By Russell Ray, Managing Editor
For U.S. power generators, 2012 should be a momentous and decisive year.
The New Year began with tremendous new challenges for the country’s fleet of coal-fired power plants and a major shift in momentum for nuclear power.
Last month, the Environmental Protection Agency unveiled sweeping new rules requiring the producers of fossil-fueled electricity to install maximum achievable control technologies such as scrubbers and baghouses to limit mercury and other toxic air emissions. Utilities have three years to comply.
The problem is this: It takes three to six years to plan, finance, permit, construct and install these kinds of projects.
What’s more, the EPA estimates the new rules will create $10 billion in new costs for energy production, a price that will be passed on to consumers in the form of higher electricity rates.
The new rules will force the industry to retire at least one unit at more than 30 coal-fired power plants in 12 states, according to a survey by The Associated Press. Those units account for nearly 13,000 MW of capacity. Another 11,000 MW are at risk of being shut down due to the costly new rules, the survey showed.
The loss of capacity could cause electricity to become less reliable, depending on the amount of new generation the industry builds in the next few years.
If a utility hasn’t already started to plan for emission control upgrades, their chances of complying on time are next to nil under the new rules. U.S. lawmakers are rightly working to mitigate the compliance costs through legislation that would extend the compliance date by two years to 2017. An extension of the compliance date represents a reasonable compromise that achieves balance between the economics and the environment.
David Walsh, senior vice president of Mitsubishi Power Systems, put it this way during the keynote session at POWER-GEN International last month in Las Vegas, Nev.
“The bigger issue is the timing as opposed to the nature of the regulations,” Walsh said. “Most of our owners really struggle with the imposition dates of being in compliance. We still need in this country 24 to 30 months to build a combined cycle plant. The timing doesn’t really allow for displacement. That’s probably the single biggest issue.”
Another major development for power producers came last month from the Nuclear Regulatory Commission. The commission approved the design of Westinghouse Electric’s AP1000 nuclear reactor, a safer, simpler and more passive design that utilities plan to use at several sites in the U.S., including Georgia, South Carolina, North Carolina, Alabama and Florida.
The Westinghouse reactor would limit mechanical error because it has 80 percent less cable, 80 percent less pipe, 50 percent fewer valves and 35 percent fewer pumps than existing reactors. The new design means the plant will be less reliant on mechanical means to move water through the cooling system. Instead, the new reactor uses gravity, natural circulation and compressed gas to keep the core and containment from overheating.
After last year’s meltdowns at the Fukushima Daiichi nuclear plant in Japan, approval of the Westinghouse reactor appeared uncertain as the NRC and the rest of the world reevaluated the safety of nuclear power. Ten months after the disaster at Fukushima, it is now clear that the events that led to the meltdown in Japan are thoroughly covered by existing regulation in the U.S. and Canada.
“We think we have today the right standards in place,” Elmo Collins, NRC regional administrator, said during the keynote session at POWER-GEN International. “We have provisions in place for a loss of all AC power.”
The Tsunami that struck Japan’s Fukushima plant on March 11, 2011, exceeded the plant’s design standards, knocking out all power to the plant’s cooling systems. The AP1000 reactor is designed to keep the core cool without electrical power or pumps.
NRC’s approval of the Westinghouse reactor should help restore America’s confidence in nuclear power. It won’t lead to the long-promised “nuclear renaissance.” Competition created by low-priced natural gas and rising construction costs will continue to dissuade utility executives from pursuing nuclear expansion. But NRC’s decision to approve the design means nuclear power will be a major element in the country’s plan to meet demand with cleaner energy.
Florida Power & Light plans to install two AP1000 reactors at its Turkey Point nuclear complex. The utility expects to secure a license for both reactors by June 2014.
“Even with no operator action and a complete loss of all on-site and off-site power, the AP1000 will safely shut down and remain cool for up to 72 hours, allowing significant time for restoration activities,” said FPL spokesman Michael Waldron.
For power generators in the U.S., it has become abundantly clear that the disaster at Fukushima will not lead to costly new rules governing the safety of nuclear power.
A few checks and balances recommended by the NRC’s Near-Term Task Force will be incorporated into new standards for the nation’s fleet of reactors. But it appears that the added oversight won’t cause capital and construction costs to soar, as some predicted. The free marketplace for concrete, steel, copper and labor will have a much greater impact on construction costs than the new requirements by the NRC.
While 2011 posed great new challenges for power generators, it appears that 2012 could be even more challenging. Power Engineering magazine will be even more relevant as the industry searches for solutions and adapts to a rapidly changing marketplace. Power Engineering promises to provide the industry the information and the tools it needs to adapt to this evolving market.
As the new managing editor of Power Engineering, I look forward to hearing your ideas and feedback.
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