In January 2003—early in the “nuclear renaissance” of the 2000s—around 70 nuclear utility executives attended an ANS Utility Executive Conference, which was organized around the theme “Future Vision.” They traveled to Scottsdale, Ariz., to discuss how the nuclear community could achieve the bright future they envisioned just ahead—does that sound familiar?
What were they talking about? Many of the topics of the 2003 conference were similar to sessions that drew crowds at the 2023 ANS Annual Meeting, even though twenty years have come and gone. While the context and details of the conversations are different, the general topics remain the same: workforce, capital costs, new regulatory processes, and even clean air policy.
What were utility executives saying about these topics 20 years ago? Read the excerpts below from the April 2003 issue of Nuclear News (pp. 51–56) to find out.
We’re still talking: Despite the many similarities in issues facing the nuclear community across the decades, the momentum behind nuclear energy in 2023 is different. Two decades on, energy security and climate change are widely seen as existential issues that need to be addressed now—not pushed into the future. To quote the theme of this year’s Annual Meeting: “Failure Is Not an Option.”
The 2003 Utility Executive Conference was a precursor to the ANS Utility Working Conference. This August, the conversation will continue at the UWC in Marco Island, Fla., but with redoubled urgency, in keeping with this year’s theme: “Building Resiliency in a Rapidly Changing World.”
ANS EXECUTIVE CONFERENCE (excerpts from the January 2003 meeting report)
Utility execs peer into the crystal ball:
Ensuring a steady supply of workers for the nuclear industry is among the most pressing issues facing the field in the coming years.
Nearly 70 nuclear utility executives escaped to the warming sunshine of Scottsdale, Ariz., in late January 2003 for a few days to discuss the issues that will be facing the industry in the coming years. Looking a step beyond today—which some are calling a renaissance in the field of nuclear energy—utility officials began to identify and wrestle with the needs of tomorrow's nuclear industry.
“We've had the theme in various conferences around our industry of a renaissance in our industry,” said Gary Gates, vice president of nuclear operations at Omaha Public Power District, during the opening session of the ANS-sponsored Utility Executive Conference: Future Vision, held January 26–29. “But we need to start talking about a vision of the future in many of the areas that influence us.”
The industry needs to press for clean-air legislation to help nuclear energy remain viable in the coming century, one speaker emphasized. The field must not turn away from the possibilities of hydrogen production, stressed another. One insurance company executive discussed the challenges of insuring nuclear power plants in an age when multisite sabotage is now plausible. A representative from the Nuclear Regulatory Commission addressed the emerging challenges of license renewals and early site permits.
Another speaker from the Institute of Nuclear Power Operations presented an overview of the organization's most drastic makeover in its history, which is occurring this year. The transformation reflects the changes in the nuclear utility industry since INPO's inception in 1979 and attempts to ensure the nation's nuclear power plants will meet the performance needs of the upcoming century. It was clear, however, what the greatest challenge for the nuclear industry will be in the coming decades: attracting workers. Amid their presentations, two speakers cycled through numerous statistics on the staffing needs of the nuclear industry and expected supply of workers in the next half century or so. The picture that emerged, if trends continue, was not one to bolster immediate hopes for the health of the industry. There are steps that can be taken, however—such as marketing a better image for the industry—to attract young bright minds to the field.
“We've all heard that we’re in a nuclear industry renaissance,” said Omaha Public Power District’s Ross Ridenoure. “And that's wonderful. But it's not going to happen unless we have people that can continue to operate these plants and fuel cycles and engineering cycles and everything else that's needed for the industry. . . . If the people aren't there to run the plants, what we're doing today simply won't matter. We have to take more aggressive steps to attract and retain the workers that we want.”
Clean air legislation
At 69 percent, nuclear energy currently accounts for the largest segment of emission-free generation in the United States, more than doubling its nearest competitor, hydro power, according to the Nuclear Energy Institute. And the nuclear industry stands to increase its presence among the country’s energy mix in the coming decades if certain environmental legislation is passed in the United States. Layla Sandell, manager of new nuclear plant development for the Electric Power Research Institute, described the results of a revised EPRI study that predicts new nuclear power plant deployment by 2016, with growth in the industry through at least 2050.
EPRI's Energy-Environment Policy Integration and Coordination—or E-EPIC—study investigated the potential effects of future regulation on sulfur dioxide, nitrogen oxide, and carbon dioxide emissions on the U.S. electricity generating system from present day to 2050. The study utilized the National Energy Modeling System (NEMS), developed by the Department of Energy's Energy Information Administration.
The original E-EPIC study showed a poor prognosis for nuclear power, with the energy source disappearing by 2050. EPRI, however, took a careful look at the assumptions used by NEMS and, after consideration, decided that some of the assumptions were based on information that is “not consistent with the current industry thinking,” Sandell said. As a result, EPRI modified some of the assumptions used by NEMS, mostly in the areas of plant capital cost, improved licensing expectations, existing plant performance, and the percentage of plants that will seek license renewal, Sandell said.
With the changes in assumptions, EPRI ran several scenarios for the E-EPIC study at a range of gas prices and carbon tax additions. Using a $4.12-per-million Btu (British thermal unit) price for gas, existing nuclear capacity begins to increase through power uprates and plant life extension, according to the revised study. Also, new nuclear power plants begin to be deployed around 2016, Sandell said.
“When you look at the base case scenario for generating capacity out to 2050, you see that existing nuclear will close out at about 2045. That’s when all the plants will have lived out their 60-year life expectancy. And new nuclear power plant deployment [begins] in about 2016, increasing through 2050,” Sandell explained.
Sandell then outlined in numerous scenarios the projected new nuclear power plant additions through 2020. If gas prices rise to $4.50 per million Btu, nuclear capacity would increase in the United States by 40 gigawatts. A 10 percent reduction in capital costs for nuclear plants coupled with a gas price as low as $3.60 per million Btu would make way for 60 GW of new nuclear generating capacity, Sandell said. And, with a $50-per-metric-ton carbon tax imposed, the nuclear market share could go up as high as 30 percent by 2020 (it currently stands around 20 percent).
“The role of nuclear plants in clean air can be significant,” Sandell said. “If we’re serious about controlling carbon emissions, we will need to deploy a portfolio of nonemitting generating options, including advanced fossil plants. Nuclear should be a major part of that portfolio. We need to work with our legislative community to educate them on the environmental benefits of nuclear power and work with [the NEI] to introduce appropriate legislation.
“In summary, indicators tell us that the future for nuclear is positive. . . . We do recognize that there are still significant hurdles that need to be overcome for that first new plant order to be placed. Those hurdles range from capital cost reductions to working with the government on construction loan guarantees and demonstrating a new and unproven regulatory process. But these hurdles can be overcome and we’re working to overcome them. Clean air legislation for nuclear will help level the playing field.”
The freedom of nuclear electric utilities to increase the maximum power at which their reactors can operate and to renew the operating licenses of their reactors is good news for the industry. It is a challenge, however, to the agency that must approve those moves—not least because of the shroud of secrecy under which utilities often keep their plans in order to hold competitors at bay. “We have a predictive challenge with regard to our workload,” explained David Matthews, director of the Division of Regulatory Improvement Programs for the Nuclear Regulatory Commission. “And it is exacerbated by the reluctance by many of the licensees to declare their intentions, for obviously many well-founded reasons. But it still makes our predictive capability very difficult when nobody will tell us when they’re coming [for license renewal], because the resources are intensive.” Matthews limited the scope of his outlook to the next three to five years, citing the difficulty of predicting trends in the nuclear industry from a regulator’s perspective.
In 2002 alone, Matthews said, the NRC approved 18 power uprates, an area that will continue to challenge the NRC. “All of a sudden, we saw an onslaught of power uprates. The commission became aware of it and made it very clear to us that they saw that power uprates was one of our primary licensing challenges in the next few years, and also imposed on us some very strict requirements associated with the timeframes under which we would review these,” Matthews said.
For each license renewal application that it receives, the NRC devotes the equivalent of I2 and a half staff members’ full-time work over the course of a year. Another $350,000 to $450,000 is then needed for the environmental review. A complicating factor for the NRC is that many applications are being combined. “Duke [Power] came in with a combined application from acquiring Catawba [station],” Matthews said. “We’re anticipating a combined application—and I get a headache just saying it—for Browns Ferry-1, -2, and -3. And why I say that is obvious: Browns Ferry-1 hasn’t been operated in what, 12 years, 16 years now? We don’t know what their licensing basis is, but they’re going to bring it in at the same time as -2 and -3 at the end of this year, with the expectation that we grant three licenses simultaneously at the end of the 22-month period. So, we have some challenges.”
An early site permit from the NRC allows a utility to build a certain class of a nuclear power plant and allows for early consideration of site suitability issues. Matthews said the NRC expects two early site permit applications by the middle of this year and one more at the end of the year. The relatively new process, however, will have some snags to be worked out in the coming years, such as how specific the permit can be in approving a type of reactor design. “There is a lot of contentiousness associated with the degree to which an early site permit can appreciate the range of designs that might be installed on that site,” Matthews said. “And that permitting is very dependent on many of those design considerations.”
The NRC is weighing an approach suggested by the Nuclear Energy Institute for considering a range of design options: the site parameter envelope. “An SPE . . . would come in with each of these [early site permits] and would in effect outline the design-related features that we need to be able to evaluate in completing the site suitability review and the environmental review. Understand that the environmental review, by necessity of a federal court ruling, has to have a risk assessment associated with severe accidents. And that’s very difficult to do for a design that you haven’t defined yet. So, there’s a real challenge for us in this area.”
The Nuclear Energy Institute set a bold target for the industry in its Vision 2020 outline: adding 50,000 megawatts of new nuclear generating capacity by 2020. Such an increase would be the equivalent of enough electricity for all of New York, Pennsylvania, and Illinois, and it would mean a 50 percent increase in electricity produced at nuclear power plants, explained Richard Smith, program manager for policy and planning at NEI, who reviewed the plan and emphasized the significance of hydrogen production for the industry’s future.
Over the next decade, the industry can add 10,000 or so megawatts by becoming more efficient, Smith said. This can be accomplished through a combination of productivity improvements (3,000 to 5,000 MW), uprates (6,500 to 8,500 MW), and the restart of Browns Ferry station (over 1,000 MW). Such improvements would help President Bush’s plan to reduce the carbon intensity of the nation’s economy. “When the White House made that announcement [to reduce greenhouse gas intensity by 18 percent by 2012] we submitted to them a letter outlining our efforts in that regard. It was warmly received, because that 10,000 MW by 2012 actually amounts to 21 percent of the president’s goal,” Smith said.
With hydro power expected to decline and only marginal increases in renewable energy forecasted, Smith said, the nuclear industry must add 60,000 MW simply to ensure that 30 percent of the nation’s electricity continues to come from emission-free sources, as it does now. “Increasing nuclear energy production in the next 20 years is important to maintaining the diversity of our fuel supply in our electricity systems. Even more important. . . expanded nuclear energy will play [a vital role] in maintaining our current supply of electricity that is generated free of emission.”
Nuclear energy also has a role to play in hydrogen production in the coming decades. Producing hydrogen requires significant amounts of energy and, moreover, many of the emission-free advantages of hydrogen are canceled out when it is produced from a fossil base, Smith pointed out. “It is my personal opinion that the industry needs to be thinking about how to be a player in the hydrogen economy—even at our current fleet of plants, even if it’s a test facility, a demonstration project,” he said. “Electrolysis with off-peak electricity producing parallel streams of pure hydrogen and pure oxygen could lay the foundation and provide the kind of information that we will eventually [need] in terms of storing, transport, and use of hydrogen.
“There are ready markets for industrial hydrogen already. There are ready markets for pure hydrogen. And there are certain commercial markets for pure oxygen.
“Now, Mr. Bush announced a $1.2 billion [hydrogen fuel initiative]. The Department of Energy has already budgeted significant amounts of money for hydrogen demonstration projects, partnerships between industry and government. And I believe strongly that it’s time to start looking into those to see what we can do to break out ahead of the curve. Because I can tell you now, the companies that are playing in the hydrogen arena are the major oil companies and the major automobile companies. They want to keep their current position. They don’t care whether it’s gasoline or hydrogen. They just want you buying it from them.”
J. P. Sakey began his presentation by asking for a show of hands of white males in the room under the age of 45. A total of three hands went up, including the one of the reporter who was there to cover the meeting. The incident underlines perhaps the single greatest threat to the future of the nuclear power industry: the drying up of the pipeline of nuclear engineers.
Sakey, senior vice president of TMP Worldwide—which calls itself the world’s largest recruitment advertising agency and which runs the Internet job-seeking resource Monster.com—addressed some of the current patterns in the labor force and stressed the need for the industry to improve its marketability by establishing a distinctive brand image for itself.
The nuclear industry, however, is not alone in facing worker shortages in the coming decades. As a measure of people entering the workforce, in the past 15 years the labor force in the United States grew at an annual rate of 1.6 percent, Sakey said. Over the next 50 years, however, the labor force is expected to grow only by 0.6 percent. “Now, across a 300 million population, you begin to multiply those numbers out and you begin to see that there’s really going to be a shortage of people entering the workforce,” Sakey said. By the year 2006, two workers will exit the workforce for every one entering.
What are the key elements that have made way for this trend? Declining births are one aspect, Sakey said. Families no longer have three children. Also, now in their mid-40s up to their mid-50s, baby boomers are aging, and many will be able to afford to retire. And there is also a squeeze in the supply of foreign workers, with the United States not as open to foreign labor as it once was, Sakey said.
Looking at age makeup, 13 percent of the labor force is now made up of people over the age of 55, Sakey said. By 2020, that proportion grows to 20 percent. “We’ve got an older workforce. That really means more experience, more knowledge, expectations for higher income, probably expectations for more leisure time. . . . This is a very important trend,” Sakey explained.
But what does it all mean for employers?
“It really means tremendous competition for workers,” Sakey said. “It means that the next decade, if you look at any kind of economic growth at all and you look at unemployment declining to the 4 percent level . . . there is going to be tremendous competition for jobs. There will be2.6 new jobs created for each new person entering the American labor market. That means other choices. There will be a dizzying array of job opportunities.”
Such a forecast may not be the best news for the field of nuclear power, which is already struggling to infuse itself with new nuclear engineering graduates. “I don’t want to misunderstand the nuclear industry, but I don’t believe people can easily flip careers into your industry,” Sakey said. “A health-care worker can’t all of a sudden become an SRO [senior reactor operator]. I’m not sure that these sorts of things can happen.
“So, you’ve got a career issue to think about—more of a career issue as opposed to software workers who can move. If you’re familiar with certain types of software applications, you can move within industries. I mean, Oracle is Oracle is Oracle. . . .
“This is going to create tremendous competition. The competition to retain new employees and retain existing personnel will reach dimensions that are unthinkable in today’s environment.”
Sakey cited a study by the Bureau of Labor Statistics that found that 21 percent of all jobs will go unfilled within the next decade. In white collar industries, 1.5 out of every l0 jobs will go unfilled, Sakey said—something American industries are already familiar with. “When I used to visit the nuclear power plants and walk around and talk to people, I was always told, ‘We could use two or more of these [workers] or three more of these. We don’t have them right now. It’s not in the budget,’ et cetera. I think we’re kind of used to, in our American work culture, to be short positions.”
Far removed from the esteemed image it held in the public’s eye in the 1950s and 1960s, the nuclear industry will face increasing competition from other, newer high-technology industries. “I wanted to go to a local high school where I live and give them a list of 10 careers and see how many chose nuclear power as a career,” Sakey said. “I would be willing to wager . . . it’s not at the top of anybody’s list. It really is not, which is really a shame, for a couple of reasons. I’m not a scientist, but isn’t this one of the most advanced industrialized operations known to man, the production of electricity from the splitting of the atom? It’s pretty high-tech. It’s pretty far out there on the physics scale.”
The nuclear industry needs to create an enticing branding image for itself to attract the youngest and brightest minds, Sakey said. “You ever see the Nike employee branding ads? They’re phenomenal. It’s high-speed, lots of flash. You say to yourself, ‘That’s a really neat company. That’s something I might be interested in.’
“[The nuclear] industry doesn’t do a lot to brand itself. It’s not mainstream. Maybe it requires thinking to attract people in their 20s.”
Part of the industry’s appeal is its stability, which can be capitalized on in a marketing campaign, Sakey said. “If you’re a software engineer, you might work for l0 companies in 10 years. But if you’re going to be a nuclear engineer, you might have a really good long-term career. It may not be for everybody. But the reality is I’m not sure this industry has actually portrayed the stability that is there in the workforce. You’ve got to use that for recruitment.”