More Nuclear Energy: Why America Needs it Now

It's my pleasure to introduce our distinguished speaker tonight, Admiral 'Skip' Bowman. Admiral Bowman is the President and the Chief Executive Officer of the Nuclear Energy Institute. NEI is the nuclear energy industry's policy organization in Washington DC. Prior to joining NEI, Admiral Bowman served for more than 38 years in the US Navy. Admiral Bowman held the dual roles of Director of the Naval Nuclear Propulsion Program and Deputy Administrator of Naval Reactors in the National Nuclear Security Administration at the US Department of Energy. In these concurrent positions he was responsible for the operations for about 103 reactors aboard Navy's aircraft carriers and submarines, fitting credentials for the leader of the nuclear energy industry's policy group. Nuclear energy has emerged again on the national scene as part of the dialogue of what to do about global warming and climate change and about the energy security. The industry is preparing to submit license applications for a whole new generation of commercial reactors across the United States. So the Commonwealth Club thought it would be appropriate that we welcome 'Skip' Bowman to our club this evening. Please welcome Admiral Bowman. Thank you very much David and thank you and I especially thank the Commonwealth Club for inviting me to be here with you tonight. I am quite impressed with your 1903 beginnings and the 1913 First Environmental Study that was done by this club and it's quite a thrill to be here to talk. I think it's fitting that I would be here to talk given some of what David just said and the role that I feel nuclear can play in solving some of our current energy problems. Clean nuclear energy can partner responsibly with renewables, with advanced coal and even with plug in hybrids. All of these technologies are part of an energy supply portfolio that will be needed to meet growing energy needs after all conservation and efficiency measures are long exhausted. Two propositions first, I believe that nuclear power is currently the only proven technology deployed or deployable on a large scale to provide base load electricity 24/7 with zero air emissions. Second, I believe that if we are going to be environmentally responsible and produce the base load electricity required to drive modern economic growth, nuclear power is an indispensible part of the future energy portfolio of the United States and the world. So to explore these assertions if you would allow me to focus on three areas tonight. First the importance of emission free nuclear energy in generating electricity for our country. And then secondly, bring it a little closer to home and talk about electricity generation and consumption here in California today and the challenges that we and you face and the steps that you might consider to solve those challenges. And then third some concerns about nuclear energy and there are several, and I will be the first to acknowledge that the love affair that we are now experiencing with the American public and with leadership in Washington is a little bit qualified, because what I hear is yes, nuclear must be on the table but what about now fill in the blank, what about waste, what about costs, what about safety, what about security, what about proliferation, what about transporting that waste and so on and so forth. I would like tonight to take two of those and then respond to any questions you might have in the other areas and I will tonight talk about nuclear plan. Safety and the use nuclear fuel aspect of all of this. So let me start with nuclear energy's clean air benefits and back to that very first assertion that I made, that nuclear energy is our country's only large scale energy source capable of producing round the clock electricity while emitting no air pollutants or greenhouse gases during production. The 104 nuclear plants today generate 20 percent of this country's electricity and nuclear energy is the largest source, nearly 75 percent, of all emission free electricity in this country. Nuclear plants in fact avoid carbon dioxide emissions equivalent annually to the carbon dioxide emissions from virtually all the passenger cars on the roads in the United States today. Nuclear energy is also the lowest cost large scale producers of electricity in this country. Nuclear energy's electricity production cost marginal production cost in 2006 was 1.7 cents per kilowatt-hour. Here in California I understand the number is on an average about 14 or 15 cents per kilowatt-hour that you are actually paying. Coal in 2006 compared to that 1.7 cents per kilowatt-hour came in at 2.4 cents a kilowatt-hour. Natural gas is 6.8 cents per kilowatt-hour and petroleum at 9.6 cents a kilowatt-hour. So you can see nuclears' production cost and admittedly this is marginal production cost, it's not retiring capital because the capital is essentially already amortized and retired. But nuclears' marginal production costs are far and away the lowest and are not subject to fluctuations in the natural gas market as are many of the others. So for these reasons nuclear energy release economic and environmental pressures on fossil fuels, greenhouse gas emissions from the electric sector would be far greater without the contribution of nuclear energy generation, in fact 27 percent greater. Natural gas price volatility would also be even worse than what we have seen in the past two or three years without nuclear energy being in the generation mix. Using nuclear energy for electricity production makes natural gas more available to those industries like petrochemical and fertilizer production that use gas not as a heat source but as a feed stock. High and volatile natural gas prices have already driven 300,000 plus jobs overseas. As a domestic energy technology with fuel from the United States and reliable trading partners, nuclear energy is essential to our nation's energy security. And energy security is a critical component of our national security. Because of my 38 year career in the Navy I really link these two elements. I believe that nuclear energy is critical to the national security. So energy security equals national security. In fact that view my current job as a natural extension of the previous 38 years of my life. America already depends entirely too much on imported oil, 63 percent of its oil consumption and much of it is, you all know, from countries whose values do not often coincide with our own. We exacerbate that dependence on energy sources from these countries by increasing our dependence on imported natural gas. Consensus estimate show that the United States would be importing 25 to 30 percent of its natural gas needs within 20 years and most of it from countries that are prone to political and social instability. For these reasons I believe it is in our national interest and in our security interest to maintain and expand nuclear energy for this country for the generation of electricity. I would now like to turn to part two of this and talk about energy needs for California and how nuclear energy might help. Economic growth is of course a very good predictor of growth in electricity demand and the California economy is simply booming. You have achieved an average growth in gross state product of three percent per year over the past 5 years and you are now number one in the country in terms of gross state product. California will need reliable, affordable electricity in the future to sustain this economic growth, to attract the world businesses and to encourage spending and investment. Growth in population is another predictor of growth in electricity demand. And according to the US Census Bureau, California is expected to add some 12.6 million new residents to through 2030, a 37 percent increase. In part that's why the US Energy Information Administration projects electricity demands in California will increase by 74 percent by 2030. Today over 40 percent of California's electricity comes from natural gas. In fact you can read some versions of this to say over 50 percent of electricity comes from natural gas compared with the national average of 20 percent dependence on natural gas. This is reason for concern in my view for the reasons that I have stated. This dependence subjects California and you and your economy to the punishing price volatility that reflects our natural gas markets. The solution to the future energy requirements and electricity requirements of California of course is not simply to build more generation capacity. We should and must first exhaust all possible efforts at efficiency and conservation. And I truly believe that. We should next not turn to nuclear but turn to renewables to the maximum extend we possibly can. But having done these two things, having taken all the possible conservation demand side approaches that we possibly can and putting on as much renewable as we possibly can, I also believe that the arithmetic would tell us that there will remain a gap and that gap needs to be filled by a reliable source of electricity that doesn't continue to contribute to greenhouse gas problems and climate change. In 2006, you Californians passed land mark legislation establishing comprehensive programs to achieve real quantifiable reductions of greenhouse gases, AB32. Californians have always been exceptional environmental stewards going back to 1913 right here at this club. You truly care about the kind of California that you pass on to your grandchildren and my six grandchildren. But here is the challenge; California has an increasing electricity appetite that can't be ignored. Yet you have the laws and a strong sense of environmental stewardship that limit your choices in electricity production options. I will continue to suggest then tonight that the option for nuclear simply must be on the table. Today, California's four nuclear power plants produce about 13 percent again I can find numbers ranging all the way up to 19 percent of your electricity generation compared to around 20 percent nationally. As you know the two reactors at Diablo Canyon operated by Pacific Gas and Electric, and the two reactors at San Onofre are operated by Southern California Edison. Every year, because they displace fossil fuels that would otherwise be required to meet your electricity demands here in California, these four nuclear plants avoid emissions of over 200 tones of sulphur dioxide, of course associated with acid rain, 2000 tones of nitrogen oxide, creep precursor to ground level ozone and smaller and over 14 million metric tones of carbon dioxide are avoided. That's the equivalent of about 2.7 million automobiles on the road. Now these numbers come from the Department of the Energy's information sources that are available on the net; anybody can go find those. Unfortunately in my view anyway, California over the years has shut down three nuclear power plants. But looking to the future, with that behind us, if California were to build three nuclear power plants to begin operating by 2030, nuclear could meet nearly 20 percent of that predicted growth in electricity requirements that I have been talking about. I command the California Public Utility Commission for recognizing the value of nuclear energy last year when they approved the capital improvements at both San Onofre and Diablo Canyon, and recognized that significant investment in these nuclear plants and what would bring to the citizens of California to keep them running safely and efficiently well into the future. So again I came tonight to suggest that nuclear energy should be on the table for your consideration. Now on the challenges, the so called "yes-but" you may remember that I said that the yes-but fall into the categories of what about safety, what about security, what about waste, what about transportation of that waste, what about proliferation ad will nuclear new nuclear really be competitive with new something else. So I promise that I would address two of these and I think I picked two of the ones that are most prevalent and may be two of the ones most on your mind. So let me let me go about this. I would like first to talk about these questions about safety of the nuclear industry. And let me just start by saying having come from the Navy's Nuclear Power Program and now I am having been associated with the Commercial Nuclear Power Program in this country for the last two and a half years, safety is the industry's and the Navy's Nuclear Navy's highest priority; period. We never relax our vigilance when it comes to safety. We have created operating practices in over site institutions that ensure the highest standards and continue to outstanding safety performance on the commercial side of these 104 reactors. Safety begins with the design of our plants; redundant, reliable safety systems are designed to protect you, to protect our operators and to protect the environment. Our reactors are designed to withstand the effects of extreme natural phenomena such as earthquakes, tornados hurricanes, floods, tsunamis, without loss of capability to perform safety functions. The plant designs reflect the most severe of the natural phenomena that have historically been reported for that site for that particular site and the surrounding area, plus an additional built in safety margin. Beyond design though, we are committed to other parts of defense in depth, a safety approach that ensures absolute safe operation. First we employ a very dedicated, a very talented and a very professional work force that receives comprehensive and rigorous training. We operate these plants with strict procedural compliance and maintain an industry wide database to catalog plant operating experiences so that the entire industry can learn from every plant's experience and operations. We also have been exhaustive inspection program. Our safety record is proven by key performance indicators tracked by the industry and by the Nuclear Regulatory Commission. But even more confidence for me is derived from the process and not just the matrix that produce those indicators. We have the robust design and the robust defense in depth that I just spoke of, but we also have an independent and demanding regulator in the Nuclear Regulatory Commission, an agency by the way empowered to impose fines and shutdown operations on the spot. Each nuclear site has at least two resident inspectors and as many as four. Throughout the year these inspectors and others from the headquarters in Washington perform base line inspection of all aspects of each plant's operations, including those key performance indicators that I just mentioned. These inspections constitute a minimum of 2500 man hours each year and hold the industry to extremely rigorous standards of safety and security. But we don't stop there in the commercial industry. The industry itself established the Institute of Nuclear Power Operations that conduct extremely detailed two week inspections each two years. These inspections are conducted to the standards of excellence, not just minimum standards of safety. Exit interviews are conducted with the top leadership in the utility organization up to the Chief Executive Officer of the holding company. This is an important part of who we are and what we are. Having observed this INPO process myself now for two years I can assure you that the peer pressure to perform to each excellent standards is enormous, peer pressure CEO to CEO; I have watched it myself now 10 times at 10 different board meetings. So yes I do take comfort in the very positive trends of the indicators that are also on the website, the NRC website, but I take even more comfort in the processes that we've established to ensure. Next let me talk just a little bit about that bigger elephant in the room and it is the waste management idea. First I talked to folks at cocktail parties as well as gatherings like this about about the magnitude of the problem, the volume of the problem and it surprises some people. It may not surprise you. This is a sophisticated audience. But some are astounded to find that if you stacked end to end all the used fuel from 55 years of commercial operation of nuclear power plants in this country, it would fill one football field up to the height of the goalpost, no larger than that. It's still a problem; we still have to deal with it. But it's not the size of the State of Rhode Island or the State of California and some people are really amazed by that. To put it in a little bit different way, if you and I received all our lifetime electricity from nuclear power from day of birth to age 70, the amount of waste contribution from our use of nuclear electricity would weigh about two pounds and would fit into a coke can. So you have to put this a little bit into perspective. I am trivializing what must be done with it but it's not bigger than a bread box. The second thing that people believe and and somehow have come away with is that, this used fuel is very, very difficult to manage and I think I think truth be known, it's just the opposite. Today, used nuclear fuel is stored very safely and securely at the 64 sites around the country in compliance with all Nuclear Regulatory Commission regulations. Used fuel is a solid material encased in steel alloy rods stored in water filled steel walls or in concrete and steel containers; and effectively monitored and managed by the individual nuclear power plant sites. It is safe here, but that's not what the law of the land calls for. The law of the land calls for the United States Government to take title to and remove this fuel from our neighborhoods, from the 64 sites and consolidate it at centralized locations. So that is the problem. It's not certainly that it's unsafe where it is, but it's not meeting yours or my expectations for disposing of this fuel. Now the third myth that I would like to tackle is a may be new news; and it is that the the something around the nuclear industry doesn't have a plan for disposal of this used fuel. Well, we we do have a plan and in fact the original of deep geologic disposal of used fuel like Yucca Mountain remains viable and scientifically justified. That's third assertion I guess, tonight. But a parallel and complimentary path that we have recently developed and this is the new part, features the development of advanced of an advanced fuel cycle technology to employ recycling, to recover vast unused energy in the in the fuel, to reduce the waste volume of that fuel and to reduce the radio toxicity that mother earth must absorb. Now that's big. Its it make sense to me. The the original way the way we have been following for years and years and years has once through fuel rods go through the reactor, you pull them out, you then put them in Yucca Mountain and you walk away from it. You leave 95 percent of the energy content of those fuel rods in the rods if that's the way we go about it. And if you take a look at my garage or ask my wife, you will see that that doesn't sit well with me. I have never thrown anything away over my life time. So why on earth are we throwing away 95 percent of the energy content of this very valuable resource? Why on earth are we subjecting mother earth to more radio toxicity and more heat load than we have to? So the idea would be a three stage plan. First, find volunteer communities that would be willing to and in fact anxious to share in the research and development of this new technology that I am talking about, to recycle this fuel and would agree as part of this to interim storage of the used fuel under US Government control and US Government title while the recycling technology is being developed. Second, conduct that research and develop, conduct that demonstration, prove this out on a on a scale basis on a full scale basis. Prove that it can be done. And then third, construct that the plan that will do that recycling will do that reprocessing and bury the residual in some deep geologic repository. A repository that if we went trough those steps I have just outlined, would easily last even if we go to the kinds of numbers that some people are forecasting for this country, on the order of 300 nuclear power plants for this country, we could we could do with just one deep geologic repository. I think it's important that we think about this. Very major advantages for the country for the country and I am sure you see those. So finally I want to update very quickly the industry's plans for new nuclear capacity as it stands right now today. 17 companies or groups of companies consort to are developing combined construction and operating licenses for up to 31 new nuclear power plants in this country and intend to file those applications with the Nuclear Regulatory Commission beginning this year. We expect to see as many as four of those applications this calendar year in fact. The new nuclear power projects now being developed and employ advanced versions of the light water reactor technology used in today's very safe 104 operating plants, optimized for improved safety, reliability, lower operating and maintenance cost. Unlike the advanced coal based systems that are being looked at, which are growing more and more complex as plant designers' grapple with more stringent environmental requirements, and how to capture and sequester large amounts of CO2. The advanced nuclear plants are moving in the direction of greater simplicity as plant designers take advantage of 30 years of operating experience to improve safety performance while reducing the number and complexity of the systems. Construction of new nuclear power plants is expected to begin by the end of the of the decade; by around 2011. Primarily right now, in the south-eastern part of our country. These first plants could start commercial operation as early as 2015 or 2016. Your support and willingness to factually consider nuclear energy will be essential to California arriving at a well thought out energy plant. Expressing your endorsement to your policy makers, both State and Federal would be very important. But equally important will be furthering this discourse with the broader business community and the general public, both in California and through out the country on the role that nuclear energy can play in solving our energy crisis, preserving our air quality and growing our economy. I hope that I can count on you to join me in this effort, thank you.