Exelon – Leader of Nuclear Power’s Future
In response to climate change concerns and global emission control efforts, utility companies face increased pressure to reduce carbon emissions resulting from energy generation. As the United States (U.S) seeks to shift its reliance away from burning fossil fuels, alternative and renewable energy forms gain popularity. Anticipating the effects of climate change, one utilities services company, Exelon, is well positioned to react to the shift in energy consumption patterns as the U.S. reduces its carbon footprint.
As both an energy generation and power delivery company, Exelon has invested heavily in its Energy Generation Division to utilize alternative energy production sources, most notably nuclear power[1]. Exelon leads the U.S. by owning and operating 14 nuclear reactors[2]. Through Exelon’s nuclear power assets, the company provides regions of the U.S. with a high-capacity and reliable baseload output of electricity, while additional forms of renewable energy supply the variable demand for power. Despite the controversy regarding the future of nuclear power, the U.S. can significantly benefit from its continued employment as a carbon-free baseload of electricity, and Exelon stands ready to deliver that output.
The U.S. generates 19% of its total electricity and 60% of its carbon-free electricity from nuclear power. The reactors generating this power, however, average over 30 years old, and need continued maintenance and investment[3]. Regulators have long opposed nuclear power citing incidents such as Three Mile Island, Chernobyl, and most recently Fukushima in 2011. These vestiges of nuclear power, and enormous upfront capital investment costs, have prevented any new construction reactors since the late 1990s.
Continued improvement in the political landscape for nuclear power and emphasis on climate change and carbon reduction has begun to shift the public perception of nuclear power’s contribution to national energy production. Recent discussions in December, 2015 at the U.N. Climate Change Convention in Paris specified carbon reduction targets, and experts noted that achieving the targets will be nearly impossible without any emphasis on nuclear power for a baseload.[4] This shift in perspective will certainly not offset the high cost of building a new nuclear reactor. However, it may provide incentives to continue to fund active reactors by encouraging support for the maintenance and permits required to operate the aging reactor population.
Exelon is well suited to accept this shift in energy preferences and continues to invest in its reactors through its Reactors Improvement Program. The funds associated with this program ensure that the reactors can contribute their greatest strength: dependable, reliable power output at a low variable cost. The Exelon reactors, on average, have a utilization capacity of 93.7%, and only need to shut down for routine maintenance. The variable costs associated with operating the reactors once critical are very low compared to competitive sources of energy – the upfront costs, which Exelon endured decades ago – deter future capital investments by other firms. [5]
To continue to improve the maintenance process for its reactors and to reduce the shutdown maintenance time, Exelon has invested in additional technological resources. For example, it now uses drones to conduct inspections on components that are difficult for employees to view. Additionally, the firm invested in virtual reality software for the technicians whom perform the reactor maintenance, to be able to visualize the working conditions within a specific reactor and become familiar with the job. This serves to minimize the time the technicians are exposed to potentially hazardous conditions and allows reactors to return back to operation faster[1].
Though Exelon stands ready to assume the additional energy demand on its reactors, it also prides itself on its sustainability program and commitment to clean energy and nuclear waste management. As reactors age, depleted nuclear fuel and waste associated with the radioactive components of the reactor are an increased concern. Exelon’s robust process for nuclear waste serves to reassure the public of its commitment to the highest standards of social responsibility. Though the U.S. government has yet to determine where to store nuclear waste indefinitely, Exelon maintains all by-products safely on site, in reinforced concrete vaults underground[6]. Exelon is the leader of its nuclear industry, prides itself on its nuclear infrastructure, and is excited for the new opportunities as the country mitigates climate change.
(705 words)
[1] Exelon Annual Report. (2015). Exelon 2015 Summary Report. Retrieved from http://www.exeloncorp.com/company/Documents/Annual%20Report%20Final%20High-Res.pdf
[2] Unknow, (2015, 31 Oct). The Future of Nuclear Energy: Half Death. The Economist. Retrieved from http://www.economist.com/news/international/21677243-nuclear-power-emits-no-greenhouse-gases-yet-it-struggling-rich-world-half-death?zid=298&ah=0bc99f9da8f185b2964b6cef412227be
[3] Harder, Amy (2016, 16 June). Environmental Groups Change Tune on Nuclear Power. The Wall Street Journal. Retrieved from http://www.wsj.com/articles/environmental-groups-change-tune-on-nuclear-power-1466100644
[4] Levitan, Dave (2016, 6 March). Is Nuclear Power Our Energy Future, or in a Death Spiral? Ensia Magazine. Retrieved from http://www.climatecentral.org/news/nuclear-power-energy-future-or-dinosaur-death-spiral-20103
[5] Exelon 10-K. (2015) Exelon Form 10-K. Retrieved from http://www.exeloncorp.com/investor-relations/Documents/10K%20for%202015.pdf
[6]Exelon Sustainability Report. (2015). Exelon Corporation Sustainability Report 2015. Retrieved from http://www.exeloncorp.com/sustainability/Documents/dwnld_Exelon_CSR%20(1).pdf
Nuclear is a contentious topic in the renewable energy world. Although it has advantages over intermittent competitors, it also has some significant drawbacks. In particular, Japan and Germany have both recently reduced their nuclear production. At any rate, it certainly doesn’t have the kind of public opinion tailwind that solar PV has. With the ageing of their fleet, Exelon has a new challenge on its hands as its business is dying of old age. High capital costs have kept competitors out, but apparently have also prevented new builds for them. Remember, the world is still building coal plants, so I think that the boost they’ll get from climate change goals won’t be enough to counteract the effects of an ageing fleet. They’ve got some work to do.
Regardless of Exelon’s commitment to innovation and technical prowess, the biggest challenge to it’s long-term success is one of marketing, not operations. As you’ve already mentioned, the world has largely turned its back on nuclear energy post-Fukushima, a problem further exacerbated by the excess supply and subsequent low costs of substituting fossil fuels such as natural gas. With more nuclear facilities closing rather than opening around the world, it seems that Exelon and other nuclear energy leaders need to focus their attention on marketing the true value of nuclear power – that it is highly sustainable, clean, inexpensive, and actually very safe despite some very rare and unfortunately well known accidents. Until they can get that message across to regulators, governments and the public in general, no amount of innovation will be able to push this incredible technology forward.
So you’re proposing combating global warming with nuclear winter??? And haven’t you seen those mutated plants (1) and animals in Japan from the Fukushima radiation?
Just kidding….
Nuclear power is such a no-brainer when it comes to CO2 emissions concerns. Unfortunately, and you touched on it briefly, one of the major hindrances surrounding the continued and expanded use of nuclear power is the issue with storage of spent fuel. Unfortunately, the US government hasn’t even been able to follow its own laws (2) with respect to the use of the proposed permanent spent fuel depository in Yucca Mountain. That’s right, while on the one hand government leaders are vehemently calling for reduced greenhouse gas emissions, they’re failing to comply with their own laws (2) that would enable increased usage of ZERO-EMISSIONS nuclear power! It makes no sense if you ask me. Extremely politicized decisions like the one to not proceed with the use of Yucca Mountain (even though the law (2) requires it) paint a bleak view of our capability to respond to important issues like climate change in the future.
(1) http://news.nationalgeographic.com/2015/07/150723-fukushima-mutated-daisies-flowers-radiation-science/
(2) http://www.world-nuclear-news.org/WR-DOE-legal-obligation-on-Yucca-Mountain-0908167.html
Nicely written! I wrote something similar on fission’s estranged cousin fusion. I think long term these are our best bets for energy. However, you brought up some of the issues we currently have with fission reactors and I agree with you that CSR (if you can even call it that on such a crucial issue of responsibly disposing of nuclear waste) is crucial to making nuclear net-positive to the environment and public opinion.