ATLANTA -- The U.S. Nuclear Regulatory Commission began hearing testimony Tuesday that will help it decide in coming months whether to allow the Atlanta-based Southern Co. to build a $14 billion nuclear power plant in eastern Georgia.
No power company has received a license to build a nuclear plant since 1978, a period when utilities cancelled more than five dozen proposed plants as the economy soured, financing costs soared and demand for electricity weakened. A meltdown the following year at the Three Mile Island nuclear plant in Pennsylvania worsened the pressure and sent the industry into a long slump
The nuclear industry is hoping that Southern Co.'s plan to build two more reactors at Plant Vogtle near Augusta will relaunch their sector. It's a test case for whether nuclear reactors can be built on time and without the endemic cost overruns that plagued power companies decades ago.
"This is an important and historic day at the NRC," NRC Chairman Gregory Jaczko said.
NRC staffers say that Southern Co.'s plan met federal safety requirements. The two-day hearing at the agency's headquarters in Maryland allows NRC commissioners the opportunity to quiz their staff and Southern Co. officials on the quality of the review. It's the first such hearing since the NRC changed its licensing process for nuclear plants in the late 1980s.
It may be months before the commissioners vote on whether to allow the Southern Co. to build. The commissioners cannot formally approve construction until they authorize the latest design of Westinghouse Electric Co.'s AP1000 reactor, which would power it. If approved, Plant Vogtle would be the first use of the AP1000 reactor in the United States, although four reactors are under construction in China.
A recent memo from R.W. Borchardt, the NRC's executive director for operations, said that if the commissioners approve the reactor design, it could take until January or later to formalize the regulations allowing its use. Southern Co. has said it wants a license this year, but CEO Tom Fanning has told analysts that a decision may not come until early 2012.
Fanning said such a delay should not affect the project's overall budget.
The new reactor at Plant Vogtle is the first to be reviewed under a new process that emphasizes standard plant designs. None of the country's 104 commercial nuclear reactors are identical, a factor that analysts say ran up construction costs years ago and complicated their licensing and safety reviews. Under the new system, Southern Co. and other utilities are encouraged to select an approved reactor and stick to a standardized plant design that can be replicated at other sites.
President Barack Obama's administration has conditionally granted the project $8 billion in federal loan guarantees. That financing is part of Obama's push to increase reliance on a domestic power source that does not emit large quantities of the greenhouse gases blamed for global warming.
Southern Co. officials say the new nuclear plant will provide a stable source of power to meet future energy demands in a growing state. It would also reduce Georgia's reliance on coal-burning power plants.
But the nuclear industry has come under pressure. Natural gas prices have fallen sharply, making it more difficult for nuclear reactors to economically compete against gas-fired power plants. Then came a major accident at the Fukushima Dai-ichi nuclear plant in Japan, which was struck by a massive earthquake and tsunami on March 11. The plant suffered reactor meltdowns, explosions and released radiation into the environment.
In its aftermath, several environmental groups in Georgia have asked the NRC to reconsider its review of Plant Vogtle. An NRC legal panel has not ruled on that request. More than 13,000 people -- mostly nuclear industry opponents using a form letter -- submitted written comments during the review of the AP1000 reactors.
Jaczko questioned his staff Tuesday on whether the crisis in Japan prompted them to reconsider their analysis of a possible accident at Plant Vogtle.
Gregory Hatchett, the environmental branch chief in the office of new reactors, told Jaczko that the accident revealed new information, but it was not significant enough to change the NRC's review.
"I'm not understanding why this wasn't significant," Jaczko said.
He said he was planning to ask more questions about that issue when the hearing continues Wednesday.
Ray Henry can be reached at http://www.twitter.com/rhenryAP .