How much of a setback is San Onofre's closure?

The word "uncertainty" has become quite a buzzword in business and financial reporting, but it's perhaps nowhere more aptly used than it is when talking about the state of the U.S. nuclear power industry. Uncertainty is the stated reason why Edison International's Southern California Edison decided to permanently retire its already shut down San Onofre Nuclear Generating Station (SONGS).

This uncertainty stems from low natural gas prices, the lingering memory of Fukushima, cheaper alternatives, nervous investors and capital costs that seem to start out high only to be revised higher — as is the case with both the SCANA Corp.'s V.C. Summer Nuclear Station expansion and Southern Co.'s Plant Vogtle expansion.

The uncertain environment is in no way helped by the spate of awful headlines that is plaguing the industry as of late — everything from cracked equipment and plant closures to the strange case of how two goldfish wound up in a juice pitcher in a restricted area of FirstEnergy's Perry nuclear plant.

Headlines such as these (and others, as the parade of bad news for the nuclear industry has been almost too overwhelming to keep track of lately) have a cumulative negative impact on public opinion, and the nuclear sector has always had to be more concerned about public goodwill than most other businesses.

So call it navel gazing, soul searching or just a much-needed conversation, but people are wondering about the long-term future of this industry. Proponents of nuclear generation are hoping the technology didn't peak in 2001 when it produced more than 20 percent of all power in the U.S., though that figure has since fallen to 19 percent.

What are the bright spots for nuclear? Well, one advantage that will never go away is the technology's superior carbon emissions profile — namely, it releases none. However, there are alternatives to nuclear that release no pollution, are easier to install, suffer from less of a NIMBY effect and are generally better-liked by the public.

Another area where nuclear proponents are holding out hope for is small modular reactors. The Department of Energy is backing R&D for SMR technology, and several big-name companies are looking into getting involved or are already involved. The benefit of the SMR is safety and scalability, but developers still need to prove they can get an SMR up and running. The advantages of SMRs don't mean much if they prove every bit as hard to get deployed and operating as conventional reactors are.

For California, the permanent loss of SONGS' nuclear generation capacity means a less diverse generation portfolio overall, to be sure, however, all is not lost on that score. Around the same time SCE announced they were throwing in the towel on SONGS, the California ISO announced that the Golden State was now capable of producing more than 2 GW of solar energy.

Normally when nuclear power plants are taken offline, for whatever reason, the only feasible solution is to replace the lost baseload with coal-fired power or natural gas power. California, though, is one of the top 10 economies in the world and in possession of an incredible variety of natural resources and geological variety. The potential for developing geothermal assets, hydropower facilities and solar and wind farms is more promising in California than in many other areas of the world. The state already generates more than 23 percent of its power from renewable sources, including hydropower.

What California does or doesn't do about its generation mix, though, is cold comfort to the nuclear industry at large. The economics of power generation is changing as fuel prices fluctuate and new regulations kick in. Coal as well as nuclear energy — both proven ways to generate baseload power — are becoming liabilities to their owners instead of assets.

Given the economics of the situation, it's hard to blame Southern California Edison's for its decision on San Onofre. The plant had become a money pit. However, even now that the decision to close it has been made, the plant itself will continue to cost its owners a significant sum. Safely disassembling the facility will take decades — perhaps even a half century. You have to wonder what things will look like for the American nuclear power industry by the time the plant has been completely taken apart.