MAJOR QUESTIONS arise about whether we will continue to have reliable and affordable electricity in the years ahead.
Demand for electricity in the United States is growing 3 percent annually, twice the rate of a few years ago. Unfortunately, demand is growing faster than the system's ability to generate and deliver power, and this is putting the reliability of the nation's electricity supply at risk.
Who is going to take the lead in ensuring that the nation has enough generating capacity?
If present trends continue, a doubling of the required power plant capacity can be expected in the next 24 years. To meet this rise in demand, which most likely will occur barring a prolonged recession, a huge increase in capital investment for power plant construction will be necessary.
Currently, 76 percent of the nation's electricity comes from coal and nuclear power, the mainstays of the electrical system, even though there have been almost no new construction orders placed for coal plants in the past decade and none for nuclear power since 1978.
The American power industry expects to meet the increased demand by building power plants fueled with natural gas. But this strategy is shortsighted since the demand for gas is outrunning supplies. But when all the gas needed is added up, this approach could lead to a doubling of natural gas demand for the electric sector alone within five years.
At current prices, gas accounts for about 90 percent of the total power production cost over the lifetime of a plant. Therefore, relying heavily on natural gas for new electricity supply is very risky.
Moreover, there is not enough pipeline capacity to bring gas to all of the power plants planned or under construction. Power companies will have to compete with the needs of 61 million American households, along with industries that use gas to produce plastics and other petrochemicals. The implications for consumers and the economy are enormous.
There are those who maintain that if we want electricity at a reasonable and stable price, its cost to the consumer should be regulated. While part of the reason for California's power crisis is botched deregulation, a more important factor is insufficient electricity supply in the face of strong demand.
Returning to a regulatory regime would act as a disincentive to the production of new power supplies, which the nation must have to sustain economic growth. Instead of regulation, the states should look to coal and nuclear power to supply the needed energy.
America has no shortage of coal and uranium reserves. Its deposits are greater than those of any other country. Our nation's endowment of coal and uranium is comparable to Saudi Arabia's share of the world's oil.
Today, coal plants can be built using state-of-the-art clean-coal technologies, such as coal gasification. Nuclear power makes sense because it is the only way to generate large amounts of additional electricity without emitting pollutants that are regulated under the Clean Air Act or greenhouse gases. Next-generation nuclear plants can be built to standardized designs, three of which have been certified for licensing by the Nuclear Regulatory Commission.
If America is to have a reliable and affordable supply of electricity, more coal and nuclear plants should be built. Since electricity is critical to the functioning of a modern economy, there are few more important tasks than ensuring they get built.
Natural gas should be saved for household and industrial use.
Martin Nelson is a professor of mechanical engineering at the U.S. Naval Academy in Annapolis.