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NUCLEAR POWER IN THE WEST By RICHARD P. GODWIN, Manager Corporate Planl1ing and Development Bechtel Corporatiol1, San Francisco, California l Within the last five years considerable progress has been made towards competitive nuclear power. This statement should not come as any particular surprise to most of you as many of us, my- self included, have been hearing a great deal about low cost nuclear power for the last fifteen years. In my remarks here this morning, I would like to give you a thumbnail sketch of the present competitive position of nuclear energy and try to relate this new low cost power source to the deve- loping economy of the Colorado River Basin. But, before I focus on the Colorado Basin, some background is necessary to understand just what has happened in the nuclear industry in the last few years. The most obvious change has been a very remarkable spurt in orders for large nuclear stations. - In the 1963-64 period, for example, just five years ago, something less than 5% of new gen- eration capacity ordered in the U.S. was nuclear. - In 1967, in contrast, orders for nuclear units had jumped to approximately 50% of all new generating capacity, with some 23,000 MW ordered, all slated to go on stream in 1973-1974. What happened to have caused this spurt in orders? There was no technical break-through as such or at least not in the conventional sense. What did occur was that the fruits of a 15 year development cycle were beginning to ripen. The development programs initiated and supported by the AEC had obtained an active partner in private industry. Nuclear equipment suppliers had gained enough experience to offer the electric util- ities large nuclear plants under conditions which were competitive with fossil fuel in high fuel cost areas. The two conditions which were of overriding importance to the utilities were: - First, that plants of substantial size - 500-1000 MW - could be designed and built at a fixed price, and - Secondly, that nuclear fuel has been domonstrated and so the supplier can now guarantee nuclear fuel life, which is tantamount to guarantee of fuel costs. Probably the first head-on competitive meeting between nuclear and fossil fuel occurred in 1964 when the Jersey Central Power and Light Company made an extensive study of the relative eco- nomics of nuclear vs. fossil fueled power plants. Following the analysis of competitive bids for both fossil and nuclear plants, Jersey Central selected a 515 MWe nuclear unit. It is fair to say that a considerable amount of utility interest was generated at that time, but not much action. It was not until about one year later in 1965 when the Tennessee Valley Authority made a commitment for two nuclear units of approximately 1000 MWe each that this interest was translated into firm commitments for nuclear power plants. The fact that TV A decided in favor of nuclear power for plants located in a region of relatively low-priced coal resulted in a significant psychological breakthrough for nuclear power. A wave of ord- ers for large nuclear power stations followed, both from public and private utilities, with a total of 26 units being ordered in 1966 and 34 plants in 1967. The rate appears to have slowed somewhat in 1968, with 16 nuclear units committed in the first nine months of this year. l (NOTE: SLIDES USED IN THIS PRESENTATION HAVE BEEN OMITTED FROM PROCEEDINGS.) Surprisingly, these plants were not identified with any particular area of the country, but were located throughout the U.S. In 1960 there were only 16 plants operating or planned in the U.S., the majority of which could be considered research type reactors or at best prototypes. By 1968, about 110 nuclear plants were in being or under contract. While broadly spread geographically, all are near large population centers in areas of high or medium fossil fuel costs, You have all probably noticed that the Colorado River Basin has essentially no nuclear generating capacity in being or projected. This, I believe, is a passing condition, however, since power needs will grow in the Colorado Basin just as elsewhere in the U.S. and nuclear power will undoubtedly compete in some situations although certainly not all. -29-