Cherokee County Site Picked for Nuclear Plant
By Jim Duplessis, The State, Columbia, S.C.
Mar. 17–Duke Power Co. and Southern Co. have picked a site in Cherokee County for a potential $4 billion to $6 billion nuclear plant, reviving plans abandoned there 23 years ago in the wake of concerns about spiraling construction costs and exaggerated projections for demand.
If the utilities decide to go ahead, they expect it could take up to four to six years to gain regulatory approval. Construction could take up to five years, employing about 1,000 people at its peak.
By 2016, Duke Power hopes to have 700 to 800 employees working to generate 1.1 megawatts to 2.2 megawatts of electricity from nuclear power in Cherokee County. One megawatt is enough electricity to power from 400 to 900 homes for a year.
"Looking 10 to 15 years out from now, we clearly, clearly will need additional capacity," said Brew Barron, Duke Power’s chief nuclear officer.
Under the agreement announced Thursday, Duke Power owns 55 percent of the project. The remainder is owned by Southern Co., based in Birmingham, Ala., and serving 4.2 million customers.
Southern would be obligated to pay 45 percent of construction costs for the first unit and buy 500 megawatts of power from the site, said Sandi Robinson, a Southern spokeswoman. It has no obligation to pay construction costs on a second unit and no additional power purchase commitments, she said.
The greatest asset for the 2,000-acre site was its approval in the 1970s by nuclear regulators. That familiarity could save time and cut construction risks for what would be the utility’s first nuclear power plant since the Catawba plant opened in York County in 1985.
Duke Power, a subsidiary of Charlotte-based Duke Energy, chose Cherokee County over sites in Oconee County and Davie County, N.C.. The utility held out the possibility those sites would be considered for future plants to meet power needs beyond the current 15-year plan.
The prospects for nuclear power have been brightened by rising energy prices and instability in the Middle East. The industry also has been helped by incentives supported by President Bush; streamlined regulatory reviews; and new, modular construction methods designed to reduce risks of flaws.
The plan revives nuclear ambitions for the site dating back to 1974, when Duke Power announced plans to build three units.
In the 1960s, some nuclear power supporters said plants would produce power at a cost too cheap to meter, because fuel costs would be relatively low.
But the Achilles heel for the industry was construction costs. The Three-Mile Island nuclear plant accident near Harrisburg, Pa., brought greater public and regulatory scrutiny to the industry, while electricity demand growth slowed, construction costs rose and interest rates to finance the construction skyrocketed.
The result was an industry-wide retreat from nuclear power plant construction. Duke had already begun construction of its first unit at the Blacksburg site by 1982 when it scrapped plans for the other two. Duke halted construction at the site in 1983 after spending $633 million, or about $1.2 billion adjusted for inflation.
Earl Owensby, a Shelby, N.C., businessman, bought the site two years later and converted the complex into a movie studio. The best-known film to emerge from the complex was "The Abyss," a nuclear submarine rescue move filmed underwater in 1988 in the plant’s massive containment vessels.
Southern Co. bought the site last year.
Shares of Duke rose 16 cents, to close at $29.37 on the New York Stock Exchange, and Southern Co. shares rose 10 cents, to $33.83.
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Copyright (c) 2006, The State, Columbia, S.C.
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