Nuclear power’s new debate: cost
Issues of safety and waste make way for a focus on funding.
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If construction begins in Lusby, Md., perhaps by 2012, Calvert Cliffs III will be part of the larger promise of a “nuclear renaissance” of reactor construction sweeping the globe, proponents say.
By providing safe, domestic, moderately priced, and greenhouse-gas-free energy, nuclear power will be “a critical component of America’s future,” says George Vanderheyden, president of UniStar Nuclear Energy LLC, developer of Calvert Cliffs III.
Yet a new wave of concern is rising – not over traditional anxieties such as radioactive waste or weapons proliferation – but about the mammoth financial cost of nuclear power and who will bear it.
The big hurdle for Calvert Cliffs III and at least 21 other nuclear power reactors now in the US development pipeline is all about money – finding the billions in loans to build them. And the key to getting those loans is winning federal guarantees to back them.
Today, the US has 104 nuclear reactors, providing about 20 percent of the nation’s power. No new nuclear plants have been ordered in the US since 1978. This is not because of protestors, but because of a lack of investor funding and Wall Street remembering the ghosts of nuclear power’s past – massive construction cost overruns, utility defaults, and bankruptcies. Yet these no longer seem to haunt the nuclear industry or its supporters.
A new nuclear enthusiasm has now emerged quite powerfully in Congress.
House Republicans in June unveiled a plan for 100 new US nuclear reactors. A Senate proposal calls for a 20-year construction schedule, costing $700 billion. Industry will pay the full freight, according to the Senate plan. While there must be federal loan guarantees in order to convince Wall Street to fund the projects, in the end, the system will cost taxpayers “zero dollars,” it says.
Echoing that push, the Democrat-controlled Senate in May put its stamp on energy-climate legislation that has buried in it the potential for hundreds of billions of dollars in loan guarantees for “clean energy” – the lion’s share destined for nuclear power, critics say.
“The Senate energy committee has passed legislation that could provide unlimited loan guarantees for new nuclear reactors ,” says Michele Boyd, head of the safe-energy program for Physicians for Social Responsibility.
No nuclear plants in the US are under construction yet because they haven’t secured federal licenses or loan guarantees, many observers say. Such guarantees would become a huge stimulus for the nuclear power industry, enabling utilities to borrow billions from Wall Street or the federal finance bank.
“Despite industry efforts to frame nuclear energy as the cheapest option, the reality is that nuclear power’s very survival has required large and continuous government support,” writes Doug Koplow, president of the Boston energy consulting company Earth Track, in a recent analysis of public subsidies for nuclear power. Mr. Koplow tracks $178 billion in public subsidies for nuclear energy for the period from 1947 to 1999. Others have reached similar figures.