming.

But more than anything else, a favorable political climate that has facilitated increased government incentives, plus the rising price of natural gas, are driving the nuclear revival.

“It’s a combination of things, really,” says Mike Garrett, CEO of Georgia Power, the Southern Company subsidiary that has majority ownership of Vogtle (Oglethorpe Power – OPC – Municipal Electric Authority of Georgia – MEAG – and Dalton Utilities are the other owners). “The question is, what is the most economical plant you can build. You look at gas prices, the cost of coal and its environmental controls, and it clearly brings nuclear power back into the picture.”

It’s taken about 30 years to bring nuclear power back into anyone’s lens, but the focus is definitely there. Southern Company filed for an Early Site Permit with the U.S. Nuclear Regulatory Commission (NRC) in August – Georgia Power is hoping to build two new reactors at Vogtle, a few miles from Waynesboro on the Savannah River.

Georgia Power would still need ap-proval from the Georgia Public Service Commission (PSC) before making a decision to build the units, but the company could receive a license from the NRC to construct and operate a plant by 2010, and have new nuclear generation sparking porch lights across the state by 2015.

“That’s the best case scenario for us being able to turn the handle in the nuclear plant and say, ‘OK, here’s more power,'” Garrett says. “Until then, we’re at the mercy of coal and natural gas. I don’t see another technology out there that can replace any of those to meet our growing electricity needs. I always thought that eventually coal and natural gas were going to play out and this country was going to go to nuclear. I’ve been disappointed that it’s taken as long as it has.”

The expense of nuclear projects, a wary investment community and exaggerated predictions for electricity demand in the 1970s moved the industry toward a decline that was hastened by the near meltdown in 1979 at Three Mile Island (TMI) and the deadly radioactive steam explosion at Chernobyl in 1986.

After all of that, Garrett says, “Nobody in their right mind was going to get into the nuclear business.”

Nobody did.

The NRC last approved a plant for construction in 1978. Some facilities, like Vogtle, approved before TMI, faced endless construction roadblocks and cost overruns in the wake of steadfast public opposition and increased regulations. Vogtle’s cost skyrocketed from an estimated $660 million to $8.87 billion (including finance charges), resulting in a massive electricity rate hike.

“From an economic perspective, nuclear energy is very risky business,” says Stephen Smith, executive director of the nonprofit Southern Alliance for Clean Energy (SACE), a vocal antinuclear leader. “Risky for individual ratepayers and businesses. I just hope the PSC doesn’t develop amnesia and forget what happened last time.”

By comparison, Georgia Power built its other nuclear facility, Plant Hatch (near Baxley), for about $1 billion. Those units opened in 1975 and 1979. Vogtle’s reactors, built on a 3,150-acre site, went online in 1987 and 1989 and have been feeding the grid ever since.

Flick Of A Switch

The lights went on in Atlanta in 1884, when the Georgia Electric Light Company built a 940-kilowatt generating plant on Marietta and Spring Streets. Today, Georgia has more than 37,000 megawatts (MW) of generation capacity – about 40,000 times the wattage of that old Atlanta plant. Georgia Power alone generates more than 15,000 MW. There are 14 independent power producers that generate in excess of 10,000 MW. But the largest single producer after Georgia Power is Oglethorpe Power Company, which owns 4.744 MW of generation.

OPC is owned by, and supplies energy to, 38 of the state’s 42 electric membership corporations (EMCs). With $1.2 billion in revenues and $4.8 billion in assets (2005 figures), OPC is the largest electric cooperative in the United States, owning several generation plants outright and co-owning (with Georgia Power, MEAG and Dalton) several others, including the nuclear facilities Vogtle and Hatch. OPC, with roots going back to the Rural Electrification Administration, serves 73 percent of the state’s land mass and a rapidly growing customer base of more than 4 million.

“There’s a real sense of urgency in the industry because of the pressure of rapid growth,” says Tom Parker, vice president of external affairs and member relations for Georgia Transmission Company (GTC), which was spun out of OPC almost 10 years ago; it is owned by, and transmits electricity to, 39 EMCs.

“I used to serve on the board of my local EMC (Coweta-Fayette EMC), about 20 years ago,” Parker says. “We had about 19,000 members. It’s more than 70,000 now. Population growth is the major issue for us, it drives everything.”

With larger homes, hotter summers, more personal electronics, business growth and more gas-guzzling SUVs, Georgia’s energy consumption has far outpaced its population growth – pretty much like the rest of the nation. From 1984 to 2004, Georgia’s population grew 51 percent (from 5.8 million to 8.8 million), while energy consumption increased 76 percent.

Absent any meaningful effort toward energy efficiency on the part of the energy industry and/or its clientele, no one expects that exponential demand growth to slow down in the near future. Expect the state’s 17,500-mile web of transmission lines only to get thicker.

GTC typically builds about 70 miles of transmission line a year at a cost of $100 million, but is planning to build 60 substations and more than 300 miles of line over the next four years. Also, over the next seven to eight years, GTC and Georgia Power plan to build the state’s first large bulk lines (500 kilovolts) since 1985, mainly in east central and northeast Georgia.

GTC, Georgia Power, MEAG and Dalton Utilities are partners in the Integrated Transmission System, one of the nation’s few statewide transmission systems. Individual participants own and maintain their lines and substations, but the consortium shares the infrastructure, planning and operating as one system.

“This state has done a great job of investing in the infrastructure to ensure reliable, affordable electricity. The issues they’ve faced, blackouts and brownouts, in California and New York, are infrastructure,” says Mike Smith, Georgia Transmission Company’s CEO. “In Georgia, there’s no redundancy in planning, you have everyone planning together, five to 10 years ahead. It takes out the competitive element and replaces it with a coordinated effort that has worked well for Georgia.”

Not to mention that in Georgia (one of the few states that grants eminent domain privileges to the energy industry), the regulatory climate has been historically kind when it comes to transmission line construction.

With Georgia’s population expected to approach 12 million by 2025 (more residents, more houses, more private property owners), Smith and fellow industry leaders worry that it could mean more regulation, or more legal battles between communities and energy companies over eminent domain – the lawful power to appropriate private property without the owner’s consent.

When siting for transmission lines, GTC has kept its use of eminent domain pretty low (about 2 percent of the company’s right-of-way acquisition was contested in court in 2005). Nonetheless, the company says it has taken steps to avoid the eminent domain hassle as much as possible. Together with the Electric Power Research Institute, GTC conducted a two-year power line siting study that involved more than 400 officials from government agencies, utilities, environmental and neighborhood groups.

But new transmission lines only transport electricity. They can’t generate it. At some point, the power brokers say, you have to make more.

“Our dilemma is, we haven’t built much in the way of base load generation in the last 20 years,” says Tom Smith, Oglethorpe Power’s CEO. “Our projections indicate we’ll need facilities that run all of the time, more base load facilities. And right now our options are limited.”

Base load plants provide a steady flow regardless of grid demand. These plants, usually powered by coal or nuclear energy, run all the time, except during repairs or scheduled maintenance, as opposed to peak plants, which run only

when there is high demand for electricity. (Georgia’s peak plants are typically natural gas fired.)

“Nuclear may be the most expensive facilities to build up front, but you make that up with the lower operating cost over time,” says Oglethorpe CEO Smith. “The thing is, nuclear energy has a stigma attached to it.”

For one, there’s the question of radioactive waste. Where do you put it?

Can’t Touch This

The spent fuel rods from Vogtle’s reactors stand at attention in a grid at the bottom of a pool, beneath 20 feet of protective water, without which those here at the plant would be dead before reaching the exit. Poolside lights cast their beams downward on the still water, giving the room a science fiction glow.

This is the way most spent nuclear fuel is stored in the United States. The rods are moved mechanically from the reactor cores, through water canals to what was designed to be a temporary resting place. Long-term storage of nuclear waste doesn’t exist yet, although the U.S. Department of Energy (DOE) has set an opening date of March 31, 2017 for the long-awaited nuclear waste dump at Nevada’s Yucca Mountain, meant to hold at least 77,000 tons of waste for thousands of years.

“Utility customers in the U.S. have spent over $20 billion for this facility. The federal government has spent $14 billion or so studying Yucca Mountain,” says Lou Long, vice president of technical support for Southern Nuclear. “It’s the most studied piece of real estate known to man.”

The DOE has been trying to develop the site as the nation’s first repository for nuclear waste for 20 years, but the project has been delayed by, among other things, lawsuits, funding shortfalls and less than stellar research by government scientists (forcing their work to be redone). Also, Nevada’s entire congressional delegation strongly opposes the dump.

Twenty years later, Yucca Mountain is still like Atlanta morning traffic: Expect delays.

Meanwhile, more than 50,000 tons of highly radioactive nuclear waste is waiting for a permanent resting place that the federal government, by contract, is obligated to dispose of but can’t, because there’s no place to put it.

“There are a few nagging questions in my mind regarding nuclear power,” says Public Service Commissioner Angela Speir. “One is the cost to build a plant. Of course, once it’s built there are virtually no harmful emissions, and it’s cheap generation. But then there’s this huge issue of radioactive waste.”

Georgia’s antinuclear activists fear it will fester at Georgia’s plants, or possibly across the river from Vogtle, at the Savannah River Site in South Carolina.

“This could be a very bad deal for Georgia and the Southeast,” says Stephen Smith of SACE. “If we build nuclear power plants, will the radioactive waste be shipped out on our highways, or across the river? Or will it just sit in our backyard?”

Before those questions are answered, the radioactive resurgence is here. The nation currently has 103 nuclear reactors for energy. The race for number 104 has begun.

Last year, shortly after the Energy Policy Act of 2005 was signed by President Bush, three companies filed Early Site Permit applications. This past August, during a visit to Georgia Power headquarters in Atlanta, DOE Secretary Samuel Bodman put the final touch on the $2 billion federal risk insurance for companies building the next six nuclear power plants in the United States (to cover costs associated with regulatory or litigation delays that stall construction) – this assurance in addition to the 50-year-old Price-Anderson Act, which indemnifies the nuclear industry against liability claims arising from nuclear incidents.

Two weeks after Bodman’s visit, Southern Company became the fourth company to file its ESP application, all 3,149 pages of it, at a cost of $51 million.

So Far, So Good

“The main reason we’re talking about new nuclear power plants is because we’ve learned how to operate the daggum things so well,” says Lou Long, an apostle of the new nuclear age.

Using decades-old technology, Vogtle has a solid record. Plant Manager Tom Tynan says he feels safe at his job. It isn’t just because of the increased security measures following 9/11, the elevated guard turrets on building corners, protective walls, razor-wire fences, security officers built like NFL linemen. It’s the staff’s expertise.

One of the results of Three Mile Island was the level of training employees receive. Operators spend 20 percent of their time training and re-training. Security personnel get more training than FBI agents.

And if, or when, Vogtle does get its two new reactors, they won’t be like the dinosaurs currently in use. One of the streamlined effects of the nuclear revival is the standardized design concept of next-generation plants, such as the Westinghouse AP1000 – Southern Company’s model of choice, already certified by the NRC. “It’s a generic, out of the box Model T you can put virtually anywhere if you find an approved site,” Long says.

The new plants are smaller, with passive measures using natural forces – such as gravity – bringing water down from above to cool the reactor core. The idea is: Fewer pipes, fewer pumps driven by diesel generators, less to go wrong.

Also, constructing the new reactors would not require a small city of workers, like the 13,000-plus who built Vogtle. According to Long, 30 to 40 percent of the AP1000 would be built off site and shipped as modules, requiring a much smaller workforce.

“We were the general contractor when Vogtle was built,” Long says. “This time, Westinghouse would be responsible for the entire construction. That means they’re accountable and have all the incentive to do the job for the price they give us.”

Estimated cost: $2 billion per reactor. Actual cost: Guess.

“Now, I’m not saying there still aren’t huge challenges in defining the cost of a nuclear power plant,” Long says.

Nothing is assured. Georgia Power and Southern Company may never generate another watt of electricity using nuclear energy. Or they may.

“If I want to go and build a nuclear reactor, I have to go to my boardroom and say, ‘This is what it’s going to cost, this is how long it’s going to take to build it, and this is the design everyone agrees on,'” says Georgia Power CEO Garrett. “And then I have to assure them it’s not going to turn out like the last one. That’s what keeps me awake at night.”