Nuclear power is on the verge of a remarkable comeback. It's been three decades since an American utility ordered a nuclear plant, but 35 new reactors are now in the planning stage. The byzantine regulatory process that helped paralyze the industry for a generation has been streamlined. There hasn't been a serious nuclear accident in the U.S. since the Three Mile Island meltdown in 1979. And no-nukes politics has become a distant memory. It was a sign of the times when John McCain ridiculed Barack Obama for opposing nuclear energy--and the allegation wasn't even true. "There's only a very small minority in Congress that still opposes nuclear power," says Alex Flint, the top lobbyist at the Nuclear Energy Institute (NEI). "That's quite a change."
The most powerful change agents have been the surge in U.S. electricity demand--forecast to grow another 30% by 2030--and the threat of global warming. Atomic reactors produce no carbon emissions, so energy analysts, politicians and even some environmentalists have embraced them as a clean power source for a wired world, an alternative to fossil fuels that can generate electricity when the sun isn't shining and the wind isn't blowing. The specter of a carbon-pricing scheme to address climate change has transformed nuclear economics. Originally touted as "too cheap to meter," nuclear energy turned out to be extremely expensive, but advocates say it will look much cheaper once coal and gas plants have to pay for their emissions. And unlike clean coal and other speculative technologies, nuclear energy already provides 20% of our power. "We're sitting on a ham sandwich, starving to death," says Georgia Republican Senator Johnny Isakson.
But some little-noticed rain has fallen on the nuclear parade. It turns out that new plants would be not just extremely expensive but spectacularly expensive. The first detailed cost estimate, filed by Florida Power & Light (FPL) for a large plant off the Keys, came in at a shocking $12 billion to $18 billion. Progress Energy announced a $17 billion plan for a similar Florida plant, tripling its estimate in just a year. "Completely mind-boggling," says Charlie Beck, who represents ratepayers for Florida's Office of Public Counsel. "A real wake-up call," says Dale Klein, President Bush's chairman of the Nuclear Regulatory Commission (NRC). "I'll admit, the costs are daunting," says Richard Myers, NEI's vice president for policy development.
The math gets ugly in a hurry. McCain called for 45 new plants by 2030; given the nuclear industry's history of 250% cost overruns, that could rise to well over $1 trillion. Ratepayers would take the main hit, but taxpayers could be on the hook for billions in loan guarantees, tax breaks, insurance benefits and direct subsidies--not to mention the problem of storing radioactive waste, if Congress can ever figure out where to put it. And those 45 new plants would barely replace the existing plants scheduled for decommissioning before 2030.