NRG Energy to build 2 Texas nuclear plants
Critics worry about risks from massive $16 billion expansion
By ELIZABETH SOUDER
NRG Energy Inc. said Wednesday that it will build two new nuclear power units in Texas as part of a giant plan to construct more power plants across the country during the next decade.
The Princeton, N.J., company aims to spend $16 billion on new coal, natural gas, wind and nuclear plants.
At the center of the strategy is a plan to spend $5.2 billion to double the size of the South Texas Project nuclear plant by adding the two new units.
"The big feature of the wholesale power market recently has been high and volatile electricity prices, largely caused by the underlying natural gas prices. A variety of fuels allows us to insulate the consumer from that risk," said NRG chief executive David Crane.
The proposal would help address Texas' tight power market and high prices. But the nuclear focus worries some people who recall the South Texas Project's spotty safety record.
The NRG plants also make Texas part of a new wave of nuclear power plants in the U.S.
The Nuclear Regulatory Commission anticipates applications for 25 new nuclear units soon, as power generators try to dodge the rising price of fossil fuels and take advantage of federal incentives.
The most recent nuclear plant in the U.S. began operating 10 years ago.
Dallas power company TXU Corp. proposed its own plan two months ago to build 11 coal plants in Texas.
NRG said Wednesday it plans to build 10,500 megawatts of power generation capacity across the country in the next 10 years by adding to the coal, natural gas and nuclear power facilities it already owns.
In Texas, NRG expects to finish the first nuclear plant by 2014 and the second in 2015.
NRG also plans to build a coal plant in Limestone County, to upgrade a coal plant in Fort Bend County, and to add natural gas capacity in Houston.
The company will develop wind power through its acquisition of Padoma Wind Power LLC.
The Texas coal plant will use traditional pulverized coal technology, similar to the 11 plants proposed by TXU.
But NRG plans to build three coal gasification units in New York, Delaware and Connecticut using technology that emits less of the polluting chemicals that can cause health problems.
Experts say gaining permits for the traditional coal plants is easier in Texas than the Northeast.
Still, NRG said Wednesday the upgrades would include enough pollution control equipment to cut total emissions by 67 percent and carbon intensity by 20 percent to 25 percent.
Similarly, TXU pledged to cut its total emissions by 20 percent as it boosts capacity.
Environmental experts also worry that nuclear plants and waste are unsafe, and the South Texas Project has a spotty track record.
The project, which is owned jointly by NRG, the city of Austin and the San Antonio municipal power company, brought Texas into the nuclear power age in August 1988 when it began regular service.
The plant was among the nation's most troubled nuclear plants during its early years, making the Nuclear Regulatory Commission's "watch list."
In recent years the plant has received good marks in its annual federal inspections. But in 2003 engineers spotted a leak on a vessel that contains a reactor.
Later that year, the commission declared the reactor safe for operation. Since then, the plant has told the NRC that the vessel has shown no further leaks.
That's cold comfort to some.
"Nuclear power has proved to be too costly to generate without significant federal subsidies, extremely risky to operate, and the wastes are still too hot to handle," said Tom "Smitty" Smith, with consumer advocate Public Citizen.
The problem is that Texas could face tight electricity supplies in coming years without more plants.
And coal and nuclear plants are relatively cheap to build and operate, giving power companies big profit margins and probably pushing retail electricity prices lower.
The Electricity Reliability Council of Texas predicts Texas will have just 4.9 percent more generation capacity than it needs by 2011.
ERCOT likes to keep that reserve margin at 12.5 percent.
If TXU and others actually build all of the plants they expect to be operating by 2011, the state's reserve margin would be north of 23 percent, ERCOT says.
NRG still must find financing for the plants, and the company said it would build them only if it can sign deals to sell most of the power ahead of time.
Environmental writer Randy Lee Loftis contributed to this report.
TXU VS. NRG
TXU: 8,600 megawatts of coal-fired power generation capacity
NRG: 10,500 megawatts, fired by coal, natural gas and nuclear energy, including 4,000 megawatts in Texas
TXU: The entire project is in Texas, though TXU says it wants to expand to the Northeast
NRG: Nuclear units and a coal unit in Texas; coal and natural gas units in the Northeast, the South and the West
TXU: The first coal plant is scheduled to go online in 2009
NRG: The next 10 years; the first Texas nuclear plant is scheduled to go online in 2014
TXU: Aims to cut its total Texas emissions by 20 percent
NRG: Aims to cut its total U.S. emissions 67 percent
TXU: $10 billion
NRG: $16 billion
SOURCES: TXU; NRG Energy