Florida Containment Dome Crackers: How Saving $15 Million Ended Up Costing $2.5 Billion

The Crystal River nuclear plant, seen from across adjacent wetlands, back in 2007 when it was actually functional. (Wikimedia Commons)

Almost single-handedly, reporter Ivan Penn at the Tampa Bay Times (formerly known as the St. Petersburg Times) has been informing the world of the disgusting spectacle taking place only sixty miles southwest of my home at the Crystal River nuclear power plant in Florida. The plant has been shut down since Progress Energy decided in 2009 that they could save $15 million in the costs of managing the replacement of the plant’s steam generators by managing the project itself. The ongoing mismanagement of the project has resulted in at least three major cracks in the containment building for the reactor and a projected cost of at least $2.5 billion to repair a plant that was designed to operate only through 2016. The second crack came when repairs were attempted on the first crack. And yes, these crackers just couldn’t learn, and the third crack came while they were contemplating how to repair the second crack instead of bringing in experts who actually knew what they were doing.

In a November 6 article from this year, Penn describes many of the details above about how Progress Energy chose not to use one of the two experienced engineering firms to manage the project in order to save $15 million in management fees. But because representatives of one of those firms, Bechtel, were present as part of the construction phase of the project, Progress still received warnings about the strategy they had chosen:

One warning:

Charles Hovey was an experienced construction foreman who had worked on similar projects at other nuclear plants. Progress, he observed, planned to use a different procedure to cut into its containment building.

“I have never heard of it being done like this before and I just want to express my concerns to you one last time.”

Another warning:

“Why are we doing tendons different here than all other jobs?” site supervisor John Marshall asked in an e-mail sent to Sam Franks, another Bechtel supervisor.

The “tendons” are steel cables that reinforce the concrete slabs from which the containment building is constructed.  Before cutting into a slab, as Progress planned to do in order to replace the steam generators, it is necessary to loosen the tendons.  All previous projects had loosened the tendons non-sequentially, while Progress decided, inexplicably, to loosen them sequentially. Furthermore, previous successful projects involved loosening all tendons prior to cutting, but Progress chose to loosen just less than half.

On November 5, Penn addressed the prospect of the repairs at Crystal River being covered by insurance:

Progress Energy’s insurer has launched its own review of the outage at the Crystal River nuclear plant to determine whether insurance will cover repairs to the broken reactor building.

Bill Johnson, Progress’ president and chief executive officer, told investors Thursday that the utility’s insurer has appointed a special committee of its board and hired engineering consultants to review the Crystal River plant.

Progress wants the insurer, Nuclear Electric Insurance Limited (NEIL), to cover three-quarters of the $2.5 billion it will cost to fix the nuclear plant, which first broke during a maintenance and upgrade project in fall 2009. Costs not covered by NEIL would rest on the shoulders of the utility’s customers or investors.

And there’s one more tidbit about NEIL in the article:

“This is a complex matter, and it’s in our best interest to work cooperatively with NEIL to provide them with all the information they need to make their coverage decisions,” Johnson, who sits on NEIL’s board of directors, said during a quarterly report webcast Thursday.

Yup, that’s right. The CEO of the company that caused this craptastic adventure also sits on the board of the insurer that will decide whether to cover the fiasco.  Conflict of interest much?

Here is how NEIL describes itself on its website (this is a screencap since the text on the page can’t be copied:

And Johnson is not alone.  A quick review of the NEIL Board of Directors finds a token insurance executive, a token banker and a token legal expert, but the bulk of the board consists of nuclear energy company executives.  Even if Johnson recuses himself, it’s hard to see NEIL not choosing to cover Progress Energy’s mistake, even though Penn points out that Progress has not received any payments from NEIL for repair work done in the last year.

And just to drive home the folly of Progress’ efforts, here are a few excerpts from Penn’s article on the third major crack:

Staff of the Public Service Commission did not hear about the third crack until Oct. 18, when a Progress engineer, John Holliday, made passing reference to it in a deposition. He was asked about his role in the Crystal River repair after the first crack shut down the plant in 2009.

“We’ve had two more” cracks, Holliday said. “Both of those (cracks) are larger” than the first.

But it gets better:

Six 42-inch-thick concrete panels form the walls of the containment building — the final barrier against deadly radiation escaping into the atmosphere during an accident. Three of those panels have suffered serious cracking, or “delaminations” in engineer-speak.

Panel 3 broke in October 2009, as workers cut a 25-by-27-foot hole in the concrete wall to replace steam generators inside the building.

Panel 5 broke in March after Progress repaired panel 3.

Panel 1 broke in July, while Progress tried to figure out how to repair panel 5.

So far, it is expected that Florida rate-payers will bear at least one fourth of the cost of the repairs to Crystal River.  Should NEIL miraculously refuse to cover the remaining loss, it will be very interesting to see just how that cost gets split among Florida rate-payers and the stockholders of Progress.  Either way, though, it will be Florida’s customers of Progress who will bear the bulk of that burden.

There is one small glimmer of hope against that development, though:

Florida’s Public Counsel J.R. Kelly calls the separation of a concrete wall at Progress Energy Florida’s Crystal River-3 nuclear unit “a huge construction negligence case,” and says that Progress does not appear to have been very prudent in its decision making.


“Right now we are smack dab in the middle of discovery and depositions, and we have not formulated a final position on” whether Progress Energy prudently managed the steam generator replacement project, Kelly said.

“But a lot of signs are certainly leading us to believe that Progress was not prudent in its decision-making … If that turns out to be the case, we will argue very strongly [to the Florida Public Service Commission] that ratepayers should not have to bear the costs” of repairing Crystal River and providing replacement power. “This is becoming a huge construction negligence case,” he added.

What becomes especially enraging about this entire spectacle, though, is that this plant is only slated to operate through 2016 and the request by the industry in general to extend first generation plants from a 40 year to a 60 year lifespan has not yet been approved:

The Crystal River plant is hardly new. It’s just a few years away from reaching its 40-year lifespan, when the industry originally intended to shut down and decommission its first-generation plants.

Now power companies want federal permission to continue operating their aging nuke plants for another 20 years. In Crystal River’s case, that means extending the life of the plant from 2016 to 2036.

Here’s the trick. Progress Energy says it will spend billions to fix its broken nuclear plant. But the company still lacks an explicit okay from the feds to run the plant until 2036.

So the bottom line is that Progress Energy is seeking $2.5 billion in insurance funds to repair a plant that could have only two years left in its licensed lifespan once repairs are complete. How can that be a prudent investment?



17 replies
  1. rugger9 says:

    It’s not a prudent investment, and Fukushima [as well as Chernobyl] should warn any sane person away from arbitrarily extending service life on something as dynamic and potentially dangerous [when operated unsafely] as a nuclear power plant. These guys are trying to squeeze every last penny out of the operation, that’s why with no in-house expertise they decided to save 15 million to spend 2,500 million. We’re supposed to applaud geniuses like that in the business world. “No one could have foreseen” is just around the corner, it’s the GOP get-out-of-jail mantra.

    Based on my many years of operating nuclear plants, this is just plain dangerous and makes me wonder how many other corners they’ve been cutting. It’s like the I-35 bridge maintenance deferral that Pawlenty did year after year until it fell into the Mississippi River. The Crystal River plant will probably have to be shut down, I can’t see the even the corporate-captured NRC being pleased about the safety culture here.

  2. JTMinIA says:

    Don’t worry, Jim, my neighbors and I will help you pay for it. This plant is too big to fail. Sort of like the windfarms we have here in Iowa, which are being built closer and closer to houses and roads. But I’m not worried about those, either; they are too big to fall.

  3. scribe says:

    Somewhat off topic, but then again, it’s about Bad Things Happening Around a Nuke Plant, so it’s on topic.

    Going on your TV show in Japan and eating food produced around the Fukushima nuclear plant as a way of showing support is Not A Good Idea. Another report you won’t see in the US Media. From Munich’s Suddeutsche Zeitung (my translation interspersed paragraph by paragraph):


    Nach Verzehr von Lebensmitteln aus Fukushima Japanischer TV-Moderator an Leukämie erkrankt.

    18.11.2011, 10:09 2011-11-18 10:09:37

    After consuming* food from Fukushima, Japanese TV moderator comes down with leukemia

    * the verb “verzehren” (whence the “verzehr” in the headline) means “consume”, with the sense of “consuming heartily” but not as lustily as “wolfing down”.

    “Lasst uns dem Norden helfen, indem wir seine Produkte essen”: Im März verspeiste der Moderator einer japanischen Morgensendung Lebensmittel aus Fukushima. Jetzt wurde bei ihm Blutkrebs diagnostiziert.

    “Let’s all help the north, in particular by eating their produce”. In March the moderator of a Japanese morning show enjoyed food produced in Fukushima. Now he has been diagnosed with the blood cancer (acute leukemia).

    Norikazu Otsuka ist einer der beliebtesten TV-Moderatoren Japans – und japanischen Medienberichten zufolge an Leukämie erkrankt. Sein Schicksal versetzt das Land in Sorge, die über schlichte Anteilnahme hinausgeht. Denn im März hatte Otsuka in seiner Morgensendung Mezamashi TV in einem Anflug von falsch verstandenem Patriotismus Lebensmittel aus der Gegend um das havarierte Atomkraftwerk Fukushima Daiichi verspeist. “Lasst uns dem Norden helfen, indem wir seine Produkte essen”, verkündete er.

    Norikazu Otsuka is one of Japan’s most beloved TV moderators – and Japanese media reports follow his coming down with leukemia. His story has beset the country with concern, whether he’s brought this on himself. In March in (what appears to have been) a display of misguided patriotism on his morning show Mezamashi TV Otsuka enjoyed food from the neighborhood of the devastated nuclear power plant Fukushima Daiichi. He advised: “Let’s all help the north, in particular by eating their produce”.

    “Lasst uns dem Norden helfen, indem wir seine Produkte essen”, forderte Moderator Norikazu Otsuka die Zuschauer der beliebten Morgensendung Mezamashi TV auf. (© screenshot: Mezamashi TV)

    Caption: “Let’s all help the north, in particular by eating their produce”.

    Vor wenigen Wochen entdeckte der 65 Jahre alte Moderator dann einen geschwollenen Lymphknoten an seinem Hals, kurz darauf diagnostizierten die Ärzte eine akute Blutkrebserkrankung. Otsuka muss sich nun Berichten zufolge schnellstmöglich einer Chemo-Therapie unterziehen.

    A few weeks ago, the 65 y/o moderator discovered a swollen lymphnode on his throat, which was shortly thereafter diagnozed by his doctor as acute leukemia. According to reports Otsuka must now undergo chemotherapy as soon as possible.

    Zwar ist fraglich, ob die Symptome des Mannes mit der Strahlenkatastrophe vom 11. März zusammenhängen. Doch Otsukas Krankheit steht in einer Reihe von Vorkommnissen, die entgegen der offiziellen Sicherheitsbeteuerungen die Unruhe in der Bevölkerung befördern dürften.

    It is open to question whether his symptoms are connected to the radiation catastrophe from March 11. But Otsuka’s illness stands in line with other sequelae that go against the official prouncements of safety and are causing uneasiness in the populace.

    Erst am Donnerstag hatte die japanische Regierung erstmals eine Lieferung von Reis aus der Umgebung des havarierten Atomkraftwerks wegen zu hoher Strahlenwerte gestoppt – dabei hatte die Präfektur Fukushima noch im Oktober ihren Reis für sicher erklärt. Auch hatten Politiker und Journalisten immer wieder öffentlich beteuert, Produkte aus dem Norden könnten gefahrlos konsumiert werden. Vor zwei Wochen trank ein Abgeordneter ein Glas Wasser aus einer Pfütze vor der Ruine des Atommeilers, um zu beweisen, dass die akute Strahlengefahr vorbei sei.

    On Thursday, for the first time, the Japanese government stopped a delivery of rice from the neighborhood of the devasdtated power plant on account of high radiation levels. The prefecture of Fukushima has in October declared its rice as safe. Moreover, politicians and journalists have often publicly stated that products out of hte north can be consumed without danger. Two weeks ago, a representative (from the Diet?) drank a glass of water from the pool/puddle in front of the ruins of the plant, as a demonstration that the danger from acute radiation is passed.

    An Hunderten Stellen wurde der Reis aus der Gegend um das Kraftwerk in Fukushima getestet, der Cäsium-Grenzwert von 500 Becquerel wurde zwar einmal erreicht, jedoch nie überschritten – bis jetzt. Bei Tests von Reis aus Onami, das zur Stadt Fukushima gehört, wurden 630 Becquerel pro Kilogramm an Cäsium gemessen.

    In hundreds of places the rice from the neighborhood of the powerplant in Fukushima has been tested, and the limits for cesium (500 Becquerel) were indeed reached once, butnever gone over – until now. In tests of rice from Onami, the city to which Fukushima belongs, 630 Bequerels of cesium per kilogram were measured.

    Die japanische Regierung verhängte ein Auslieferungsverbot für den betroffenen Reis und bemühte sich um Schadensbegrenzung: Der verseuchte Reis sei nicht in den Handel gelangt, versichterte Regierungssprecher Osamu Fujimura. Die Provinzverwaltung sei aufgefordert worden, die Inspektionen in der Gegend zu verstärken.

    The Japanese government hung the delivery prohibition on the affected rice and concerned itself with limiting damage: the contaminated rice had not made it into the market, reassured government spokeman Osamu Fujimura. The provincial government was asked to step up inspections in the area.

    Niemand müsse sich über Reis, der bereits in den Handel gelangt sei, Sorgen zu machen, beteuerte Fujimura. Reis aus Fukushima sei “sicher”. Die Regierung werde auch weiterhin versuchen, eine Ausbreitung unbegründeter Gerüchte über radioaktiv verseuchte Produkte aus Japan zu verhindern, zitierte die Nachrichtenagentur Kyodo den Regierungssprecher.

    No one need concern themselves over rice which is already in the market, said Fujimura. Rice out of Fukushima is “safe”. The Kyodo news agency reported the government spokesman as saying the government will also further seek to hinder the expansion of ungrounded rumors about radioactive contamination of products from Japan.

  4. BoxTurtle says:

    The power operators don’t think Obama will refuse to license them any more than I do. He’s just waiting for the election to be over.

    And the ratepayers will be responsable for the operating costs and at least 25% of the repair bill, with nothing falling on the stockholders.

    Prudent enough, from a beancounter perspective.

    Boxturtle (Let’s pass a law requiring Nuke executives to live downwind of their oldest reactor)

  5. rkilowatt says:

    When word came [credible scuttle-butt line] that Crystal River’s containment dome had cracked/voids in the nearly 4′ thick concrete, I was at work on Bechtel’s 2009 SanOnofreNucGenSta project doing the 1st of 2 dome-holes to replace 640-ton steel monsters called steam generators; 2 in each of 2 containments].

    Fishing for more data that might impact my area, I asked “What does this mean?” and the authoritative reply was “They’re fucked”.

    I worked alongside the handling of the horiz. and vertical cables that go around/over the domes at SONGS in conduits that tension the concrete [inward pre-stress to counteract/reinforce against accidental overpressure inside containment, as from steam or hydrogen event. This is in addition to massive rebar].

    Even though main-contractor Bechtel had good experience doing similar projects at power-plants and I knew there were first-time aspects to SONGS. Bechtel had conservatively estimated the best procedures to ensure dome integrity and personnel safety.

    The detensioning/removal of the cables, prior to cutting the hole in the dome at SONGS, got major attention both to optimum sequence and number of cables to be cut/removed before cutting the concrete and steel liner. […and cable replacement {then re-rebarring/reconcreting}and retensioning].

    To relieve stresses in the extremely tensioned concrete without causing further damage, the detensioning was applied to other cables beyond the proposed hole itself, all done gradiently to ensure success and personnel safety. The project was completed successfully.

    As far as I know, there were no serious personnel injuries among the about 1500 union-crew of Bechtel at SONGS. There was luck involved. Still, there were some very dangerous surprises so Bechtel wisely make adjustments when the 2nd dome was cut a year later.

    At Crystal River, all nuclear fuel was removed from the containment prior to their work. IMO and hopium, the interior of the containment can be sealed against rain/wind/flood. I do not know the condition/location of spent-fuel storage.

    There is no perfect planning or drug-testing to anticipate all possibilities. There is only optimum training, education and communication to invite “luck” and minimize/mitigate unwanted results.

    BTW, the American NucRegCommission has always assumed that containment domes are fail-proof and cannot and have never leaked…perhaps sufferring from regulatory-capture disease. Fukushima Daichi might be their cure.

  6. Jim White says:

    @rkilowatt: Thanks for that. Bechtel’s experience, and their knowledge that surprises occur during this sort of work is why Progress should have been willing to shell out the extra $15 million. I find it very hard to believe we would be in the current situation had an experienced firm like Bechtel been in the project management seat.

  7. rugger9 says:

    @rkilowatt: #8
    Roger that, but better reactors also help. Both Chernobyl and Fukushima used old designs, trying to get some more kWh out of them, FWIW Chernobyl still used graphite moderation which was what Fermi used in Chicago in the early 40s.

    Newer designs are more fail-safe [i.e. less likely to melt down], and are quite environmentally sound if operated safely [as we had drilled into us at the Navy]. I actually had less exposure in my plants than when I was topside. That being said, the key phrase here is “operated safely” and I have no confidence that someone trying to save 15 million on a billion dollar job will be a safe operator. One wonders what the BFPL curve looks like now for those reactors after 40 years of embrittlement, or whether the managers are aware of the consequence. Hurricanes are a problem in the way that the tsunami was, by knocking out cooling flow, or by the possibility of a sinkhole creating a stress point. Either way, the fail safe design ensures that the reactor isn’t at power when the casualties occur.

  8. sojourner says:

    @scribe: Yeah, right… I worked on a project down at a nuclear power plant last year and was amazed at how much non-nuclear infrastructure maintenance had been deferred over the years. The project I was on was to upgrade much of the electronic communications and systems that supported the plant.

    Corner-cutting to save some money is inherent in free enterprise. Something that has not been stated in Jim’s article is any mention of the cost of this plant being down (non-operational) for the amount of time that it has. I am sure that has to impact Progress Energy’s bottom line tremendously! But, that leads to another thought — I don’t know about Florida’s power markets, but losing a nuclear plant for any length of time will sure put a hole in generating capacity.

    There is a story that came out this last week here in Texas that we will likely experience some crucial power shortages this next year because of lack of generating capacity. Of course, we have a deregulated market that was supposed to save consumers LOTS of money through competition. Unfortunately, free market players don’t seem to take into account the expense of creating new generating facilities. Just as was mentioned in Jim’s article, the players all seem to rely on squeezing more and more life out of old inefficient plants and equipment. Then, some crisis will occur and Texas customers will wind up caught in the squeeze of paying for their providers’ mistakes, both in terms of short power supplies and higher costs to build new capacity. We already are, for that matter, but that is another story.

    Just another day in paradise!

  9. Jim White says:

    @sojourner: The linked articles give a good description of both the costs of buying the needed electricity on the open market at higher than the production costs if the plant were operating and ongoing “fuel costs” that I think are the costs of maintaining the fuel that was removed when the plant was shut down for replacing the generators.

  10. sojourner says:

    PJ and Jim… I understand and agree with both your comments. My point that I probably did not make very well is simply that so-called “free enterprise” will take the least expensive route whenever it can. I suppose that is natural — I probably would! I have been deeply concerned, though, at how regulatory oversight for critical infrastructure is being dismantled by the day in the interest of bigger and better profits with no concern for public need or safety. I think that says it correctly!

  11. Jim White says:

    @sojourner: No problem. I agree completely. I was just pointing out that an easy place to get the info you mentioned as missing was in the linked articles. And on the larger point: yes, the dual forces of big business cutting corners and regulators being defanged have screwed us royally. A Fukushima in the US is probably a lot less remote possibility than the nuclear industry would have us all believe.

  12. cwolf says:

    All these reactors will either fail and/or their spent fuel will eventually become dispersed much in the manner of the much ballyhooed Dirty Bombs.

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