Exelon at Standstill
January 23, 2009
McClatchy-Tribune Regional News - Tara Bozick Victoria
A nuclear company plays the waiting game during a transition of
power and an uncertain economy.
Throw into the mix a design change and need to reaffirm a water
supply for a proposed project in Victoria County. Yet, Exelon Nuclear
continues to position itself for future financial growth.
Exelon needs federal loan guarantees to back financing for a
proposed nuclear plant near McFaddin in Victoria County. But with only
$18.5 billion in guarantees available and $122 billion requested for
21 reactors, Exelon waits to see what a new administration under
President Barack Obama will bring.
"Without a loan guarantee program, I wouldn't say it would never
be built but it wouldn't be built within this decade," Christoper
Crane, president and chief operating officer, said during a meeting
with the Advocate's editorial board on Friday.
More work needs to be done with the whole loan guarantee process,
whereby money would be appropriated through Congress, he said. The
company continues to seek support from U.S. legislators on the issues
of energy and economic stimulus.
The acquisition of NRG, which owns 44 percent of the South Texas
Project in Matagorda County, would give a combined company the
financial strength to pursue future projects, which ultimately would
be based on economics and regulatory permitting, Crane said.
While Exelon doesn't intend to cancel either the Victoria project
or STP's proposed two-reactor expansion, an acquisition could affect
the timeline of those projects, Crane said. The company needs to
consider the debt it would take on in the current economic environment
as well as demand for electric generation.
An economic recession could cut demand, but Exelon still needs to
evaluate the kind of recession Texas might face. A severe one could
move proposed projects back by a decade.
"We believe the health of the Texas economy is somewhat stronger
than other parts of the country and it should rebound faster," Crane
said.
Crane and other Exelon officials spent Thursday discussing these
same issues with state leaders, including Lt. Gov. David Dewhurt.
During that meeting, Crane relayed the need to conduct an independent
study to evaluate the water supply for a plant in Victoria County
after a Chicago protest and input from concerned ranchers.
Dewhurt expressed support of the company's decision.
"He's supportive of more nuclear power generation in Texas, but
he understands the need for doing it in a responsible way," Rich
Parsons, Dewhurt's press secretary, said.
Exelon wants to find a credible, independent source to conduct
the study, which it would like to have complete by this spring, Crane
said.
Texans for a Sound Energy Policy Alliance would scrutinize such a
study as its own hydrologists found an adequate water supply lacking,
director John Figer said.
"We're not going to take someone else's word for it," Figer said.
"We just don't think there is enough water for the future."
Figer added he thinks it "absurd" to build nuclear plants in the
current economic situation. He said the billions of dollars in federal
guarantees should go toward researching how to make wind and solar
power more viable.
Dale Fowler, president of Victoria Economic Development Corp.,
disagreed. He said if the water wasn't dedicated to an Exelon project
or any other local project, cities like San Antonio would eventually
get it.
For Victoria, he added, now is the best time to see a nuclear
plant come to fruition.
"We've seen headlines recently that other industries in the area
are making cutbacks in jobs," Fowler, who is also an advisory
committee member for Nuclear Energy for Texans, said. "This helps our
region stave off some of the economic woes that are hitting the rest
of the nation."
Changing the proposed reactor design for the Victoria project
wouldn't affect that project timeline, either, Christopher Crane,
Exelon's chief operating officer, said. The company will announce at
the end of February which reactor will replace the first pick of the
Economic Simplified Boiling Water Reactor.
Crane added that the Advanced Boiling Water Reactor, the design
for STP's expansion, was No. 2 on its original list.
McClatchy-Tribune Regional News - Tara Bozick Victoria
A nuclear company plays the waiting game during a transition of
power and an uncertain economy.
Throw into the mix a design change and need to reaffirm a water
supply for a proposed project in Victoria County. Yet, Exelon Nuclear
continues to position itself for future financial growth.
Exelon needs federal loan guarantees to back financing for a
proposed nuclear plant near McFaddin in Victoria County. But with only
$18.5 billion in guarantees available and $122 billion requested for
21 reactors, Exelon waits to see what a new administration under
President Barack Obama will bring.
"Without a loan guarantee program, I wouldn't say it would never
be built but it wouldn't be built within this decade," Christoper
Crane, president and chief operating officer, said during a meeting
with the Advocate's editorial board on Friday.
More work needs to be done with the whole loan guarantee process,
whereby money would be appropriated through Congress, he said. The
company continues to seek support from U.S. legislators on the issues
of energy and economic stimulus.
The acquisition of NRG, which owns 44 percent of the South Texas
Project in Matagorda County, would give a combined company the
financial strength to pursue future projects, which ultimately would
be based on economics and regulatory permitting, Crane said.
While Exelon doesn't intend to cancel either the Victoria project
or STP's proposed two-reactor expansion, an acquisition could affect
the timeline of those projects, Crane said. The company needs to
consider the debt it would take on in the current economic environment
as well as demand for electric generation.
An economic recession could cut demand, but Exelon still needs to
evaluate the kind of recession Texas might face. A severe one could
move proposed projects back by a decade.
"We believe the health of the Texas economy is somewhat stronger
than other parts of the country and it should rebound faster," Crane
said.
Crane and other Exelon officials spent Thursday discussing these
same issues with state leaders, including Lt. Gov. David Dewhurt.
During that meeting, Crane relayed the need to conduct an independent
study to evaluate the water supply for a plant in Victoria County
after a Chicago protest and input from concerned ranchers.
Dewhurt expressed support of the company's decision.
"He's supportive of more nuclear power generation in Texas, but
he understands the need for doing it in a responsible way," Rich
Parsons, Dewhurt's press secretary, said.
Exelon wants to find a credible, independent source to conduct
the study, which it would like to have complete by this spring, Crane
said.
Texans for a Sound Energy Policy Alliance would scrutinize such a
study as its own hydrologists found an adequate water supply lacking,
director John Figer said.
"We're not going to take someone else's word for it," Figer said.
"We just don't think there is enough water for the future."
Figer added he thinks it "absurd" to build nuclear plants in the
current economic situation. He said the billions of dollars in federal
guarantees should go toward researching how to make wind and solar
power more viable.
Dale Fowler, president of Victoria Economic Development Corp.,
disagreed. He said if the water wasn't dedicated to an Exelon project
or any other local project, cities like San Antonio would eventually
get it.
For Victoria, he added, now is the best time to see a nuclear
plant come to fruition.
"We've seen headlines recently that other industries in the area
are making cutbacks in jobs," Fowler, who is also an advisory
committee member for Nuclear Energy for Texans, said. "This helps our
region stave off some of the economic woes that are hitting the rest
of the nation."
Changing the proposed reactor design for the Victoria project
wouldn't affect that project timeline, either, Christopher Crane,
Exelon's chief operating officer, said. The company will announce at
the end of February which reactor will replace the first pick of the
Economic Simplified Boiling Water Reactor.
Crane added that the Advanced Boiling Water Reactor, the design
for STP's expansion, was No. 2 on its original list.