General Public Utilities Announces Plans for a Commercial Nuclear Reactor

General Public Utilities Corporation, the parent company of Jersey Central Power and Light, announced plans to construct the first commercial nuclear reactor to generate electricity. The nuclear power plant began generating power in 1968.

Summary of Event

On December 12, 1963, General Public Utilities Corporation (GPU), a utility holding company with operating properties in New Jersey and Pennsylvania, announced the company’s plan to build a nuclear generating plant in Oyster Creek, New Jersey. The plant was designed to produce electricity for Jersey Central Power and Light Jersey Central Power and Light , a GPU subsidiary serving customers in the central portion of the state. The commercial nuclear generating facility was generally regarded as the first to be wholly privately financed. GPU’s announcement was greeted with approbation by President Lyndon B. Johnson Johnson, Lyndon B.
[p]Johnson, Lyndon B.;nuclear energy , who declared, “it appears that the long promised day of economical nuclear power is close at hand.” General Public Utilities
Nuclear energy;power plants
Power plants
Oyster Creek nuclear power plant
[kw]General Public Utilities Announces Plans for a Commercial Nuclear Reactor (Dec. 12, 1963)
[kw]Public Utilities Announces Plans for a Commercial Nuclear Reactor, General (Dec. 12, 1963)
[kw]Commercial Nuclear Reactor, General Public Utilities Announces Plans for a (Dec. 12, 1963)
[kw]Nuclear Reactor, General Public Utilities Announces Plans for a Commercial (Dec. 12, 1963)
[kw]Reactor, General Public Utilities Announces Plans for a Commercial Nuclear (Dec. 12, 1963)
General Public Utilities
Nuclear energy;power plants
Power plants
Oyster Creek nuclear power plant
[g]North America;Dec. 12, 1963: General Public Utilities Announces Plans for a Commercial Nuclear Reactor[07760]
[g]United States;Dec. 12, 1963: General Public Utilities Announces Plans for a Commercial Nuclear Reactor[07760]
[c]Energy;Dec. 12, 1963: General Public Utilities Announces Plans for a Commercial Nuclear Reactor[07760]
[c]Manufacturing and industry;Dec. 12, 1963: General Public Utilities Announces Plans for a Commercial Nuclear Reactor[07760]
[c]Trade and commerce;Dec. 12, 1963: General Public Utilities Announces Plans for a Commercial Nuclear Reactor[07760]
Holifield, Chester
Eisenhower, Dwight D.
[p]Eisenhower, Dwight D.;nuclear technology
Morehouse, Edward W.
Rickover, Hyman G.
Roddis, Louis H., Jr.
Strauss, Lewis L.

The GPU announcement was part of the saga of nuclear power that began with the dropping of the atomic bomb on Hiroshima and Nagasaki in 1945. The creation of the atomic bomb was wholly a product of governmental research. Initially, all thought concerning nuclear power was focused on how to keep the secret of atomic weaponry from spreading to other nations. It was in the light of this preoccupation that the first legislation dealing with atomic energy, the Atomic Energy Act Atomic Energy Act (1946) of 1946, required that the U.S. government retain ownership and control of all atomic facilities.

The act created a new government organization to control all the government’s atomic activities, the Atomic Energy Commission Atomic Energy Commission, U.S.;corporate regulation (AEC). The government owned a variety of atomic installations and controlled all research into possible applications of atomic power, although much of the research and development was done through contracts with private companies, notably General Electric (GE) and Westinghouse, each of which had its own atomic laboratory. Further, the government retained ownership of all nuclear material.

Pressure was already building, however, to find a peaceful use for this powerful new energy source. The creation of the AEC led to a new congressional committee, the Joint Committee on Atomic Energy Joint Committee on Atomic Energy , to oversee the work of the new commission. The committee, and particularly its vice chairman, Congressman Chester Holifield of California, was a strong voice for finding peaceful applications. The congressional agenda pushed the AEC in the direction of seeking nonexplosive uses for atomic energy.

The first step in the long process of adapting atomic energy for use in the generation of electricity was the formation, in 1949, of the Ad Hoc Advisory Committee on Cooperation Between the Electric Power Industry and the Atomic Energy Commission Ad Hoc Advisory Committee on Cooperation Between the Electric Power Industry and the Atomic Energy Commission . The chairman of the commission was Philip Sporn Sporn, Philip , a utility economist and president of American Gas and Electric Corporation (later to become the American Electric Power System); the other two members were Edward W. Morehouse, also a utility economist and vice president of General Public Utilities Corporation, and Walton Seymour Seymour, Walton , another utility economist and director of the Power and Programs office of the U.S. Department of the Interior.

The members of the committee received security clearances that enabled them to visit all the major atomic installations of the government except that at Los Alamos, New Mexico, which was wholly dedicated to weapons production. They consulted scientists at Argonne Laboratories, at Oak Ridge Laboratories (assigned the mission of leading the AEC’s research efforts into industrial applications of atomic power), Brookhaven Laboratories, Hanford (concerned primarily with the enrichment of uranium), the Knolls Atomic Power Laboratory (a GE facility dedicated to contract research for the AEC), and the Bettis Laboratory (a Westinghouse facility comparable to Knolls).

Extensive consultation by the committee members with AEC scientists convinced them that the potential for civilian and commercial application existed. At the same time, much would need to be done in the way of research into a safe reactor form that could be produced at a cost competitive with fossil fuels. The chief advantage of nuclear generation would turn out to be the small size of its fuel compared to coal, making possible immense savings in fuel transportation costs.

A major factor in the evolution of civilian nuclear power was the interest of the U.S. Navy, under the leadership of Admiral Hyman G. Rickover, in the development of small nuclear “engines” that could propel naval vessels, particularly submarines. Rickover assembled a group of scientists and engineers, including Louis H. Roddis, Jr., later to become an active participant in the GPU decision-making process as president of Pennsylvania Electric Company, a GPU subsidiary. In late 1947, intensive research efforts were begun in search of a suitable format for an atomic power plant for naval, especially submarine, use.

These efforts bore fruit in 1953, when a prototype submarine-propulsion reactor was successfully tested at the National Reactor Test Station in Idaho Falls, Idaho. This reactor led directly to the propulsion units for submarines. This reactor also led directly to the pressurized-water and boiling-water reactors that became the predominant form of nuclear power plant for electricity generation in the United States.

The Joint Committee on Atomic Energy seized on these developments as confirmation of its belief that a major effort directed toward the development of nuclear power reactors was justified. It pressured the AEC to make a formal commitment to research dedicated to developing suitable forms for nuclear power generation. The administration of President Dwight D. Eisenhower, himself an advocate of the peaceful use of atomic power, strongly supported this agenda, which he would call Atoms for Peace.

Because there was public concern about the safety of nuclear power, much of the research focused on safe operation. The problem was one of controlling nuclear fission so that only enough of a chain reaction occurred to keep the process going. Research that was focused on the safety factor rapidly led researchers to conclude that the safest design was either the pressurized-water reactor or the boiling-water reactor. In both types, the water used as a coolant quickly turned to steam and shut down the reaction.

It was clear that the legislation passed by Congress in 1946 was too constraining to permit effective development of a nuclear power industry, especially one predominantly in private hands, as Eisenhower’s administration ardently desired. Accordingly, the Atomic Energy Act of 1946 was replaced by a new Atomic Energy Act Atomic Energy Act (1954) in 1954. This act authorized the licensing of private nuclear facilities by the AEC and permitted the AEC to furnish the nuclear fuels for such facilities, though the government retained ownership of the fuels. Armed with this enlarged authority, the AEC’s chairman, Lewis L. Strauss, created a demonstration reactor program, under which the AEC welcomed proposals for the construction of demonstration reactors on the part of private utilities. The utilities would finance, or at least contribute to, the capital costs, but the AEC would provide funds for research, development, and evaluation, and would also provide the nuclear fuel.

A number of small-scale plants were built under this program. The first was a plant at Shippingport, in western Pennsylvania. The power generated there was supplied to Duquesne Light Company. Another early plant was commissioned by a consortium of New England utilities called Yankee Electric; it built a plant at Rowe, in western Massachusetts, which operated successfully for more than thirty years. All these plants were, however, of modest dimensions. They did provide the basis for cost studies that led to defining a goal of the utility industry of costs less than four cents for each ten kilowatt-hours generated.

Intensive studies were carried out by both industry and the government to determine the costs of nuclear power generation. The basic question was how the cost of nuclear generation compared with that of coal-based power. All utilities performed cost studies, but among those most intensively studying costs were the officials of GPU. GPU’s operating plants had access to Pennsylvania coal, so the competitive factor was intense. The decision to go ahead with the Oyster Creek facility was based on the belief that the company could produce electricity below the cost of four cents per ten kilowatt-hours.

Equally decisive was the successful negotiation with General Electric for a turnkey price for the Oyster Creek plant of $76.6 million. GE was able to offer such a proposition because it was a major producer of turbines and generators for utilities and eager to get in on the potentially profitable field of building nuclear power plants. In the early 1960’s, electricity use was increasing at a steady rate of about 3 percent per year, so GE could foresee a large demand for new electrical generating facilities. By signing on with Jersey Central for the construction of the Oyster Creek facility, GE opened for itself a potentially highly lucrative business, even though the early turnkey plants were probably constructed at a loss.


The immediate impact of GPU’s announcement of the Oyster Creek project was the decision, on the part of eleven privately owned utilities, to embark on their own nuclear construction programs. By 1975, fifty-three civilian nuclear power plants had received operating licenses, and an additional sixty-three plant-construction licenses had been issued by the AEC. At that time, applications were pending for an additional seventy-four construction permits. In a short period of time, the American utility industry had made a major commitment to nuclear power.

Another important legislative action had already been taken in 1957, when the Price-Anderson Act was passed by Congress. The insurance industry had made clear that it would provide insurance against a catastrophic accident only up to a limit that the utility industry found to be inadequate coverage. The government agreed to provide backup insurance beyond the $60 million the insurance industry was ready to commit. The act was originally intended to last ten years, but in 1965, in anticipation of the operation of private nuclear generating plants, it was extended for another ten years, with the inclusion of a “no-fault” clause permitting immediate indemnification of anyone injured.

It was clear that a major portion of the government’s role in the field of civilian nuclear energy would be licensing and regulation. This entailed several reorganizations of the AEC, resulting finally in its replacement by the Energy Research and Development Administration (which later became the Department of Energy) in 1974. The regulatory role was spun off to the Nuclear Regulatory Commission, which was tasked with overseeing the nuclear power industry.

The Oyster Creek facility went on line in 1968. Its original rated capacity was 550 megawatts, but following a “run-in” or “stretch” period, as it was known in the industry, it was able to increase its capacity to 640 megawatts. That was the largest capacity contemplated when Oyster Creek was announced, but within a few years technology had advanced to the point at which thousand-megawatt plants were being ordered.

Oyster Creek was the beginning of a whole new technology, one that has since spread to much of the industrialized world. The promise of a technology that could provide power at a cost below that of fossil fuels in most parts of the world was irresistible; Oyster Creek demonstrated its practicality. Safety and environmental issues, however, mitigated against widespread use. General Public Utilities
Nuclear energy;power plants
Power plants
Oyster Creek nuclear power plant

Further Reading

  • Atomic Industrial Forum. Atomforum 64: Proceedings, Atomic Industrial Forum 1964 Annual Conference. New York: Author, 1965. Contains speeches by Louis H. Roddis, Jr., and Chester Holifield, both celebrating a bright future for civilian nuclear power.
  • Caldicott, Helen. Nuclear Power Is Not the Answer. New York: New Press, 2006. Physician, antinuclear activist, and scholar Caldicott refutes the claim that “clean and green” nuclear power is the solution to global warming. Also discusses alternatives, such as renewable energy sources and green technology.
  • Dawson, Frank G. Nuclear Power: Development and Management of a Technology. Seattle: University of Washington Press, 1976. A clear presentation of the stages in the development of nuclear power as a workable commercial technology. Contains a reasonably clear explanation of technical factors.
  • Leone, Daniel A., ed. Is the World Heading Toward an Energy Crisis? Farmington Hills, Mich.: Greenhaven Press, 2006. Presents a pro-and-con format with contributions from opinion makers on all sides of the issue of energy consumption and production. Includes discussion of nuclear power and alternatives.
  • Mullenbach, Philip. Civilian Nuclear Power: Economic Issues and Policy Formation. New York: Twentieth Century Fund, 1963. A critical review by a former Atomic Energy Commission economist of the decisions leading to the development of civilian nuclear power. Mullenbach argues that many of the decisions were made on strategic rather than economic grounds.
  • Roddis, Louis H., Jr., and Daniel K. Park. “Nuclear Energy and the Electric Power Industry: Before and After Oyster Creek.” In Innovation and Achievement in the Public Interest, edited by Ward Morehouse and Nancy Morehouse Gordon. Croton-on-Hudson, N.Y.: Wayward Press, 1966. This account of the events leading up to the Oyster Creek project, together with some discussion of its consequences, is the most concise and informative story of the Oyster Creek facility.
  • U.S. Atomic Energy Commission. Civilian Nuclear Power: Current Status and Future Technical and Economic Potential of Light Water Reactors. Washington, D.C.: Government Printing Office, 1968. This publication appeared just as the Atomic Energy Commission was winding down its research on light water reactors, on the ground that they had become a “proven” technology.

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