The Tennessee Valley Authority says that it is committed to the nuclear revitalization program that it began a few years ago. Despite criticisms from opponents, it is positioning the strategy as necessary to reduce its coal portfolio. 

The federally-owned wholesale distributor of electricity is in a quandary: It says that cutting its pollution is a top priority and that the most effective way to do so is by building clean base-load nuclear generators that can feed its expanding territory. But even before the Fukushima accident in Japan, the utility had opponents and now, they are even more strident. 

“TVA is possibly about to embark on one of the greatest financial gambles in the history of the agency,” says Stephen Smith, executive director of the Southern Alliance for Clean Energy. 

TVA's board of directors approved last Thursday plans to build a new $4 billion nuclear reactor at its “Bellefonte” site. Beside the timing, its dilemma is compounded further because it is a federal agency that has $24 billion in debt, which Congress has capped at $30 billion. So, the additional money cuts things pretty close. 

However, TVA has a different take. For starters, the 1,260 megawatt nuclear plant would be state-of-the art and cleaner than the older coal facilities that would be retired. And, it would run at much greater capacity levels while the cost of the fuel would be constant -- just as its six other nuclear plants do. In short order, the reduced operational costs would more than offset the initial investments, it says.  

“Diversity proved to be the most prudent course in meeting future energy needs in all the various future scenarios we studied,” says Tom Kilgore, chief executive of the TVA. “A variety of electricity sources, rather than heavy reliance on any single source, reduces long-term risks and helps keep costs steady and predictable.” The goal he says is to “reduce carbon intensity.”

The Bellefonte site in Alabama actually got its start in 1974. But the utility halted the construction of what would have been two reactors, citing lessening energy demand. By 2009, nuclear’s image had changed for the better and federal regulators agreed to allow the completion of both reactors. If approved by the Nuclear Regulatory Commission, TVA says that it will complete only one of them by 2020. 

Critics Fire Back

TVA has already spent $1.8 billion to restart Browns Ferry Unit 1 in 2007, which added 1,155 megawatts to the system. Meantime, it finished Watts Bar 1 in 1996.  By 2013, it expects to expand generating capacity by 1,100 megawatts with Watts Bar Nuclear Unit 2. All of those plants, which were originally licensed in the 1970s, were also shut down in the 1980s.

The Southern Alliance is not persuaded that the investments are either solid or safe.  It commissioned Fairewinds Associates to review TVA’s plans. The consultancy concluded that Bellefonte’s proposed design lacked an operational history while groundwater intrusion at the site added risk. And finally, the study says that the cost TVA is estimating is low-balled and that the utility ought to consider cheaper natural gas and more energy efficiency. 

It would be unconscionable in the wake of Fukushima to further skew risk factors and threaten public health and safety by licensing and operating Bellefonte with a less than reliable 35-year old concrete containment that appears unable to properly hold its tension even prior to the stress of operations,” says Arnold Gundersen, author of the report and a nuclear engineer.

TVA’s Kilgore responds that the territories from which his nuclear units operate -- Alabama and Tennessee -- are not prone to the earthquakes and tsunamis that brought down the Fukushima units. Moreover, TVA’s plants have safety devices built into them such as emergency power to cool down spent fuel rods. He also says that nuclear power is the cleanest way to supply a large population. 

In light of the Japanese nuclear accident, the U.S. Nuclear Regulatory Commission has released a study and recommends that the 104 reactors here get scrutinized every 10 years for seismic and flooding risks. And that includes routine inspections to ensure that the vulnerabilities of every plant are fully understood. Plants would furthermore be required to have licensed, back-up emergency equipment to ensure that the cooling pools containing fuel rods would continue to operate in the event of a power failure. 

In the immediate aftermath of the Japanese nuclear accident, TVA paused. But it has since assessed the situation and concluded that it can meet both the technical and financial challenges ahead. Whether or not market and political conditions allow it to proceed is a whole other test.