Bloomberg News

Lobbying Flurry Precedes U.S. Vote on Fukushima Rules

March 01, 2013

Lobbying Flurry Precedes U.S. NRC Vote on Fukushima Rule

Cooling towers emit steam at the Exelon Corp. Limerick Generating Station nuclear energy plant in this aerial photo taken in Pottstown, Pennsylvania. Photographer: Andrew Harrer/Bloomberg

A proposed requirement that U.S. nuclear-power plants add $20 million devices to prevent radiation leaks, one of the costliest recommendations stemming from meltdowns in Japan two years ago, has attracted a flurry of last-minute lobbying.

The U.S. nuclear industry opposes the rule, which would require almost a third of the nation’s reactors to install a special filter on vents designed to prevent an explosive buildup of gases. Exelon Corp. (EXC:US), which owns more U.S. reactors than any other company, estimates each filter would cost $20 million, meaning the Chicago-based company could end up paying $220 million to equip its units.

The staff of the U.S. Nuclear Regulatory Commission recommended in November that the radiation-scrubbing filters be required on 31 aging reactors. The commission itself is now voting on the proposal, a process that is expected to conclude in coming days just as the second anniversary of the triple meltdown at Japan’s Fukushima Dai-Ichi plant nears.

“I would encourage you to resist outside pressure to disregard the expert recommendations of your staff,” Representative Paul Tonko, a New York Democrat, told the five NRC members at a House Energy & Commerce subcommittee hearing in Washington yesterday. “To the public, there is no such thing as a small nuclear accident.”

Entergy, Duke

Entergy Corp. (ETR:US) of New Orleans, Duke Energy Corp. (DUK:US) of Charlotte, North Carolina, and Southern Co. (SO:US) of Atlanta are among companies owning units that would need to add the filters. A requirement for the equipment would benefit filter suppliers, such as Areva SA (AREVA) of Paris and Westinghouse Electric Co., a unit of Tokyo-based Toshiba Corp. (6502)

“Safety gains should be significant enough to outweigh additional costs” as the agency considers ordering plant upgrades, Representative John Shimkus, an Illinois Republican, said at yesterday’s hearing.

Supporters of the measure say it is overdue and consistent with what the rest of the world is doing. Japan announced last year that filtered vents will be required on its reactors. Other nations that use or are considering filtered venting systems on their reactors include Taiwan, Spain, Switzerland, Finland, Sweden, France and the Netherlands, according to the NRC.

“The tens of millions of Americans who live near the affected reactors located in 15 states should not face additional delays,” a dozen Democratic senators led by Barbara Boxer of California and Ron Wyden of Oregon wrote in a Feb. 20 letter to NRC Chairman Allison Macfarlane.

Macfarlane’s Course

The NRC vote will signal which way Macfarlane is leading the commission as it writes rules for the nation’s 104 operating reactors. Macfarlane, 49, took office in July, and the filter decision will be her first on Fukushima-related regulations.

“If we think a particular rule or regulation is required for adequate protection of a facility, then we do not account for cost,” Macfarlane said during a Feb. 25 interview at Bloomberg’s Washington offices. She declined to discuss the filter rule specifically, other than to say the commissioners are voting.

The industry already faces decisions about investing in costly upgrades or simply retiring aging plants that are in competition with cheaper natural gas. Some other countries are reconsidering their use of nuclear energy as well after the Japan disaster. Germany said it would shutter its atomic plants by 2022.

‘Grand Scheme’

The costs associated with adding filters are “not overwhelming in the grand scheme of things” for utilities, Julien Dumoulin-Smith, an analyst at UBS Securities LLC in New York, said in a phone interview. The additional costs would add “insult to injury’ for an industry in a difficult economic environment, he said.

The industry prefers a plant-by-plant approach to the question of whether filters are necessary.

‘‘The optimal filtration method should be determined on a plant-specific basis,’’ Richard Myers, vice president for policy development at the Nuclear Energy Institute, said at a conference in Washington on Feb. 21. The NEI is a Washington- based industry group of reactor owners.

Margaret Harding, a nuclear-industry consultant based in Wilmington, North Carolina, said it would be better for the NRC to define the acceptable limit of emissions from the vents and allow the industry to determine the best way to achieve that goal.

‘‘Every single reactor out there is a little bit different,’’ she said today in a phone interview.

Reactors Affected

The proposed changes would affect so-called Mark I and Mark II containments that house boiling-water reactors. These General Electric Co (GE:US).-designed structures, similar to those that were destroyed by a tsunami at Fukushima, are smaller than those at newer reactors that can handle a greater buildup of pressure.

The filters are built to capture radioactive materials before they are released into the atmosphere during an emergency. They are installed on vents that resemble smokestacks and can be opened to release hydrogen, which under pressure can cause explosions.

In Germany, such filters are installed already at venting systems in all of the country’s nine operating nuclear reactors,

Nicolas Wendler, a spokesman for the German Atomic Forum, said today by phone. Equipping venting systems with filters ‘‘makes absolute sense’’ to prevent radioactive contamination from spreading in case of an accident, he said.

Chernobyl Accident

The 1986 Chernobyl nuclear disaster in what is now Ukraine, which caused radiation to spread across large swaths of territory, prompted the adoption of venting technology for some reactors in Europe, Harding said. U.S. regulators in response to that accident placed greater focus on minimizing the causes that could lead to such an event, she said.

No U.S. boiling-water reactor has ever had to use its venting system, and the benefits of filtering vents don’t outweigh the costs, according to the NEI. Most filtering should take place inside reactor containment buildings before additional devices are installed elsewhere at a power plant, the group has said.

Krista Lopykinski, an Exelon spokeswoman, declined to comment beyond the company’s price estimates for potential reactor upgrades. Constellation Energy Nuclear Group LLC of Baltimore estimates that requiring filters at two reactors at its Nine Mile Point plant in New York would cost from $20 million to $30 million per unit, according to Richard Yost, a company spokesman.

Southern Nuclear

‘‘Southern Nuclear shares the industry position on venting and alternative filtering strategies,” Michelle Tims, a company spokeswoman, said in an e-mail.

Spokesmen from Duke and Entergy said they couldn’t speculate ahead of the NRC’s vote on the costs associated with potential upgrades. Entergy owns three reactors that would be affected and Duke and Southern each own two units.

Filters would limit the amount of radioactive material that escapes during a severe plant emergency, said David Lochbaum, director of the Nuclear Safety Project for the Cambridge, Massachusetts-based Union of Concerned Scientists.

If radiation “doesn’t leave the site, it can’t contaminate land” he said in a phone interview. “Once Pandora’s box is opened, all bets are off.”

To contact the reporter on this story: Brian Wingfield in Washington at bwingfield3@bloomberg.net

To contact the editor responsible for this story: Jon Morgan at jmorgan97@bloomberg.net


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Companies Mentioned

  • EXC
    (Exelon Corp)
    • $34.57 USD
    • 0.48
    • 1.39%
  • ETR
    (Entergy Corp)
    • $78.04 USD
    • 0.71
    • 0.91%
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