Why More Flexible Operation Won’t Save US Nuclear Power Plants

Technology can help nuclear match renewables. But American market dynamics are complicated.

Technology being used to help nuclear plants cope with renewables in Europe likely wouldn’t revive nuclear’s flagging fortunes in the U.S., according to a leading expert in the field.

Edward Kee, CEO of the Nuclear Economics Consulting Group, confirmed that U.S. regulations and market structures would complicate matters for plant owners wanting to deploy flexible generation technologies like those installed by Areva at the Goesgen plant in Switzerland. 

Areva’s Advanced Load Following Control (ALFC) system, installed this month, allows Goesgen to vary output automatically down to 50 percent of total capacity at a rate of up to 30 megawatts per minute, without any intervention from the plant owner. 

The technology has been around since 2008 and has already been installed in the Philippsburg 2, Isar 2, Brokdorf and Grohnde power plants in Germany. It should help Goesgen cater to increasing grid intermittency, said Areva’s nuclear arm Areva NP.

“The intermittent electricity generation of renewable energy sources like wind and solar increases the need for balancing power,” explained Carsten Dueweke, Areva NP’s head of instrumentation and control projects, in a press release this month. “Our ALFC system enhances the capabilities of nuclear power plants to deliver such services and to perform a stabilizing role in the power grid.”

ALFC sounds like a dream come true for nuclear operators struggling to adapt their lumbering plants to the rapidly shifting requirements of renewable-heavy grids.

As a 2011 report from the OECD's Nuclear Energy Agency noted: “Nuclear power plants have been mainly seen as a baseload source of electricity. The main reason for this is that operating the plants at the rated power level is usually more efficient economically and simpler.”

Unfortunately for nuclear operators in the U.S., where the sector is still struggling despite government attempts to increase support, adding a load-following system is unlikely to change things, Kee said.

The first and most obvious reason is that the U.S. Nuclear Regulatory Commission prohibits the remote or automatic control of nuclear plants. But even if a change in the law allowed for the use of load-following technology, the economics might not make it worthwhile.

Already, said Kee, light water reactors are technically capable of flexible operation, automated or not. “France operates its nuclear fleet with flexible output options, as did Germany,” he said. 

In the U.S., meanwhile, the Columbia Generating Station near Richland, Washington operates flexibly in response to the threat of excessive spillover on the hydroelectric plants in the Bonneville Power Authority network during the spring.

Columbia performs this "load shaping" according to guidelines negotiated with Bonneville and approved by federal regulators, noted Kee's consulting group in a 2015 blog post.

The plant can adjust output down to 85 percent of rated capacity with a 12-hour notice, 65 percent with 48 hours’ notice and zero after 72 hours.

It is doubtful whether U.S. plants elsewhere can make money with even this level of flexible operation, however, because of nuclear power’s short-run marginal cost (SRMC). This is the variation in total power plant cost from a small, temporary output change.

For nuclear, along with hydro, wind and solar, the SRMC is essentially zero. For combustion-based power plants, it depends on the cost of fuel.

On most grids, said Kee, “Low-SRMC generation assets would be dispatched first, so that they end up in baseload operation for economic reasons.”

However, he continued, “Operating nuclear power in a flexible mode may be important if there is a lot of zero-SRMC generators that are intermittent. Deciding which zero-SRMC generators operate when there is more output than system demand is an issue.”

For nuclear plants that depend purely on power sales, as is the case with merchant plants in the U.S., operating flexibly would just reduce the total amount of energy sold, thereby reducing the profitability of the business.

The only way flexible operation would benefit U.S. merchant plants, Kee said, would be for them to somehow recover generating costs regardless of output -- or get paid a premium for operating flexibly.

Nevertheless, he said: “An interesting side note is that some U.S. merchant nuclear plants may be able to improve financial outcomes if they operate in a flexible manner during negative market price periods [such as] off-peak demand periods when the wind is blowing."

“If a merchant nuclear plant faces negative prices, lowering output during negative price periods will reduce the payments to the market operator and may reduce the magnitude of negative prices," Kee explained.