Growing US nuclear power resurgence reaches the nation’s heartland
A nuclear power comeback is starting to take shape in the U.S. as officials consider reopening the Duane Arnold Energy Center in Iowa.
Straight Arrow News
As the owner of Three Mile Island plans to restart a reactor at the plant where America’s worst commercial nuclear accident occurred 45 years ago, the owner of Duane Arnold nuclear plant in eastern Iowa says it, too, is weighing whether to bring its closed facility back online.
Maryland-based Constellation Energy said Sept. 20 it plans to restart an undamaged reactor at Three Mile Island to provide 835 megawatts to serve Microsoft Corp.’s massive data center energy needs over the next two decades. Repowering Three Mile Island, where one of the two reactors suffered a partial meltdown in 1979, will cost $1.6 billion, the utility estimates.
A separate company, Utah-based Energy Solutions, owns the damaged reactor and is continuing a long-term cleanup, with plans to demolish it mid-century.
NextEra Energy, the Florida company that owns the 600-megawatt Duane Arnold Nuclear Center, said this week it “may consider resuming operations” at the plant near Palo — Iowa’s only nuclear power station — as it looks at “future energy demands.”
“There are no formal plans to do so at this time,” NextEra spokesperson Bill Orlove said in an email. But he added, “We are evaluating this opportunity.”
Data centers like Microsoft’s are driving exploding demand for energy, and Iowa is a major hub for that industry. Google, Facebook, Microsoft and Apple have invested nearly $12.3 billion building data centers in the state since 2007. And investment continues. Google has proposed a $576 million data center in Cedar Rapids and an unidentified company this week proposed to spend $750 million to build another there, a project that the Cedar Rapids Gazette reported would be the largest in the city’s history.
About 80 miles southeast, Facebook parent Meta is planning to build an $800 million Facebook data center in Davenport.
In June, NextEra CEO John Ketchum told Bloomberg News that some tech giants have asked the utility, “Can you show us sites that can accommodate 5 gigawatts of demand?” given data centers’ voracious energy needs to power artificial intelligence, high-speed streaming and remote work.
“Think about that. That’s the size of powering the city of Miami,” Ketchum told Bloomberg, declining to name the tech companies. Finding a site that could provide 5 gigawatts of energy — equal to about eight times Duane Arnold’s nuclear generation — would take some work, and require an added mix of solar, wind and battery storage, along with a connection to the power grid.
Some of the potential tech interest has focused on restarting the Duane Arnold plant, Ketchum said, adding that he would consider it “if it could be done safely and on budget.”
Data centers’ energy demand is expected to grow 160% through 2030 “as the pace of efficiency gains in electricity use slows and the AI revolution gathers steam,” according to a Goldman Sachs Research report in May. One reason why: ChatGPT, an AI chatbot that uses machine learning to generate human-like text, “needs nearly 10 times as much electricity to process as a Google search,” the report says.
Last year, Microsoft said one of its West Des Moines data centers has been the “unlikely epicenter for the AI revolution,” with its Azure supercomputers there assisting OpenAI, the private AI research company. The collaboration created models capable of performing an increasing range of tasks, “from analyzing documents to writing and debugging computer code and helping plan vacations,” Microsoft said.
“How do you move fast enough to meet these new loads?” said Clair Moeller, president of MISO — the Midcontinent Independent System Operator — that manages energy transmission across Iowa and 14 other states, as well as a Canadian province.
“Bringing on capacity like Duane Arnold or building additional gas-fired generation in the short run is pretty important in order to meet this serious acceleration in data centers,” Moeller said in an interview with the Des Moines Register.
Changing market conditions could revitalize nuclear power
The Duane Arnold nuclear plant closed four years ago because it was no longer economically viable. In 2018, NextEra and Alliant Energy announced an early end of Alliant’s agreement to purchase power from the plant. The companies said the move, along with repowering existing wind farms, would save Iowa energy customers $300 million over roughly two decades.
A majority owner, NextEra began decommissioning Duane Arnold in August 2020 after a massive derecho plowed through Iowa and seven other states, causing $11 billion in damage to structures including the plant’s cooling towers, pushing up its decommissioning by about two months.
The six-decades long decommissioning is estimated to cost about $1 billion, according to documents filed with the U.S. Nuclear Regulatory Commission.
Since then, though, market conditions have changed, experts say. The plant, about 8 miles northwest of Cedar Rapids, could become financially viable if a “big tech company or data center player” became the dedicated energy buyer, said Akshat Kasliwal, energy markets adviser at PA Consulting Group Inc., a global business services company.
With “aggressive goals around decarbonization,” tech companies are more willing to pay a “bit of a price premium” for carbon-free energy, said Kasliwal, a managing consultant based in Denver.
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Over the past five years, he said, tech companies have purchased as much, and possibly more, renewable energy than utilities. But wind and solar, even with batteries, aren’t yet able to provide 24/7 renewable energy. And companies like Microsoft and Google want to use “carbon-free electricity all hours of the year, not just an annual match,” Kasliwal said.
“There’s just not a lot of options out there in terms of around-the-clock carbon-free energy,” he said.
NextEra’s Orlove said resuming operations at a nuclear plant that’s being decommissioned “is not a simple exercise.”
“The company needs time to look at all aspects needed to make an informed decision about resuming operations at the facility,” he said.
MidAmerican Energy, owned by Warren Buffett’s Berkshire Hathaway, said in an email this week that it expects nuclear energy to play “an even greater role as we navigate through the energy transition and continue to balance reliability and affordability in ways that are environmentally responsible.”
MidAmerican owns 25% of the Quad Cities Clean Energy Center, a nuclear plant in Cordova, Illinois, that produces close to 2 gigawatts of energy. Constellation Energy, the company that wants to restart Three Mile Island, owns 75% of the plant, which is about 25 miles north of Davenport.
While MidAmerican removed its proposal to recover nuclear energy study costs from its $3.9 billion wind and solar initiative, called Wind Prime, the Des Moines utility said in an email it continues to explore nuclear energy options, especially small modular reactors.
“The same goes for other emerging technologies, such as energy storage, which would complement our growing renewable energy fleet,” the company said.
Federal aid could make nuclear plant restarts more feasible
PA Consulting Group’s Kasliwal said efforts to reopen Three Mile Island, as well as Palisades nuclear plant in Michigan, could help provide NextEra a blueprint for restarting Duane Arnold.
In March, the U.S. Department of Energy said it would provide Holtec International, the Florida company that owns Palisades, with a $1.52 billion loan to help restart the 800-megawatt plant. The state of Michigan also has earmarked $150 million to repower the plant.
The federal loan was made possible by the 2022 Inflation Reduction Act. President Joe Biden has said nuclear energy can help the country achieve a carbon pollution-free power sector by 2035 and net-zero emissions economy by 2050.
Holtec, which is privately held, said it has signed long-term agreements to sell Palisades’ power to two electric co-ops, one based in Michigan and another nearby in Indiana.
Kasliwal said Palisades and a restarted Three Mile Island also could qualify for federal production tax credits, like those offered for solar and wind energy.
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While complicated, restarting nuclear plants is more attractive than building a new plant, given regulatory hurdles, transmission constraints and potential opposition, Kasliwal said.
And Duane Arnold can lean on its 45-year history of safe operations should NextEra decide to restart the plant, he said. Constellation likewise said the Three Mile Island reactor it would restart operated at “industry-leading levels of safety and reliability for decades before being shut down for economic reasons” five years ago.
It’s unclear how much work will be required to reopen the nuclear plants, Kasliwal said, adding that NextEra would need to rebuild Duane Arnold’s cooling towers. And this week, a nuclear power regulator said inspections revealed the Palisades steam generators require additional repair.
Holtec nevertheless said it should be able to complete the work in the time and cost estimate provided, and it expects the plant to reopen in 2025. The company also plans to build two small modular reactors next to the restarted plant. Each unit, expected to come online in 2026, is designed to produce 300 megawatts of power.
Constellation expects the Three Mile Island project, renamed the Crane Clean Energy Center, to open in 2028. Kasliwal said he would expect Duane Arnold to need a similar period to recommission, if it were to reopen.
Both Constellation and Holtec said they expect broad economic benefits from the restarted plants, including creating 600 permanent jobs. Duane Arnold employed about 500 people before it closed.
Donnelle Eller covers agriculture, the environment and energy for the Register. Reach her at deller@registermedia.com or 515-284-8457.
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Publish date : 2024-09-26 00:49:00
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