Sunday, December 17, 2017
Business

Officials must decide if Crystal River nuclear plant is needed

Call it Florida's giant concrete paperweight.

For three years, the broken Crystal River nuclear power plant has been little more than a monument to Progress Energy's failure to pull off a relatively routine upgrade project.

The question now is not when the plant will return to service, or the potential long-term impact of the loss of its enormous generating capacity.

Rather, says R. Alexander "Alex" Glenn, the incoming president of Progress Energy Florida, all other concerns about Crystal River matter little until the utility answers one question:

"Can we repair the plant?"

As Glenn told the state Public Service Commission: "What is the risk associated with (repairing the plant)? What is the cost associated with that?"

The hurdles to fixing the plant appear to grow more daunting as time passes. Meanwhile, it becomes increasingly difficult to support the argument that Progress even needs the power Crystal River once provided.

• • •

Energy use in Progress' service area peaked in 2008, and won't return to that level until after 2021, according to Progress' own projections.

The lack of imminent demand sharpens key questions:

Why pour money into a broken 36-year-old plant whose license expires in 2016 and which might not get renewed because of the plant's troubles and costly new safety requirements?

What if repairs fail?

Why take the risk?

"It is not a decision that can be taken lightly," said Mike Hughes, a spokesman for the utility. "I think most of the challenges have been well-documented."

The repair and related costs continue to rise and could top $3 billion. That would make it more costly than the Three Mile Island disaster in 1979.

• • •

Ultimately, those numbers may not matter because so much hinges on whether the plant can, in fact, be fixed.

No one has ever attempted anything like it.

"This repair is not well understood or well known," said Arjun Makhijani, a nuclear and electrical engineer and president of the Institute for Energy and Environmental Research. "It looks like a multi-billion dollar experiment. This is really a huge financial gamble with ratepayer money."

For much of the last 18 months, Progress Energy and teams of engineers and consultants have tinkered with computer models and pored over documents to determine how to fix cracks in Crystal River's containment building.

In their first face-to-face meeting last week, the new combined board of Duke Energy and Progress Energy, which merged July 2, began evaluating whether to repair or decommission the plant .

Ajaya Gupta, a professor emeritus of structural engineering and mechanics at North Carolina State University, says a fix is doable but complicated.

"As an engineer, I don't envy any of those people who are there," Gupta said. "You're in a bad situation. To fix a bad situation is always harder than to do things right to start with."

And Crystal River had structural problems from the beginning.

During construction in 1976, the concrete dome atop the building that shields the nuclear reactor cracked.

A study concluded that the "fragility" of the material used in the concrete contributed to the break. Workers repaired and strengthened the dome, but they did nothing to strengthen the walls of the containment building, the final barrier against radiation reaching the atmosphere.

In 2009, Progress decided to manage a project that other utilities had contracted out to specialists. The plan was to upgrade some equipment and replace old steam generators with new ones. To get the generators in and out of the containment building, workers cut into the thick concrete wall.

Similar steam generator replacements had been successfully completed at 34 other nuclear plants, of which 14 involved cutting into the containment building.

But when Progress workers cut into the wall, it cracked. After an attempted repair, workers retightened the steel tendons in the concrete that help support the structure and it cracked twice more. The plant has now sat idle for almost 10 percent of its life.

Former Progress Energy CEO Bill Johnson told the North Carolina Utilities Commission in July that one of the problems with the building was the strength of the concrete.

Gupta said the problem with the dome in 1976 and the cracks that resulted from the 2009 project indicate pre-existing structural problems that will complicate any repair plan.

A more optimistic view came from a structural engineer who has designed reactor containment buildings for the firm of Sargent & Lundy,

With a solid engineering plan, said Bryan Erler, fixing the containment should be "straightforward."

"The approaches to repairing it can vary," said Erler, now vice president of the American Society of Mechanical Engineers. "Safety-wise, there's no problem to be able to repair it. But is it cost-effective? That's the work they're doing."

Progress plans to remove and replace the concrete from all of the walls of the building except one already repaired. Utility officials have said they would keep the existing dome.

Workers will have to safely tie all the upgraded sections to the older dome and adjacent buildings. The trick is to make sure nothing cracks again when they tighten the steel tendons that support the structure.

• • •

Progress says it has developed a repair plan that is now about 85 percent complete and has picked engineering, construction and technical services company URS as the preferred contractor on the project.

But even with a nearly finished engineering plan, Glenn, the incoming Progress Energy Florida president, questioned whether the plan would work. He's cautious for good reason.

"We cannot be assured that (the plant) can be repaired and brought back to service until full engineering and other analyses are completed," Progress reported to the U.S. Securities and Exchange Commission last month.

Progress has spent $839 million so far on the first repair attempt and to purchase alternative electricity, according to its SEC report. The utility expects future repair costs to exceed $1.3 billion and the cost for replacement power while the plant sits offline to run about $300 million a year.

The earliest projection for bringing the plant back online is the fourth quarter of 2014.

Another hurdle to repairing the plant: The company that insures Crystal River continues to review whether it will pay for the needed repairs. The insurer, Nuclear Electric Insurance Limited, stopped paying for any costs related to the damages by the end of the second quarter of 2011 and opened its own investigation into what went wrong. Progress Energy has said it will likely close the plant if NEIL doesn't agree to pick up more of the cost.

The utility and its insurer are set to negotiate about coverage in the last quarter of this year.

• • •

And, given all the risks, there is the question of whether the plant is even needed.

Customers aren't using as much power, a result of the Great Recession and more energy-efficient products. Progress Energy predicts a further decline in power use through 2013 and then only incremental growth over the following decade.

"Even now, electricity demand is kind of slack," said Makhijani, the nuclear engineer.

Adding the cost of repairs to monthly bills could result in customers cutting further back on usage, he said.

State regulators, however, want Progress to repair Crystal River because, when it's online, it produces a lot of power at low cost.

To shut down the plant would mean the loss of diversity in Progress' energy mix and an increased reliance on natural gas, whose prices are near historic lows but remain volatile.

Makhijani, whose background has led him to advise utilities and the likes of the Lawrence Berkeley National Laboratory, said this period of slow economy and declining energy demand should be used to find less costly and more efficient ways of providing electricity.

Spending billions on questionable fixes of old nuclear plants, Makhijani said, "doesn't make sense."

"If you have to make extensive back fits, I think it's a pretty hopeless case," he said. "Just shut Crystal River down, write it off and start the process of decommissioning."

Ivan Penn can be reached at [email protected] or (727) 892-2332.

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