Washington Post (pg. D1)  [Printer-friendly version]
September 25, 2007


Permission Sought to Build 2 More Reactors at Texas Facility

By Steven Mufson

A New Jersey electric power company yesterday filed the first full
application to build new U.S. nuclear plants since Pennsylvania's
Three Mile Island reactor had a partial meltdown in 1979.

NRG Energy said it had asked the Nuclear Regulatory Commission for
permission to add two new nuclear reactor units with a total capacity
of 2,700 megawatts to an existing nuclear facility in Bay City, Tex.
It estimated that the project would cost between $5.4 billion and
$6.75 billion and provide enough electricity for about 2 million
homes. The company hopes to complete construction by 2015.

The commission expects to receive applications to build as many as 32
new U.S. reactors as utilities and independent electricity generating
companies rush to take advantage of generous federal tax incentives,
streamlined application procedures and the surge in concern about
greenhouse gas emissions from coal, oil and natural gas.

NRG Energy chief executive David Crane called it "a new day for energy
in America" and said in a statement that the nuclear reactors would
contribute to U.S. energy security and offered the "the only currently
viable large-scale alternative to traditional coal-fueled generation"
that did not produce greenhouse gases.

In an interview, he said electricity demand in Texas is growing at a
rate of 2 to 3 percent a year, the equivalent of 1,000 megawatts to
1,500 megawatts a year. "Texas is a fantastic market... to do
nuclear," he said. In addition to rapid growth, he said it has lots of
space and a strong transmission system.

But he added that federal tax incentives and loan guarantees were the
key catalysts for the company's plans. "The whole reason we started
down this path was the benefits written into the [Energy Policy Act]
of 2005," he said.

That legislation provided as much as $125 million in annual tax
credits for a nuclear plant, plus loan guarantees that would cover as
much as 80 percent of construction costs. The government provided
insurance for application costs too, protecting companies against the
possibility that they would be unable to finance a nuclear project and
against the possibility of regulatory obstacles. The first half dozen
new plants would get extra benefits.

NRG Energy applied for a combined construction and operating license,
which is part of a streamlined application process. Other firms have
filed less comprehensive requests. In July, Constellation Energy Group
filed a partial application, asking the NRC to review environmental
plans for a new reactor to be built at its Calvert Cliffs site in
Maryland. Other firms have asked for permits for new sites.

NRG Energy said that it planned to use advanced boiling water reactors
designed by General Electric. It also said that Tokyo Electric Power ,
which owns and operates two of those reactors, would help support the

NRG Energy is an independent power generating firm. It sells power to
utilities and large commercial and industrial consumers. It has 23,000
megawatts of generating capacity, primarily in the United States, and
it is the second largest power producer in Texas.

Crane said that he hopes to bring in the San Antonio municipal utility
as an equal partner in the new units and perhaps a third partner with
a smaller stake. He said NRG Energy wanted to keep a 40 percent stake.

Copyright 2007 The Washington Post Company