News

June 20, 2009

Planned nuke reactor might not be built

Report: PPL could sell Bell Bend if it can’t get fed loan guarantees, says PPL exec.

PPL Corp. might sell the Bell Bend nuclear reactor it’s hoping to build in Salem Township if it can’t secure enough federal nuclear loan guarantees, company chief Jim Miller told reporters in Washington, D.C., on Tuesday,

Joe Scopelliti, the spokesman for the two-reactor Susquehanna nuclear plant that PPL operates in the township, confirmed Miller made the comments. But the spokesman said the comments might have been taken out of context “a bit” in The Energy Daily newsletter.

The publication reported that “the license would be good for 40 years and that if PPL decided not to proceed with a new reactor, the license (according to Miller) ‘could be sold to someone who might want to use it.’”

“I can tell you that we haven’t made a final decision on whether or not to build Bell Bend, but that we continue the process with the (U.S.) Nuclear Regulatory Commission of the combined construction and operating license application. We also continue to seek federal loan guarantees. We think federal loan guarantees are important,” Scopelliti said. “Whether or not we build Bell Bend, of course, the application has value itself.”

The problem, according to Miller’s reported comments and past statements from Scopelliti, is that the $18.5 billion in federal loan guarantee authority provided by Congress to bolster financing for new reactors will only support a few new reactors.

Bell Bend and numerous other proposed plants not ranked highly enough by the Energy Department will have little chance of securing any of that funding. Despite general federal support for nuclear development, PPL and other companies believe the government has done nothing to support the actual construction.

“I think there was a great anticipation (that there would be a renaissance). That has not come to pass,” Energy Daily quotes Miller as saying on Tuesday. “Nothing is in place to move the industry.”

“We would like to see that pool expanded to a larger amount, yes,” Scopelliti acknowledged. “With a project as large as this, financing is a critical part. … It’s not like we’re getting a gift. What we’re getting is an opportunity to finance money at a better (interest) rate.”

While Scopelliti said he’s not aware of any plans to sell the proposed 1,600-megawatt reactor, the company is seeking partners to fund construction adjacent to the existing reactors at Susquehanna. Scopelliti noted the company has time to line up finances because the reactor won’t be considered for approval by the NRC until 2012.

He said even if the company seeks the license, the design is certified and the COLA is accepted, if the finances aren’t good for building in 2012, the company doesn’t have to build in that year.

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