In Florida and the nation, nuclear power is poised for a comeback - and so far no one seems to mind.
The company says it hasn't decided on a location, but a likely site is Crystal River in Citrus County, where Progress Energy already operates an 838-megawatt nuclear plant. Expanding on the Crystal River site would take advantage of existing transmission lines and avoid the problems associated with putting a nuclear facility in a new community. Crystal River also is close to the north-central Florida region where Progress Energy is experiencing the highest growth in demand for power.
Because it's been more than 25 years since a utility sent an application for a new nuclear plant to the federal Nuclear Regulatory Commission, Progress Energy is in uncharted territory. Keenly aware that a terrorist event or a change of sentiment on Wall Street could sway the current atmosphere quickly, the company is careful in its public statements. "We're keeping our options open for our customers," says Jeff Lyash, Progress Energy's senior vice president for energy delivery in Florida.
But there hasn't been a time in the past two decades when the conditions for undertaking a new nuclear facility have been more favorable, starting with recent federal legislation that offers financial support, loan guarantees and production tax credits to utilities that create a new generation of nuclear plants. The Energy Policy Act of 2005 even creates delay insurance for utilities, putting the federal government on the hook for up to $2 billion if the Nuclear Regulatory Commission's licensing process produces cost overruns, or if there are litigation delays that are not the fault of the private sector.
In addition, the federal government has streamlined its licensing process for nuclear plants, combining construction and operating licenses -- which previously posed separate sets of regulatory hurdles -- into one combined operating license (COL). Progress Energy projects that it can complete the COL application process by 2008 and then begin ordering components before the first stage of a five- or six-year construction process begins in 2010.
Meanwhile, the supply-demand equation is working in Progress Energy's favor. With the price of oil rising, few dispute the need to diversify the nation's power sources. And fast-growing Florida needs the juice. The state produces less than 1% of the energy it consumes, according to Florida's Energy Plan, a Florida Department of Environmental Protection report released in January. The DEP expects the state's consumption of electricity to increase by 28% over the next decade. "People use more electricity each year across the entire system," says Lyash.
The power industry even has reason to think that public attitudes toward nuclear power have grown more benign. An August 2005 report commissioned by the Nuclear Energy Institute surveyed 1,100 people who live within 10 miles of a nuclear plant. It found that 76% would find it acceptable to add a reactor at the site near them. Lyash characterizes reaction to publicity about Progress Energy's plans as "very positive, very supportive, including areas where we would potentially site these plants."
As it proceeds, Progress Energy won't lack for support from other utilities. "We think that having nuclear as part of the state's portfolio is a good idea," says Bruce Christmas, vice president of fuels management for Tampa Electric Co., which does not operate any nuclear plants but does buy energy on the spot market when needed.