On Feb. 9, the Nuclear Regulatory Commission (NRC) granted the first license in three decades for construction of a new nuclear electric power plant in the U.S. This development presents an important policy question: if the country is at the start of a renaissance of nuclear power as a baseload source of electricity or if this event is unique and will not be replicated for litigation, economic or safety reasons.
Nuclear plants are far more expensive (an estimated $7 billion) than other electricity-generating facilities of comparable capacities, and the siting, regulatory approvals and construction can take up to a decade. Modern reactors have useful lives of 60-70 years, during which the relative costs of fuels for power generation will shift dramatically, both up and down. Public opinion also is subject to significant swings about the safety of nuclear power. The meltdowns of three reactors at the Fukushima plant in Japan and the recent earthquake on a previously undetected fault that knocked out a nuclear plant in central Virginia have reinforced public awareness of these risks. As a result, the business decisions utilities face when deciding whether to invest in new nuclear plants are unusually difficult.