- Associated Press - Friday, August 15, 2014

ST. LOUIS (AP) — Past the razor wire and security checkpoints that guard Missouri’s first and only nuclear power plant, there’s an empty gravel lot where a second reactor was to have been built.

Union Electric - the utility now known as Ameren Missouri - envisioned an $839 million, two-reactor facility when it began work in Callaway County in the 1970s. Rising costs and more conservative electricity demands prompted the utility to scale back the project. When it finally went online in 1984, the single reactor ended up costing $2.85 billion.

Even after that experience, which led to the largest electric rate increase in state history, Ameren never quite gave up on a second reactor, the St. Louis Post-Dispatch reported (http://bit.ly/1yhwl3E ). It spent recent years trying to pave the way for another reactor via a financing rule from the state legislature and, more recently, a grant from the U.S. Department of Energy.

But those efforts have stalled, and new energy economics have forced the utility to reevaluate its future needs. Stagnant demand growth means the utility isn’t even sure it will have to replace capacity from its Meramec coal plant in south St. Louis County, which it announced last month it would retire by 2022.

On a tour of the nuclear power plant last month, Warren Wood, Ameren vice president of external communications, indicated the utility was viewing future energy needs through the same lens as most power producers these days.

“It’s not our next immediate resource,” Wood said of nuclear generation. “Natural gas is next in the queue.”

Its most recent attempt to build a nuclear plant was a 2012 application in partnership with nuclear engineering firm Westinghouse. The partners applied for a federal grant to jumpstart the development of small nuclear plants that provide about 20 percent of the energy a conventional reactor does. That drew political support from Gov. Jay Nixon, the state’s Congressional delegation, the University of Missouri System and local governments eager for the jobs they hoped the project would bring.

Beyond new power, politicians and Ameren pushed the prospect of a new state industry in the design and manufacture of the supposedly assembly-line-ready new nuclear technology. But the DOE twice passed Ameren and Westinghouse over, and the utility said in December it was “stepping back and considering our alternatives.”

But as Ameren looks beyond the life of the coal-burning power plants that supply most of the region’s electricity, the utility still holds out the hope that a second reactor - albeit a smaller one - might one day fill some more of the 8,000 acres of land it owns in Mid-Missouri.

In the utility’s upcoming resource plan, set to be released this fall, Wood said Ameren will stay upbeat on the carbon-free fuel.

“You’re going to see nuclear faring well,” he said. “Putting all your chips in gas is a risk.”

The renaissance in carbon-free nuclear energy hoped for a decade ago hasn’t materialized despite increasing concern about climate change and air pollution. Eight permit applications, including one from Ameren Missouri, submitted to the Nuclear Regulatory Commission over the last decade have been put on hold. There are, for the first time in decades, several nuclear reactors under construction, but those are in fast-growing Sunbelt states.

Now, the biggest obstacle to new nuclear plants, besides massive construction costs, is the natural gas revolution.

Even Ameren, long interested in adding nuclear energy for its predictable fuel prices and consistent power, views the fuel it mostly used to meet peak summer demand as the most likely way forward.

“Natural gas prices (a decade ago) were very high and we were expected at that time as a country to have to import liquefied natural gas,” said Phil Sharp, president of Resources for the Future, a Washington think tank, and a former member of the Department of Energy’s Blue Ribbon Commission on America’s Nuclear Future. “With the price of natural gas dropping so much, it simply is cheaper to build natural gas generating plants than it is to build a nuclear plant.”

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