Next in Line for a Bailout: The Nuclear Industry?
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The Obama Administration has been pretty upfront about its support for an energy policy that promotes both clean energy technologies and renewed investment in old technologies such as nuclear, coal and offshore drilling. "I think that on energy there should be a bipartisan agreement that we have to take a both/and approach rather than an either/or approach," the President said just last week.
But some environmental groups are not buying it. One of them is Friends of the Earth - the venerable environmental organization is staunchly opposed to governmental support for nuclear power, calling it "a preemptive bailout for a failing nuclear industry."Friends of the Earth released a statement this weekend criticizing the Obama Administration's reported decision to provide loan guarantees for the construction of two nuclear reactors in Georgia. The reactors would be part of the first new nuclear power plant to be built in the US in almost 30 years.
"The last thing Americans want is another government bailout for a failing industry, but that's exactly what they're getting from the Obama administration," said Friends of the Earth Climate and Energy Tax Analyst Ben Schreiber. "The Department of Energy is putting taxpayers on the hook for bailing out costly and dangerous nuclear reactor projects when the loans used to finance those projects default."
In the absence of the loan guarantees, argues Friends of the Earth, the nuclear industry is unable to secure private sector financing for new projects, due to high risk of default. Interestingly, the guarantee is based on 2005 legislation that lets the government provide loan guarantees for projects that avoid, reduce or sequester air pollutants or greenhouse gas emissions. Friends of the Earth was also critical of the Administration's recent decision to end subsidies for gas and oil, only to nearly triple support for nuclear power.
President Obama has presented his support for nuclear power, so-called "clean coal" projects and offshore drilling as both a gesture to Republicans and a pragmatic approach to supplying America's future energy needs, arguing that "we can't overnight convert to an all-solar or an all-wind economy."
Reporting on the loan guarantees, the Financial Times noted that country's 103 nuclear power plants, which provide 20% of the States' electricity, are getting so old "they are being forced to get 20-year extensions on their 40-year operating licenses."
So perhaps building a new batch of nuclear power plants is a good thing - if that means old and leaking clunker plants can be decommissioned? On the other hand, can we really present nuclear power generation as helping reduce carbon emissions?
More on nuclear energy:
Nuclear Power: Climate Fix or Folly?
Could Nuclear Power and Offshore Drilling Get Republicans to Vote for Cap and Trade?
Business Roundtable: We Can't Get There Without Nuclear