Economic woes delay U.S. nuclear power expansion

By Bernie Woodall and Scott DiSavino - Analysis

LOS ANGELES/NEW YORK (Reuters) - The sputtering global economy and frozen credit markets have shrunk the first wave of a highly touted U.S. nuclear power renaissance.

Nuclear industry advocates had predicted more than a dozen new reactors worth $100 billion or more generating at least 15,000 megawatts of power in the United States by 2020.

Then the economic slump hit. Now, Cambridge Energy Research Associates expect four to eight new reactors providing 5,000 MW to 10,000 MW by 2020. The Nuclear Energy Institute, an industry advocate, said four units will be in service by 2016 and as many as eight by 2018.

"Recent market developments are influencing the pace of new power plant projects in the U.S. industry-wide," said Danny Roderick, vice-president for nuclear plant projects at GE Hitachi Nuclear Energy.

"The global financial climate is causing some U.S. customers, primarily ones that are relying on the capital markets to finance their projects, to reprioritize needs and consider options for the construction of new nuclear power plants," Roderick said.

The number of new units after that first wave will depend upon whether developers can bring them on-line near schedule and within budget.

The impact of the credit crunch remains hard to gauge. Companies in line for new reactor licenses have several years before they have to build a new unit, which can cost between $5 billion and $12 billion, said Jone-Lin Wang, head of CERA's global power group.

The U.S. Nuclear Regulatory Commission says it has received applications for 26 new reactors. Already, reviews for four of those have been suspended, although not for reasons related to the sour economy, the commission said.