I have written several times before on the nuclear death spiral, and will add to that in this posting.
This will likely fall under the California attorney solicitation rules, so I state here at the outset that THIS MAY BE A SOLICITATION. I ask readers near the end of this piece to contact me for assistance in obtaining relief from the nuclear death spiral effects, by obtaining permits and financial assistance with installing self-generation systems.
NUCLEAR DEATH SPIRAL
The nuclear death spiral is a phenomenon whereby utilities build nuclear power plants, raise power prices, customers find a way to self-generate and go off the grid, and the utility increases power prices yet again.
The nuclear death spiral is the result of utilities in the U.S. building nuclear fission power plants, of which 104 plants are in operation as of today (June 2, 2009). Contrary to the overly-optimistic projections of nuclear proponents, the power plants cost far more than estimated, sometimes by a factor of 5 or more. Yes, nuclear power plants that were promised to cost only $900 million were finally started up years after a cost of more than $5 billion. Most were many years behind schedule. Building a nuclear power plant is the first step in the nuclear death spiral.
The power price after starting up those out-of-control nuclear power plants, charged to customers to recoup the investment, went up and up. Raising the power prices to customers is the second step in the nuclear death spiral.
The consequence of rapidly increasing power prices is that customers look for alternatives, rather than paying the exorbitant price to the utility. Many customers, especially industrial and large commercial customers, have the ability to identify alternatives, and the financial resources to implement alternatives. And so they did. High electric prices create a financial incentive to install cogeneration of various forms, including gas-fired gas turbines connected to generators, and process heat steam generators to drive steam turbines connected to generators. At one time in my career, I was one of those who evaluated self-generation alternatives and designed and built a few. The result of building a self-generation plant is that the utility no longer sells power to that customer, or at least as much power as before. This is the third step, reducing a utility's power sales.
When fewer kWhrs of electric power are sold by the utility, the utility sees less revenue. This is intolerable, so the utility seeks a rate increase from the Public Utility Commission, or other rate-making agency, to maintain the revenue stream. This is the fourth step in the nuclear death spiral.
The PUC then grants the rate increase, (the fifth step), and now more customers see an economic advantage in pulling the plug on the utility, and installing their own generating plant. The cycle continues, spiraling downward until the utility is selling power at a very high price, and customers no longer have opportunities to generate their own power.
The net effect of the nuclear death spiral, in the past, was to unfairly burden those who could not afford to purchase a self-generation system. These included the poor, the elderly on fixed incomes, and those families and persons just struggling to get by month to month. The nuclear death spiral with the very high power prices forced some into making a horrible choice between paying for electricity, or for rent, or for food, or for medications. The nuclear power industry is and was directly responsible for those hardships endured by so many, many people.
In this modern day, the situation is different. Those who want to and plan to build new nuclear power plants in the U.S. should be aware of what is facing them. If more of the very high-cost nuclear power plants are built in the U.S., the nuclear death spiral will occur again, but the outcome will be somewhat different this time.
SELF GENERATION (Distributed Generation)
When the nuclear death spiral occurred in the 1980's and 1990's, technology did not exist in as many forms as exist today for self-generation. Large industries, such as refineries, chemical plants, and petrochemical plants, could and did install cogeneration facilities of substantial size and great expense.
Today, a customer can install, and in many states is encouraged to install, solar PV, solar thermal, small wind turbines, large wind turbines, geothermal, bio-gas, landfill gas, power from municipal solid waste, small hydroelectric, and natural gas-fired small turbines or micro-turbines. Other technologies will surely be developed or invented as the years pass. Offshore technologies such as wave and tidal power, or ocean current, and run-of-the-river systems will be options very soon.
Solar PV uses solar cells in flat panels, usually mounted on a building roof or parking lot, to produce electricity from sunlight. The electricity is converted appropriately and safely into useable power for the home or building, such that the customer buys less power from the utility. The incentive is great in some areas, where a utility charges more for each increment of power that is used. For example, the utility may charge 15 cents per kWh for a base amount of power, 20 cents for power from 100 percent of the base up to 200 percent of the base, and 25 cents for power in excess of 200 percent of the base. It does not require many years for a solar PV system to pay for itself with government financial assistance and avoided power costs of 25 cents per kWh.
Solar thermal uses a reflecting collector to concentrate the sun's rays onto a thin pipe that carries a liquid, usually a special oil. The hot oil then boils water into steam, and the steam spins a turbine connected to a generator. Hot oil from solar thermal also provides heat to a thermal refrigeration plant to provide air conditioning instead of running an electric air conditioner.
Small wind turbines allow the homeowner or business to generate power from the wind. Much like the solar PV, there are appropriate electronics to convert the wind-generator's power into power for the home or business. This reduces the amount of power purchased from the utility, with the same incentives as described earlier.
Large wind turbines are appropriate for a customer with more land, where the wind turbines generate power for sale to the utility, thus offsetting power purchased by the customer.
Geothermal uses heat from wells deep in the earth to boil water that is pumped into the wells, producing steam that is used to spin turbines. An alternative is to use hot water from the geothermal wells to boil an organic liquid such that the vapor spins a turbine connected to a generator. An electric customer can invest in, or build itself, a geothermal power plant, and thus sell power to the utility. The power sales offset his own purchases.
There are various forms of producing natural gas from waste, including bio-gas and landfill gas. One form of bio-gas is the gas collected from manure, such as at dairy farms or cattle feed lots. The natural gas may be sold as is, or burned on-site to produce electric power and reduce purchases from the utility. Landfill gas uses appropriate collector systems to gather gas formed as landfill material decomposes.
Power from municipal solid waste, MSW, may be from burning MSW, or from thermal decomposition, or anaerobic thermal decomposition. The PHREG patent, recently issued to Peter Nick et al, is an example of anaerobic thermal decomposition.
Small hydroelectric generates power from flowing water or small waterfalls. Other applications exist where water flowing in pipes must flow through pressure control valves to reduce otherwise undesirable pressure. This occurs in terrain with hills and valleys.
Small turbines and micro-turbines burn natural gas in an appropriately-sized gas turbine connected to a generator. The exhaust heat is then used to provide hot water. The system reduces the electric power purchased from the utility, but increases the amount of natural gas purchased. A variation on this is to burn the natural gas in a reciprocating engine rather than a micro-turbine.
PERMITS
Various permits are required to install a self-generation system, with regulations that vary according to state and specific location. In general, one must obtain a permit for air emissions, then a land-use permit, then a construction permit based on an approved design. There may be state agencies, county agencies, and city councils, among other entities that issue such approvals.
FINANCIAL ASSISTANCE
Many states now offer financial assistance in various forms for self-generation projects, as does the federal government. Financial assistance may take the form of income tax credits, rebates on the purchase price, or creative financing. In some California cities, a homeowner can obtain a loan from a government-approved lender for the installation cost, then add the loan payment to the homeowner's property tax bill. The concept is that savings on the monthly electric bill will provide sufficient cash to the homeowner to pay for the increased property tax bill.
If installing a self-generation facility of any type sounds attractive, or for more information on a particular set of circumstances, I encourage you to contact me. My background is chemical engineering, where I evaluated dozens of alternative generation projects in industrial and commercial applications. I now use my engineering experience as an attorney to assist and advise clients in completing the steps necessary to see a project through to completion. Sometimes the steps are numerous, confusing, and time-consuming. A knowledgeable attorney and engineer can smooth the process.
CONCLUSION - UTILITIES BEWARE
The next generation of nuclear power plants, if they are installed, will have the result of raising power prices again. This time, though, customers by the millions will have a wide range of choices to install self-generation systems and cut their power consumption from the utility. In sunny areas, there may be solar PV and solar thermal systems installed. In windy areas, there may be small or large wind-turbines installed. In other areas, there may be gas-fired generators installed, or any of the other systems described above.
A utility must surely consider these facts, before setting out to build a new nuclear power plant in the U.S. People are wiser now, and have the tools to protect themselves from the very high power prices that produce the nuclear death spiral.
Roger E. Sowell, Esq.
rsowell@resowell-law.com
Marina del Rey, California
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