NRC Approves Construction and Operating License for Vogtle Nuclear Power Plant

February 8, 2012

Q1: What does the Nuclear Regulatory Commission’s approval of the Combined Construction and Operating License for the Vogtle nuclear power plant in Burke County, Georgia, mean?

A1: The Combined Construction and Operating License (COL) issued for the Vogtle nuclear plant in eastern Georgia today by the Nuclear Regulatory Commission (NRC) is the first ever issued—and the first license for new plant construction issued in 32 years. While a new nuclear plant has not come online since 1996, the capacity factor of the civil nuclear reactor fleet went from 58.4 percent in 1989 to 91.2 percent in 2010. This is an efficiency improvement equivalent to bringing 25 large one-gigawatt reactors on line, which makes the U.S. fleet the most productive in the world. Industry-wide improvements have also been made to physical plant infrastructure, operating procedures and standards, emergency response planning, personnel training, and plant security. These drastic strides in production have enabled nuclear energy to keep pace with increasing demand for electricity without new construction. But now that the current fleet is reaching the end of its operational life, new construction is needed to fill the gap in electricity generation created by retiring plants.

Improvements have been made to the regulatory process as well. NRC has consistently provided independent, expert oversight and regulation as an autonomous agency, the sole focus of which is to regulate nuclear matters in the United States. The industry also has a robust organization for self-regulation, the Institute of Nuclear Power Operations (INPO). Created in the wake of the accident at Three Mile Island, INPO formulated a process and a set of operational standards that went beyond the stipulated framework of NRC to ensure the highest levels of safety and performance. Together, these bodies enhance industry performance to the point where the United States sets the global benchmark for safe, reliable, and economic operations of a large fleet and provides a stable foundation on which the next generation of nuclear power plants can be built.

The Vogtle COL is an important event, certainly, but two—or even four or six—new nuclear power plants will not replace the plants that will retire in the coming decades. The amount of time and degree of challenge it takes to site, license, finance, and construct a nuclear power plant should be considered before asserting that this most recent milestone indicates a significant new construction program is on its way.

Q2: Is this the beginning of a nuclear renaissance in the United States?

A2: While the progress of the Vogtle build is an encouraging sign for the technological progress in the civil nuclear industry, it is important to be cautious about extrapolating this specific project’s success as an indication that the long talked about nuclear renaissance is upon us.

The Vogtle project is indicative of an emerging next generation of technology from the U.S. nuclear industry. The new plants certified and licensed by NRC are built off the experience of the last several decades and should be considered the safest and most efficient in the world. The most recent designs incorporate thousands of reactor years in construction and operating experience. The AP-1000 that is set to be installed at the Vogtle site was the first of several new designs to be reviewed by NRC and the first to emerge from the licensing process. Specifically, four additional reactor designs are currently under consideration for NRC-issued licenses. However, economics and financing are both continuing challenges to the viability of new nuclear plant construction. Finding approaches to successfully address these challenges will be an indicator of whether additional new nuclear builds will follow Vogtle and whether the United States will maintain its status as the global leader in safety, operation, and design.

In addition, the financing prospects for new nuclear builds continue to be very challenging. The Vogtle plant and the Virgil C. Summer project in South Carolina represent special cases where utilities enjoy an especially favorable state-regulated electricity market. In most U.S. markets, economic and financing difficulties stem from low energy prices driven by the low price of natural gas.

Q3: Why does nuclear energy matter?

A3: Given the current economic climate, which challenges broader new nuclear plant development, policymakers should recognize the broad set of benefits provided by a viable commercial nuclear program. A sustained lack of new nuclear construction will jeopardize U.S. global leadership in regulation, operations, emergency response standards, and nonproliferation efforts. Additionally, nuclear energy can play an important role in efforts to meet global carbon emissions targets. The maintenance of a robust domestic industry is absolutely critical in our continued role in setting global standards in all of these areas.

Michael Wallace is a senior adviser with the U.S. Nuclear Energy Project at the Center for Strategic and International Studies in Washington, D.C. Sarah Williams is a research associate with the project.

Critical Questions is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

© 2012 by the Center for Strategic and International Studies. All rights reserved.