estimated cost of new nuclear power plants has tripled in the past few years

Cost of nuclear plant fuels battle - Price of new plants in North and
South Carolina would be ammunition for opponents -- if utilities didn't
hold info close

News Observer, April 24, 2008
by John Murawski

As the fight over nuclear energy shifts from safety to cost, timing the
public release of the multibillion-dollar expense takes on an increasingly
strategic value to both sides.

The estimated cost of new nuclear power plants has tripled in the past few
years, with projections now hitting $6 billion to $9 billion per reactor.
Cost estimates are expected to continue escalating. Soaring costs make the
prospect of new nuclear power even harder to sell to a public that will
ultimately pay for new plants through rate increases.

Nuclear critics are homing in on the staggering costs to lobby their case.
It helps the opponents to have a dollar figure to object to, but electric
utilities are reluctant to cooperate.

Nuclear opponents are trying to force Duke Energy of Charlotte to disclose
the projected cost of a proposed nuclear plant in Cherokee County, S.C.,
that would serve the Carolinas. The groups have asked officials in both
states to require that Duke disclose the estimate. South Carolina
regulators are expected to rule on the request today. North Carolina
regulators could decide as early as Tuesday.

"If you want the ratepayers to pay for something, are you going to tell
them it's none of their business?" said C. Dukes Scott, South Carolina's
consumer advocate, who represents the public in utility rate cases.

Scott agrees with anti-nuclear groups that the cost estimate should be
made public.

Duke will have to reveal the project cost when it seeks a permit in South
Carolina, but such a disclosure may be a year away. Nuclear opponents say
the public shouldn't have to wait that long for vital information about
such an important decision.

Cost kept confidential

The cost estimates are available to state regulators, public officials and
lawyers, as long as they sign confidentiality agreements.

Duke is still negotiating with vendors and contractors, contending that
its cost estimates are proprietary and sensitive.

North Carolina's consumer advocate, Public Staff, agrees with Duke that
the cost estimate qualifies as a trade secret under North Carolina law.

Releasing the company's preliminary cost projections could undermine
Duke's negotiating leverage and ultimately hurt customers, it says.

"Our whole effort here is trying to get the best cost for our customers,"
Duke spokeswoman Paige Sheehan said. "The people who have intervened in
this case are doing anything and everything they can to harm this

Nuclear opponents want the utilities to develop alternative energy and
efficiency programs and rely on the construction of a power plant as a
last resort. The state's utilities maintain that new power plants are
needed to meet this region's growing demand for energy.

Nuclear critics insist that a ballooning price hurts the case for new
nuclear plants and that cost revisions over time undermine a utility's

"The thing is just replete with uncertainty and risk on every front," said
Jim Warren, director of N.C. Waste Awareness and Reduction Network, a
Durham organization that opposes nuclear plants. "There's a lot of denial.
They'd like to think they've got this thing nailed down."

Progress' estimate

Progress Energy won't reveal cost estimates for nuclear reactors proposed
for its Shearon Harris nuclear plant in Wake County, where the Raleigh
utility operates one reactor.

The company was required by Florida law to disclose the cost of proposed
reactors in that state, revealing that each reactor would cost about $7

But Progress Energy warned that the estimate is preliminary and likely to
increase. Residential utility bills in Florida could increase by as much
as $25 a month to pay for the plant.

Duke is being challenged to disclose nuclear costs under new laws in North
Carolina and South Carolina that allow utilities to start paying debt on
power plants before the plants are built -- even if the projects are

Duke isn't applying to raise customer rates now, but the company is asking
regulators in both states for the green light to spend about $230 million
in development costs as the company keeps its nuclear option open. Those
costs include preparing an application for a federal nuclear license,
federal regulatory fees, site evaluation, land and rights of way
purchases, demolition and site preparation, and detailed engineering.

The nuclear reactors that Progress is planning in Florida -- the
Westinghouse AP 1000 model -- are the same technology that Progress has
proposed for the Shearon Harris site and Duke has proposed for Cherokee
County, southwest of Charlotte.

Duke's 1.8 million customers in North Carolina would use most of the
electricity generated by the proposed plant and would pay for about 70
percent of the cost of the project.

Just double talk?

In February, Duke Energy CEO Jim Rogers told South Carolina regulators
that the Cherokee County plant would cost $6 billion to $8 billion, but
the company now says that estimate is dated and inaccurate.

Scott, the South Carolina consumer advocate, said that he supports Duke's
nuclear plans but that he wants the company to keep the public in the

"If the cost wasn't confidential in February," Scott said, "how is it
confidential in April?"