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New nuclear plant construction on horizon?

0 674 Market Intelligence

2011 could see the beginning of a boon in the commercial construction sector with the possible development of several nuclear power plants. President Obama recently announced he will make a budget request of $54 billion in loan guarantees for new nuclear reactors. It is still undetermined how many will be needed or will be built. The U.S. Department of Energy (DOE) forecasts that energy demands will increase 28 percent by 2035. Currently, nuclear energy supplies 20 percent of the U.S.’s energy use. The DOE estimates a minimum requirement of one plant built per year, beginning in 2016, in order to meet projected energy demands while maintaining the current percentage of power supplied from nuclear reactors. Legislators have expressed desire for as many as 100 new plants to begin construction as soon as possible.

2011 could see the beginning of a boon in the commercial construction sector with the possible development of several nuclear power plants. President Obama recently announced he will make a budget request of $54 billion in loan guarantees for new nuclear reactors. It is still undetermined how many will be needed or will be built. The U.S. Department of Energy (DOE) forecasts that energy demands will increase 28 percent by 2035. Currently, nuclear energy supplies 20 percent of the U.S.’s energy use. The DOE estimates a minimum requirement of one plant built per year, beginning in 2016, in order to meet projected energy demands while maintaining the current percentage of power supplied from nuclear reactors. Legislators have expressed desire for as many as 100 new plants to begin construction as soon as possible.

It is an understatement to say that nuclear power plant construction is expensive: The Nuclear Energy Institute (NEI) puts the cost of a single reactor at around $9 billion. The benefits can be substantial for those involved in the manufacturing and construction process, however. The labor market will receive a boost, as the NEI estimates that the construction of a nuclear power plant employs 1,400 to 1,800 people, with peak employment as high as 2,400. The employment increase has some longevity, with plant construction time lasting around four years, following a year and a half of pre-construction planning and preparation. The total time needed to build a nuclear reactor, from acquiring a permit to operational phase, spans up to 9 years.

The material resources needed to build a reactor are also considerable. A single new plant requires approximately:

  • 66,000 tons of steel
  • 400,000 cubic yards of concrete
  • 44 miles of pipe
  • 300 miles of electric wiring
  • 130,000 electrical components

The vast amount of materials needed present the proverbial wrench in the works, however, due to the limited availability of some of the materials, as well as competition for those materials, not only from other countries, but from other industries in the U.S. (e.g., petrochemical). To facilitate the approval and construction process, the Nuclear Regulatory Commission (NRC) established a new licensing method in 1992 that provides for a combined construction/operating license, allowing the company that constructs the plant to operate it as well. As of 2007, 17 companies had started the application process.

by Wayne Engebretson

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