The cost of power from a small nuclear reactor — eyed by Montana legislators and utility commissioners as a potential lifeline for Colstrip Power Plant — has nearly doubled according to reports from early adopters in Utah and Idaho.
Once expected to cost up to $58 a megawatt hour, energy from the small modular reactor in development by Oregon-based NuScale Power and utility partners is now expected to be closer to $100 MWh, significantly higher than anything in base rates paid by Montana utility customers currently. NorthWestern Energy's portfolio, for example, includes wind power in the $30 MWh range, hydropower in the upper $50 MWh range and coal power in the $50s to $70s.
Speaking to the Idaho Falls City Council on Nov. 10, Idaho Falls Power General Manager Bear Prairie said the costs weren’t looking very good and would likely breach the $58 MWh price participating utilities had agreed to. Prairie told the council that federal subsidies were already baked into the inflated price. The U.S. Department of Energy awarded up to $1.4 billion to the Carbon Free Power Project in 2020. He indicated that the participating utilities could choose to terminate the project.
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Two other communities were having similar discussions. All are members of Utah Associated Municipal Power Systems, which partnered with NuScale on the "Carbon Free Power Project," the goal being to build six small modular reactors to replace dispatchable power from fossil fuel sources.
In early November Rick Hansen, Power Director for Washington City, Utah, told commissioners that the small modular reactor project needed more investors. Roughly three-quarters of the Carbon Free Power Project's would-be 462-megawatt capacity is still unspoken for.
"I think we're seeing in general that more and more people are realizing without that piece to the puzzle. Getting to carbon free emissions is not going to work," Hansen said of nuclear power. "So that's a positive side, but we still aren't seeing a flood of people say 'sign me up.' So, we got a lot of cheerleaders, but not a lot of players."
Diane Hughes, NuScale’s vice president of marketing and communications, said in an email Monday that construction costs were to blame.
"From wind and solar to hydrogen and nuclear energy, there have been price increases due to a changing financial market and inflationary pressures on the energy supply chain that have not been seen for more than 40 years. The CFPP has matured to face, understand, and address these challenges that other similar technologies and generation options must also face,” said Hughes.
Elected officials in Montana have been eyeing the small modular reactor development for a few years. Republican lawmakers in 2021 upended a 44-year-old law requiring a public vote of approval before nuclear power plants could be constructed in state. The Legislature also commissioned a study by the Energy and Telecommunications Interim Committee to study the possibility of small modular reactors. From the start, the suggestion was that a nuclear reactor could replace the surviving two units at Colstrip, Units 3 and 4, in southeast Montana.
No energy company, the six current owners of Colstrip included, has expressed interest publicly in investing in nuclear power in Montana, but politicians have been dogged on the subject. As recently as Tuesday, Montana Public Service Commissioner Brad Johnson commented on “the potential that the small modular nukes offer for Montana, specifically in the area of conceivably retrofitting 3 and 4, to preserve that dispatchable generation for the state and for the region.”
Members of the Energy and Telecommunication Interim Committee traveled to Idaho to tour reactors at Idaho Nuclear Laboratory near Idaho Falls. In September, an ETIC bill to create a Montana nuclear power advisory panel failed after consumer-minded lawmakers amended protections into the proposal, namely to ensure Montanans weren’t left paying the bill for unexpected costs.
The Legislator’s primary advocate for nuclear power, Republican Sen. Terry Gauthier, of Helena, resigned shortly before Thanksgiving, telling the Helena Independent Record he is going on a two-month motorcycle tour this coming March.
Earlier in the year, economist David Schlissel, director of Resource Planning and Analysis for the Institute for Energy Economics and Financial Analysis, told lawmakers that new-era small modular reactors were likely as prone to cost overruns as the large-scale nuclear reactors of 50 years ago. He reiterated that assessment in an interview last week.
“What I’ve been telling people is that no one should delude themselves that this is going to be the last cost increase in the project. It could be seven, eight years before it's finished,” said Schlissel, who expects the development of more efficient batteries to deliver a more affordable source of dispatchable power than nuclear within eight years.
“The problem with the nukes is they’re so expensive and you have to commit to them now in order to have it 10 years down the road. Nobody should tell you with a straight face that the cost of nukes is going down.”
Tuesday, the trade publication “Utility Dive” reported that the Nuclear Regulatory Commission had identified several challenging, significant issues with the draft design approval application for NuScale’s small modular reactor. Federal officials said they hadn’t received enough information in the draft application from NuScale to evaluate the reactor’s core design.
NuScale requested NRC review to determine whether its application for design approval was ready. The company said it will address the issues raised by NRC.
"As part of a planned pre-submission process, NuScale will address NRC comments, as they are made, in the final version of the SDAA. The SDAA application remains on schedule for submittal this year," Hughes said.