The Wolf Creek nuclear power plant cost $3 billion to build, and it could cost as much $1 billion to get rid of it.
Shutting down the mammoth power plant near Burlington will mean having to dispose of about 20 million pounds of radioactive waste and radiation-tainted equipment, according to a new report from the Wolf Creek Nuclear Operating Corp. to the Kansas Corporation Commission.
The report marks the first time any cost estimate for dismantling Wolf Creek has exceeded $1 billion, but Westar Energy and the state’s consumer advocate say they don’t expect it to substantially raise rates in the near term.
Wolf Creek operates the nuclear plant on behalf of its three owners, Westar, Kansas City Power & Light and Kansas Electric Power Cooperative.
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Customers of those three companies will have to pay for decommissioning the plant when it reaches the end of its useful life about 30 years from now.
That cost is recalculated every three years so that the commission, which sets electric rates, can ensure that the companies collect enough from customers to fund a trust to pay the cost of decommissioning and removing the plant when the time comes.
Sooner or later?
The new report, prepared by consultant TLG Services Inc., draws two scenarios for decommissioning Wolf Creek.
The first, called “DECON,” is based on beginning to dismantle the plant as soon as it is shut down. That’s the least expensive option at $765 million in current-value dollars, although it could creep up to more than $1 billion if the federal government doesn’t reach a solution on the problem of long-term disposal of spent nuclear fuel, the report said.
The report projects it will take about eight years to dismantle the plant. The last of the fuel and the nuclear core will have to stay on site at least 5 1/2 years before they’ll be cool enough to package and transport for permanent disposal, the report said.
The main advantages of immediate dismantling are that much of it can be done by employees who are already hired and on-site, and overall personnel costs are less because it’s being done more quickly, the report said.
The second scenario is called “SAFSTOR” – for safe storage – and projects the cost of mothballing and removing Wolf Creek over a longer period of time, as much as 60 years. That would cost $1.03 billion, the report estimates.
The primary advantage of waiting is that radioactivity decreases over time, making it safer for workers to tear down the plant and reducing the amount of highly radioactive debris that would have to be sent to secure disposal sites.
Both cost estimates are substantially more than they were in 2011, the last time the estimates were updated.
And in both case-scenarios, the increased cost estimate outpaced the inflation rate by about $100 million.
The 2011 report estimated the cost of the DECON alternative at $630 million; inflation alone would raise that to $662 million in current dollars, according to federal government inflation calculators.
For the SAFSTOR alternative, inflation alone would raise the cost from $884 million in 2011 dollars to $929 million in 2014 dollars.
Part of the increased cost is that Wolf Creek has added buildings in past three years that would have to be removed with the plant, said Terry Young, a spokesman for the operating company.
Other drivers of higher estimates include increased rates for disposal of non-fuel radioactive waste, program management and security costs. The nuclear industry also has acquired better data, based on the actual costs of decommissioning older plants around the country, Young said.
Fuel disposal an issue
Cost estimates in both decommissioning scenarios are based on the federal government establishing a site for long-term disposal of spent uranium fuel.
Congress approved a site at Yucca Mountain, Nevada, in 2002. But Sen. Harry Reid, D-Nevada, has used his political clout to block the project since 2007, when he became Senate majority leader.
The actual disposal and long-term storage of nuclear fuel waste is the responsibility of the Department of Energy, which will bear most of that cost, the report said.
But, “Politically, the country is at an impasse on high-level waste disposal,” the report continued.
At present, all the fuel ever used at Wolf Creek is now being stored in a large pool of water at the facility.
The water cools the fuel rods, which continue to generate heat long after they’re removed from the reactor. The water is laced with the chemical element boron, which absorbs neutrons and provides radiation shielding.
The pool will outlast the plant because the last fuel rods and the reactor core itself will have to cool there about 5 1/2 years before they can be packaged and transferred to a permanent disposal site, the report said.
But as thorny an issue as fuel disposal is, it is estimated to make up only about 6 to 12 percent of the eventual cost of decommissioning the plant, according to the report.
The biggest cost in any scenario is project management and engineering; $245 million for DECON and $330 million for SAFSTOR.
“The magnitude of the expense is a function of both the size of the organization required to manage the decommissioning, as well as the duration of the program,” the report said.
In the DECON option, the second-largest expense is removal of material, $103 million.
In the SAFSTOR scenario, security cost takes second place at $163 million over the course of the project, according to the report.
History of overruns
Wolf Creek has a long history of construction cost overruns.
The plant was originally designed as a near-identical twin of the Three Mile Island nuclear plant in Pennsylvania.
But after the 1979 Three Mile Island meltdown, the nation’s worst civilian nuclear accident, Wolf Creek, then under construction, had to be redesigned to meet new safety standards.
Originally projected to cost $525 million, the plant ultimately cost $3 billion, causing decades of rate disparity between southern Kansas customers who were saddled with the nuclear debt and northern Kansas customers who got most of their power from coal plants.
In 2009, about the time that southern customers were starting to benefit from Wolf Creek’s operating efficiency and lower fuel costs, Westar and the Kansas Corporation Commission consolidated the rates between Westar’s north and south divisions.
Commissioners said last week that they have not had time yet to fully review the report and decide what to do with it. None of the three commissioners were in office when the last study was done.
David Springe, consumer counsel for the Citizens’ Utility Ratepayer Board, said he expects that as in the past, the commission will have a case to consider whether electric rates need to be increased to ensure there’s enough money to pay for eventual Wolf Creek decommissioning.
He said that process usually includes an actuarial study, much like an insurance checkup. CURB, the state agency representing residential and small-business customers, would be a part of the case to protect consumer interests, he said.
“If the actuarial numbers go up, rates might have to go up a little bit,” he acknowledged.
However, Springe said he’s much more worried about other issues in rates, especially funding for new transmission lines to carry western Kansas wind power to market and costly environmental upgrades the federal government is requiring at aging coal-fired power plants in the state.
“Those are the things driving the increase in rates right now,” he said.
Reach Dion Lefler at 316-268-6527 or email@example.com.