NextEra Energy chairman, president and chief executive officer John Ketchum said this week the company is “very interested” in re-commissioning and restarting the former Duane Arnold Energy Center nuclear plant near Palo, as two large data center developments in Cedar Rapids are set to bring a heavy new demand for electrical power.
“We we are very busy looking at Duane Arnold,” Mr. Ketchum said in a third-quarter earnings call Oct. 23, according to a transcript posted by The Motley Fool. “We’re doing all the things right now that you would expect us to do. We’re doing all the assessments, which include engineering assessments, working with the NRC (Nuclear Regulatory Commission). It includes working with local stakeholders. So we are continuing to advance that project. And they’re obviously — it goes without saying there’s very strong interest from customers, really data center customers, in particular, around that site.”
The 615-megawatt Duane Arnold Energy Center, Iowa’s only nuclear plant, which opened in 1974, ceased operations following the August 2020 derecho that brought winds of up to 140 mph to the Corridor, causing heavy damage to the plant’s cooling towers, according to NextEra Energy officials.
The plant was already scheduled to be decommissioned in October 2020 after its main customer, Alliant Energy, paid $110 million in 2018 to exit its power purchase agreement with the plant several years early.
According to a statement released by NextEra in 2020, post-derecho inspections of the plant revealed “extensive damage to Duane Arnold’s cooling towers,” which were used to cool steam after it exited the plant’s turbine. Officials stressed that there was no damage to infrastructure used to cool critical nuclear components, but noted that repairing the cooling towers would not be feasible before its October decommissioning date, leaving the plant incapable of restarting.
The plant, now owned by NextEra Energy, is currently in the midst of a 60-year decommissioning period.
Since the plant’s shutdown, NextEra has launched construction of two utility-scale solar projects near the former plant, following a Linn County review process that included extensive, sometimes contentious exchanges between NextEra officials and area landowners.
One of the solar projects is already generating electrical power, a second is under construction, and NextEra officials are now pursuing a third solar project in the county, dubbed Duane Arnold Solar IV.
Calls to recommission the Duane Arnold plant have gained momentum in recent months, particularly with the announcement of two large-scale data center projects in southwest Cedar Rapids, which will require large amounts of electrical power when they become operational.
Mr. Ketchum acknowledged the nation’s ever-increasing need for electrical power during the Oct. 23 earnings call, noting that forecasts call for “an approximate six times increase in power demand growth in the next 20 years versus the prior 20.”
“U.S. data center power demand alone is expected to increase substantially, adding approximately 460 terawatt hours of new electricity demand at a compound annual growth rate of 22% from 2023 to 2030,” Mr. Ketchum said.
NextEra Energy is attempting to meet that increased demand, in part, through the development of renewable energy projects such as solar and wind facilities.
“Nuclear will play a role,” Mr. Ketchum said, “but there are some practical limitations. Remember, on a national level, we expect we are going to need to add 900 gigawatts of new generation to the grid by 2040. There are only a few nuclear plants that can be recommissioned in an economic way. We are currently evaluating the recommissioning of our Duane Arnold nuclear plant in Iowa as one example. But even with a 100% success rate on those recommissionings, we would still only meet less than 1% of that demand.”
In response to an analyst’s inquiry during the earnings call, Mr. Ketchum said NextEra Energy is still in the process of evaluating the Duane Arnold facility, including the potential costs of bringing it back online.
“I’m not going to give you a cost number yet, because that’s part of the evaluation that we’re going through currently,” Mr. Ketchum said. “Remember, this is a BWR, boiling water reactor. They are a lot less complex to bring back and to recommission … So that gives us optimism at being able to do this at an attractive price and be able to execute it without as much risk that might be associated with recommissioning a plant that does not have a boiling water reactor.”
Mr. Ketchum said there’s no time frame established for that evaluation thus far, but noted it would be based on an overall evaluation of the company’s electrical generation portfolio.
“We look at our entire nuclear fleet as part of our data center strategy,” he said. “So we’re sort of technology agnostic as we approach it.”
Efforts to bring other nuclear power plants back online after shutdowns are gaining some momentum nationwide. Politico reported in October that Microsoft has announced a deal with Constellation Energy to restart a unit of the Three Mile Island nuclear plant in Pennsylvania, and the Department of Energy has finalized a $1.52 billion loan to Holtec International to restart the Palisades nuclear plant in Michigan that would supply power to electric cooperatives in the Great Lakes region.
