-----Original Message-----
From: 	Burk, Bart  
Sent:	Wednesday, May 02, 2001 12:33 PM
To:	Gaskill, Chris
Subject:	The Price Anderson Act - Nuclear Power

I called the Nuclear Information and Resource Service in D.C. and spoke to a representative. He mentioned that the Price Anderson Act has brought about opposition in the past, but has typically breezed through the renewal process. The NIRS website seemed to more anti-nuclear power focused, so it was interesting that he did not see the Act as having any trouble in its renewal.

My perspective is that nuclear power accounted for about 20% of all power generation last year, and would cause rolling black-outs if ceased. Politics and recent surveys of the positive turn in public opinion suggests that it would be highly unlikely for nuclear power to be phased out. Nuclear plants nearing the end of their initial useful life period - around 30 years - have already begun an extension process. Five reactors have been licensed for another 20 years of operation. The WSJ article stated that within the next 15 years, 40% of the 103 licensed U.S. reactors are likely to request similar extensions.

Independents are buying-up the plants from utilities and taking advantage of high power prices and low nuclear fuel costs. The new technologies mentioned in the article suggest that an overrun of construction permits may be filed in the near future. Smaller megawatt units operate at lower temperatures, and are thus less susceptible to catastrophic failure if their cooling systems are crippled. Investment costs are modest, construction times are faster, power could be supplied in a shorter period of time, and the NRC has improved the time for the approval process. Companies could re-coup their costs and make decent profits within a short period, even if there were fears of negative opposition down the road.

A negative outcome for the Price Anderson Act renewal could slow plans to build new nuclear plants, but it is likely that existing plants will continue to operate. At a minimum, base load nuclear power generation should be flat over the next couple of years.


Bart R. Burk, Jr.
Enron Corporation
Gas Fundamentals Research
Phone: (713) 345-3635