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<br />1 <br />I <br />I <br />1 <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br /> <br />61 <br /> <br />In recent years there has been a significant shift (as <br />previously noted) in planned generation from nuclear to coal facilities. <br />The shift is due in part to the reluctance of utilities to commit to <br />nuclear projects which require a large capital investment and a long <br />regulatory approval process. In addition, the organization has to accept <br />the risk that an operating license may not be issued after the unit has <br />been constructed. <br /> <br />The delays encountered in completing major units already under <br />construction and the problems utilities face in obtaining authorization to <br />construct new facilities will place a heavy burden on existing thermal <br />generating units. Many of the existing thermal units are old and less <br />efficient than the planned units and would normally be on cold standby to <br />be used only during emergencies. Forced operation of these units at <br />higher annual capacity factors may result in a higher incidence of <br />equipment failure, deterioration of bulk power supply reliability and the <br />continued reliance on oil-fired generation. <br /> <br />The delay in nuclear and coal-fired resources will also increase <br />the requirements for oil and significantly increase operating costs due to <br />the cost differential between these energy sources and oil-fired energy. <br />Inflation will also increase the capital costs associated with these <br />facilities which will be needed to serve future energy requirements. <br />