WV Executive

First, some context: I am a friend of coal, natural gas and wind energy, and I have nothing against oil. But this admission comes with a very practical overlay: America must have a clear, analytical energy plan geared toward: meeting our domestic energy needs; severely reducing our dependence on foreign natural resources; and leaving the softest footprint on the environment, as practicable. And we, as West Virginians, must take the reigns of our destiny and assume our rightful role as an energy leader that is leading the effort toward attaining these desired national goals.

Coal and natural gas extraction jointly represent the backbone of West Virginia’s economy and have for a very long time. Wind energy represents another opportunity for West Virginia to capitalize on a natural strength. Short-to-mid-term, we must maximize the longevity and value creation opportunities associated with these God-given hole-card resources through the development of innovative extractive techniques, applications and/or usages, all in a manner consistent with the above referenced national goals.

By advocating a nuclear energy strategy for West Virginia, I am not—in any way—suggesting that we turn our backs on our current resources. Quite the opposite, what I am suggesting is that we collectively peer into the future—beyond the shelf-lives of the above referenced resources

Hindsight Fueled Foresight

As the attack was occurring the morning of September 11, 2001, I sat atop a mountain near Welch, West Virginia talking with two of the three McDowell County commissioners—Gordon Lambert and Carl Urps—about an innovative economic development project that would benefit their county. Over the static of the truck’s radio, we collectively heard the breaking news, shared the shock and grief, and shuttered at a very present irony: we were meeting to discuss the potential site location of a maximum security federal prison for resident aliens who posed a threat to the United States of America.

On that day, everything changed. Our dependence on foreign natural resource supplies was again a tier-one public policy concern; densely populated cities and regions in the United States became potential terrorist targets; major airports became bottlenecks. But, oddly, West Virginia’s stock rose, and the McDowell County Federal Bureau of Prisons project was just the tip of the iceberg.

Given our abundant natural resources, dispersed population, road infrastructure, water resources, access to the national power grid and proximity to metro-markets, the catastrophic events that unfolded on 9/11 collectively and collusively had the unintended effect of making West Virginia a more attractive economic player. It is against this backdrop that I advocate for a long-term focus on a nuclear energy strategy for West Virginia.

The New Economics of Nukes

While organizing content for this article, I posed the following question to my 11-year-old son over lunch: “When you hear the term ‘nuclear energy,’ what is your first reaction? Michael II provided—as most 11-year-olds do—a wide-eyed, efficient response: “Dangerous!” And this review is likely indicative of top-spot output from far more sophisticated polling.

In 1979, the nuclear industry—at least the energy end of the industry—went dark. The Three Mile Island meltdown was the first punch; Chernobyl, the second. Environmental advocates and politicians alike piled on with emotion. Although there were 50 plants in the planning stages in the United States, alone these tragedies caused all to be scrapped. A bit behind the public policy curve, West Virginia banned nuclear power in 1996, citing general concerns associated with the health, safety and welfare of her citizens.Fast-forward to today: nuclear energy is experiencing a resurgence. Like most of this kind, this resurgence is being driven by economics. The economics in question are largely driven by the events that I fi rst heard about on top of the mountain in McDowell County.

Global turmoil spikes core commodities. The first domino to fall was the price of oil; coal and natural gas followed. Add incremental premiums for both the value associated with domestic sources and the mainstreaming of global warming concerns, and you have a new, higher baseline associated with energy pricing across the board. It is this new baseline that is driving global innovation in the energy sector. It is likewise this new baseline that is driving the resurgence of nuclear energy.

Economics Knows No Political Boundaries

Environmentalists and politicians are likewise revisiting nuclear energy. US Senator Pete Domenici, the New Mexico Republican who was the chief architect of the 2005 energy bill, succinctly provides the resurgence rationale, “It’s now dawning on people that if you’re talk- ing about producing cleaner energy that will really fulfi ll needs of large populations, nuclear stands alone.”

In promoting the same, Senator John McCain, (R-Arizona) is introducing a measure to reduce greenhouse gasses and strongly believes that nuclear power can positively impact global warming. In a recent Senate speech, McCain issued a challenge, “I am a green and I entreat my friends in the movement to drop their wrong- headed objection to nuclear energy.”

The other side of the aisle is responding. Senator Harry Reid, the senate democratic leader from Nevada, once stated that he was “totally opposed to nuclear power.” But recently, Reid predicted a public policy move toward nuclear power. “If done right, it will protect the environment,” he stated. Other democrats—Tom Carper of Delaware, Mary Landrieu of Louisiana and Ben Nelson of Nebraska, to name a few—are following Reid’s lead.

Some environmentalists are also revisiting the issue. Stewart Brand, the editor of The Whole Earth Catalogue, is endorsing nuclear power as a way to reduce global warming. In a MIT Technology Review article published last spring, Brand wrote that “the only technology ready to...stop the carbon dioxide loading of the atmosphere is nuclear power.” Other no- table environmentalists such as Patrick Moore (co-founder of Greenpeace) and Jim Lovelock author of the “Gaia Hypothesis” are advocating nuclear energy as the only green solution.

Samuel Bodman, energy secretary, as reported in early 2005 in the Wall Street Journal, is promoting the sale of US nuclear and clean-coal technolo- gies. Bodman clearly outlined the thoughts of the current admin- istration, stating “We believe that energy is a global, not just a domestic problem...” The secretary clearly advocates that the United States needs to lead rather than follow with regard to energy innovation throughout the globe, and who could dis- agree with the prem- ise?

Public Policy Reaction

For the above provided reasons, the propriety of nuclear energy is being aggressively revisited throughout the globe, and Europe is taking the lead. Finland is currently constructing Europe’s first plant since 1991. With 58 plants in operation, France plans to build an additional 30 in next two decades. Interest is also gaining traction in Britain, the Czech Republic, Hungary and Switzerland. In a policy reversal, both Germany and Sweden were committed to abolishing their standing facilities, but now both are revisiting the propriety of nuclear energy. Even Italy is exploring its long-standing nuclear power ban. On the other side of the globe, energy starved China intends to invest $50 billion by 2020.

The United States has 103 active nuclear power plants operating in 31 states, and these plants currently supply 20 percent of the nation’s electricity. States’ usage interests range from Vermont (74 percent of its electricity is provided through nuclear generation) to Ohio at 6 percent.

It has been over 30 years since the last reactor was built in the United States. (Progress Energy’s Harris Plant located near Raleigh, North Carolina), but at least four major domestic energy players have—or shortly will have—permit applications pending before the Nuclear Regulatory Commission: Dominion, Duke, Exelon and Entergy. The application process is cumbersome and expensive. In fact, these companies face a $30 million licensing process, just to clear the way for capital expenditures ranging from $4 to $6 billion.

Several other factors are stimulating interest in nuclear energy. The above referenced plants, both foreign and domestic, are aging. Interest rates are relatively low. Further, the Bush administration is supporting public incentives that buy-down the above referenced costs associated with the licencing process. Finally, next-generation designs are more cost-effective and safe.

Bringing the Above Home

The nuclear energy scales are re-tipping, so let’s stay ahead of the public policy curve by developing a state strategy associated with nuclear energy. West Virginia has the chance to build upon its traditional energy base by diversifying the same through the addition of such a strategy, and our demographic strengths provide a credible, analytical foundation for such.

Nuclear energy site locations require water, road and electrical grid infrastructure. It is better to site such facilities within a dispersed population base, and our topography provides an additional security component. Also, we have a quality, cost-effective workforce for such construction and operation undertakings. In short, West Virginia and nuclear energy are a solid fit for one another.

Even if we subscribe, the vision cannot unfold overnight; it’s clearly a 20 plus year initiative. First, we must stimulate dialogue toward amending the legal prohibition in West Virginia, then the hard part begins. Bringing a nuclear energy strategy to reality will necessarily require all interested parties to work together. Business, labor, environmental, regulatory, political and other interests must share the vision and enter a sustained lockstep formation toward the desired end. In short, let’s become a center of innovation for the natural resources that we have, and prepare ourselves for the day when said resources are less plentiful.