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Posts Tagged ‘South Texas Project’

STP US vs Foreign OwnershipU.S. Nuclear power plants and foreign control

In September 2012, the Nuclear Regulatory Commission denied an operating license to Unistar Nuclear Energy for its planned third reactor at Calvert Cliffs in Maryland because it is fully owned by France’s Électricité de France (EDF)-a foreign entity. Federal law prohibits a foreign entity from completely owning or controlling a U.S. nuclear plant. The company was given 60 days to find a U.S. partner, which it has been unable to do in the past two years, and if it fails to do so the license application will be fully terminated.

Federal law is clear that foreign controlled corporations are not eligible to apply for a license to build and operate nuclear power plants. The evidence is that Toshiba is in control of the project and this precludes obtaining an NRC license for South Texas Project 3 & 4.

While foreign investment in U.S nuclear projects is not prohibited; Toshiba is paying all the bills for the proposed STP 3 & 4 project. This makes it difficult to accept that Toshiba doesn’t control the project.

Toshiba North America Engineering, or TANE, has assumed exclusive, principal funding authority for the project, but they are a wholly owned subsidiary of Toshiba America, Inc, a Japanese corporation. Public Citizen contends that this makes them ineligible for licensing.

How did foreign ownership become a problem? New Jersey based NRG announced on April 19, 2011 that it would write down its investment in the development of South Texas Project units 3 & 4. Engineering work and pre-construction activities were halted, and NRG stated that Toshiba North America Engineering – TANE – would be responsible for funding ongoing costs to continue the licensing process.

The upcoming hearing will deal, in part with the issue of STP’s foreign control.

The Atomic Safety and Licensing Board (ASLB) has rescheduled to Jan. 6, 2014, a hearing in Houston involving an application to build two new reactors at the South Texas Project site near Bay City, Texas. The ASLB is the independent body within the Nuclear Regulatory Commission that conducts adjudicatory hearings and renders decisions on legal challenges to licensing actions.

The hearing will start at 9:00 a.m. CST on Monday, January 6, in Room 425 of the Fourteenth Court of Appeals, 301 Fannin St. in Houston. The hearing will continue on January 7 until noon, if necessary. Members of the public and media are welcome to observe the evidentiary hearing, but participation in the hearing will be limited to the parties and their lawyers and witnesses. Those planning to attend the evidentiary hearing should arrive at least 15 minutes early to allow time for security screening, including searches of hand-carried items such as briefcases or backpacks. No signs will be permitted in the courtroom.

The hearing involves Nuclear Innovation North America’s application to build two Advanced Boiling-Water Reactors at the South Texas Project site. The hearing will examine whether the applicant’s planned corporate governing structure and financing comply with the NRC’s rules prohibiting foreign ownership, control and domination.

The board continues to accept written comments from interested members of the public, known as limited appearance statements. These statements are not testimony or evidence, but they may aid the board and/or the parties in considering the issues in the hearing. Statements may be submitted via mail to:, Office of the Secretary Rulemaking and Adjudications Staff, U.S. Nuclear Regulatory Commission, Washington, D.C. 20555-0001; via fax to (301) 415-1101 or via e-mail to [email protected] Copies of the statements should also be submitted to: Administrative Judge Michael M. Gibson, Atomic Safety and Licensing Board Panel, Mail Stop T-3F23, U.S. Nuclear Regulatory Commission, Washington, D.C. 20555-0001; via fax to (301) 415-5599, or via email to [email protected] and [email protected]

Documents related to the South Texas Project application are available on the NRC website. Documents regarding this board’s proceeding are available on the NRC’s Electronic Hearing Docket by clicking on the folder entitled “South_Texas_52-012&013-COL” on the left side of the page. More information about the role of the ASLB in the licensing process is available on the NRC website.

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A licensing hearing for South Texas Project reactors begins today in Austin, Texas.

The hearing is on the application to expand the South Texas Nuclear plant and raises key issues, especially in light of the explosions, fires and meltdowns at Fukushima.

An Atomic Safety and Licensing Board (ASLB) panel–an independent body within the Nuclear Regulatory Commission (NRC)–will hear oral arguments and conduct an evidentiary hearing beginning at 9:30 a.m. in Room 2210, Building F at the Texas Commission on Environmental Quality (TCEQ), 12100 Park 35 Circle in Austin. On the 18th and 19th the hearing will continue in Building E, Room 201 S at TCEQ.

The public is invited to the hearing, but participation is limited to the parties admitted to the proceeding: the Sustainable Energy and Economic Development (SEED) Coalition, the South Texas Association for Responsible Energy, Public Citizen, the applicant, NINA, and NRC staff.

the Sustainable Energy and Economic Development (SEED) Coalition, the South Texas Association for Responsible Energy and Public Citizen will raise the issue of whether it is possible to control multiple reactors after a fire or explosion at one of the units, and question the need for more reactors since new federal energy efficiency laws are in place.

Another major issue the groups hope to raise is the applicant (Nuclear Innovation North America – NINA) doesn’t meet federal requirements prohibiting foreign ownership, control or domination of a U.S. nuclear facility.

The South Texas Project expansion has been hurting for investors.  TEPCO, the owner of the ill-fated Fukushima reactors, will no longer invest in the reactors. Austin Energy has chosen not to invest and City Public Service in San Antonio has reduced its 50% interest to only 7%.  Even NRG, the major force behind the reactor project, is no longer investing.   The nuclear license is still being sought by NINA- a partnership of NRG Energy and Toshiba – but only Toshiba is an investing partner at this time and it is also a foreign company.  Opponents have called for a halt to licensing, especially since a license could be sold in the future.

“Fukushima shows just how dangerous it is to have a lot of reactors in one location. We will raise safety concerns about locating so many nuclear reactors close together,” said Karen Hadden, SEED Coalition’s Executive Director. “We’re raising concerns about the legality of foreign ownership of the proposed reactors.”

“Texas doesn’t need or want more nuclear power,” said Tom “Smitty” Smith of Public Citizen’s Texas office. “We have safer, cleaner and more affordable energy options available today. New federal building codes and appliance standards will improve efficiency, making the two additional nuclear plants unnecessary. San Antonio’s reduced nuclear project share is being replaced through energy efficiency, wind and solar power and natural gas.”

Background

The South Texas Project COL application was submitted to the NRC on Sept. 20, 2007, the first such application in the United States in nearly 30 years. The license would allow construction and operation of South Texas Project reactors 3 & 4 at the existing Bay City, Texas site.

Over the past four years, the proposed nuclear project has experienced:

  • Cost estimates that have skyrocketed from $5.6 billion to over $18 billion.
  • A major pull-back by NRG’s partner, San Antonio’s CPS Energy, from a 50% stake down to 7%, which left a huge investor gap.
  • NRG Energy and TEPCO will no longer invest in the project. Previously anticipated loan guarantees from Japan now appear unlikely. Despite the lack of further investment, NINA  continues to seek a license for the proposed reactors. NRG will give Toshiba $20 million for this purpose.

Individuals or groups not admitted to the proceeding can submit “written limited appearance statements” to the ASLB. Anyone wishing to submit a written statement can email [email protected], or fax to (301) 415-1101, or send mail to: Office of the Secretary, Attn. Rulemaking and Adjudications Staff, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001. In addition, copies of written statements should be sent to  [email protected] and [email protected]; by fax to (301-415-5599), or by mail to: Administrative Judge Michael M. Gibson, Atomic Safety and Licensing Board Panel, Mail Stop: T-3F23, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001.

Documents related to the South Texas Project COL application are available on the NRC website. Documents pertaining to the ASLB proceeding are available in the agency’s electronic hearing docket. NOTE: Anyone wishing to take photos or use a camera to record the hearing should contact the NRC Office of Public Affairs beforehand.

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On January 13th, the Nuclear Regulatory Commission (NRC) announced the opportunity to request a hearing on an application to renew the operating licenses for the South Texas Project (STP) Units 1 and 2 which will expire on Aug. 20, 2027, and Dec. 15, 2028, respectively.

South Texas Project Nuclear Operating Company, submitted the renewal application to the NRC on Oct. 25, 2010. When the agency receives a license renewal application and it is docketed three actions are triggered:

  • technical safety reviews
  • environmental reviews
  • an announcement of an opportunity for a hearing

The deadline for requesting a hearing is 60 days following the publication of a notice in the Federal Register.   This means, by March 14, petitions should be filed by anyone whose interest may be affected by the license renewal and who wishes to participate as a party in the proceeding. (more…)

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Statement of Tom “Smitty” Smith:

We are shocked to hear the news that former Austin Energy and Pedernales Electric Cooperative General Manager Juan Garza has taken a job promoting nuclear power with New Jersey-based NRG Energy. While Garza rightfully acknowledges the danger climate change poses to Texas, nuclear power’s life cycle carbon footprint, exorbitant cost and extreme construction time belie the claim that nuclear is a solution to the climate crisis.

Numerous independent analyses warn that new nuclear reactors are too expensive, including consultants to the City of Austin who twice recommended the city pass on investment in the proposed South Texas Project units 3 and 4 due to high risk and cost. San Antonio’s CPS Energy has cut off investment in the project. Municipal utilities and electric cooperatives should take heed of the nuclear industry’s poor track record of delivering new reactors on time and on budget. The cost of these reactors has more than trebled in three years and when we built the first two units they were 6 times over budget and 8 years late. There are cheaper, cleaner, faster ways to meet new power needs in a carbon-constrained world.

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By promoting cleaner energy, cleaner government, and cleaner air for all Texans, we hope to provide for a healthy place to live and prosper. We are Public Citizen Texas.

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STP

South Texas Project

Human error appears to have caused a partial shutdown last Friday at the South Texas Project, one of the state’s two nuclear plants.

Last week, prices spiked in the wholesale electricity market.  On Monday the 16th,  wholesale electricity, which had been selling for less than $30 per megawatt-hour spiked to more than $2,000.  That’s an increase of more than 7,000 percent. Prices also spiked several times to the $1,000 level. A price spike of $2,200 is especially startling, given that the regulatory cap is set at $2,250. That is, the wholesale prices legally could not have gone much higher.  At the same time, according to the Electric Reliabiilty Council of Texas (ERCOT), who manages the Texas electricity grid, a new record for statewide power use was set.

Then, to top off the week, Unit 1 of the South Texas Project apparently tripped off (also known in the industry as a SCRAM – an acronym for safety control rod axe man but which is essentially an emergency shutdown of a nuclear reactor).

The event, first reported in a trade journal SNL Power Daily, was apparently caused by human error. “The NRC said in its Aug. 23 event report that the unit experienced an automatic reactor trip that was caused by an inadvertent turbine signal initiated during testing,” reported SNL’s Jay Hodgkins, citing the U.S. Nuclear Regulatory Commission. The publication reported that power was restored by Monday. It’s unclear whether the outage contributed to the price spikes, although that seems likely.

I guess I’ll take a contribution to a price spike over a meltdown any day, but still kind of scarey!

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By promoting cleaner energy, cleaner government, and cleaner air for all Texans, we hope to provide for a healthy place to live and prosper. We are Public Citizen Texas.

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About 20 of the roughly 100 contractor personnel working on the proposed addition of two new 1,350-MW nuclear units at the South Texas nuclear station have been let go.

Nuclear Innovation North America (NINA), an 88/12 joint venture of NRG Energy and Toshiba, currently owns 92.35% of the planned expansion, and CPS Energy, the municipal utility in San Antonio owns the remaining 7.65%.   In May, NINA announced Tokyo Electric Power Co. plans to eventually take up to a 20% stake in NINA’s share, beginning with a 10% stake in that share–or a 9.235% stake in the  project itself–if a $7 billion federal loan guarantee is secured.

NINA has recently said it expects the project to cost about $13 billion, including $10 billion in “overnight” costs and $3 billion in financing costs. Although earlier cost projections have put the project coming in at $18 billion.

At this time, there is spectulation that the remaining loan guarantees will go to Calvert Cliffs in Maryland.  NINA has said they would not go forward with the expansion without the loan guarantees.  Could this be the beginning of the end for the STP expansion?  Stay tuned.

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By promoting cleaner energy, cleaner government, and cleaner air for all Texans, we hope to provide for a healthy place to live and prosper. We are Public Citizen Texas

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Agency Is Refusing to Adhere to an Order to Release Document That Would Help Determine Safety of New Nuclear Reactors

WASHINGTON, D.C. – The Nuclear Regulatory Commission (NRC) should stop balking and provide a critical document that would reveal how the owners of a Texas nuclear plant expansion project plan to deal with a fire or explosion, three public interest groups told the commission late last week.

Three administrative judges of the Atomic Safety and Licensing Board have ordered the agency to provide at least a redacted version, but NRC staffers have refused. The NRC’s lack of transparency could impact the ability to get adequate safety-related information not only about the South Texas Project (STP) but about other proposed reactors around the country as well.

Late Friday, the groups – the Sustainable Energy and Economic Development (SEED) Coalition, Public Citizen and the South Texas Association for Responsible Energy – filed a brief with the NRC. It noted that the NRC staff’s refusal to provide the information violated President Barack Obama’s new transparency policy. The groups also said the NRC is acting arbitrarily and trying to shut the public out of NRC proceedings.

“After the Sept. 11 attacks, Congress required new fire and safety standards for all new plants and the NRC developed rules to reflect this. Now, the NRC is trying to do its work behind closed doors, and its staffers are literally making up how to handle information as they go along, keeping as much secret as possible,” said Karen Hadden, executive director of the SEED Coalition. “Without disclosure of this information, we can’t tell how well the NRC is doing in protecting the public.” (more…)

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Statement of Tom “Smitty” Smith, Director, Public Citizen’s Texas Office

Today’s announcement that as a part of a settlement with NRG Energy, CPS Energy will withdraw its application for a federal loan guarantee for the South Texas (Nuclear) Project (STP) expansion and end further investment in the project demonstrates nuclear plants are too costly and too risky to build.

CPS Energy and the San Antonio City Council have signaled their desire to stop throwing good money after bad at STP, a message we hope will tell the U.S. Department of Energy that this plant is a poor candidate for federal loan guarantees. This debacle should show the federal government that nuclear loan guarantees are a fundamentally flawed and wasteful use of taxpayer money.

At $18.2 billion, the cost of STP has already tripled in just a year. When STP 1 and 2 were built, they ended up being six times over-budget and eight years behind schedule, and STP 3 and 4 look like they are on track to beat out that poor performance record.

Today’s announcement is a victory for the many citizens of San Antonio that have worked so hard in the last year to bring openness and accountability to the city’s participation in this project. We applaud CPS for wisely seeing the futility of wasting more time and energy on this flawed nuclear endeavor. We hope that they will be satisfied with the deal they’ve gotten and avoid the temptation to increase their ownership in the project. CPS has finally reached a settlement that shields San Antonio ratepayers from the financial risks of yet another nuclear deal gone wrong. Any future investment would throw that protection to the wind.

On Thursday, the City Council will vote on a proposed rate increase for CPS. The City Council should put a firewall in that proposal to ensure that no unauthorized money will be siphoned off to buy a bigger stake in STP.  San Antonio can’t afford to let this rate increase become a back door to continued nuclear investment.

We also have to wonder how NRG will move forward, without another clearly delineated partner in the project. Less than a month ago, NRG announced that if CPS “does not meet future obligations representative of its ownership interest in the site”, they “will wind down the project as quickly and as economically as possible.” We certainly hope that NRG CEO David Crane will remain true to that expressed intent to protect his shareholders from the next financial failure in a long historic line of overly expensive, poorly executed nuclear projects.

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By promoting cleaner energy, cleaner government, and cleaner air for all Texans, we hope to provide for a healthy place to live and prosper. We are Public Citizen Texas.

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I got at least one worried phone call this morning about an article in the Bay City Tribune claiming that

A resolution backing STP Units 3 & 4, possibly within the next few days, may be at least partly the outcome of a meeting Matagorda County Judge Nate McDonald and Bay City Mayor Richard Knapik had with San Antonio Mayor Julian Castro last Friday.

Whaaa–? The announcement seemed to be coming out of left field. After all the scandal and controversy of the last few months, a statement of support for STP expansion from San Antonio City Council is about the last thing I’d expect to see.  But before I had a chance to investigate, the intrepid Greg Harman of the San Antonio Current (who just this fall we gave an award to for “Best Environmental Journalist”) already had all the answers.

In a nutshell: rest easy my duckies, the Bay City Tribune’s announcement was just wishful thinking on the part of Matagorda County Judge Nate McDonald (who is no fan of us, boy oh boy), Bay City Mayor Richard Knapik, and Mike Reddell, the author of the article in question.  From Harman himself,

No such resolution is on the horizon for San Antonio, where the proposed expansion has fallen into deep disfavor after CPS Energy officials sought to cover up escalating cost estimates. The closest thing matching Reddell’s statements would be an expected CPS Energy Board of Trustees vote on whether or not to continue in the construction of two new reactors with NRG Energy, at all. However, that vote was delayed yesterday.

Harman’s article is well worth reading for the rest of the story on the Tribune’s journalistic integrity. Crazy story there, check it out!

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By promoting cleaner energy, cleaner government, and cleaner air for all Texans, we hope to provide for a healthy place to live and prosper. We are Public Citizen Texas.

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A critical court ruling today rang the first chime in what could be the death knell of the so-called “nuclear renaissance,” starting with the failed expansion of the South Texas Project (STP).

This afternoon’s ruling by 408th District Court Judge Larry Noll that CPS Energy can safely withdraw from the proposed STP expansion project without losing all its investment offers the utility and the city of San Antonio the cue they’ve been waiting for to exit the national nuclear stage. Combined with the NRG Energy CEO’s announcement during a shareholder and press conference call this morning that NRG would “wind down the project as quickly and economically as possible” if CPS withdraws or STP does not receive federal loan guarantees, this news marks a major blow to those who claim nuclear power is a viable alternative to fossil fuel energy. The expansion project calls for two new nuclear reactors at a site with two existing reactors.

slide 8 of NRG's "STP 3&4 Nuclear Project and CPS Litigation" presentation given at shareholder and media conference call Friday, January 29, 2010 8:00 a.m. ET

These events give credence to the contention made over the past five years by opponents of nuclear power that it is a needlessly expensive and risky way to meet future energy needs.. In less than a year, the price of the STP nuclear expansion ballooned from around $5 billion to more than $18 billion. Given this case study of nuclear power’s failure, we must call into question the federal government’s decision to increase federal loan guarantees to support oversized, untenable projects that are already proving too risky for private investors.

Public Citizen calls on both CPS Energy and NRG Energy to stop throwing good money after bad with their nuclear expansion plans and halt the project. Thankfully, San Antonio Mayor Julian Castro intervened by putting the project on hold before costs jumped too far out of San Antonio’s reach. Given the court’s announcement that the city’s interests are protected, we hope San Antonio will take the next responsible step and bow out entirely.

Statement of Tom “Smitty” Smith, Director of Public Citizen’s Texas Office

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By promoting cleaner energy, cleaner government, and cleaner air for all Texans, we hope to provide for a healthy place to live and prosper. We are Public Citizen Texas.

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Statement of Tom “Smitty” Smith, Director of Public Citizen’s Texas Office

The latest interim charge of the state Senate Business and Commerce Committee provides a welcome opportunity for Texas to rein in rogue utilities like CPS Energy of San Antonio. Now tasked with studying the costs of municipally owned utilities’ generation plans and their impacts on residential and commercial customers, the Senate committee has the opportunity to protect Texans, especially low-income families, from the machinations of a utility bent on pleasing its industrial consumers at the cost of its most vulnerable customers.

CPS Energy is pursuing a risky investment in a nuclear expansion project that, depending on the final cost of the project, would raise rates between 36 percent and 60 percent over the next 10 years. The municipally owned utility has failed to adequately involve the citizenry and city government in its generation planning process. CPS Energy’s nuclear energy plan lacks any mechanism to protect consumers or low-income families, despite the fact that those customers would have to pick up the tab if the deal gets more expensive.

In comparison, the city of Austin’s generation planning process spanned two years and involved public input and roundtable stakeholder negotiations, leading to the development of special policies to protect low-income families from higher bills. Policies like built-in periodic reassessments of cost and feasibility will protect Austin residents and businesses from runaway energy costs that are so typical of large-scale nuclear construction projects. San Antonio residents need to see the same protections.

As Austin’s process clearly shows, CPS Energy can be much more inclusive and transparent. Public Citizen is grateful that the members of the Senate Business and Commerce Committee can step in and act as responsible figures in this process.

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By promoting cleaner energy, cleaner government, and cleaner air for all Texans, we hope to provide for a healthy place to live and prosper. We are Public Citizen Texas.

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The San Antonio Nuclear Expansion Soap Opera plot thickens.  Today’s update brings the shocking news that South Texas Project Reactors 3 & 4 could actually cost, not $13 Billion, not even $17 Billion… but $18.2 Billion!

With all the trouble CPS has gotten into recently regarding transparency (a gentle term we’re using that translates roughly to “lying to the public and covering up bad news”), you’d think that they would’ve come forward and made this estimate public as soon as humanly possible.

But you’d be wrong.  Instead, they presented the numbers to their board in a closed session last week (read: NOT public, you’re not invited).  Sometime later, the San Antonio Express-News got wind of the update, “based on numbers provided by the South Texas Project Nuclear Operating Co”, and published the results.

When will CPS learn that they have got to be honest with the public, the mayor, and city council? They told folks all summer long that the plant would cost $13 Billion, even though insiders knew since late June that it could very well be $4 Billion more.  CPS has led a lengthy and sloppy cover-up campaign of STP and nuclear power’s “inconvenient truth” that culminated in resignations, an internal investigation, and several firings and demotions.

Am I going to fast for you? Did you miss a few episodes, and are confused that CPS’ prize project could so quickly fall to pieces? Let’s do a recap.

Previously, on Amores Nucleares:

With just days before San Antonio City Council was to vote to approve $400 million in bonds for new nuclear reactors, it was leaked that the project could actually cost $4 Billion more than CPS had been saying all summer (according to Toshiba, who would actually be building the plant).  The vote was postponed, there was an impromptu press conference, and it came out that CPS staff had actually known about the cost increase for more than a week — Oops! Oh, and the “leak” wasn’t that CPS came out with the truth, an aide from the mayor’s office only found out after confronting CPS about a rumor he’d heard. But how did the mayor’s office find out? NRG, CPS’ partner in the project was the “Deepthroat”, because they were going to announce Toshiba’s $17 Billion cost estimate at a shareholder’s meeting soon after the city council vote and thought, geez, that could look really bad for CPS! Meanwhile,  CPS reps flew to Japan in a hurry to figure things out.  Steve Bartley, interim GM for CPS, resigned.  Furious that CPS had hidden the ugly truth from City Council, the mayor demanded the resignation of two key CPS board members, and got City Council to vote unanimously that they get the boot.  Chairwoman Aurora Geis agreed to go, but Steve Hennigan said “No Way, Jose.” THEN CPS completed an internal audit of the whole shebang to figure out what-the-hell-happened, which found that Steve Bartley was to blame, and everyone else was only guilty of failure in their “responsibility of prompt disclosure”.  And then this week it came out the project could be even more way way expensive than anyone thought (except of course Energia Mia, Public Citizen, SEED Coalition, the Center for American Progress, Nuclear Information and Resource Service, and analysts Arjun Makhijani, Clarence Johnson, Craig Severance, and Mark Cooper to name a few).

That about brings us up to speed.

So what is next? December 31st, Toshiba should come out with a new, “official” cost estimate, which CPS will use to come up with their own cost estimate mid-January. City council is slated to vote January 15th, once and for all, on $400 million in bonds to continue the project.  But clearly, enough is enough.  Tell City Council to stop throwing good money after bad, and to cut their losses before its too late.  Tell them to vote “no” to nuclear bonds January 15th, and start the year off fresh and free from the “ghost of nuclear projects past.”

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By promoting cleaner energy, cleaner government, cleaner cars, and cleaner air for all Texans, we hope to provide for a healthy place to live and prosper. We are Public Citizen Texas.

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Millions of people have been farming in Texas for a very long time. In fact, agriculture is one of the major components of the state’s economy. But news reports have been showing that the farming industry is facing real problems that pertain to climate change. That’s right, many farmers have to cut back their production, if not stop entirely, due to insufficiency of water.

19-Rice-Farming

Rice Farming

As many know, Texas has been experiencing a serious drought, one that is comparable to the drought back in the 5o’s. The National Climatic Data Center describes the 50’s drought as ”characterized by both low rainfall amounts and excessively high temperatures.” Sounds familiar? The Austin American Statesman reports that, “The Lower Colorado River Authority could soon ask the state environmental agency to declare the current drought worse than the one in the 1950s.”

The Lower Colorado River Authority is now trying to get the EPA to regulate the water Texas farmers are using. This will affect as many as 70 counties in central and southeast Texas. For example, the Highland Lakes, a water supply to most rice farms in southeast Texas, might soon be cut off to farmers under the LCRA’s pending water management plan.

More than 42 million acres are affected, which is about a quarter of our state, an area roughly equal to the total land area of New England.

U.S. Sen. John Cornyn

The LCRA is the same entity that allows the South Texas Project nuclear plant to withdraw as much water as it needs. A proposed project to add two more nuclear reactors to the South Texas Project will require as much water as what half of the city of San Antonio needs in a dry year. It seems a little contradictory. If we need to cut back and become more conservative in using our resources, we all need to cut back and not just some of us. We should also be careful that our energy sources don’t unnecessarily use up the water that we need for residents and agriculture — and surely not when other energy sources (wind, solar, energy efficiency, to name a few) are available with minimal water use.

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With just two days before San Antonio City Council was to vote to approve $400 million in bonds to move forward with the South Texas Nuclear Project two reactor expansion, officials announced yesterday that the cost estimate for the project had ballooned by up to $4 BILLION.  That means that the new price tag on the new reactors, up from $13 Billion, is now a whopping $17 Billion (and don’t forget that even $13 Billion was a big jump from the original cost estimate of $5.4 Billion).  As a result, the Council has postponed the vote until January.

This is a huge victory for environmentalists, social justice workers, and citizen activists who have been tirelessly organizing opposition to new nuclear reactors.  If these concerned citizens hadn’t gotten involved, the City Council would have voted to approve the bonds a month ago, with no option to renegotiate their contract or pricing.  Because citizens got educated and involved, City Council was forced to delay the vote until they had all the information.  And the information, as it turns out, is that the cost estimates that groups like Public Citizen and SEED Coalition have been predicting for more than a year (up to $17.5 Billion according to a 2008 study by Arjun Makhijani and as much as $22 Billion according to analyst Clarence Johnson), far from a Cassandra cry, have been right on the money all along.

For all the dirty details, be sure to read the San Antonio Express-News’ breaking article Nuclear cost estimate rises by as much as $4 billion and the San Antonio Current’s blog post Nuke Collider: San Antonio delays $400 million nuke bond vote over Toshiba cost surge.  And courtesy of the unstoppable Greg Harman at the Current, check out the following video from the emergency press conference CPS officials and the Mayor’s office held yesterday, a MUST WATCH:

[youtube=http://www.youtube.com/watch?v=nwdivqvtjgc&feature=player_embedded]

What I find most interesting about this whole mess is that CPS insiders knew a week and a half ago that the costs were up by $4 Billion, but neglected to tell the Mayor or City Council until yesterday.  And even then, it didn’t come as a formal announcement — the cat was only let out of the bag because, as the Express-News reports, an aide of the Mayor confronted CPS about rumors of a cost increase.

CPS interim General Manager Steve Bartley said the utility’s main contractor on the project, Toshiba Inc., informed officials that the cost of the reactors would be “substantially greater” than CPS’ estimate of $13 billion, which includes financing.

He said utility officials found out about the increase “within the last week and a half or so.”

But the mayor said he only learned the news Monday night after an aide asked Bartley about rumors of a cost estimate increase.

Castro said he didn’t know whether CPS would have divulged the increase to the council before its vote Thursday had his aide not directly questioned utility management.

“One would hope otherwise, but the evidence seems to suggest that they were less than proactive,” he said.

Sounds like CPS was going to wait until after Thursday’s vote to share their special need-to-know information, and that if it weren’t for those meddling kids they would have gotten away with it too.

Any way you look at it, yesterday’s announcement is fortuitous for the City of San Antonio.  Now City Council has a better idea of the real costs they are looking at with the project, and hopefully will think twice about placing their trust in CPS Energy now that they’ve been burned by the utility’s untransparent business practices.  With two months time until the vote, City Council now has plenty of time to order an independent study to model various energy scenarios and present a slew of options (besides just “nuclear or nothing”) for San Antonio’s energy future — including a heavy mix of renewable energy and efficiency. An outside study to model alternatives would present City Council with the most cost-effective, least risky, most environmentally sustainable plan possible. CPS claims to have done a ‘thorough’ investigation of these options, but just as they conveniently underestimated the cost of nuclear, they have overestimated the cost of renewable energies such as wind, solar, storage, and energy efficiency to the point of absurdity.  With two months to work at it, there is no reason why San Antonio shouldn’t have a green plan to put up against the nuclear plan by January.  They nearly voted to approve the project this week without the full range of information.  San Antonio City Council can’t put themselves in that situation again.

But don’t take my word for it.  Check out the following statements from Tom “Smitty” Smith, director of Public Citizen’s Texas Office and Karen Hadden, director of the SEED Coalition:

Cost Increase of South Texas Project Shows Nuclear Power Is Too Expensive, Too Risky

Statement of Tom “Smitty” Smith, Director, Public Citizen’s Texas Office

We can’t think of any good reasons for the San Antonio City Council to continue with this project when there are far less expensive alternatives readily available. Investing in wind and solar makes much more sense and carries none of the risks – both the extreme financial risk that CPS wants taxpayers to bear and the health and safety risks inherent with nuclear power. If the City Council continues with this project, the average ratepayers will see their utility bills increase by 50 percent.

If San Antonio citizens hadn’t stepped to the plate, the City Council would have voted for the STP a month ago and the city would have been another $400 million in the hole with no option to renegotiate. But citizens got educated and got involved. Their involvement made the City Council delay the vote until they had all the information.

We know the San Antonio City Council is too smart to continue to support this boondoggle. Nuclear power is too expensive and too risky to use. It’s time for the San Antonio City Council to pull the plug on the STP expansion.

Statement of Karen Hadden, executive director, Sustainable Energy and Economic Development (SEED) Coalition:

We aren’t surprised to hear that the latest cost estimate for the South Texas Project puts the price to build two new nuclear reactors at $17 billion, $4 billion more than what CPS Energy said in June and more than three times the project’s original $5.4 billion price tag. We’ve been saying for two years that CPS has been feeding the public lowball estimates that wouldn’t hold up to reality.

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CPS has dropped the ball on alternatives to nuclear

By Arjun Makhijani – Special to the San Antonio Express-News

CPS Energy is asking its board and the San Antonio City Council for permission to sell $400 million of bonds to follow the $276 million CPS Energy has already spent to get an option to buy a nuclear pig in a poke.

Yet, the price that Toshiba, the company that would build the plant, would charge won’t be fully disclosed until 2012; a “baseline” cost estimate will be disclosed this winter. A commitment of such a vast additional sum is premature, at best.

First, CPS’ electricity demand projections are suspect. Its projected annual growth rate would increase from about 1.5 percent during 2009-2020 to about 2.4 percent after that. Yet, stringent building and appliance efficiency regulations are in the works nationally. Carbon prices are likely to rise steeply after 2020.

CPS’ assumption about an increasing growth rate makes neither market sense nor common sense. The risk to San Antonio would not be as serious had CPS done a careful analysis of the options. It has not. It only considered coal (a poor risk) and natural gas as potential alternatives.

CPS did not consider compressed-air energy storage, in use on a large scale both in Alabama and Germany. An investment of $400 million could convert the 1,250 megawatts of wind energy that CPS has or plans to acquire into about 400 megawatts of baseload capacity. CPS estimates a cost of $9,000 per kilowatt for a concentrating solar thermal power plant with heat storage, yet utilities are signing contracts (or purchased power agreements) for half this amount or less today. Google’s green energy chief, Bill Weihl, recently stated that solar projects typically cost $2,500 to $4,000 per kilowatt, plus $1,000 for storage.

Moreover, these costs are coming down. CPS did not consider combined heat and power, which is commercial, biomass used in an integrated gasification combined cycle plant, or elements of a smart grid that could convert intermittent renewable capacity into dependable capacity for loads like washing machines and air conditioners. It doesn’t appear to have considered recent drops in natural gas prices.

In brief, CPS has dropped the ball on alternatives. The argument that CPS must meet urgent deadlines to preserve its nuclear option should not rush the board or the city. NRG, CPS’ 50-50 partner in the project, can hardly proceed without CPS. Without CPS’ stellar bond rating and money, NRG, with its junk bond rating, would be far less likely to get federal loan guarantees.

Indeed, in my view, without CPS, NRG would not have a viable project. During the Clean Technology Forum in San Antonio on Sept. 16, Mayor Julián Castro promised the public that CPS’ investment decision will be made on merits.

However, this cannot be done now, because CPS has not put the options on the table that would enable a comparison on the merits. An independent expert panel could probably do a study for City Council in six months, possibly less. It would be unwise to risk $400 million more without it.

Arjun Makhijani is president of Institute for Energy and Environmental Research. He has published two studies on CPS nuclear costs.

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