One Woman’s Crusade – Nancy Thorner is Asking Exelon to Please Operate a Large Nuclear energy Facility Located in Her Backyard

November 3, 2010

 
On the Atomic Insights Blog, Rod Adams discusses energy supplies, energy technology, and energy politics from an atomic point of view. This blog is closely associated with Atomic Insights at www.atomicinsights.com.

Tuesday, November 2, 2010

One Woman’s Crusade – Nancy Thorner is Asking Exelon to Please Operate a Large Nuclear Energy Facility Located in Her Backyard

by Rod Adams

Zion Nuclear Station from Lake Michigan

Several times during the past few years, I have written about the Zion Nuclear Power Station. The station, located on the shores of Lake Michigan, about 30-40 miles from Chicago, hosts two 1100 MWe Westinghouse Pressurized Water Reactors. Commonwealth Edison shut it down for repairs the mid 1990s (Unit 2 on September 19, 1996 and Unit 1 on February 21,1997). The company announced its decision not to restart the units on February 13, 1998.

On September 1, 2010, Exelon, the successor to Commonwealth Edison, took another step designed to ensure that the reactors never again produce electricity. It transferred the possession only license to ZionSolutions, LLC for a 10 year, one billion dollar decommissioning project. If you want more of the back story you can scroll down to the section titled “Background” for some historical context of the situation.

I want to tell you about the crusading efforts of a woman who lives in Lake Bluff, Illinois. I hope this will be recognized as an unusually important “man bites dog” type of story. Unlike NIMBY activists that work to stop corporations from building or operating productive facilities, Nancy Thorner has been fighting Exelon, one of the largest utility companies in the US, for several years in an often lonely attempt to force it to start up and operate a nuclear power plant that is located in her backyard.

Here is a copy of a report that she recently wrote after attending a public meeting about the decommissioning process.

I attended a Community Open House held by ZionSolutions, LLC, on Thursday, Oct. 28, which is a special-purpose subsidiary of EnergySolutions, Inc. formed specifically to deliver integrated services and solutions for the safe decommissioning and environmental restoration of the Zion Station site.

Exelon Corporation made the decision to waste its Dual Zion Nuclear Plant in 1998 stating economic reasons. The Plant operated from 1974 to 1998 when it was prematurely closed down and put in Safe/Store. The Zion decommissioning represents the largest plant dismantling everundertaken in the U.S. The billion dollar project is a ten-year operation.

A question never sufficiently answered: Why was Zion mothballed in 1998 when it had many years left of service and why is Zion being decommissioned when aging equipment could be replaced?

I exchanged cards with a number of ZionSolutions officials present and asked very pointed questions of the engineers, etc., not being surprised when their answers were illogical or not based on fact. I listened politely to their responses, but refrained from responding, thinking it best to play along with the experts so as not to expose their efforts to pull the wool my eyes.

All of the officials assigned to ZionSolutions were courteous to me. Some seemed to agree with what I was saying about the foolishness of closing a plant which has the potential of producing a massive amount of energy, but it was obvious that the Community Meeting message was to convince me and others in attendance that ZionSolutions was making every effort to be open and transparent with the public. (When people try too hard to be congenial where there are outstanding issues that demand explanations, I become suspicious of motives. This was the case when interacting with ZionSolutions officials.).

The major theme was that ZionSolutions had nothing to do with the Zion Plant closing. It was all Exelon’s doing. ZionSolutions was only handling the decommissioning. (Weren’t contracts signed and negotiations happening during the past three years between ZionSolutions and Exelon Corporation, yet ZionSolutions had no knowledge about why Exelon was wasting a perfectly good plant! Not believable.)

The same story was related to me by officials from the Nuclear Regulatory Commission. I was told that the NRC only deals with safety and that it had no part in shutting down Zion. The NRC was called in only when Exelon decided to mothball Zion in 1998, as licenses needed to be changed (revised) to conform to the Plant’s new Safe/Store status.

I did inquire about the invitation. When did it go out? Was the event advertised? I was informed proudly by the public relations person that a full-page ad was placed in Mona Shannon’s Zion-Benton Harbor newspaper, where upon I responded that the Zion-Benton Harbor newspaper is but a weekly publication that doesn’t reach very many individuals.

I was thanked for my information and proceeded to name other newspapers in Chicagoland which have far larger readerships. (Molly has concluded that the invitation was purposely put in a little read newspapers, so ZionSolutions could honestly say that the community was notified. In that ZionSolutions didn’t know what the major newspapers were in Illinois is not believable! What about the Chicago Tribune?)

There were as many ZionSolutions officials present at the event as there were outsiders, no more than 50 individuals all total. Only one County Commissioner was present, John Paxton. Paxon was also surprised that no one else showed up, not even Mayor Lane Harrison of Zion; legislators Jo Ann Osmond and Michael Bond; Mona Shannon, editor of the Zion-Benton News; or Ken Graesser and Ken Butterfield, plant managers at the Dual Zion Plant during its operation.

The previous week I had contacted all Lake County elected legislators and officials and selected Illinois Republican and Democrat legislators about the Zion Community Open House.

I was somewhat surprised when a ZionSolution engineer, now assigned inside the Plant, told her that the Units are beautiful inside. After hearing the engineer’s response, I walked over to the person in charge of the Zion project, John Hess, and questioned why the Plant couldn’t be reopened if all looked beautiful inside.

Mr. Hess told me that “just because something looks beautiful doesn’t mean that it’s still functional.” To which Molly responded: “Doesn’t Zion still have the equipment inside which it did when the plant was mushroomed back in 1998? If so, the other plants still operating in Illinois most likely have the same equipment, with perhaps some upgrades, so why can’t the Zion Plant be upgraded accordingly and restarted?”

I also raised the issue that “to replace what was required inside the Zion Plant could be done at a fraction of the cost that it would take to build another Plant having the same power capacity as Zion. After all, a billion dollars was being spent to tear the plant down.”

Another inquiry was made about the validity of “economics” as the reason given by Exelon Corporation for wasting the plant. John Hess didn’t quite know how to reply to my questions other than to say that is was Exelon’s decision to decommission the Zion Plant. (Question: Is it possible for a citizen to request information though the Freedom of Information Act? Just an idea that might be worth looking into).

And what about Exelon? There was no one from Exelon Corporation at the Zion event. Why? Exelon knows there are questions that demand answers. Exelon Corporation has shut up like a clam. Transparency and openness have been lacking from the beginning with its decision to take Zion’s power off the electrical grid.

I proceeded to ask about security at the Zion Plant. The Zion Plant has had many individuals inside taking care of the Plant — it is not crumbling — and outside guarding the Plant since it was shut down in 1998. The radioactive rods in dry cast storage will rest on an area about the size of a football field. There will be a two chain link fences around the site which will be set as far back from Lake Michigan as possible not to encroach upon the Wet Lands (ZionSolutions is very much into considering the environment in dealing with its Zion decommissioning.).

A natural berm will be built around the football-sized storage area so it can’t be seen by the public. When I asked how many guards would be needed to guard the area where the radioactive rods are to be stored, I was told, “just as many because the government mandates that we do so.” (I can only imagine the cost of all these guards and the use of only Union Workers to decommission Zion. No wonder a BILLION dollars is needed for the Zion operation which shouldn’t even be on-going!)

Here are several other items of interest:

1. Only the radioactive fuel will stay behind. The low radioactive waste will be transported to ZionSolutions storage place at their Clive facility in Utah.

2. When I asked why the radioactive rods weren’t being reprocessed as they were in other countries, I was told by one ZionSolutions representative that the process was too new to be considered (Untrue) Another representative was perhaps more truthful when he told me that our government doesn’t wish to go that route.

3. The licenses given for the decommissioning process gives ownership of all the building, etc., to ZionSolutions; Exelon owns the land underneath. Once the decommissioning is done, Zion can do with the land whatever it wishes for it as its owner.

4. The Chicago Tribune sent a reporter and camera man to the Zion event. The reporter came and spoke to me, asked for my comments, and then gave me his business card on which he wrote his telephone number. I was told that the CT sent a reporter and camera man to the event because of my notification to the Tribune editors about the event.

Notices were sent to all other newspapers in Chicagoland, but only the Tribune responded.

I did design a handout about Zion which was distributed to those present, even the ZionSolution team members.

On the handout these two important question were emphasized that need to asked of Exelon Executives (Public statements from Exelon regarding Zion’s closure have been opaque and confusing.) before Zion is unnecessarily demolished, which does not bode well for future energy needs here in Illinois:

1. Did Exelon intentionally prematurely close the two Zion Nuclear Fueled Electricity Generating Plants that customers have already paid for, in order to keep these least expensive, safe, green, non-polluting electricity generating plants out of the grid, thereby keeping electricity prices high?

2. Why hasn’t Exelon tried to sell these two Zion electricity generating plants? Could it be because a new owner would produce lowest cost, safe, green electricity for Illinois customers and this would lower the electricity bills for consumers, reducing Exelon’s profits?

Nancy J. Thorner

Background

For a variety of reasons which included labor-management relations, material condition of the plant steam generators, and unusually low natural gas prices (with official predictions from the Energy Information Administration of low escalation for the next ten years), Commonwealth Edison made the temporary shutdown permanent on February 13, 1998. In order to reduce the carrying costs of the plant, Commonwealth Edison removed all of the fuel from the reactor and notified the Nuclear Regulatory Commission that it wanted to give up the plant operating licenses.

Aside: The current annual cost of holding a nuclear plant operating license under 10 CFR 171.15(b)(1) is $4,784,000 per unit. The cost for a possession only license under 10 CFR 171.15(c)(1) is just $148,000 per unit. Though those numbers were different in 1998, you can see why a company would not want to hold onto an operating license if it was pretty certain that it did not want to operate the plant again. End Aside.

It is important to remember the contributing factors in the decision within the context that it was made. The Zion work force had a reputation for resisting management initiatives. Commonwealth Edison had a poor reputation within the industry and at the Nuclear Regulatory Commission. At the time, the average capacity factor for the Commonwealth Edison fleet of reactors was less than 50%. Just a few months after the decision to give up the license for Zion and focus on improving the remaining units, a new team led by Oliver Kingsley established a completely different culture based on discipline, accountability and investing in improvements where required to improve reliability.

Besides issues specific to the Zion station itself, there were also some industry wide issues of concern that contributed to the shutdown decision. Westinghouse steam generators were failing to achieve the longevity initially promised in the late 1960s and early 1970s and the company was being sued by many of its customers. According to a January 1, 1996 article in PowerGen titled Steam Generator Replacement Overview

As of Dec. 31, 1995, 38 steam generators had been replaced in 13 of the 72 operating PWRs, and three units had been shut down prematurely, due primarily (or partially) to degradation of their steam generators: Portland General Electric`s Trojan unit, located in Prescott, Ore., in 1992; Southern California Edison`s San Onofre 1, located in San Clemente, Calif., in 1992; and Sacramento Municipal Utility District`s Rancho Seco unit in 1989.

In the coming years, operators of PWRs in the United States with degraded steam generators will have to decide whether to make annual repairs (with eventual derating likely), replace the generators or shut the plants down prematurely.
. . .
Finally, owners considering steam generator replacement will find the job easier to justify if they are also considering license renewal, as a long license term provides a lower per-kilowatthour cost for the replacement.

That last statement needs some additional historical context. Though license renewal discussions had been a big topic for more than a decade as the earliest units began approaching the expiration of their initial 40 year licenses, there was a great deal of uncertainty about the process remaining in February of 1998. It was not until April of 1998 that the first application for a license renewal was submitted to the Nuclear Regulatory Commission. The process that application initiated was not completed until March 2000, more than 2 years after Commonwealth Edison gave up its operating license.

When the Zion owners decided to shut the plant down, they could purchase natural gas for $1.80 per million BTU, they had a balky labor force, they needed to replace steam generators, they had about a dozen other units that needed attention and investment, they were operating in a region whose power demands were shrinking as industries shut down, and they were not even sure they would be able to operate the plant after 2013, even if they did solve all of the other problems.

However, times change and decisions should be reevaluated in the light of new information if possible. For reasons that remain shrouded in the veil of corporate decision making, Exelon has transferred the possession only license to a newly formed company called ZionSolutions, LLC to begin a 10 year long, $1 billion effort to dismantle the two 1100 MWe, emission free nuclear plants.

My suspicion, which has been confirmed by several conversations with former Exelon insiders, is that the company financial analysts have determined that the additional supply of power from the plant would drive the selling price of electricity down for all of the suppliers in the region. The predicted result of a lower price for power in a model where regional demand is held static would be lower total revenue, making the required investment in a restoration project “not cost effective” for Exelon.

Aside: I phrased the above paragraph carefully. Predicting the economic benefit of substantially lower electricity prices for the entire region would require a much more complex model. Also, the computation of cost effectiveness for the required investment would be substantially different for a purchasing company that does not already sell power in the affected market. End Aside.

If the Zion plants had been purchased by a normal private enterprise, I might simply note that the decision might not be in the best interest of customers and move on. However, the two units at the Zion Nuclear Power Station were built under the old model of regulated monopoly utilities. Those utility companies received the full cost of construction plus a guaranteed profit in return for a legal obligation to reliably serve the power needs of their customers at a reasonable cost.

Though I have never lived in Illinois or any part of the service territory and might be accused of meddling in other people’s business, I have a life-long association with the electric utility business. Dad spent his career as an electrical engineer at Florida Power & Light and often brought his work home with him to the dinner table. My dad’s influence firmly planted the importance of an obligation to serve. My personal understanding of that obligation grew during 33 year years in uniform.

At my alma mater (the United States Naval Academy) there is a very important saying that is used to explain why there are different levels of privilege associated with different positions within the military structure. “Rank has its privileges. Rank also has its responsibilities.” Another way that to express the same thought comes from Luke 12:48 “For unto whomsoever much is given, of him shall be much required: and to whom men have committed much, of him they will ask the more.” (King James Bible.)

For me, the decision to destroy Zion is being made by people that have already been given access to more wealth than most of us can even imagine. It is especially irritating to see that decision being implemented since the people who will pay the price in higher electricity bills for decades to come were the people who paid for the plant in the first place. I applaud Nancy Thorner’s stubborn struggle against one of the most dominant corporations in her region and willing play the role of Sancho Panza as she tilts at something far more valuable than a windmill.

Disclosure: I own some stock in EnergySolutions, the owner of ZionSolutions, LLC. I expect that the value of those shares will drop if the project gets cancelled, but I am willing to take that risk.Labels:

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