Sometimes perfection is the enemy of the good. A fine example of this is the North Anna Power Station. It's a nuclear power plant sitting on the perfect fault line. All critics can do is focus on the word "fault" and spread fear, uncertainty and doubt.
North Anna is owned by Dominion Resources (D), it was designed by their Virginia Electric and Power Company (Vepco) subsidiary in the 1960s, and it was built in the 1970s. During construction, engineers discovered the plant was sitting on top of a geologic fault.
This isn't a surprise. Fault lines exist throughout the east coast region. What critics do not understand, however, is that all faults are not equal. In fact, North Anna's fault is a perfect fault because it is not really a fault.
Naysayers argue that Vepco was underhanded and somehow tried to slip the vault's discovery by regulators. This assertion is nonsense, as is the assumption that building any structure over a fault line is inappropriate.
North Anna's rock fracture was discovered early in the excavation process. In early 1973, geologists determined that the newly discovered fracture, which was not a clean break, was in fact a fault. At this time, Vepco notified the Nuclear Regulatory Commission's (NRC) predecessor, the Atomic Energy Commission.
The Commission immediately issued a show cause order to suspend all work pending investigation and study. When the study was completed, the Commission held hearings, which lasted twelve days and produced 2,593 pages of testimony and 74 exhibits. All interested parties participated as did the U. S. Geological Survey (USGS), which was the Commission's advisor on seismic and geologic matters.
The Commission determined and the Appeal Board affirmed that there was reasonable assurance that the site was as stable as one without a fault. It was also determined that the presence of the fault did not require changes in design specifications. Further, the Commission determined this fault did not preclude the approval of the construction permits for the two nuclear power plants planned for the site and two additional units proposed for the same site.
However, Interveners were not satisfied and decided to file a federal suit against the Commission. (See North Anna Environmental Coalition v. United States Nuclear Regulatory Commission, 174 U.S.App.D.C. 428, 533 F.2d 655 (1976)). The complaint went all the way up to the United States Court of Appeals. It was argued November 20, 1975, and decided on March 3, 1976.
The Federal Court heard similar arguments that were previously presented to the Commission. The public, once again, learned that the North Anna fault was "incapable" and there was "reasonable assurance of safety."
The fault was determined to be incapable because geologists proved the fault was inactive and had not moved for more than 500,000 years (more like a million years). The proof was found in the fragile, saprolite material, which is located on top of the fault.
Three years of litigation before three tribunals did not change the facts. The fault is irrefutably "incapable." All the experts agreed; this fault is as dangerous as no fault.
Last Tuesday, the East Coast experienced a rare 5.8 magnitude earthquake. The North Anna power plant is located approximately 10 miles from the quake's epicenter. Because the plant was designed for 6.2 magnitude, the quake produced no material damage to the plant.
The fact that North Anna was unharmed was expected. The plant could likely absorb much more than a 6.2 magnitude earthquake since engineers typically add a significant margin of safety in their calculations. However, critics focused on the arithmetic difference between 6.2 and 5.9 and exclaimed a "close call." It was not a close call; earthquake measurements are based on logarithmic scales.
The fault beneath North Anna is a fault in name only; this is no longer a debatable point. But, the amount of seismicity experienced by North Anna is debatable. Soon, Dominion and the Commission will learn exactly how much acceleration was experienced. If it was more than the 6.2 design basis, then appropriate modifications to the plant will be considered.
In the meantime, both of North Anna's units will remain in cold shutdown. With 1,953 megawatts sitting idle, Dominion will lose approximately $2 million a day in revenues.
Another consequence is that independent power producers (IPP) will make up the difference and serve the 2-gigawatt base load. Dominion's loss is a gain for IPPs; North Anna's replacement power may come from IPP companies like Calpine (CPN), GenOn Energy (GEN) and Dynegy (DYN).
IPPs' revenues should be better than expected for two reasons: They will have new customers and they have higher prices. Dominion's 2-gigawatts represent the market's low-cost producers. They can only be replaced with the market's high-cost producers, and the high-cost producers set the price for the market. The result is Dominion's other nuclear facility and IPPs should see higher prices for longer periods.