Common sense and a commitment to nuclear energy.

• Author: Little, Jim
• Position: THE CAROLINAS' NUCLEAR CLUSTER

Recent events in the nuclear energy industry demand that the Carolinas' Nuclear Cluster raise its voice. These events create the need for a strong defense of the industry:

* Entergy announced it will close Vermont Yankee Nuclear Station after receiving a license extension.

* Kewaunee Nuclear continues decommissioning.

* San Onofre Nuclear Generating Station will not reopen.

* "What if' regulations resulting from Fukushima impact the cost of U.S. operations.

* Natural gas has become, for now, a fuel-of-choice because of its current low cost.

The issue is this: Our national energy viewpoint is not distinguishing between energy values and energy valuation. There's a big difference.

Let's start with valuation

I can't second-guess a boardroom decision based on financials and the best determination of future business possibilities, especially in a merchant marketplace with the volatility in supply and demand. In the end, companies have to make profits and a return to their shareholders.

A decision to shut down an existing facility, which has remaining generation potential, is not, in my opinion, caused by the current economics of nuclear power. It is a result of decisions made more than 10 years ago to deregulate the electric energy industry.

Deregulation was envisioned as making the industry more competitive to benefit both consumers and industry. Recent developments show that deregulation allows destabilizing events in an industry where stability is paramount. Utilities invest in needs over 30 to 40 years while generating reasonable and stable returns to attract investors. Deregulation was a vision not realized.

What about our energy values?

I am concerned about our energy portfolio. Removing an existing, carbon-free generation source without a clear equivalent alternative for the future creates risks by concentrating on other sources, which may be less sustainable or reliable. Some will quickly claim that the availability of renewable energy sources such as wind and solar, effective energy efficiency initiatives or the abundance of natural gas would fill the void. These options each have their own challenges and costs. We are betting that solutions will arrive in time with no assurance. This is not a prudent strategy either.

Here's a broad view: Energy utilities fill a socioeconomic role for us. A reliable, environmentally friendly energy supply enables a high quality...