Tuesday, July 4, 2017

Construction stocks could rally as California's $52 billion roads plan clears major hurdle

A large 20-foot-deep (6-meter) sinkhole that swallowed two vehicles in North Laurel Canyon Blvd, in Los Angeles, is cordoned-off on February 18, 2017, after a powerful storm hit southern California.
Mark Ralston | AFP | Getty Images
A large 20-foot-deep (6-meter) sinkhole that swallowed two vehicles in North Laurel Canyon Blvd, in Los Angeles, is cordoned-off on February 18, 2017, after a powerful storm hit southern California.
California's $54 billion plan to fix roads and fund highway improvements cleared a major hurdle late Thursday, passing in the state legislature and setting the stage for what could become a massive spending spree.
Positive comments last week from analysts about the state transportation plan sent shares of several construction-related companies sharply higher. Some of them continued to trend higher this week and with passage in both houses of the legislature it's possible they could rally Friday.
Analysts have suggested beneficiaries of the state spending could include Summit Materials, a construction materials producer, and AECOM, an engineering firm. Summit's stock jumped more than 5 percent last week and was up another 2 percent on Thursday.
Goldman Sachs last Wednesday recommended investors buy call options on Vulcan Materials - a producer of aggregate materials used in highway construction - as part of a strategy to benefit from the California transportation spending bill. The call options go up in value when the stock rises, and in the case of Vulcan its shares spiked nearly 7 percent last week.
Also, Cowen last Friday said it sees the California infrastructure spending as particularly lucrative for Granite Construction given the company has a 10 to 15 percent share of the state highway spending already.
The legislation, part of a transportation funding package, provides money for local and state projects to fix roads, highways and bridges as well as to fund other transportation programs. The plan would generate about $5.2 billion in new taxes annually over the next decade by increasing gasoline taxes by 12 cents per gallon to 30 cents per gallon in the Golden State.
The last time the state increased the gas tax was in the early 1990s.
California's Senate voted 27-11 to approve the transportation plan, while the Assembly chamber passed it 54-26, barely reaching the two-thirds required. Governor Jerry Brown has already promised to sign the legislation into law.
Brown traveled throughout the state this week to lobby for the proposal, which also would raise money through vehicle taxes.
According to Brown, the state had a backlog of more than $100 billion in unfunded transportation needs even before the heavy winter rains caused damage to highways, bridges and local roads.
Some Republican lawmakers opposed the plan arguing the state currently has some of the highest gasoline prices nationally and the additional gas taxes would encourage more businesses to leave California.
Critics also contend the state has a history of raising money from gas or vehicle taxes and siphoning the money away to fund programs unrelated to roads, bridges or other transportation needs. That said, backers of the plan insist the legislation includes safeguards to prevent the funds from going to purposes other than for transportation.

Highway and Road Transportation in Orange County California

Workers on Big California Bridge Tackle Oil Wells, Seismic Issues

Project managers cope with commuters, cargo trucks, trailers, trains and more.

Surrounded by workers, Nik Pecci, project safety manager with PMCM Consulting Engineers for the $1.5-billion Gerald Desmond Bridge replacement project—which is revitalizing a 50-year-old link in Long Beach—gestured in several directions: “I’ve got all these [port] tenants here, I’ve got a massive bridge over here. I have to build this thing intertwined with one of the busiest ports in the world. I constantly have  commuters, cargo trucks and trailers and trains.”
And that’s just what’s on th......http://www.enr.com/articles/41370-workers-on-big-california-bridge-tackle-oil-wells-seismic-issues?v=preview

Monday, July 3, 2017

1,800 tons of radioactive waste has an ocean view and nowhere to go

The massive, 150-ton turbines have stopped spinning. The mile-long cooling pipes that extend into the Pacific will likely become undersea relics. High voltage that once energized the homes of more than a million Californians is down to zero.
But the San Onofre nuclear power plant will loom for a long time as a landmark, its 1,800 tons of lethal radioactive waste stored on the edge of the Pacific and within sight of the busy 5 Freeway.
Across the site, deep pools of water and massive concrete casks confine high-power gamma radiation and other forms of radioactivity emitted by 890,000 spent fuel rods that nobody wants there.
And like the other 79,000 tons of spent fuel spread across the nation, San Onofre’s nuclear waste has nowhere to go.
The nation’s inability to find a permanent home for the dangerous byproduct of its 50-year-adventure in nuclear energy represents one of the biggest and longest running policy failures in federal government history.
Now, the Trump administration and Congress are proposing a fast track fix. The new plan aims, after decades of delays, to move the waste to one or more temporary central storage sites that would hold it until a geologic repository can be built in Nevada or somewhere else.
But the new strategy faces many of the same challenges that have dogged past efforts, leaving some experts doubtful that it can succeed.

America’s nuclear waste failure

Left, Construction is underway of the Independent Spent Fuel Storage Installation (ISFSI) where dry cask storage of used nuclear fuel will be stored vertically at the closed San Onofre Nuclear Generating Station. Right, view of the two domes at San Onofre Nuclear Generating Station. The I-beams in foreground are part of the turbine structure, where steam was turned into electricity at the now closed facility. (Allen J. Schaben / Los Angeles Times) 
The shuttered San Onofre facility — not withstanding its overlook of prime surf breaks — is similar to about a dozen other former nuclear power plants nationwide that now have to babysit waste to prevent natural disasters, human errors or terrorist plots from causing an environmental or health catastrophe.
Though utilities and government regulators say such risks are remote, they have inflamed public fear at least since 1979’s Three Mile Island reactor accident in Pennsylvania.
The sites are located on the scenic shores of northern Lake Michigan, along a bucolic river in Maine, on the high plateau of Colorado and along the densely populated Eastern Seaboard — each environmentally sensitive for different reasons.
No one wants that waste near them — including officials in the sleepy beach town of San Clemente, just north of San Onofre. Even Southern California Edison Co. officials, while insisting the waste is safe, agree it should be moved as soon as possible.
“It doesn’t make any sense to store the fuel at all these sites,” said Thomas Palmisano, chief nuclear officer at the Southern California Edison plant. “The public doesn’t want the spent fuel here. Well, the fuel is here.”
But every attempt to solve the problem almost instantly gets tangled in complex federal litigation and imposes enormous expense on taxpayers.
The Energy Department was legally bound to haul away the waste by 1998 under the Nuclear Waste Policy Act, making the agency about 20 years late in fulfilling its promise. That has saddled utilities with multibillion-dollar costs to store the waste onsite.

An aerial view of the closed San Onofre Nuclear Generating Station hangs on the wall of a conference room at the facility.
An aerial view of the closed San Onofre Nuclear Generating Station hangs on the wall of a conference room at the facility. (Allen J. Schaben / Los Angeles Times)
As a result, every nuclear utility, including Southern California Edison, has sued to recover its waste storage costs. So far, they have won judgments and settlements of $6.1 billion, and the Energy Department has projected that it may be liable for up to $25 billion more.
But the new plan is fraught with complex legal, political and financial questions, and has yet to be fully defined or vetted among powerful interest groups or receive approval by Congress or survive inevitable court challenges.
The House Energy and Commerce Committee last week overwhelmingly approved legislation that could clear up many legal questions. Similar bills have been introduced in recent years and failed to move ahead, but this legislation has strong bipartisan support and is backed by the White House.
Still, a lot could go wrong with the plan, as it has for every plan for decades.
Two little-known privately held companies, New Jersey-based Holtec International and Texas-based WCS, have unveiled plans and begun licensing applications with the Nuclear Regulatory Commission for interim storage sites on each side of the New Mexico-Texas border. Officials in the area, a booming center of oil production, are enthusiastic about the potential economic benefits. And nuclear utilities have offered encouragement.
Company officials and other proponents say such temporary dumps could be opened in as little as three or four years, assuming the licensing goes smoothly. But other nuclear waste experts expect a timetable of 10 to 15 years for a temporary dump and much longer for a permanent repository.
Two dozen antinuclear activist groups and leading environmental nonprofits already have signaled in letters to the NRC that they will dispute the idea of creating temporary consolidated storage sites.
The groups, along with many longtime nuclear waste technical experts, worry that temporary storage will weaken the government’s resolve to build a permanent repository. And they assert the plan would require transporting the fuel twice, first to the temporary site and then to a permanent dump, magnifying transportation costs and the fuel’s exposure to accidents or attacks by terrorists.
“These trains hauling nuclear waste would go right by Trump’s hotel in Las Vegas,” said Marta Adams, a now-retired deputy attorney general in Nevada who is consulting with the state on its renewed legal battle.

Top, view from inside the turbine building where large pipes and valves are used to support generating electricity inside the closed San Onofre Nuclear Generating Station. Left, Looking down at the San Onofre Nuclear Generating Station (SONGS) control room at the closed facility in San Clemente. Right, the San Onofre Nuclear Generating Station provided electricity for almost 3 million customers. (Allen J. Schaben / Los Angeles Times) 
Serious business problems cloud the plan. Among the most important is who would own and be legally responsible for the waste once it leaves the utility plant sites.
The federal government promised in the Nuclear Waste Policy Act of 1982 to take ownership at a government-owned dump, but it never authorized such ownership at a temporary private facility — one of the legal questions that the Energy and Commerce Committee’s legislation would clear up.
A temporary facility by Holtec or another organization is intended as a segue to a permanent dump at Yucca Mountain, about 100 miles north of Las Vegas. Along with an interim storage site, the Trump administration wants to restart licensing of Yucca Mountain, which President Obama suspended.
But reviving Yucca Mountain is a long shot. A decade ago, the Energy Department estimated Yucca Mountain would cost nearly $100 billion, a figure that has undoubtedly increased. The cost could be a problem for deficit-minded Republicans.
The Energy Department collected a tiny monthly fee from utility customers to build the dump, and currently a so-called trust fund has $39 billion reserved for the purpose.
But a little known clause in federal budget law 20 years ago decreed that contributions to the trust fund would count against the federal deficit. There are no securities or bonds that back up the fund, unlike the Social Security Trust Fund. As a result, every dollar spent on Yucca Mountain will have to be appropriated, and the money will add to the national debt.
“The money was collected for one purpose and used for another,” said Dale Klein, a former NRC chairman who is now associate vice chancellor for research at the University of Texas. “There is a moral obligation to address the issue. It will be a challenge to get Congress to pay for it.”
The Trump plan has also rekindled the strident bipartisan political opposition of Nevada officials, including the governor, senators, representatives and attorney general, among others. They vow to erect every legal and political obstacle to delay or kill the Yucca Mountain dump.
The state filed nearly 300 formal objections to the plan before the Obama administration suspended licensing. They must be individually examined by the NRC, a process that could take five years.
Then, the design and construction of the underground dump will require construction of about two dozen big industrial buildings and 300 miles of new railroad track. It could cost $1 billion or more every year, ranking among the largest federal operations.
A permanent repository could take 10 years to 20 years by most estimates.

On the beach

Nowhere is the nuclear waste problem more urgent than at shuttered power plants like San Onofre.
After utilities dismantle the reactors, haul away the concrete debris and restore the sites to nearly pristine condition, the nuclear waste remains. Security officers with high-powered automatic weapons guard the sites round the clock.
About five years after the spent fuel rods cool off in a 40- to 50-foot-deep pool, they are transferred to massive steel and concrete dry casks about 20 feet tall. Almost every government and outside nuclear expert considers the dry casks much safer than the pools.
The 3 Yankee Cos., which are safeguarding dry casks at three former New England reactors, spend about $10 million annually per site for maintenance and security, company officials say. The costs could be higher at San Onofre if the waste is left in place, Palmisano said.
Clockwise from top left: A model of a fuel assembly inside the conference room at the closed San Onofre Nuclear Generating Station. Thomas Palmisano, decommissioning and chief nuclear officer, holds No. 11 rebar, which is used in the structure of the dry cask storage. Construction is underway of the Independent Spent Fuel Storage Installation, where dry cask storage of used nuclear fuel will be stored vertically. A view of a concrete dry cask facility where 50 canisters, about one-third of the used nuclear fuel, is stored horizontally. (Allen J. Schaben / Los Angeles Times) 
Edison is building a massive concrete monolith for more storage, using a Holtec design called Hi-Storm UMAX. It will hold about two-thirds of the plant’s spent fuel in 73 stainless-steel canisters about 125 feet from the ocean. The 25-foot structure is about half-buried with the underground foundation just above the mean high-tide line. Tall cranes and swarms of hard hats are moving construction ahead. 
The crucial question is whether it will be safe, especially if congressional inaction or litigation by opposition groups keeps it on-site for years.
“The top has four feet of steel-reinforced concrete,” said Ed Mayer, program director at Holtec. “It is remarkably strong. The … steel lids are designed to take an aircraft impact.”
NRC officials say the design is safe and meets all federal requirements. Although nuclear issues are within the NRC’s jurisdiction, the Coastal Commission also examined the potential for a tsunami, sea level rise or an earthquake to undermine the facility.
“Under our authority, which is limited, the commission approved the permit, and behind that is the evaluation that it is safe for a period of 20 years,” said Alison Dettmer, deputy director of the commission.
But suspicion lingers. San Clemente city officials have demanded that the fuel be removed as soon as possible. An activist group, Citizens’ Oversight, has sued Edison for starting construction and the California Coastal Commission for approving it.
The waste “is right down by the water, just inches from the high-tide line,” said Ray Lutz, the group’s founder. “It is the most ridiculous place they could find.”
In an effort to assuage local concerns, Edison participates in a “community engagement panel” that meets at least quarterly, led by UC San Diego professor David Victor.
“Early on, I was surprised by how many people did not understand there was no place for the fuel to go,” he said. Over the last year, the possibility of a temporary storage site has raised people’s hopes for a quicker solution, he said.
The history of nuclear waste, however, is replete with solutions that seem plausible but succumb to obscure and unanticipated legal, technical or financial issues.

HVAC boot cleared of Asbestos in Los Angeles