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August 1, 2012: Should the United States Rethink Sanctions Against Iran?
July 16, 2012: The Risks and Benefits of Laser Isotope Separation (LIS)


Will Nuclear Energy Lead to Energy Independence in the United States?


  • Dr. Mark Perry, American Enterprise Institute (AEI)
  • Ms. Ellen Vancko, Union of Concerned Scientists (UCS)
  • The need for a new U.S. energy policy is clear. The United States nuclear power industry currently generates about 20 percent of the nation's electricity, more than that from oil, natural gas, and hydropower, and behind only coal, which accounts for more than half of U.S. electricity generation. And while nuclear plants generate more than half the electricity in six states, the nuclear power industry's challenges include high nuclear power plant construction costs, public concern about nuclear safety and waste disposal, and regulatory compliance costs.

    Dr. Mark Perry of the American Enterprise Institute (AEI) and Ms. Ellen Vancko of the Union of Concerned Scientists (UCS) debate below about the future of nuclear energy in the United States.


    Dr. Mark Perry,  (Twitter: @Mark_J_Perry American Enerterpise Institute (AEI)

    Nuclear Power is the Key to U.S. Energy Independence

    It’s elementary but it is true: nuclear power can produce an enormous amount of clean energy from a small amount of fuel.  Even environmentalists should welcome nuclear power.

    Yet, for the last several years, natural gas has dominated the energy picture.  Thanks to an abundance of unconventional gas from shale deposits, natural gas has accounted for more than 80 percent of new electric generating capacity in the United States.  Gas now provides 32 percent of total generation, up from 25 percent just two years ago, and it surely would be higher if not for the impressive performance and excellent safety record of the U.S. fleet of 104 nuclear plants.

    According to the Nuclear Energy Institute, America’s nuclear plants produce electricity 90 percent of the time, compared to 70 percent for natural gas plants.  After a long hiatus, nuclear power has gained respect again, with the renewal of licenses approved at more than two-thirds of the operating plants, five new reactors are under construction, and applications to build another dozen or so reactors are pending before the Nuclear Regulatory Commission.

    The United States needs more energy to replace aging coal plants and meet growing demand for electricity.   Even with slower economic growth and vigorous conservation, it will be an immense challenge to meet the demand for energy without building a new generation of “base-load” power reactors.

    Some say: Why bother building new nuclear plants at a time when energy experts both in government and industry estimate the United States has more than 100 years’ worth of natural gas?  And natural gas plants can be built for a fraction of the cost of nuclear plants?

    Simply put, nuclear power is essential for energy security.  To become overly dependent on a single energy source for something as vital as electricity supply would be irrational.

    Natural gas is needed for much more than electricity production. U.S. manufacturers are making increased use of cheap natural gas, and truck fleets are beginning to switch to natural gas.  The Department of Energy is considering applications from a dozen companies to export as much as 20 percent of domestic gas in the form of liquefied natural gas to markets in Europe and Asia.

    All of this is likely to result in a significant jump in natural gas prices, which are already beginning to climb after bottoming out at $2 per thousand cubic feet.  The Energy Information Administration cautioned in a study published earlier this year that exports of 12 billion cubic feet of gas per day would bump up electricity prices by up to 3%, a significant price increase.  But the price of gas doesn’t have to reach $15, as it did a few years ago, for utilities to opt for more nuclear power instead.  By the time gas prices reach $7 or $8, nuclear power will be back in the mix.

    Although the capital cost of building a nuclear plant is high, the average price of nuclear-generated electricity over the lifetime of a nuclear plant is competitive with natural gas. Many nuclear plants are expected to remain in commercial service for 60 years or more.

    What’s more, nuclear power doesn’t pollute the air or emit greenhouse gases.  It accounts for 70% of the nation’s carbon-free energy, and polls show that a strong majority of Americans favor the construction of new nuclear plants.

    Without the addition of more nuclear plants, efforts to curtail greenhouse emissions 80 percent by 2050 will languish.  Natural gas plants, though cleaner than coal, release large amounts of carbon dioxide into the air.  And no practical technology is available yet for capturing carbon.  Solar and wind energy cannot supply large amounts of clean base-load electricity reliably, whereas nuclear plants do.

    But for nuclear power to continue playing a decisive role in reducing greenhouse emissions, ground will need to be broken for new reactors now.  With the help of new reactor designs for plants that are even safer than those in operation, nuclear power will continue to make a substantial impact in meeting our need for clean and affordable energy.

    And what about nuclear power’s role in achieving energy independence?  The reality is that a goal of total independence is probably unachievable.  It’s both too costly and unnecessary.  However, nuclear power will continue to play an important economic role in providing domestically-produced energy that’s clean, reliable and affordable.  As its use increases in the future, America will become more energy self-sufficient.

    Ms. Ellen Vancko,  Union of Concerned Scientists

    Nuclear Power Will Not Lead the Way to U.S. Energy Independence

    No single form of electricity generation will lead to U.S. energy independence, especially since the vast majority of the oil we import fuels our transportation sector – not electricity generation –and will for the foreseeable future. Electric cars are coming, but we likely will be driving mostly gas-powered vehicles for another decade or more, although new federal fuel-efficiency requirements will go far to reduce demand for imported oil in the interim.

    That said, recent proclamations that the United States is the “Saudi Arabia” of natural gas and wind suggest that these two abundant domestic energy sources, along with solar, geothermal and biomass, have a good shot at significantly decreasing our nation’s dependence on foreign energy supplies over the longer term and also reducing our carbon emissions.

    At the same time, one must look with great skepticism at claims that nuclear power will lead this country to anything resembling energy independence. Several months ago, the operators of three nuclear reactor projects – Tennessee Valley Authority (Watts Bar 2 in Tennessee), Southern Company (Vogtle 3 and 4 in Georgia) and Progress Energy (Levy 1 and 2 in Florida)  – announced that they are all over budget and behind schedule. This suggests that the nuclear industry is repeating its past mistakes, when reactor construction resulted in hundreds of billions in cost overruns, abandonments, bankruptcies, defaults and the cancellation of more than half of the reactors proposed to be built across the country.

    TVA Watts Bar 2 is one of two reactors that TVA began building in 1973. It completed Unit 1 in 1996, but halted construction on Unit 2 in 1988 after completing about 80 percent of it and spending $1.7 billion. In 2007, TVA decided to complete the unit, expecting that it would come on line in 2012 and cost another $2.5 billion. In April, TVA released a revised construction schedule and cost estimate. Now the agency says it will start generating electricity in December 2015 and cost an additional $1.5 billion to $2 billion, putting the total estimated cost of completing the reactor at $4 billion to $4.5 billion. If TVA’s new schedule holds, Watts Bar 2 will have taken 42 years and at least $6 billion to complete.

    Southern Company subsidiary Georgia Power and several regional partners are building Vogtle 3 and 4 at an existing reactor site. Georgia Power et al. originally planned to start one unit up in 2016 and the other in 2017 at a cost of $14 billion, but they announced in April that the project will cost at least $900 million more and they may have to push back the start dates.

    Progress Energy Florida is proposing to build Levy 1 and 2 at a new site in Levy County, Florida. Progress first announced Levy in 2008 as a one-reactor, $3.5 billion project that would come on line in 2016. In April, the utility announced that the first of what is now planned to be a two-reactor project would not come on line until 2024 because of low customer demand, the ongoing recession, low natural gas prices, and the lack of a federal carbon pollution policy. Project cost estimates for the two reactors have ballooned to $24 billion.

    This latest news from the front should provide yet another cautionary tale to anyone who believes that a “nuclear renaissance” is imminent or that new nuclear reactors are key to our nation’s energy security. Most regulated utilities are taking a wait and see approach to building new reactors: They will wait and see how Watts Bar, Vogtle and Levy turn out. Early indications are not encouraging. Independent power developers and Wall Street analysts have already rendered their verdicts: New nuclear power is too risky to compete in competitive electricity markets.

    Meanwhile, the cost of upgrading our rapidly aging reactor fleet, particularly in the wake of the Fukushima disaster and new safety requirements, also is creating challenges for the industry. This is especially the case for competitive electricity markets, where the cost of expensive upgrades must be recovered in the face of dramatically lower natural gas prices driving down wholesale power prices. Thus, while nuclear power presently comprises 20 percent of U.S. electricity generation, there is no guarantee that it will remain at that level  given the deteriorating economics of both new and existing reactors.

    The jury is still out on the implications of a large scale transition to natural gas and its associated fracking and climate change risks. And we still have not put all of the policies in place to build and pay for the modern and more flexible transmission system that is needed to integrate our abundant wind and other renewable resources. But for better or for worse, increased utilization of home-grown renewables and natural gas would bring us much closer to reducing our dependence of foreign energy supplies than increasing our dependence on increasingly unaffordable and risky nuclear power. 




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    Dr. Mark J. Perry (Twitter: @Mark_J_Perry) is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan. Dr. Perry holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University near Washington, D.C. In addition, he holds an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota. In addition to a faculty appointment at the University of Michigan-Flint, Perry is also a visiting scholar at The American Enterprise Institute in Washington, D.C. He is best known as the creator and editor of the popular economics blog Carpe Diem. While at AEI, Dr. Perry writes about economic and financial issues for The American and the AEIdeas blog.



    Ellen Vancko manages the Union of Concerned Scientists (UCS) research and analysis of nuclear power’s viability as a potential climate solution. She also is UCS’s senior adviser on federal and state policies governing electricity markets, reliability, transmission systems, energy conservation, demand management, smart grid, and the integration of renewable energy into the electrical system. Vancko, a highly regarded energy policy expert, has more than 25 years of experience in the electric utility industry. Before joining UCS, she was director of communications and government affairs for the North American Electric Reliability Council, regulatory policy director for Allegheny Energy and the Edison Electric Institute, and served as an energy consultant on a range of issues. She holds a master of science degree in energy management and policy from the University of Pennsylvania and a bachelor’s degree in political science from the George Washington University. Vancko has authored and edited major UCS reports and analyses, including "Nuclear Power: A Resurgence We Can’t Afford," "Nuclear Power: Still Not Viable Without Subsidies," and "Nuclear Loan Guarantees: Another Taxpayer Bailout Ahead?" She speaks regularly at energy conferences and has been cited by dozens of media outlets, including the Boston Globe, Christian Science Monitor, National Journal, New York Times, Wall Street Journal and Washington Post. She has also appeared on news programs on Bloomberg TV, MSNBC, National Public Radio and Public Radio International.


    FAS Resources:

    2012 Summer PIR: President's Message, "Making the Case for Nuclear Power in the United States"

    2012 March 15, The National Interest: "Nuclear Power's Uncertain Future"

    2012 February 29, Nieman Watchdog"So Many Questions About Nuclear Power"

    2012 February 27, The Burn Blog (curated by UT Austin), "Response: Make Nuclear Power More Efficient and Cost Competitive with Natural Gas"

    2012 February 8: FAS Report,  The Future of Nuclear Power in the United States

    2012 January 13, The Atlantic"Killing Iranian Nuclear Scientists Is Counterproductive and Wrong"

    2011 November, Foreign Policy"Think Again: Nuclear Power"

    Additional Resources:

    CRS Reports:


    Other Resources:

    Last updated September 12, 2012 5:30 PM



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