The participants in a project to build 12 small nuclear reactors west of Idaho Falls have until the end of October to decide whether to continue into the next phase of the project.
Portland-based NuScale Power is designing the small modular reactors, which will produce 720 megawatts and which Utah Associated Municipal Power Systems plans to build at the U.S. Department of Energy desert site west of Idaho Falls. So far 35 cities and local power companies have signed on, mostly in Utah, but including Idaho Falls, which is one of the bigger subscribers at 10 megawatts. The plant is expected to be operational in 2029.
The project’s cost is divided between the participants, and the budget expects $1.4 billion from the U.S. Department of Energy. Idaho Falls’ share would be $1.3 million if DOE comes through, although this would jump to $8.5 million without the federal funding, according to a presentation given to Idaho Falls Power in August.
Over the past month, the project’s opponents have been stepping up their campaign to scuttle it, pointing to cost overruns and potential risks to local taxpayers, and so far two Utah cities have dropped out.
To its backers, the Carbon Free Power Project is part of a transition to cleaner energy and vital to an industry they see as critical to the economic future of eastern Idaho, home of Idaho National Laboratory and the place where electricity was first generated from nuclear power in 1951.
“It’s just super important for the nuclear industry, and our local economy relies on nuclear innovation and the future of nuclear energy,” said Idaho Falls Councilman John Radford, who favors sticking with the city’s 10-megawatt subscription level. “I think if we’re going to have new nuclear, this project has to come to fruition, and I don’t want to damage or make that harder for anyone.”
Critics point to the project’s escalating cost, which has gone from $3.6 billion in 2017 to an estimated $6.1 billion now, and question whether it could be a boondoggle similar to other failed taxpayer-subsidized nuclear projects such as the Vogtle Project in Georgia and the V.C. Summer Nuclear Station in South Carolina.
“The root cause is always the same — nuclear power is far more expensive than competitive technologies, even competitive low-carbon technologies,” Peter Bradford, a former U.S. Nuclear Regulatory Commission member who has been critical of many nuclear projects, said on a conference call with reporters.
In August the Utah Taxpayers Association teamed up with Bradford to urge cities to withdraw. Rusty Cannon, vice president of the Taxpayers’ Association, said his group has no stance on nuclear energy but opposed committing local tax dollars to a project that depends on federal subsidies and is based on an unproven technology that, he said, is not economically competitive with other types of energy. Cannon pointed to the current commitment of utilities to purchase power, which is at about 30% of the power that would be generated, as a bad sign for the project’s future success.
“(The cost is) substantial, and we think it’s the wrong move to move any further forward and make that large of a commitment to the city that could come back on ratepayers and taxpayers,” Cannon said.
The deadline for power systems to approve the new budget and commit to the next phase has been pushed back repeatedly. It was mid-September at first, then Sept. 30. Then, last week UAMPS moved it back again to Oct. 31, since the expected DOE funding hasn’t yet been approved. The Idaho Falls City Council will likely vote on whether to stick with its current commitment on Oct. 22, the last meeting scheduled before the deadline, said city spokesman Bud Cranor.
“The reason for the change is that the one really important part of the financing of the project, and that helps reduce the risk of the project, is … the multi-year cost share award by the Department of Energy,” said UAMPS spokesman LaVarr Webb. “And that award we fully expect to receive, but the process is going slower than expected, and so we want to be certain that that DOE cost share award is approved and signed and in place before the project goes into the next phase.”
Webb said the DOE funding is “heavily weighted toward the early costs of the project,” such as helping to pay for the construction and operating license and some construction costs. He said the money is “critical to the success of the project,” reducing what the members would have to pay otherwise and helping UAMPS meet its goal of selling the power for $55 per megawatt-hour. Webb said the money would also be subject to future congressional appropriations, but he doesn’t expect that to be a problem, saying DOE has approved other multi-year projects before.
“The whole amount won’t come right now, but we have very strong support by both Republicans and Democrats in Congress,” he said. “The Obama administration and the Trump administration both have been very supportive of the project.”
The Logan and Lehi city councils voted to withdraw from the project in August, citing fiscal concerns. Logan Mayor Holly Daines said the Council was worried about “the financial uncertainties of a first-of-a-kind project, and the large increases in the projected budget since the project was initiated.” She said the Council didn’t discuss technical concerns or concerns about nuclear energy.
“It’s an interesting project, but my concerns as Mayor (and I wanted to exit the project at an earlier date) have always been that this project is much better suited to risk-taking venture capitalists rather than municipalities,” Daines said in an email.
Webb said he doesn’t expect Logan and Lehi leaving to threaten the project’s viability. He said it has also recently gained one more member, the Wells Rural Electric Company in Nevada.
“As the project proceeds and it becomes more obvious it’s going to be successful, then we expect more utilities will participate,” he said.