Ten years from now, your jobsite might very well be powered by nuclear energy. With job creation and carbon footprint reduction on everyone’s mind, nuclear power generation is entering its first renaissance period in 30 years. Nuclear will be the year’s buzzword in the industrial construction sector, especially as coal falls out of favor.
“We believe very strongly in the resurgence of the nuclear market in the United States,” says Jarret Adams, a spokesman for AREVA, Inc., Bethesda, Md. The company, headquartered in Paris, France, is the largest nuclear energy company in the United States, with 6,000 employees performing work from mining and uranium enrichment to fuel fabrication, heavy construction and fuel storage.
Nuclear energy currently provides approximately 20 percent of electric power in the United States, and that number will remain steady in the near future. Plans for nuclear power plant construction are seemingly unaffected by the current credit crisis, as groundbreakings are not expected until 2011 and beyond for most projects.
“We’re seeing the owners of existing nuclear power plants renew and extend their operating licenses in record numbers,” says James Joosten, senior energy analyst for the U.S. Department of Energy’s (DOE) Energy Information Administration.
Nuclear energy stands out for being both cost-effective and sustainable to operate. Factors contributing to its growth as an energy source are its low electricity costs compared to other power generation sources and the ability of reactors to operate continuously for one to two years without refueling.
Few other energy sources can claim an unlimited supply. Uranium is not only in abundant supply in the Earth’s crust and oceans, but it also can be recycled to extract all of its potential energy. It contains 50 million times more energy per pound than coal.
Also, as a green energy source, nuclear reactors emit close to zero pollutants, and nuclear waste amounts are relatively small. In addition, nuclear reactors have demonstrated a positive 40-year safety record, helping to dispel negativity about new projects.
“In the end, it all comes down to economics and business decisions, but it’s hard to imagine that society could pass up an emission-free energy resource like this,” Joosten says.
Nuclear energy also is rising in demand as scientists develop technologies that can tap the heat from nuclear energy and use it to make clean hydrogen fuels. Automakers are actively designing cars powered by hydrogen fuel cells that emit pure water vapor as a waste gas emission.
“While we think about nuclear energy typically in terms of the electricity it produces, the transportation sector is another potentially huge market that is on the cusp of becoming a new market for nuclear reactors—and hence new construction projects,” Joosten says.
As of last October, the DOE had received applications for federal loan guarantees to cover the construction of about 21 new reactors. Investment is taking place for not only power plants, but also for other manufacturing and support facilities. The Nuclear Regulatory Commission (NRC) has received applications or letters of intent to construct or expand about 28 new uranium recovery facilities.
Fueling New U.S. Reactors
The DOE is investing $4.8 billion to build a mixed-oxide fuel fabrication facility at its Savannah River Site in Aiken, S.C., one of the country’s most active nuclear sites.
The Shaw Group, Inc., Baton Rouge, La., and AREVA formed a joint venture (Shaw AREVA MOX Services) to break ground in August 2007 for the facility, which will process weapons-grade plutonium into fuel that can power commercial nuclear reactors. Creating thousands of jobs, the partnership will design, build, construct and test the facility, and maintain it for 20 years before planned demolition in the 2030s. The design is based on a successful model used in France, where MOX technology has been in use for decades.
The 500,000-square-foot facility, divided into two sections, contains a seven-story unit for cleaning and purifying plutonium, and a three-level unit for fabricating fuel pellets and assembling MOX fuel rods. It will be capable of processing 3.5 tons of plutonium into fuel each year.
Savannah River Nuclear Solutions, a consortium led by Fluor Corp., Irving, Texas, acts as the management and operating contractor for the entire site, handling nuclear waste, storage and recycling.
The MOX fuel will supply new nuclear reactors popping up throughout the mid-Atlantic and South.
For example, in the spring, Charlotte, N.C.-based Shaw Power Group and its consortium partner Westinghouse Electric Company were awarded two engineering, procurement and construction contracts to build four Westinghouse AP1000 nuclear power units and their related facilities—the first contracts awarded to any construction firm in 30 years.
(No new nuclear projects were permitted after the Three Mile Island accident, in which a pressurized water reactor experienced a partial meltdown at the generating station near Harrisburg, Pa., in 1979.)
Georgia Power Company contracted for an expansion at the Vogtle Electric Generating Plant site near Augusta, Ga., with two units to be placed in service in 2016 and 2017.
“This contract is a landmark event for Shaw, especially our nuclear team that has worked diligently to be in this position,” says J.M. Bernhard, Shaw’s chairman, president and CEO. “Nuclear energy is vital for the future of our nation’s electricity supply system as the demand for clean, reliable and cost-effective energy continues to soar.”
South Carolina Electric & Gas Company and the South Carolina Public Service Authority also will build two units at the V.C. Summer Nuclear station near Jenkinsville, S.C., to be placed in service in 2016 and 2019.
Shaw, a 20 percent owner in Westinghouse Electric Company, has a long history in the nuclear industry dating back to the design and construction of America’s first commercial nuclear power plant at Shippingport, Pa., which began operating in 1957.
Uranium Enrichment
With the majority of uranium supplying U.S. reactors currently imported from foreign sources, including Russia, Canada and Australia, domestic energy companies are pushing for the DOE to invest in local supplies. World demand is a major factor in new projects: Uranium exploration and mine development has risen by 254 percent from 2004 to 2006, according to the DOE.
URS Corporation, which has been building commercial nuclear generating units around the world since the 1960s, is overseeing a major project owned by Louisiana Energy Services (LES) and international firm Urenco Ltd. The project, valued at approximately $1.5 billion, will create a domestic source of enriched uranium in southeastern New Mexico.
The LES National Enrichment Facility is the first commercial uranium enrichment license issued by the NRC in 30 years. The site’s location near Los Alamos and Sandia National Laboratories helped the project receive support from local business leaders, especially because of the potential to create jobs.
General contractor Rust Constructors, Birmingham, Ala., and its subcontractors are tasked with constructing five buildings, including a 60-foot-high reinforced concrete structure that can withstand seismic activity.
Gardner Zemke, Albuquerque, is the electrical substation contractor. Trico Consortium, a group of electrical specialists from various locations, is performing the underground electrical work, while Hy Tech Joint Venture, Albuquerque, is performing underground mechanical work.
The job is currently under way and is expected to be completed in 2013. The uranium will be sent to fuel rod production facilities throughout the country.
AREVA also recently submitted an application to the NRC to build a multibillion dollar uranium enrichment facility near Idaho Falls, Idaho, with groundbreaking planned for early 2011.
Big Backlogs
Firms that specialize in nuclear power will be extremely busy in the next 10 years, based on existing backlogs.
“Our market study shows that even if demand for uranium doesn’t grow, there is still enough demand to absorb all of the production from all of the enrichment facilities currently planned,” Adams says of AREVA’s business forecast. “Our construction projections don’t even account for additional growth.”
AREVA is partnering with Northrup Grumman Corp., Los Angeles, to build a $400 million facility in Newport News, Va., that manufactures giant reactor components for AREVA’s 1,600-megawatt Evolutionary Power Reactors (EPRs). Construction will begin this year for the 300,000-square-foot manufacturing facility, modeled after a plant the contractor built in France. It will supply 500-ton components including reactor vessels, steam generators and pressurizers.
“The demand for these reactor components is quite high, and what’s new is that these products are being targeted for EPRs right here in the United States,” Adams says. One EPR can power more than 1 million households.
Four EPRs are currently under construction in China, Finland and the Normandy region of France, and seven are under consideration in the United States. In December, the NRC approved AREVA’s applications to build EPRs at the Callaway site near Fulton, Mo., and the Nine Mile Point site near Oswego, N.Y. Additional applications are pending.
“A lot depends on the Nuclear Regulatory Commission, which has a lot of work ahead of them to review,” Adams says.
Manpower
Perhaps the greatest challenge to building these facilities is finding workers who are trained and qualified to handle not only a large industrial project, but also one with specific safety and security protocols.
For example, at peak construction, up to 1,600 workers will be onsite at the Savannah River Site in Aiken, S.C. The job creation potential is immense for nuclear construction: Onsite staff can total 4,000 individuals during a period of five to six years.
“Nuclear plants are built from extremely high-quality materials and components, and they must be assembled by highly trained and qualified personnel,” Joosten says.
Construction teams must have rigorous quality control and quality assurance programs in place before they can even bid on a project.
For some companies just starting out in the burgeoning nuclear market, this means creating new training programs from scratch. Because no new nuclear reactors have been built in 30 years, many industry training programs have been abandoned, and many nuclear experts have retired.
But in a slow economy, contractors agree now is a good time to hire and train specialized craftworkers to prepare for a construction rebound in 2010 and beyond. Nuclear facilities will require the most talented pipefitters, millwrights, electricians, concrete workers, steelworkers, earthmovers, HVAC system installers, water treatment specialists, welders, boiler and pressure vessel specialists, schedulers and managers the industry can recruit.
Competition is fierce for engineering graduates as well, with salaries starting close to $60,000 a year.
Safety and Restrictions
With nuclear engineering and construction now cast in the public spotlight, the industry will be under extreme scrutiny to keep employees safe and facilities environmentally sound. The NRC’s Atomic Safety and Licensing Board sets the highest regulatory standards in the world for nuclear power. In addition, all new plants must be built to meet stringent state and local environmental requirements.
The LES enrichment facility in New Mexico, for example, will be the fourth in the world using the most advanced, cost-effective and energy-efficient technology available.
The DOE and energy companies are working to dispel negative attitudes and emphasize that radiation exposure risks are minimal. DOE research shows employees working in the vicinity of uranium are exposed to only about 25 millirems of radiation per year. To put that number in perspective, the average American is exposed to 360 millirems per year from all sources—natural and manmade.
Risk and Cost-Effectiveness
With a 1,200-megawatt nuclear plant costing between $3.5 billion and $6 billion on average, utilities and stockholders want to ensure they’re making a wise investment. The nuclear industry has taken great steps to reduce the licensing and regulatory risk associated with nuclear power. This translates into reduced investment risk for these capital-intensive projects.
In comparison, the investment risk has actually risen for coal plants in recent years, as concerns about greenhouse gases have intensified and an expectation of future carbon taxes or carbon controls permeates the marketplace, Joosten explains.
“Over the last 18 months, we have seen a relatively large number of coal plant cancellations,” he says.
Although nuclear construction is still a costly endeavor due to regulations, long project length, labor and materials costs, and potential for litigation, the business environment has improved markedly.
“The industry can now seek regulatory approval in advance of major construction outlays, and effectively begin to build a pre-certified design instead of a design that evolves during construction,” Joosten says.
In a rapidly evolving world energy marketplace, it’s safe to say nuclear-generated power is a major energy source of the future.