ANCHORAGE (AP) - Galena city officials have approved plans to build a 10-megawatt nuclear power plant there as a test case in providing cheap power to rural communities.

City representatives and Toshiba Corp. officials will now develop an application to federal regulators for a license for the small-scale reactor near the Yukon River community, a process that could take several years.

The reactor unit would be 50 feet to 60 feet tall and 6 to 8 feet in diameter. It would be built outside of Alaska and be encased in several tons of concrete not to be opened during its operating life, estimated at 30 years.

The plant, called a battery, would be able to supply the community's electricity for about a quarter of the cost of diesel fuel, according to a U.S. Department of Energy study.

The 4S reactor unit is referred to as a battery because it does not have moving parts, and once installed, its fuel will not need to be replaced as in conventional nuclear reactors.

The Galena city council directed city manager Marvin Yoder to "establish a process and timeline leading to evaluations, industrial partners, and financial and contractual arrangements necessary to bring the economic and environmental benefits of the 4S to Galena."

The council's resolution directed Yoder to work with the community's Washington, D.C.-based attorney and Toshiba in developing the application to the Nuclear Regulatory Commission.

Licensing will be an involved process that will take several years and substantial funding by Toshiba, Yoder said.

Toshiba has offered to install the reactor at Galena free of cost if the licensing is approved as a commercial demonstration of the nuclear battery in a remote location.

If the technology is approved for use in the United States, Toshiba believes there will be opportunities for sales worldwide, and elsewhere in rural Alaska, according to Robert Chaney, a researcher with Science Applications International Corp.

SAIC coordinated the Department of Energy study of long-term energy supply options for Galena, including the Toshiba battery. The University of Alaska and Idaho National Engineering and Environmental Laboratory worked with SAIC in the study.

Chaney said the DOE study weighed nuclear power against other ways of providing Galena with improved energy, including more efficient diesel generation, a small coal-fired power plant, and wind, solar and hydropower from the nearby Yukon River.

Wind, solar and hydropower were determined not to be practical options for Galena, Chaney told an Alaska Miners Association group in a Dec. 17 briefing on the project.

If the nuclear battery went into operation in 2010, by 2020 it could supply electricity to Galena for 5 to 14 cents a kilowatt hour, assuming the community pays only operating costs, the analysis showed.

Galena's power is now 28 cents per kilowatt hour.

The costs could vary depending on the level of security federal regulators require at the site, Chaney said.

The plant would supply far more electricity than Galena now uses, but could enable local residents to convert their home heating from homes from expensive fuel oil to more affordable electricity and operate greenhouses to grow produce year-round, Chaney said.

The risks include the use of liquid sodium as a heat transfer medium and the long-term disposal of the radioactive waste, according to Ron Johnson, a professor of engineering at University of Alaska Fairbanks who is working with engineering aspects of the DOE study.

Johnson said small nuclear plants may not be the answer for rural power, regardless of the fate of the Galena experiment.

"If the technology is successfully deployed in Galena, its economic viability in other Alaska villages and elsewhere depends on the actual life cycle costs, which are yet to be quantified," he said.

Alaska miners are interested in the Galena project because if the NRC approves Toshiba's proposal, larger nuclear batteries could provide power to remote mines.