Nuclear deal didn’t pan out as dreamed in dollars and cents
It was supposed to be the proverbial win-win deal — corporate utilities and cities and towns providing power in North Carolina would go in together to build nuclear power plants and supply cheaper energy to their customers.
More than 35 years ago, utility industry officials and politicians came together to craft a deal to allow private utilities and municipal government power agencies, including the one representing High Point, to co-own nuclear power plants. The plan passed the N.C. General Assembly, then came before the voters of the state as a change to the N.C. Constitution.
Voters approved the plan in 1977. A year later, the corporate utilities, cities and towns went in on a deal to build the Catawba Nuclear Station.
But the win-win proposition began to erode in the last week of March 1979 when an accident at the Three Mile Island nuclear plant in Pennsylvania riveted the nation and shifted the direction of the nuclear industry. Requirements for building nuclear plants became more stringent, time frames for building facilities lengthened by years and the bottom-line costs skyrocketed.
Veteran High Point City Council member Becky Smothers, who serves today and also did in the 1970s, acknowledges the pivotal role Three Mile Island played in pushing up the cost structure of the Catawba nuclear plant.
The hope was that the collaboration between the corporate utilities, such as Duke Energy Corp., and the municipal power providers would lead to lower rates and a stable, long-term supply of power, said Smothers, a former mayor who first joined the City Council in 1977.
But after Three Mile Island, the cost of building the Catawba nuclear plant increased exponentially.
“What had been projected as the build cost of $823 million jumped to $1.3 billion in just design changes,” Smothers told The High Point Enterprise.
Eventually, the Catawba Nuclear Station ended up costing $2.507 billion, according to municipal power trade group ElectriCities of North Carolina Inc.
Duke Energy and Carolina Power & Light Co., which became Progress Energy, were trying to build a series of nuclear plants to serve North Carolina when Three Mile Island happened, said Jim Warren, executive director of Durham-based NC WARN, an energy industry watchdog group.
“They canceled, between the two of them, nine or 10 reactors,” Warren said.
The nuclear plants that were canceled included three set for Davie County in the Piedmont, he said.
At the Shearon Harris Nuclear Generating Station southwest of Raleigh, the overruns ended up pushing the final cost far beyond the original price tag for the project, Warren said.
“They started off trying to build four reactors for $1.3 billion. They wound up building one that cost over $3 billion,” Warren said.
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