nuclear-news

Increasingly grim outlook for nuclear industry in North America

Why the U.S. nuclear industry’s ambitions are at risk of going up in smoke – The Globe and Mail, 17 Jan 2011, North America’s much-touted nuclear revival is in jeopardy, but it is not environmental and safety concerns that are undermining it. The industry is finding it increasingly difficult to make the economic case in both Canada and the United States.

The enormous capital cost of building reactors is just one factor holding back the long-promised nuclear renaissance. Just as critical is the risk that already high costs will balloon as companies build new-generation plants that must be able to withstand the impact of a terrorist crashing an airliner into one.

In announcing their proposed merger last week, two North Carolina-based utilities, Duke Energy DUK-N and Progress Energy PGN-N say the combined company would possess the added heft needed to finance three planned nuclear projects.

But financial strength alone is not enough. The companies are also looking for political and regulatory support to shift financial obligations onto customers and taxpayers to minimize risk in what Moody’s Investor Service Inc. has dubbed a “bet-the-farm” type of project.

That effort to offload financial risk to partners, customers and governments is the hallmark of the 21st-century nuclear industry.

It has been a key factor in Ottawa’s decision to sell Atomic Energy of Canada Ltd., and Ontario’s refusal to purchase reactors from the Crown corporation – neither the federal nor provincial government wants to be on the hook if AECL can’t deliver a new reactor on budget. Private-sector bidders for AECL, including Montreal-based SNC-Lavalin SNC-T are insisting on continued government backing for the company’s new-generation reactor program in order to avoid undue risk……..

Why the U.S. nuclear industry’s ambitions are at risk of going up in smoke – The Globe and Mail

January 16, 2011 - Posted by Christina Macpherson | business and costs, NORTH AMERICA