Nuclear industry worried it might not get loan guarantees
As conservative broadcast outlets make hay of taxpayer loan guarantees to the failed solar module manufacturer Solyndra, more guarantees to the nuclear industry are awaiting approval.
Points made as vociferous politicians and others decry green energy loan guarantees will apply to the nuclear industry, and that makes some people very nervous about almost identical — and much, much bigger — loan guarantees made and pending for new nuke plant construction.
As former U.S. Nuclear Regulatory Commission member Peter Bradford told Technology Review’s Peter Fairley: “The Republican rhetoric is every bit as applicable to nuclear loan guarantees as it is to poor old Solyndra.”
The Energy Department has backed only one nuclear power plant under the loan guarantee program, thus far. Last year DOE offered to support $8.33 billion in loans for a utility to add two new reactors to an existing plant in Georgia. Congress has made an additional $11 billion available for nuclear loan guarantees, and the administration has requested another $36 billion.
These are 100 percent loan guarantees — taxpayers will repay the entire loan if a borrower defaults — so there is no risk to lenders. Even so, very few new reactors are even planned. New nuclear plants are expected to generate power at 12 to 20 cents per kilowatt-hour, which is two to three times more than average U.S. power prices, according to theMassachusetts Institute of Technology’s Technology Review.
Nuclear loan guarantees, developed during the Bush administration as part of the Energy Policy Act of 2005, are designed to make it easier to attract the huge debt financing required for the construction of new atomic reactors in the United States. And they’re very important to the nuclear industry and nuke-dependent energy utilities. Why? Because a long history of construction delays, cancellations, defaults and cost overruns have scared investors away from the nuclear sector for decades.
Meanwhile, the shuttered Hanford Nuclear Reservation in Washington is running up taxpayer bills for cleaning up highly radioactive materials left behind after the plant’s closure. This week the Hanford Advisory Board advised the Department of Energy that it believes $115 billion may not be enough to finish the environmental cleanup work there by 2060.
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