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NRG Seeks First US Nuclear Plant Permit in Decades

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WASHINGTON/NEW YORK - NRG Energy will file an application with regulators on Tuesday to build two new nuclear reactors in Texas, the first such request in the United States in 29 years, the company said Monday.

The two 1,350-megawatt General Electric advanced boiling water reactors (ABWR) would join two existing reactors at the South Texas nuclear power plant in Bay City, Texas, near Houston.

The filing with the Nuclear Regulatory Commission would be the first complete request to construct new reactors in the United States after Constellation Energy Group Inc and French-owned Areva issued a partial request to build new reactors at the Calvert Cliff Nuclear Power Plant in Lusby, Maryland, in August.

"Being the first to file is important, but the most important thing is to be the first application approved," NRG Chief Executive Officer David Crane told Reuters.

The resurgence of nuclear power in the United States comes as companies seek new generating capacity from energy sources that do not emit carbon dioxide, the greenhouse gas blamed for global warming.

The NRC says it expects US companies to file applications for about 30 new combined construction and operating licenses in coming months. If granted by the NRC, the licenses would allow companies to construct and operate a nuclear plant in one fell swoop, minimizing possible regulatory delays.

No applications for new nuclear power plants have been filed since at least 1977, and several planned plants were canceled after the 1979 Three Mile Island accident in Pennsylvania that sparked a backlash against the technology.

Now Dominion Resources, Duke Energy and Southern Co are among the utilities in the process of seeking plant licenses, according to the NRC.

The regulator is expected to take about three years to process applications, and construction could take four years, putting the first new US reactors online sometime around 2015.

HIGH PRICE, GOVERNMENT HELP

Currently, 104 nuclear units are in operation in the United States, contributing about 20 percent of the nation's power.

The price tag to develop NRG's reactors will be US$6 billion to US$7 billion -- costs that the company said it could afford only with the incentives provided by the federal government in 2005.

"We would not have even started otherwise. It was created to start a race. We set out to move as quickly as possible," Crane said.

The Energy Policy Act of 2005 authorized a production tax credit of up to US$125 million per year for companies that seek a construction and operating license application by the end of 2008, start construction by the end of 2013 and are operating before 2021.

NRG is the second largest power generator in Texas, behind TXU, and the South Texas Project is the state's largest nuclear reactor. Its two units began operation in 1988 and 1989.

NRG has yet to convince its two municipal utility partners in the existing STP facility to invest in the new reactors.

"We have not made a decision," said Ed Clark, spokesman for Austin Energy. "It will be 2008 before we decide."

A spokeswoman for City Public Service of San Antonio, the second-largest owner of STP, said late last month that no timetable had been set for the utility to make its decision.

(Additional reporting by Eileen O'Grady in Houston)

Story by Chris Baltimore and Lisa Lee

Story Date: 25/9/2007