Aucbvax.1400
fa.energy
utzoo!duke!decvax!ucbvax!OAF@MIT-MC
Sat May 23 13:32:29 1981
energy digest
Clipping service - Nuclear Industry series part 4.
Environmentalists & anti-technology types
----------------------------------------------------------------------
Date: 19 May 1981 20:40 edt
From: Schauble.Multics at MIT-Multics
Subject: Clipping Service - Nuclear Industry Series, part 4
To: energy at MIT-AI
This is the fourth in a many part transcription of a Phoenix Gazette
series on Three Mile Island and the nuclear industry. All material is
by Andrew Zipser, Gazette reporter.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Palo Verde
Struggling with criticism, cost, and consumption
Nuclear scientists and engineers have always had difficulty
explaining to the public in simple terms their complex subjects.
The critics' cry that nuclear power is "unsafe, uneconomic,
unreliable, and unnecessary" is forceful rhetoric that proponents
can only respond to with hour-long discourses.
It is unfortunately true that effectively "answering the critics
is like having first rebuttal to the cry of fire in a crowded
theatre."
-- from <NUCLEAR AND THE ENVIRONMENT POWER>, a publication of
the American Nuclear Industry.
The size of it is overwhelming.
This is the first impression. Of massive concrete structures,
megaliths thrust into the desert floor. Of sky cranes like giant
praying mantises. Of acre upon acre of equipment and supplies, such
as reinforcing bars as thick as a man's wrist.
Five years in the building, the Palo Verde Nuclear Generating
Station is destined -- for however brief a time -- to be the nation's
largest. Sitting in the desert 50 miles west of Phoenix, each of the
three reactors will have a generating capacity of 1,270 megawatts,
half again as much as the output of the biggest coal-fired generators
at Four Corners
Numbers that dwarf the imagination abound. Excavation and grading
of the site require moving 6.6 million cubic yards of dirt; the
concrete to be poured amounts to two-thirds of a million cubic feet.
More than one million feet of pipe will be needed, and almost 15
million feet of electrical cable.
Each of the containment buildings -- the domed structures that
house the reactors -- is 244 feet high and 154 feet in diameter. The
concrete slabs on which they sit are 11 feet thick.
The scale of things is so immense that the men who work here are
dwarfed by their creation. Standing on the scaffolding that embraces
one of the containment buildings, they look like insects ensnarled in
a giant spider's web. Against the harsh sterility of the cement and
steel, they are as out of place as bacteria in an operating room.
What did the Egyptians feel like when they contemplated their
first pyramid? Did they marvel at the number of blocks of stone? At
the height and bredth of their creation? At the very enormity of
their vision?
Or did they seek to humanize their work, as the men here have done
with the graffiti that adorns virtually every temporary plywood and
plastic screen? Is there, buried in the recesses of a vast Middle
East tomb, a slogan comparable to the one that reads "Free Electrons"?
----------
The Palo Verde vision was born a decade ago, when the state's
three largest electric utilities -- Arizona Public Service, Salt
River Project, and Tucson Gas and Electric -- took the first steps to
plant the peaceful atom in the Sonoran desert.
The years that followed were far from uneventful. Numerous
wildcat strikes disrupted the construction schedule, pushing
completion of the first unit from an inititial forecast of 1981 to
May of 1983. A power struggle within the International Brotherhood of
Electrical Workers ended in a shooting. State and federal officials
probed allegations that 20 percent of the work force was made up of
illegal aliens, hired by union officials who received kick-backs in
return.
The consortium's makeup fluctuated. Even before construction had
started the Tucson utility announced it was reconsidering its
participation. By 1975 it had decided to sell its 16 percent share to
Southern California Edison Co., claiming the project was too
expensive and its electric load not growing fast enough to justify
the expense. SRP, initially an equal partner with APS (each had a 29
percent share), eventually decided to transfer a fifth of its
ownership to a Los Angeles utility; in May it will decide whether to
sell even more.
Perhaps the greatest reversal occurred in 1979, two years after
APS had announced it would build yet another two units, this time in
partnership with several California utilities. Blame for the
cancellation was placed on the California regulatory agencies, which
APS president Keith Turley said had made it "impossible" for the
California participants to continue.
The California regulatory agencies, for their part, said the APS
statement was "an excuse to extricate itself" from a bad decision and
was an attempt "to blame us for what appears to be an uneconomic
project." Southern California Edison Co. further hinted that APS may
have acted too hastily, claiming it could have gotten the regulatory
approval it needed.
And protests against the project were frequent, if less dramatic
than those held elsewhere. A candlelight vigil greeted the first
reactor vessel as it crossed the Mexican border at Rocky Point.
Demonstrations were staged at the site itself, resulting in the
arrest of up to 71 people at a time. Nuclear opponents have protested
bitterly against surveillance by both APS and by the Maricopa County
Sherrif's Department. Last year someone stole a tractor from a
construction site, then rammed it into and toppled a transmission
tower, causing damage estimated at $150,000.
The war was fought at the ballot box, too. An anti-nuke group
called Arizonans for Safe Energy managed to get an initiative on the
1976 ballot that would have imposed a set of stringent requirements
before Palo Verde could be allowed to operate. Even proponents of the
measure admitted its success would effectively end the project.
Turley, observing that Palo Verde was designed to supply 26 percent
of the state's needs, added, "If we don't have nuclear we can meet
only 74 percent of the needs of the people. The question is, who's
the 26 percent who's going to sit in the dark?"
That argument -- and an estimated $700,000 spent by the utilities
to fight the measure -- was convincing enough. Arizona's voters
rejected the initiative by a 3 to 1 margin, then did the same to a
modified version of the same measure four years later.
And then there was Three Mile Island. Within days of the
incident, as much of the nation suffered a case of nuclear jitters,
Turley appointed a special task force to find out what the
probability of a similar accident disabling Palo Verde. Six months
later the task force had a preliminary report ready: while the plant
had several potential safety problems, it said, there were several
significant design differences that made a TMI type of accident
unlikely, if not impossible.
And when it finished its work last summer, the task force
reported that remedial action was being taken to correct the problems
it had found and that Palo Verde "can be operated safely and reliably
if the project is completed as planned." Nevertheless, it added, "the
tasks that must be accomplished within the next 2.5 years are
numerous and complex and will require the constant, dedicated
attention of executive management."
----------
Throughout its turbulent history the Palo Verde plant has had to
be defended against other, more abstruse attacks. If protests and
initiatives can be countered with police action and publicity
campaigns, questions about load projections and economics are far
more slippery to counter and much more open to argument.
The question of how much it will cost to build Palo Verde and how
economical it will be to operate has been a particularly troubling
one. Back in 1978, just before inflation had become a serious
concern, APS had pegged construction costs at $2.8 billion. Today,
suffering not only from inflation but from the crippling effects of
work stoppages and delayed construction, that figure has jumped to
$3.62 billion. What it will be three years from now, when the second
unit is scheduled to come on line, remains to be seen.
Such uncertainties, however, are not peculiar to the Arizona
project. Three years ago the U.S. House committee on Governnment
Operations issued a report that concluded that most nuclear utilities
were experiencing cost overruns of at least 100 percent. "Nuclear
capital costs had been seriously underestimated in the past," it
noted, "and the gap between estimated and actual costs is still
growing."
Nor does the $3.62 billion figure include several factors that
some Palo Verde critics insist belong to an accurate assessment, such
as interest on loans, taxes, fuel costs, and the cost of
decommissioning. Any of these factors, if added to the baseline cost
of construction, would result in a significantly higher figure.
One way to compare the economics of power plants is to express
them in terms of the cost per kilowatt capacity. In the mid '70s, for
instance, APS was forecasting a cost per kilowatt of approximately
$550 to $700. Today, that estimate is up to $965, and if interest and
taxes are added the total jumps to $1,432 per kilowatt of capacity.
Other factors also affect the bottom line and are even more prone
to miscalculation. There is the question of fuel cost: while nuclear
plants are significantly more expensive to build than their
coal-fired counterparts, their attraction has been the much lower
cost of the fuel equivalent. Yet uranium costs have fluctuated widely
in the past decade, from a low of $8/pound to more than $40.
A separate yet significant part of the fuel cost is the problem
of waste disposal. Present plans call for storing this waste on site,
in deep storage pools, until the federal government decides what to
do with it. The costs of a permanent solution will become part of the
fuel price tag -- yet without a final answer, utilities like APS can
only guess at how much it will be. One estimate, made by the
Department of Energy in 1978, pegged it at approximately 6 percent of
total power costs; the Natural Resources Defense Council responded
with an estimate up to seven times greater.
Another factor to be figured into cost estimates is the reactor's
reliability: an inexpensive plant or cheap fuel will still be money
wasted if the plant can only run 10 percent of the time. Energy
analysts, when discussing this aspect, use a measuring stick known as
a plant's capacity factor. Here, too, there is room for disagreement,
with estimates of the nuclear industry's average capacity factor
ranging from 55 or 56 percent to a high of 65 percent.
Whatever the actual number may be, APS estimates for Palo Verde
are considerably higher still. Ed Van Brunt, APS vice president for
nuclear projects management, say Palo Verde will operate at a 75
percent capacity factor and concedes, "We are saying we'll be
significantly better than the industry average."
The difference, Van Brunt says, can be attributed to the lessons
learned from experience -- in this case the experience of other
utilities that have had reactors for several years. Those lessons
have resulted in design changes, primarily in steam generator and
turbine design, which APS estimates will result in less downtime for
maintenance and repairs.
As for the conclusions of some studies questioning capacity
factors for large plants, Van Brunt dismisses those as being of
dubious validity. "There are people who have done studies who contend
that capacity factors drop with time, that they drop with the size of
the plant," he acknowledges.
"But," he adds, "I don't believe those views are correct."
Finally, there is the question of decommissioning. Each of the
units at Palo Verde has a 40 year life expectancy. What will happen
to them when their job is over? Who will pay for their disposal, and
how will that job be financed?
The answer to each of these questions is that nobody knows,
although it is reasonable to assume that the burden will be picked up
by the rate payers -- and should, some have argued, be included in
overall cost estimates of the plant. Here, too, the problem is
similar to disposing of high-level wastes: since no one has yet
decided which of several decommissioning methods to use, estimates of
how much the procedure will cost are only educated guesses.
Monte Canfield, director of the energy and minerals division of
the Government Accounting Office, summed up the problem at a hearing
of the House Commission on Government Operations: "You don't know
what the costs are until you know what the standards are, and you
don't know what the standards are until you develope guidelines. And
you don't know what the guidelines are until you know whether or not
you are going to have a disposal site; and you don't know where the
disposal sites are so you can't figure it out.
"And," he added, "certainly the nuclear industry is not going to
do it for you."
APS's guess, despite such reservations, is that dismantling all
three units will cost $57 million in 1979 dollars. An NRC estimate
has pegged the cost at $70 million. And the GAO, having admitted
there are few guidelines from which to draw conclusions, has
nevertheless concluded that dismantling will amount to 10 percent of
construction costs.
What does it all add up to? APS, and the industry as a whole,
maintains that nuclear plants will still produce electricity more
cheaply than any of the fossil-fuel alternatives. In 1990 dollars,
Van Brunt says, it will cost APS 5.3 cents for every kilowatt hour
cranked out by Palo Verde, compared to a cost of approximately 7
cents for every kilowatt hour produced by Cholla-4, a coal fired
plant that will come on line this year.
The skeptics, noting the above uncertainties and omissions, have
remained unconvinced.
----------
The Palo Verde utilities have also had to wrestle with a
different set of numbers, and here, too, it's been rough going: how
much electricity will Arizonans need, and how best to meet that need?
If our nation's currency has been buffeted by inflation, energy demand
estimates have been equally subject to sharp dislocations, caused
partly by changing migration patterns and partly by changes in energy
use.
When Palo Verde was still only an idea, for instance, APS was
predicting the first unit would have to be on line by 1981. Five
years ago, when voters had to decide on an initiative which, in
effect, would have ended further construction, APS was warning that
the measure's success would cause power brownouts by the summer of
1982.
Today the utility acknowledges neither forecast was accurate --
but neither were they scare tactics, according to Mark De Michele,
APS vice president of corporate relations.
The problem APS and every other utility has faced, De Michele
explains, is the long time -- now estimated at 13 to 14 years for
nuclear plants and about 10 years for coal-fired ones -- required to
bring a new facility from the planning stage to completion. When APS
made its first estimates, in 1971 and 1972, the Arab oil embargo and
the sharp drop in energy consumption that it caused had not yet
occurred. And in 1976, he adds, APS estimated it would need only 10
percent of Palo Verde's Unit 1 -- but that 10 percent might as well
have been 100 percent, in terms of completing the unit.
Since 1976, De Michele says, an agressive load management program
and continued changes in energy use, "both necessitated by the
dramatic increase in fuel costs," have pushed back the need for
Unit 1 another year.
A look at the figures APS has used in the past illustrates just
how dramatic those changes have been. When Palo Verde was in the
conceptual stage, utility planners were looking at an average
increase in demand of almost 9 percent a year; by 1979 APS was
projecting a growth rate of 5.7 percent a year of the next decade.
Today, De Michele says, that projection has been scaled down still
further, to an annual growth of 4.2 percent a year -- or less than
half of what was expected a decade ago.
Changing demands, when contrasted with generating capacity, have
laid the utility open to frequent charges of building too much excess
capacity. Completion of Cholla-5, for instance, has been delayed
until 1990, although money has already been spend on its
construction; Cholla-4, after several delays, will be going on line
this year -- but part of its capacity will be sold to other utilities
for the next seven or eight years. And two years before Palo Verde's
first unit is finished, APS is already planning to sell some of its
share of the power.
Although so much excess capacity may seem embarrassing, APS
officials insist it is not as bad as it seems. Russ Hulse, vice
president of resource planning, says excess power is simply sold to
other utilities -- with those other utilities therefore paying "for
the heavy front end of the depreciation costs of that unit until APS
needs the extra capacity. And when that happens, he added, "what we
end up with is a 1989 unit at 1981 prices."
The alternative, Hulse says, is to build insufficient plant
capacity and be caught short in the future -- at inflated
construction prices. He believes this is happening in California,
where an adverse regulatory climate has resulted in a virtual freeze
on new power plant construction. "I think the California people who
have blocked construction, they're going to be hit with some hard
realities in a few years," he adds.
There is another side to this equation, too -- a side that caused
a lot of trouble for APS last year, when it approached the Arizona
Corporation Commission with a request for a rate increase. A major
part of the utility's construction fund is raised through stock
sales; stock holders, if they are to invest in APS, must be offered a
competitive return. So every time APS issues more stock it has to
raise its earnings -- and that means higher rates for its customers.
In essence, critics of Palo Verde have charged, today's consumer
is also paying for some of tomorrow's generating capacity. That isn't
fair, they say, and the argument has received at least a partially
sympathetic ear: when APS requested a rate hike of 19.2 percent, the
corporation commission's chief hearing officer knocked it down to
only 4.9 percent, saying the company's load projections have been
"excessive".
APS's response was a familiar one to jaded ears. It would have to
sell up to half of its interest in Palo Verde, it said, if it didn't
get what it requested -- and that would result in additional fuel
costs to its customers of $1 billion over the next 10 years. The
commission, apparently unimpressed, finally approved an increase of
6.5 percent, boosting APS's annual income by $37.4 million instead of
the $112 million it had said it needed.
(APS has since been granted an emergency rate hike and a new rate
hearing will be held later this year.)
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Future items in this series:
Background pieces on the history and operation of nuclear power
plants.
More arguments over nuclear power, with emphasis on safety.
------------------------------
Date: 21 May 1981 0936-PDT
From: LEWIS at SRI-AI (Bil Lewis)
Subject: Enviromentalists & anti-technology types
To: energy at MIT-MC
Just what impelled Andy to lump us in with "anti-technology"
is beyond me, but I resent it. They are the ones that are afraid of
change, and opting for a return to the "good old days" (that never
really existed I suspect). The folks I work with, up here in the AI
center are some of the ones who are most responsible for that change,
and 80% of us consider ourselves enviromentalists.
I suppose that one definition of an enviromentalist is a
group of people that are keeping their eyes open, to ensure that what
turns a dollar today doesn't kill us tommorrow. So what if (and this
is an absurd example, but I want an extreme one) we discover that
some of the waste products from the shuttle are carcinogenic, and
that 10,000 people will contract a cancer after every launch? Would
you just dismiss this as being anti-technology and assure us that
everything has its cost, and that plus the fact five times that
number get killed in cars every year?
Excuse the intensity, Andy just struck a tender spot, what
with Watt & Koop being Reagan's top men. I suspect that he and I are
using vastly different definitions of "enviromentalist."
-Bil
-------
End of energy digest
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