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Failed Carbon Free Power Project can pave the way for future successes in new nuclear

Utah Associated Municipal Power Systems couldn’t bring its plans for the Carbon Free Power Project to fruition, but its CEO/General Manager Mason Baker hopes the lessons his agency learned in trying to bring a first-of-its-kind small-modular reactor facility online will pay dividends for those who follow.

Baker addressed the Leadership In Nuclear Energy Commission on Jan. 31 in the Lincoln Auditorium at the Idaho State Capitol.

He noted that he was proud of the since-scuttled project’s many successes and felt it paved the path to success for future projects.

The Carbon Free Power Project was a partnership between UAMPS and Oregon-based NuScale Power Corporation that planned to build six 77-megawatt nuclear power modules at Idaho National Laboratory. The partners announced in November that they would not move forward with the plan after realizing they would not meet the 80% subscription threshold set by UAMPS members by the end of 2023.

Several factors including COVID-19 supply chain issues and inflation, particularly skyrocketing costs for steel, drove up construction cost estimates for the project, resulting in an increase in the rates it would need to sell electricity for once it was built.

Baker and later Idaho Falls Mayor Rebecca Casper drove home the message that the cause of the Carbon Free Power Project’s demise were commercial challenges, not technical or permitting issues. Idaho Falls is a UAMPS member and was one of the leading advocates of the plan.

All of the factors that led UAMPS and its members to pursue nuclear energy still exist. Those include a need for dispatchable energy that does emit carbon dioxide or other pollutants such as nitrogen oxides as the nation and the world transition energy production away from fossil fuels.

“From UAMPS’ perspective, to be clear, we think nuclear is still absolutely necessary,” Baker told the commission. “We see it as part of the portfolio for our members to meet the challenges of the energy transition.”

The transition away from fossil fuels will require the development of low-cost no-carbon resources “and that’s very difficult,” Baker said.

He noted progress and costs improving for other renewables such as wind power and solar power with battery storage but said “none of those resources by themselves are going to provide for and meet that energy transition challenge.” Because those resources are intermittent, an on-demand source like nuclear is an important part of the mix.

“These are things we all know, but we certainly need to continue to express them collectively so we can continue to move forward in getting one of these first-of-a-kind advanced reactors online,” Baker said. “That’s going to be very important moving forward to make sure we get one of these over the finish line soon.”

Baker detailed other challenges to the energy transition such as a need for improvements to the electric grid and explained that the current timeline for getting approval for new transmission infrastructure is 15 to 20 years, which he called unacceptable. But he added there has been some movement in Congress on permitting reform.

Baker said that Carbon Free Power Project succeeded in many areas including gathering local and state support as well as bipartisan support from Congress. The project also had good support and engagement with the U.S. Department of Energy and was actively engaged with the Nuclear Regulatory Commission.

The project had its standard design approval application for the project accepted and received a limited work authorization from the NRC.

“In Idaho we worked hand in hand with local and state government for over a decade, which puts Idaho in a unique position to move forward, having done a lot of that work,” Baker said. “That local support is absolutely critical.

“I think Idaho is a great place to do business and I think others will find that as well.”

In the end, the financial risk involved with a first-of-its-kind construction project doomed the plan as worries about increasing costs proved to be a roadblock in getting utilities over the line to sign up and kept the project from meeting its 80% subscription rate.

Baker said that over the last year there has been a lot of discussion with Congress about developing some sort of federal construction cost overrun insurance product for similar endeavors.

“From UAMPS’ perspective that can be a game changer moving forward,” he said.

Casper took that point even further using her chance to ask questions as an opportunity to advocate for changing how new nuclear projects are funded.

“We have to ask ourselves if a project (like the Carbon Free Power Project) is a super-well vetted, very much needed project and it was not able to survive in this environment, is the current model we’re using to bring new nuclear to the fore, is it the best model?,” she said.

“I believe in the free-market system … but we didn’t rely on the free-market system to get us to the moon. It was a national priority. We didn’t rely on the free-market system to get us our first nuclear submarine. It was a national priority.

“So when it comes to advanced nuclear, which in some ways is the same tech as old nuclear but it’s not — it’s a game changer for energy across the globe — is the free-market system going to be the best way to bring this next project to the fore?”

Baker said that despite the termination of the Carbon Free Power Project, “all our communities are still very keen on nuclear.”

Casper agreed, adding “all 30-plus utilities still need clean power for the future and we’re all scrambling to fill our needs.”

INL Director John Wagner thanked Baker for his time and said that he hoped Congress invites Mason to talk about his experience with the Carbon Free Power Project.

Source: Post Register