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Public Power Communities Embrace Innovative Nuclear Technology

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Faced with growing concerns about power supply options, some public power communities in the Western U.S. are embracing a new, innovative nuclear technology option by signing on to a small modular reactor (SMR) project in Idaho.

So far, over two dozen members of Utah Associated Municipal Power Systems (UAMPS) have signed on to the Carbon Free Power Project (CFPP). The interlocal agency is developing a site in Idaho owned by the Idaho National Laboratory. The project will use SMR technology being developed and licensed by NuScale Power.

UAMPS is a joint action agency that provides comprehensive wholesale electric energy services, on a non-profit basis, to community-owned power systems throughout the Intermountain West. The UAMPS membership represents 50 members from Utah, Arizona, California, Idaho, Nevada, New Mexico and Wyoming.

Looking into the future, “there is no other option” for a reliable and affordable energy source, said Todd Robinson, mayor of UAMPS member Paragonah, a small town in southwest Utah.

Paragonah gets most of its electric power from the San Juan coal-fired plant in northern New Mexico that will be decommissioned at the end of September. Beyond that, Paragonah relies on hydroelectric power from the Colorado River Project, which is running at less than full capacity because of the persistent drought in the western U.S.

Paragonah is also a partner with UAMPS in the Horse Butte wind project, but wind power has only a roughly 30% capacity factor, and it is not cheaper than other alternatives, Robinson noted. Paragonah is also pursuing solar power, but those projects are facing delays because supply chain issues have pushed out expected online dates to the end of 2023 and even into 2024.

Between the retirement of coal plants, drought-reduced hydropower output, and the intermittent nature of renewables, “it is a triple whammy,” Robinson said.

For near-term needs, Paragonah has signed a five-year power purchase agreement with UAMPS, but to secure future resources, Paragonah has committed to take a share of the output of the CFPP. The commitment allows Paragonah to lock in a future price for power.

UAMPS members that have subscribed to the CFPP lock in a price per megawatt hour (MWh) (in 2020 dollars) that begins when the project comes online.

The CFPP is now in the licensing phase of development, and the first module is expected online in the fourth quarter of 2029 with the other five units coming online by the fourth quarter of 2030, according to Shawn Hughes, CFPP project director.

In August 2020, NuScale passed a major milestone when the Nuclear Regulatory Commission (NRC) approved the design of the company’s SMR. At the time, NuScale’s design called for a 50 megawatt (MWe) reactor. Since then, the company has increased the output of its reactor design to 77 MWe, improving the design’s economic efficiency.

The NRC will have to sign off on the design modification, which NuScale anticipates they will submit by December 2022. A year later, the CFPP plans to submit its combined Construction and Operating License Application (COLA), the last major license needed before construction can begin. The NRC’s review process takes about three years, so construction of the project in Idaho could begin as early as 2026.

The CFPP is designed to use a configuration of six 77-MWe reactors for a total capacity of 462 MWe. That capacity is “the sweet spot in the marketplace,” Hughes said, adding “The six-pack configuration also will be attractive in other markets.”

“The six-module configuration is a better fit for our project membership,” Mason Baker, General Counsel at UAMPS, said. “It reduces the need for external participants, which can make things more complicated if there are more owners,” and it brings down the cost, not just on a unit basis, but to the overall project.

Baker was recently appointed as the new chief executive officer and general manager of UAMPS by the UAMPS board of directors. The appointment is effective January 1, 2023.

In May, NuScale went public, listing on the New York Stock Exchange, through a merger with a special purpose acquisition company, Spring Valley Acquisition Corp., that gave NuScale an enterprise value of about $1.9 billion. The CFPP will also benefit from a $1.355 billion multi-year cost share award from the Department of Energy.

Like Paragonah, Brigham City in Utah is also dependent on wind and hydropower for its power supplies, and like Paragonah, Brigham City is also a subscriber to the CFPP.

“CFPP provides us with baseload, stability and control over commodity prices,” D.J. Bott, Brigham City’s mayor, said. “It could be a generational power supply,” he said, meaning that the nuclear power could provide cost and stability for the city’s power supply into and even through the next generation.

From 2012-2013, Brigham City was in negotiations with a national utility that provided it with wholesale power, Bott recalled. The cost Brigham City has contracted to pay for the CFPP starting in 2029 is “less or comparable to what the national utility was trying to sell us in 2013,” Bott said. “It is very valuable for a city to have something reliable like that.”

The prospect of a locked-in power supply is also attractive from an economic development standpoint. An industrial customer that now falls within Brigham City’s expanded city limits is served by a private generator. “If we can offer them good rates, it would be attractive to them,” Bott said.

Beyond competitive pricing, Bott also sees value in NuScale’s technology. The company’s SMR design essentially uses the same design that is deployed in traditional, larger pressurized water reactors and uses the same fuel as well. “Our version has been out there for years, it is just scaled down,” Hughes said.

In addition, an innovation that is “unique to us, we are going to air cool, instead of using water. We decided we are not going to draw on that resource,” Hughes said.

NuScale also says its design introduces safety improvements. “The SMR’s passive safety measures do not require an operator response if there is an accident, and because much of the plant will be underground, it is not as vulnerable to an attack,” Hughes said.

A Greener Future

The City of Idaho Falls, which hosts the Idaho National Laboratory, is also a subscriber to the CFPP. The city, which is home to about 62,000 people, owns and operates five hydroelectric plants and meets over 96% of its electrical needs from carbon-free sources.

Idaho Falls is looking forward to getting power from the CFPP, “to know our future will also be carbon free,” Rebecca Casper, the city’s mayor, said. “What we want is energy that is reliable, clean and affordable.”

“It is possible that a NuScale SMR could be deployed overseas before the Carbon Free Power Project,” Mike Miller, project director for CFPP at NuScale, said. “Regulatory lead times in other countries are not as long as they are in the United States.”

“And we are being inundated with multiple requests from overseas, particularly from Eastern European countries that want to build plants now in response to Russia’s invasion of Ukraine and the subsequent fossil fuel shortages,” Miller said.

During remarks made at the recent G-7 meeting in Germany, President Biden noted that NuScale Power will build a SMR in Romania.

For his part, Bott in Brigham City says he is excited that the city would take a larger stake in the CFPP if it could. And Robinson, of Paragonah, expects that as time wears on there will be a rush to join the project.

“Shortages are coming,” Robinson said, “Unless someone has a crystal ball and can figure out some other option, I don’t see an alternative at this point that is a reliable 24-hours-a-day source of power.”

For more information about NuScale and its SMR technology, click here.

 

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