CORRECT: Nuclear Energy To Remain Part Of US Energy Mix

Nuclear energy will be part of the energy mix in the U.S. despite declining public support for nuclear power because of the crisis in Japan, the president of New Jersey-based PSEG Power, a subsidiary of Public Service Enterprise Group (PSEG), said Wednesday.

President and Chief Operating Officer William Levis said it isn't "clear yet" how the Japan crisis will impact licensing renewals for existing plants or investment in new ones--"I'm not going to speak for investors," he said. But Levis did acknowledge that regulatory changes could influence planned nuclear projects.

"Obviously some of those economics are impacted by additional regulation that gets put into effect," Levis said. "You can build these plants on time and on budget with the certainly of a regulatory structure that supports it and, frankly, a public that supports it."

Levis' comments came as the nuclear industry faces increased scrutiny about its planning in the aftermath of an earthquake and tsunami on March 11 knocked out safety systems at Fukushima Daiichi nuclear power plant in northern Japan and caused the release of potentially dangerous radiation.

Levis acknowledged that the events in Japan went beyond what engineers there had planned for and said U.S. companies would have to re-evaluate the "design basis" for their own safety plans.

"We'll go back and relook at this too, just to ensure ourselves that we've got this right," he said.

But Levis echoed other industry spokesman in saying nuclear plants in the U.S. have redundant systems to deal with earthquakes, floods, hurricanes and other natural disasters.

"New plants will be able to stand up and show why they are designed appropriately for the events that we saw," he said. "At the end of the day, when you really look at the impact of this from a public health standpoint, nuclear will stand tall."

Levis argued that while construction of reactors in the U.S. slowed after a nuclear accident at Three Mile Island in 1979 brought on new regulations, "it wasn't Three Mile Island that killed the initial wave of construction in our country, it was the fact that interest rates were 20%."

Levis said the crisis in Japan shouldn't affect plant license renewals in the U.S. because the renewals here relate to managing aging equipment.

"There's nothing that happened in (Japan) that looks like it's related to aging management, so I would think that they would go on," Levis said, referring to license renewals. "But I also recognize that there is some need for caution and some additional questions that need to be asked."

Levis was speaking at the Center for Strategic and International Studies, a think tank in Washington.

-By Ryan Tracy, Dow Jones Newswires; 202-862-9245; ryan.tracy@dowjones.com

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