Small Modular Nuclear Reactors essential to North Carolina’s energy future

Thank you for letting us in on this Saturday morning.
 
Today we’re revisiting a topic we first wrote about last summer: small modular nuclear reactors (SMRs). This issue may become the defining debate over North Carolina’s energy supply in the 21^st century.
 
SMRs are just that – small nuclear reactors. They’re generally cheaper and easier to construct than traditional large-scale nuclear plants. On their current development trajectory, they might be ready for deployment by the end of this decade.
 
Duke Energy has signaled big plans for SMRs, especially in relation to North Carolina’s legal mandate to reduce carbon emissions by 70% by around 2030.
 
Duke Energy CEO Lynn Good told investors earlier this year, “The small modular reactor is something we’re spending time on, and you would expect us to. We are the largest regulated nuclear operator in the U.S., sitting in a part of the world that embraces nuclear as part of the solution.”
 
But climate activists are already mobilized to kill the carbon-free technology, complaining that development costs should instead go towards more wind and solar and threatening organized labor strikes to block SMR construction.
 
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“Omit any of these resources, especially nuclear, and we can’t be serious about climate change,” former Gov. Jim Martin, who holds a doctorate in chemistry from Princeton University, wrote in the News & Observer this year.
 
He responded to charged pushback from climate activists who lambasted the North Carolina Utilities Commission, which must authorize the state’s energy supply mix, for opening the door to expanded nuclear power.
 
It all started in 2021, when the legislature and Gov. Roy Cooper reached agreement on a landmark bill, House Bill 951, to establish North Carolina’s energy policy for the foreseeable future.
 
The general contours of the deal were this: Legislators agreed to set into law Cooper’s previously unenforceable goal of reducing carbon emissions by 70% by 2030. In exchange, the law requires those reductions to be realized at least possible cost and without sacrificing existing grid reliability.
 
It’s not hard to read between the lines – nuclear power and natural gas are essential to meeting those requirements. Nuclear power, of course, offers carbon-free energy, and natural gas burns much cleaner than coal. Both can produce power without the weather-related intermittency that plagues solar and wind energy.
 
In the second quarter of 2022, Duke Energy submitted to the Utilities Commission several plans for potential energy mixes to satisfy House Bill 951’s emission reduction mandates, all of which include nuclear and natural gas.
 
On Dec. 30, 2022, the Utilities Commission settled on a path forward – sort of. The Commission authorized several near-term actions but did not order a specific energy mix. Instead, the Commission will update its plan every two years, beginning in 2024.
 
But the move does allow Duke Energy to continue planning and developing SMRs, with the prospect of potentially extending the 2030 emissions reduction deadline to allow SMRs to come online.
 
It’s this possibility, together with similar permissions contemplating more natural gas reliance, that have set climate activists on the warpath.
 
The N.C. Sustainable Energy Association criticized the Commission for authorizing progress on “unproven, expensive technologies like SMRs.”
 
The North Carolina Climate Justice Collective called the Commission’s work “an unjust process,” and claimed (falsely) that nuclear power is a “highly polluting and dangerous form of energy.”
 
The group also threatened, oddly, that “unions in our state are ready to work on the build-out of solar and wind, but not on modular reactors.” (North Carolina is a right-to-work state; there are no unions.)
 
The battle lines are beginning to shape. On one side sits Duke Energy and the Republican-led General Assembly, committed to at least developing SMRs conceptually in the near-time and potentially deploying them in the medium-term.
 
On the other side sits climate activists and the green energy industry, committed to scuttling SMRs and pressing for much more spending on their favored products.
 
In the middle sits the Utilities Commission, the central authority in deciding who wins.
 
Relatedly, the General Assembly is mulling changes to the Utilities Commission’s makeup. Right now, the governor appoints seven commissioners, all subject to confirmation by the Senate.
 
Earlier this year, the Senate passed a bill to change the body to nine members: five appointed by the governor, four by the legislature, and one by the Treasurer. The House stripped that provision from their version of the bill before passing it, and each chamber appointed conferees to work out a compromise. 
 
Regardless of its makeup, how the Commission acts in the coming years will determine how North Carolina powers its homes and industries for decades to come.