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President Obama’s announcement yesterday of a "conditional" $8.3 billion loan "guarantee" to the Southern Company for construction of two nuclear reactors in Georgia obscured an important fact about the loan guarantee program: taxpayers are not just providing a guarantee, they also will be providing the actual loans.

According to a press release from Southern Company yesterday, "Total guaranteed borrowings would not exceed 70 percent of the company's eligible projected costs, or approximately $3.4 billion, and are expected to be funded by the Federal Financing Bank." (Note: the discrepancy in amounts--$3.4 billion vs $8.3 billion, is because Southern Company is only a partial owner of the two reactors, the rest of the funds will go to the other owners).

The Federal Financing Bank (FFB) is a little-known government entity that more typically makes loans to universities, colleges, rural electric co-ops and other small-scale projects. Interest rates from the FFB may be lower than offered by private financial institutions. Use of the FFB means that the loans themselves for new reactor construction will come from taxpayers, putting taxpayers in the risky business of both providing the loans and guaranteeing to themselves that the loans will be repaid.

Similarly, UniStar Nuclear, which is said to be on the Department of Energy’s "shortlist" of loan guarantee applicants, states in its license application to the Nuclear Regulatory Commission, "It is expected that, with respect to the portion of the debt guaranteed by the Department of Energy under the loan guarantee program, the source of financing will be the Federal Financing Bank, and with respect to the portion of the debt insured by export credit agencies, the source of financing will be commercial banks." [Note: the statement appears in the license application, General Information, Rev. 6]

This is not like Dad co-signing a loan for a child’s first car. The idea that these are just loan "guarantees" is fictitious: these are actual loans. Giant nuclear utilities will be raiding the federal treasury for money to build reactors, and they are expecting the taxpayers to bail them out if the project goes bad.

Coupled with Secretary Chu’s astonishing admission yesterday that he was unaware of the Congressional Budget Office report estimating a 50% failure rate for new reactor projects, the administration has chosen a path of enormous risk to taxpayers and is obscuring the real nature of that risk.

Originally posted to nirsnet on Wed Feb 17, 2010 at 01:54 PM PST.

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Comment Preferences

  •  Tipped & Recced (2+ / 0-)
    Recommended by:
    dykester, ontheleftcoast

    Prepare for incoming. The nuclear boosters will be here in force with an army of strawmen any second.

    •  How about those of us that want nuclear power (4+ / 0-)

      just not propped up by tax payer money going to giant conglomerates with no incentive to succeed?

      I stand by the truth, that way I don't have to be near any Republicans.

      by ontheleftcoast on Wed Feb 17, 2010 at 01:59:59 PM PST

      [ Parent ]

      •  While I Still Disagree With You (3+ / 0-)

        ....I also have to admit that your position is much more defensible than that of those who do want nuclear power even if it has to be "propped up by tax payer money going to giant conglomerates with no incentive to succeed."

        •  Should Tesla be propped up w/ Taxpayer Money? (2+ / 0-)
          Recommended by:
          kbman, ontheleftcoast

          The company would have folded last year had it not been for the US$ 500M government loan.

          Learn about Centrist Economics, learn about Robert Rubin's Hamilton Project.

          by PatriciaVa on Wed Feb 17, 2010 at 02:20:56 PM PST

          [ Parent ]

          •  All government loans should give the government (5+ / 0-)

            a stake in the company. If they are going to assume the risk they should be treated like any other stakeholder able to share in the profits as well. If the company is successful they can buy down the government loan and be on their merry way. If the Tesla deal is structured like the one we used to bail out GM, etc. then we have a stake and I'd be less worried about it. The article I read only mentioned that Tesla had incentives to pay back the loan quickly, further details were unavailable from the DoE. Not very transparent of the Obama administration so I'm guessing it is the corporate welfare type of loan which sucks.

            I stand by the truth, that way I don't have to be near any Republicans.

            by ontheleftcoast on Wed Feb 17, 2010 at 02:36:06 PM PST

            [ Parent ]

      •  nuclear FISSION (0+ / 0-)

        I'll assume you're not talking about nuclear fusion....

        FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

        by Roger Fox on Wed Feb 17, 2010 at 03:49:27 PM PST

        [ Parent ]

        •  Actually there are even forms of fission that (2+ / 0-)
          Recommended by:
          Roger Fox, angelajean

          could, note COULD, be safe. For example liquid flouride/thorium reactors. About the size of a fridge, no chance of meltdown, nothing to steal from them to make nasty stuff. But these dinosaur designed plants not so much. Of course the new safe reactors aren't ready for commercial use, that'll take some time. So we should stop wasting our money on these bloated corpses and get with other forms of energy development. Wind, solar, biomass (non-food based), conservation, etc. Problem is those efforts don't generally have billion dollar corporations with megamillion dollar lobbying efforts backing them so guess what is getting funded?

          I stand by the truth, that way I don't have to be near any Republicans.

          by ontheleftcoast on Wed Feb 17, 2010 at 03:59:09 PM PST

          [ Parent ]

          •  Fission has little time left (0+ / 0-)

            We're seeing its last gasp, Cost wise its not keeping pace. Fission just doesnt release enough energy, Fusion does. Fusion gives us the solar system. Fusion makes us a space faring race.

            Can you imagine the value of that Georgia Nuke in 2023 when the first commercial Polywell reactor goes online....

            FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

            by Roger Fox on Sat Feb 20, 2010 at 05:40:19 PM PST

            [ Parent ]

      •  Then you need to find a way to pay for them (0+ / 0-)

        We can argue the safety, etc. after you can afford to buy one.

    •  Let's not get confused. (2+ / 0-)
      Recommended by:
      Meteor Blades, greenskeeper

      The need for nukes is one question.

      The questionable financing is another question.

      The answers to each may be totally different.

    •  Let's make a deal.. not one red cent for wind or (2+ / 0-)
      Recommended by:
      Corwin Weber, Mcrab

      solar.  Let all the technologies make it compl,etely on their own in the private marketplace.  Okay?  Deal?

      "Those are my principles, and if you don't like them... well, I have others." - G. Marx

      by Skeptical Bastard on Wed Feb 17, 2010 at 02:15:01 PM PST

      [ Parent ]

      •  Actually, I would go for that.... (0+ / 0-)

        wind and solar, etc. have had less problem raising capital for projects than nuclear. One piece of evidence: wind continues to be the fastest growing electricity source in the US. Even in recession 2009, wind added nearly 10,000 MW of capacity. Nuclear, of course, added 0.

        •  Because of all the nutballs blocking the projects (2+ / 0-)
          Recommended by:
          PatriciaVa, Corwin Weber

          in courts.  Self fulfilling prophecies...

          "Those are my principles, and if you don't like them... well, I have others." - G. Marx

          by Skeptical Bastard on Wed Feb 17, 2010 at 02:20:13 PM PST

          [ Parent ]

          •  nutballs blocking projects? (2+ / 0-)
            Recommended by:
            MKinTN, Radical def

            You must be referring to the utilities themselves....

            Every new reactor project proposed since 2007 (which was the first time any had been proposed since 1978) has been delayed. None of the delays have been caused by court challenges or any other action by opponents.

            According to NRC Chair Greg Jaczko, the delays have been caused by incomplete license applications, by reactor vendors submitting inadequate designs, etc.

            The Southern Co plant that is supposed to get the loan guarantee, for example, will use the Westinghouse AP 1000 design. It is currently on its 17th design revision. At one time it was certified by the NRC, but the NRC has revoked the certification because it was discovered that a shield building (to protect against radiation releases) cannot stand up to hurricanes, tornadoes or earthquakes.

            Westinghouse has estimated this is going to add about 1 1/2 to 2 years to the process (and probably cause cost estimates to go up).

        •  probably more than 0 (2+ / 0-)
          Recommended by:
          kbman, Roadbed Guy

          US reactors have had very good capacity factors lately, or have been uprated. Getting more out of existing resources is basically the same as adding capacity. I'm too busy today to look up the DOE numbers but even in the 00s there was increased nuclear net generation w/o new plants.

        •  The reason wind and solar have less problem (4+ / 0-)

          raising capital is BECAUSE of the generous production tax credits or outright "grants", accelerated depreciation, state renewable energy mandates,... Take those away and the only new generation being built will be more coal and natural gas plants.

          •  Nuclear has the same production tax credits (0+ / 0-)

            available as wind. They were part of the 2005 Energy Policy Act. Unlike wind, however, they are permanent and not subject to Congressional reauthorization every couple of years, which has caused a lot of uncertainty (read: chaos) among those trying to plan major wind farms with multi-year construction schedules.

            •  No, not permanent (2+ / 0-)
              Recommended by:
              Mcrab, Blubba

              Production tax credits for nuclear are not "permanent." They last for only eight years after the plant is started, and they are only available if the plant is placed in service before 2021. That later deadline, however, is probably irrelevant, because they are available for only the first 6 GW of advanced nuclear capacity to qualify. After that first few gigawatts (only the first few plants), there are no more PTCs available for nuclear.

              Meanwhile, the PTCs for renewables are available as long as Congress keeps approving them, and so far Congress has decided to keep them around. If the builders of major wind farms are having difficulties with the on/off nature of renewable energy PTCs, that's only because nobody would be building the worthless things unless there was a way to mine them for tax incentives. That is, no tax credits, no new wind farms.

              An idealist is one who, on noticing that a rose smells better than a cabbage, concludes that it will also make better soup.
              -- H. L. Mencken

              by bryfry on Thu Feb 18, 2010 at 10:10:33 AM PST

              [ Parent ]

            •  No, not the same. (1+ / 0-)
              Recommended by:

              The PTC for nuclear is only 1.8 cents/Kw-hr, compared to wind's 2.1 (and increasing). Morever, the PTC is only extended to the first couple new plants, not all comers like wind.

        •  Wind and solar.... (1+ / 0-)
          Recommended by:
          Skeptical Bastard

          ....don't have a forty year campaign of hysteria against them either.

          If investing in nuclear power wasn't such a political and social hot button, you'd find more people willing to invest in it.  As it is, it's like investing in an abortion clinic.  Even as something that's needed, private industry is incredibly reluctant to touch it.

      •  That would make sense if ... (3+ / 0-)

        ...and only if the federal government hadn't poured gargantuan subsidies into various fossil fuel and nukes in the past. Now, renewables are supposed to compete wholly on their own without the same kick-start that other energy methods got? Where is the fairness in that?

        I refuse to accept "no can do" as a proper slogan for progressives.

        by Meteor Blades on Wed Feb 17, 2010 at 02:32:14 PM PST

        [ Parent ]

        •  I think renewables should get big subsidies too (0+ / 0-)

          Let's give loans and guarantees to all non-fossil energy sources. The demand is enough to support multiple technologies, and deploy each where its strengths are greatest. Viewing nuclear vs. wind as zero sum in terms of subsidy support damages prospects of everyone. It's a toxic meme that always crops up in these debates.

          •  toxic meme? (1+ / 0-)
            Recommended by:
            Radical def

            If you want to go there, let's remember that nuclear reactors emit carcinogenic radiation on a routine basis and that the National Academy of Sciences says there is no safe level of radiation exposure; that nuclear reactors are capable of catastrophic meltdowns; that nuclear reactors produce radioactive waste and no country in the world has yet to find a solution to that little problem....

            Wind's drawbacks? It isn't windy everywhere 24/7. Of course, it is windy somewhere 24/7 and with improved storage technology--for example the compressed air storage being experimented with--wind power will produce electricity 24/7.

            We don't have the resources to pay for implementation of every energy source. R&D, perhaps. But not deployment. The $8 billion for this first loan guarantee, the $10.2 billion still left in the kitty, and the $36 billion more asked for by DOE in the FY 2011 budget is money that could be used for a lot cleaner, safer, cheaper technologies that can reduce carbon emissions faster. And all that money won't even provide for  construction of as many Megawatts of power as the wind industry has done on its own the past two years.

            •  HVDC vs storage (1+ / 0-)
              Recommended by:
              Meteor Blades

              Being able to move MW's 800 miles with the same transmission losses as our current grid technology @ 100 miles. Since Utilities are now building HVDC lines, and storage is basically on paper..... you get my drift, right?

              FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

              by Roger Fox on Wed Feb 17, 2010 at 02:53:16 PM PST

              [ Parent ]

            •  If that were true . . . (5+ / 0-)

              and that the National Academy of Sciences says there is no safe level of radiation exposure

              we'd all long since be dead

              You know, since we live in a veritable sea of radioactivity and, using a handy online radiation calculator you can see that nuclear power plants emit a tiny fraction of this (considerably less than coal powered power plants, for that matter . . .)

              •  Here's a link to the National Academy of Sciences (1+ / 0-)
                Recommended by:
                Radical def

                study. It is, indeed, true.


                We can't avoid solar radiation, of course, but it is important to avoid radiation exposures we don't need to have. And, unlike solar and background radiation, reactors emit specific radioisotopes, like Strontium-90, Cesium-137, etc, that attack specific parts of the body.

                •  So basically you believe in the (3+ / 0-)

                  "baffle them with bullshit" method  . . .

                  But nice, giving a link to a 406 page book . .. presumably your claims must be in there *someplace* !!

                  •  He figures no one will bother (1+ / 0-)
                    Recommended by:
                    Corwin Weber

                    actually checking some of those pesky "facts", so he just spouts off crap that has nothing to do with reality.

                    Coal plants far outweigh nuclear plants in the amount of radiation spewed into the atmosphere.

                    "Those are my principles, and if you don't like them... well, I have others." - G. Marx

                    by Skeptical Bastard on Wed Feb 17, 2010 at 03:41:48 PM PST

                    [ Parent ]

                    •  For entertainment purposes (1+ / 0-)
                      Recommended by:
                      mojo workin

                      what's really fun is to go to PubMed, type in "radiation hormesis" and learn that there are numerous legitimate scientists out there who are suggesting that radiation - in moderation of course - might actually be good for you . . . .

                      Or, a discussion for the layperson . . .

                      •  I wouldn't go as far as hormesis (2+ / 0-)
                        Recommended by:
                        mojo workin, Skeptical Bastard

                        But LNT hypothesis may not be the entire story. It's a useful model for understanding large doses of radiation, and calculating risk based on acute exposure, but it doesn't capture the entire story at a molecular level or background radiation. I have a friend who is a radiation health physicist and we've discussed this a few times in the past (very interesting career btw, wish I knew about it before I started grad school myself!)

                        But anyway. If we reacted to natural/background radiation with the same intensity as microscopic quantities of radioisotopes released from nuclear reactors during an emergency, the US Capitol Building would be a DOE site and bananas would be dirty bombs....

            •  your claims are not credible (0+ / 0-)

              you'll need more than talking points to have a discussion with me. So, yes, toxic memes. Worse than spent nuclear fuel!

              Anyway, yeah, fund everything. We'll be able to come up with the money if people are terrified enough of climate change. How did NASA get so much funding so quickly? Personally I think the regulatory process needs to be greatly sped up in terms of quickly building type-licensed nuclear designs. It's a stupid idea to have 104 bespoke plants operating around the country. France and Japan use a handful of designs, stamped out 50x.

            •  ps. (1+ / 0-)
              Recommended by:

              compressed air energy storage = natural gas

              No one likes to mention this. I wonder why. Do they not know how it works? It's not a big balloon blowing into a little pinwheel. The air is basically used to turbocharge a gas turbine.

              •  Because HVDC transmission lines (0+ / 0-)

                have 1/8the the transmission losses of our current grid and dramatically reduces the need or logic of storage.

                FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

                by Roger Fox on Wed Feb 17, 2010 at 03:05:52 PM PST

                [ Parent ]

                •  losses are not that high (0+ / 0-)

                  something like 7% per 1000 miles. HVDC sounds like a nice idea for people who make HVDC equipment. :)

                  •  A couple of utilities are building HVDC now (0+ / 0-)

                    I forget the details, it might be just pilot projects.

                    HVDC is also a perfect match if you happen to be generating DC, as a Polywell fusion reactor might be well before the ITER is finished.

                    FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

                    by Roger Fox on Wed Feb 17, 2010 at 03:18:37 PM PST

                    [ Parent ]

                  •  Distinct advantages over AC (0+ / 0-)

                       * Undersea cables, where high capacitance causes additional AC losses. (e.g., 250 km Baltic Cable between Sweden and Germany[12] and the 600 km NorNed cable between Norway and the Netherlands)
                       * Endpoint-to-endpoint long-haul bulk power transmission without intermediate 'taps', for example, in remote areas
                       * Increasing the capacity of an existing power grid in situations where additional wires are difficult or expensive to install
                       * Power transmission and stabilization between unsynchronised AC distribution systems
                       * Connecting a remote generating plant to the distribution grid, for example Nelson River Bipole
                       * Stabilizing a predominantly AC power-grid, without increasing prospective short circuit current
                       * Reducing line cost. HVDC needs fewer conductors as there is no need to support multiple phases. Also, thinner conductors can be used since HVDC does not suffer from the skin effect
                       * Facilitate power transmission between different countries that use AC at differing voltages and/or frequencies
                       * Synchronize AC produced by renewable energy sources


                    FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

                    by Roger Fox on Wed Feb 17, 2010 at 04:10:01 PM PST

                    [ Parent ]

        •  Most of the past money poured into nuclear power (1+ / 0-)
          Recommended by:
          mojo workin

          was in the form of R&D. Most of the subsidies for renewables, on the other hand, are on the production side. Relative to renewable production tax credits (which only go up, not down), if you amortize and normalize the nuclear R&D over the power generated, the amount is small. Production tax credits, the accelerated depreciation and all of the other inducements appear perpetual. How many more thousands of wind turbines need to be be built before that industry is suitably kick-started?

      •  And no money for oil, gas, and coal (0+ / 0-)

        Uh oh... we've already done that.  Can we take it back?

        •  hopefully.. (0+ / 0-)

          but let's talk about going forward..  Not one dime for any one technology from tax monies from this day on.

          Let's let each technology stand on its own.

          "Those are my principles, and if you don't like them... well, I have others." - G. Marx

          by Skeptical Bastard on Wed Feb 17, 2010 at 09:28:17 PM PST

          [ Parent ]

  •  kill this bullshit figure... (7+ / 0-)

    There is no 50% estimated failure rate for this project. Mother Jones printed a correction -- look at the update at the bottom of your link:

    Stephanie Mueller, Press Secretary for the Department of Energy, sent this response on Tuesday evening: "This is a 7 year old analysis of legislation that was never enacted, and it is not germane to the current project—which has undergone rigorous financial analysis, is conditioned on regulatory approval, uses proven technology, and sets strict financial requirements to protect taxpayers.  Further, the project already has power purchasing agreements in place.  In other words, utilities have signed contracts agreeing to buy power from the plant for many years into the future, ensuring a stream of revenue."

    You got time to lean, you got time to clean.

    by gooners on Wed Feb 17, 2010 at 01:59:09 PM PST

    •  Maybe you should read the rest of the update... (5+ / 0-)

      "That the study is dated is fair criticism, and the CBO is expected to issue an updated study on loan guarantees sometime soon. But the program the study examined in 2003 is not much different from the one the Obama administration is currently in the process of expanding. The CBO at that time estimated that loan gaurantees would cover half the construction cost of a new plant—the current proposals would cover up to 80 percent. And while it's beneficial that the Georgia project already has a power-purchasing agreement in place, the recent debacle with the proposed nuclear plant in San Antonio demonstrates that those agreements are hardly fail safe."

      In fact, the default rate may be worse--but in any case the risk to taxpayers is higher, up to 80% of project cost vs 50%.

    •  I wish it was 50%. (2+ / 0-)
      Recommended by:
      Dauphin, Statusquomustgo

      Then we could foreclose on the reactor and run it for the public good.

  •  We need nukes. (3+ / 0-)
    Recommended by:
    kbman, Inland, Dauphin

    We need them because the risk is too great that the Global Warming alarmists (or Cassandras) are right.

    We have to reduce carbon in the air, and nukes are the only technically feasible, politically viable way to do it.

    That said, there is no reason to let Corporations cash in on our troubles. If taxpayers put up the money, taxpayers should own the powerplants.

    •  There are lots of other ways (2+ / 0-)
      Recommended by:
      Roger Fox, TimmyB

      concentrated solar, hot-rock geothermal, high altitude wind generation could all supply a major percentage of our needs.  Each and every one of them, if used at their highest potential would be enough to generate all of the energy used by mankind currently and projected for the next century (paraphrasing several Scientific American articles, starting from Jan 2009 to IIRC Sept 2009).

      We should adopt a broad spectrum of non-carbon energy generation, and nuclear is one of them.

    •  It's still a freakin' LOAN! (2+ / 0-)
      Recommended by:
      Corwin Weber, Roger Fox

      They have to pay it back!  Who is cashing in here????

      "Those are my principles, and if you don't like them... well, I have others." - G. Marx

      by Skeptical Bastard on Wed Feb 17, 2010 at 02:17:20 PM PST

      [ Parent ]

    •  Nuclear fission is only one of many (0+ / 0-)

      And OTOH we need to proceed as if Polywell wont work.  with any luck fission will be made obsolete by (hopefully) commercial rollout of Polywell Fusion reactors, 2020-2025.

      HVDC transmission lines will make electricity generated by solar and wind viable 800 miles away with the same transmission losses as our current grid at 100 miles. 4 GW's of wind turbine capacity equals 1 GW of non traditional base load which can then be moved 800 miles to where its needed.

      In essence draw a 1600 mile circle around NYC, any generation in that circle can be moved to the city.

      FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

      by Roger Fox on Wed Feb 17, 2010 at 02:47:26 PM PST

      [ Parent ]

      •  polywell (0+ / 0-)

        fantasy technologies... :) Fission, otoh, has worked well commercially for a while now...

        •  Sorry, Polywell is very likely to beat (0+ / 0-)

          everyone to the punch when it comes to fusion. The Navy has provided funding and let the contract to build a proton Boron 11 reactor next year. If successful net power P-B11 is next.

          I know of no other avenue of fusion research that is at this stage. And that includes the toridial tokamaks like the ITER, which wont be finished until 2025.

          FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

          by Roger Fox on Wed Feb 17, 2010 at 03:26:40 PM PST

          [ Parent ]

    •  We DON"T Need Nukes (2+ / 0-)
      Recommended by:
      angelajean, Radical def

      The nukes in question will produce a combined 2,200 megawatts of electricity at a projected cost of $14 billion.  That comes out to $6,363 per kilowatt hour.      

      The costs of all types of power generation are here:        
      Note that electric power from nukes in service in this report was $2,000 per kilowatt hour,which gave a cost of up to $31 per megawhat hour at a 5% discount rate.  With triple the construction costs, that comes to a $60 current projected cost of per megawatt hour.

      The same report has wind at below $60 per megawatt hour, which is less that what these nukes are projected to cost.  Solar is currently at $150 per megawatt, 2.5 nuke costs.

      Of course, conservation is not in the mix, but the costs of conservation are much cheaper.  

      Wind power is currently cheaper than nuke power, is greener, and doesn't leave us with huge amounts of radioactive crap to store for hundreds of thousands of years.  Neither does solar, which is projected to cost 2.5 times what these nukes cost.

      There is no logical reason to build nukes.  We can pay the same for wind power, or 2.5 x more for solar.  These true green ways to produce electricity, plus conservation, are the way to go.  To claim we "need" nukes is bullshit.

  •  Hey, the all-caps thing makes me not want to (2+ / 0-)
    Recommended by:
    Larry Madill, ontheleftcoast

    take this seriously.

    Cold hearted orb/That rules the night/Removes the colours From our sight/Red is gray and/Yellow white/But we decide/Which is right/And/Which is an Illusion

    by KingofSpades on Wed Feb 17, 2010 at 02:01:10 PM PST

  •  Could people stop yelling this week? (3+ / 0-)
    Recommended by:
    rickrocket, LookingUp, jsfox

    Anyway, most of the cost of a nuclear power plant goes into construction and maintenance.  In an odd way, think of it as stimulus money.  Tens of thousands will build and run the plant, and some people will get their electricity from it.

  •  As a tax payer . . . (2+ / 0-)
    Recommended by:
    kbman, LookingUp


    In the choice between changing ones mind and proving there's no need to do so, most people get busy on the proof.

    by jsfox on Wed Feb 17, 2010 at 02:08:32 PM PST

  •  Is this even a relevant difference? (6+ / 0-)

    Either the loans are paid back or they aren't.  whether the loans are by a private bank and guaranteed, or by a federal corp (like Freddie Mac) and guaranteed, the USG is on the hook.

    If you want nuclear power for the future, it's all the same. If you don't, it's all the same.

    Subsidies without cost controls, regulatory reform means that citizens get a little more awful insurance at a huge cost to taxpayers. Like Part D but worse.

    by Inland on Wed Feb 17, 2010 at 02:09:13 PM PST

  •  Sounds good . . . (3+ / 0-)
    Recommended by:
    kbman, Inland, LookingUp


    I'm all for taking business away from the Banksters . . .  If the federal government wants to start loaning money with the associated interest accruing to the taxpayers, I have no problem with that.

  •  Sigh. What we're going to see with ... (2+ / 0-)
    Recommended by:
    Zotz, Radical def

    ...nukes are gigantic cost overruns, like those San Antonians were recently informed of, and those the Finns have run into with the French EPR (3 1/2 years behind schedule, 75% over cost).

    I'll wager my mortgage that neither of those two proposed nukes are on-line by 2017, are within 20% of their budgets.

    Meanwhile, how many concentrated solar plants and wind farms could be built with $8 billion in loans between now and 2017?

    (Full Disclosure: I am not a diehard foe of nukes. But until there is more federal support for conservation and renewables, this support for fission power is highly disturbing.)

    I refuse to accept "no can do" as a proper slogan for progressives.

    by Meteor Blades on Wed Feb 17, 2010 at 02:36:15 PM PST

    •  cost overruns are highly likely (0+ / 0-)

      In fact, a 1986 DOE study found that the average cost overrun for the first 75 US reactors was 207%. Most of the reactors that came later had even higher cost overruns. The first two reactors at Vogtle, for example (that's the plant that won this loan guarantee) were actually 1200% over budget when completed.

      Neither DOE nor OMB has any idea what they're going to do if large cost overruns are experienced again (or, if they do have an idea, they haven't been able to articulate it yet....and we've asked).

    •  2000 MW (megawatt = million watts) (2+ / 0-)
      Recommended by:
      kbman, Geek of all trades

      reactor = ~$12 Billion (just to build, enormous costs to maintain properly);

      2000 MW Wind / Solar = ~$3-4 Billion

      But the issue is really base load.

      To do wind or solar requires storage.  Storage is the key to energy transition, and until storage is addressed we're gonna do nucs or drown in CO2.

      Where they're building these reactors, currently burns coal for electricity (mostly for air conditioning -- the South).  Nuc is not wonderful, but better.

      This machine kills fascists!

      by Zotz on Wed Feb 17, 2010 at 02:47:53 PM PST

      [ Parent ]

      •  2000 MW wind/solar has maybe 30% uptime (2+ / 0-)
        Recommended by:
        kbman, Geek of all trades

        People never seem to take this into account when boasting about cost per mw of nameplate capacity. Not to knock wind, but the comparison is not valid unless you multiply it by 3 to get 90% capacity factor of a well operated nuclear plant.

        •  I think we're saying the same thing. (0+ / 0-)

          Nuc base load, wind/solar are intermittent.

          This machine kills fascists!

          by Zotz on Wed Feb 17, 2010 at 02:52:58 PM PST

          [ Parent ]

          •  Not exactly but close (2+ / 0-)
            Recommended by:
            mojo workin, Inland

            Not only are wind and solar intermittent, they are variable.  If you have a demand for 3GW and you have on average enough wind blowing to achieve 30% capacity then you need 10GW installed capacity to meet that demand.  

            There will be times when your generation is much greater than this, but since electrical power must go somewhere as it is generated, any excess either needs to sent to storage or sent through the distribution network to some region that needs power.  This is part of why a smart distribution infrastructure is needed to make wind and solar viable as large scale power production options.  

            It is also part of why wind and solar production numbers can be misleading since making a bunch of electricity during prime conditions bumps the numbers up without that energy necessarily being usable without being shunted far away from its source with the attendant transmission losses.  This is part of why effective local storage solutions need to be included in renewables infrastructure, and is another technological hurdle that has not yet been crossed.

            There will also be times when there is less than enough wind to achieve 30%.  In these times you must either draw down from storage or import energy on the network.  This is more where the baseload capacity argument comes into play since at these times there needs to be some other source of power to fill the gap.  And until the storage issue is resolved the need for nuclear, gas, oil or coal to provide this baseload capacity will remain.

        •  4 MW's of wind = 1 MW base load (0+ / 0-)

          and HVDC transmission lines have 1/8th the transmission losses of current transmission lines.

          FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

          by Roger Fox on Wed Feb 17, 2010 at 02:57:15 PM PST

          [ Parent ]

          •  Not exactly, see above response to Zotz (0+ / 0-)

            Without adequate storage there is no amount of installed capacity that can address baseload needs.  If no wind is blowing you need to get your energy from one of two places, either from storage or other generation capacity.  Zero percent of four megawatts is zero megawatts.

            •  No wind at all, in 48 states? (1+ / 0-)
              Recommended by:

              I didnt think that was possible  OMG we are so pwned

              As I said elsewhere solar and wind work really well with a national HVDC grid. W/o HVDC storage becomes the only alternative overnight.

              Solar and wind probably will not work on a large scale nationally w/o an HVDC grid. the 3 to 1 or 4 to 1 buildout wont matter with out the ability to move solar and wind power from where its generated to where its used, NY to LA with 20% less transmission loss.

              FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

              by Roger Fox on Thu Feb 18, 2010 at 12:14:18 AM PST

              [ Parent ]

              •  Agreed on this (0+ / 0-)

                I was assuming it would take a good bit of time to develop the HVDC lines beyond regional segments.  regional segments don't help a lot in this application because if the wind isn't blowing here it's likely also not blowing elsewhere in the region.

                When you combine the costs of the smart grid, the HVDC lines and the over capacity factors required it all makes the economics of nuclear look a lot more favorable - especially in the near-term, 20-50 years.

                And of course, if the Polywell succeeds then it is a game changer.  But having eagerly digested articles back in the 80's, visited Princeton's Tokomak, and followed other technological approaches,  I'm no longer as expectant or hopeful as I once was.  

                Fission works.  We have 40 years of operational experience with the technology and can apply the lessons learned over that time to develop better designs and train and manage for safe operations.

                •  HVDC is often cheaper (1+ / 0-)
                  Recommended by:

                  as it doesnt need 3 phases/multiple conductors, and makes for great bulk transmission over continental distances. Smart Grid is an idea that works perfectly with HVDC, but HVDC is off the shelf existing tech that perfectly compliments AC distribution and the growing need to build up solar and wind capacity. Heres the wiki


                  FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

                  by Roger Fox on Thu Feb 18, 2010 at 06:52:20 AM PST

                  [ Parent ]

                • (1+ / 0-)
                  Recommended by:

                  some right wingers hang there, but it is the clearing house for all things polywell. Dr Nebel is going to be building and running a proton boron 11 reactor by the end of 2011.

                  Ive traded a few emails with Dr Nebel, if all is good with the P-B11 test results, Net power is next, test run in 2014-2015.

                  The joy of polywell is that its not toridial, its quasi spherical, has no thermal plant. And polywell loks to scale up around a 35 ft building for a 1200MW plant. In my mind the polywell advances over 3-4 years put it well ahead of any other avenue. Plasma doesnt like to travel in a cute little circle aka a Tokamak, but behaves quite timidly in a polywell.

                  We'll know in 2 yrs, if DR Nebel asks for money for a net power reactor life will get very interesting. We shall see.

                  FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

                  by Roger Fox on Thu Feb 18, 2010 at 07:03:56 AM PST

                  [ Parent ]

        •  I won't argue with that at all (1+ / 0-)
          Recommended by:
          Roger Fox

          but wind put up nearly 20,000 MW in the US in 2008-2009--not exactly great investment years. That's the equivalent of 6-7 nuclear reactors, even at 30%. And they did it without risking taxpayer money.

          The $54 billion in loan guarantees DOE wants will buy about 6-7 reactors at current prices. Even NRC now acknowledges new reactor cost estimates are averaging about $10 billion each.

          •  the cost to taxpayer was 0? (2+ / 0-)
            Recommended by:
            kbman, Roger Fox

            There are many subsidies, tax credits, and renewable energy mandates that support the wind industry. The industry group repeatedly makes the point that federal abandonment of these credits and rules would destroy the industry. Even if there weren't any loan guarantees, the US taxpayer is already heavily invested in wind power.

      •  Storage with concentrated solar plants ... (1+ / 0-)
        Recommended by:
        Radical def

        ...will be coming on line soon in Arizona, and the technology is advancing. On the other hand, the EPR nuke (Areva) - proposed for two U.S. plants - has made regulators in the UK, Finland and France nervous, and the so-called inherently safe nukes have yet to be built.

        I refuse to accept "no can do" as a proper slogan for progressives.

        by Meteor Blades on Wed Feb 17, 2010 at 02:59:14 PM PST

        [ Parent ]

        •  What scale of storage? (0+ / 0-)

          FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

          by Roger Fox on Wed Feb 17, 2010 at 03:08:27 PM PST

          [ Parent ]

        •  Believe me, and I say this as an ex Navy Nuc, (2+ / 0-)
          Recommended by:
          Roger Fox, Radical def

          I am not a fan of civilian nuc power.  No one with a profit motive should be any where near a nuc plant.  IF we do it, it should be cookie cutter and government owned, operated.  These particular projects aren't of course and we're missing the opportunity.

          I was just stating what I think is the reality.  Nuc power gov dollars are going to flow because it is politically inevitable, directly supplants coal, and is impossible without huge subsidies to support long term capital committment.  It sucks but that's the calculation, I think.

          I think we should be about trying to mitigate the damage by engaging and ensuring good designs and management of the siting / construction.  And if we go there in a big way, cookie cutter, and government owned / operated with a Naval Reactors vice NRC regulatory mindset.

          This machine kills fascists!

          by Zotz on Wed Feb 17, 2010 at 06:21:42 PM PST

          [ Parent ]

          •  Agreed...if used at all, should be public owned (0+ / 0-)

            No way am I willing to trust greedy corporate bastards not to cut corners, by hook or by crook, on safety and cost controls.

            The only thing I like about the "safe nukes" and "clean coal" rhetoric is that those explicit terms at least still leave room for what I consider to be the inevitable eventual determination that, in fact, nukes are NOT safe, and even the best coal tech is NOT clean, and that neither can be expected to be so, any time soon, and thus both approaches must be abandoned, at least for now, in terms of any material solution for the present global climate change crisis.

            I'm no Luddite, and am not necessarily opposed to further research, per se, but I am in no way convinced that there is presently any such thing as "safe" nukes, or "clean" coal, yet, nor that either are likely to be ready for deployment any time soon...

            We need more substantial immediate addressment and implementation, which can and must include much more serious energy conservation and more appropriate alternative sources and uses of energy.  

            Every structure in the country should be required to install full alternative green tech, appropriate to prevailing conditions and use. This would be much cheaper to mandate and subsidize, would produce a lot more jobs, longer-term, and reduce energy consumption drastically, everywhere, almost immediately.

            Decentralized, local production of food, especially, and other commodities as well, to significantly, vastly reduce transportation costs and emissions are another area where relatively modest investments in appropriate tech infrastructure will go a lot further, a lot faster, than any other immediately available options.

            Add to these a total gearing up, subsidizing and mandating of research and deployment of new generations of low energy appliances, tools, production processes, vehicles, and virtually all other forms of energy consumption...and we can much more substantially and quickly address climate change, with no serious compromise of "standard of living", which will actually be greatly improved, in so many ways, under the new green paradigm.

            Regarding the nukes, the clearest contra-indicator is that nobody, including the companies developing and proposing this technology, are willing to insure it against catastrophic failure.  All it takes is one total clusterfuck, to kill millions of people, cripple millions more for generations, and poison large swaths of land and water for hundreds of thousands of years.  This is not a minor consideration that can be flippantly brushed aside with "it hasn't happened yet" or "others are doing it"...we have come too freakin' close, too many times, for this to be ignored.

            If the companies are not willing to self-insure, and nobody in the insurance industry will touch them with a ten foot pole, then how much can we trust any assertions of safety, really?

            We all know how much monopoly corporate interests care about public safety and the public interest...NOT AT ALL.  They are not to be trusted one inch, if the smell of profit is present.  

            Pushing all costs, especially including liability for disastrous consequences, onto the taxpayers, in order to allow monopoly corporate profit to be realized from what is ultimately, materially, self-admittedly, a non-viable venture, is just not the way to's a throwback method that must be eliminated, going forward, in 2010 and 2012, by a much more substantial Progressive Caucus plurality, and a lot fewer Blue Dogs and Republicans in government.

            "...a printing press is worth 10,000 rifles..." Ho Chi Minh

            by Radical def on Wed Feb 17, 2010 at 07:28:34 PM PST

            [ Parent ]

    •  Major projects are usually over budget (1+ / 0-)
      Recommended by:

      I've never seen a good discussion of wind/solar projects meeting budget milestones in the face of strong, ideological opposition... Or the average for all large infrastructure/industrial projects. Might be interesting.

  •  Sounds good (1+ / 0-)
    Recommended by:

    Even though it's a commercial contractor and privately owned. Although, imho, nuclear power should be 100% socialized

  •  Go nukes! (1+ / 0-)
    Recommended by:


    But, it would be better if they threw even more cash into wind, which can also be a quite efficient, and of course even more clean, energy.

    And eventually solar, once the PRC has figured out how to make it efficient as well. (I'd like to think the Americans could lead the way on this but the past three decades have shown otherwise...)

  •  Where will the water come from? (1+ / 0-)
    Recommended by:

    Reactor plants require vast amounts of water for cooling.  Remember the drought?  Water is overobligated already.  Where will the water come from?

    This machine kills fascists!

    by Zotz on Wed Feb 17, 2010 at 02:51:11 PM PST

    •  water (1+ / 0-)
      Recommended by:
      Roger Fox

      is a serious problem that is not being taken seriously for new reactors. Instead of looking at regional water issues, the NRC and state agencies look at reactors individually, as if they were placed in an environment where only they exist....that could come back to haunt us (and new reactors) in not too many years.

    •  Seawater desalinization (0+ / 0-)

      might be popular in the near future....I like the idea of a Polywell fusion reactor to desalinate, and separate the Boron 11 from the seawater for fuel.But then there would be no need for the Fission nuke.

      FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

      by Roger Fox on Wed Feb 17, 2010 at 03:00:52 PM PST

      [ Parent ]

    •  eh (0+ / 0-)

      there are many things that can be done to mitigate water issues at reasonable cost. I don't see it as a major obstacle to blocking new construction near the coasts. Anti-nuclear activists like to talk about water access because they can use the regulation of outlet temperature as a way to club nuclear projects to death, without very much work or effort.

  •  Please explain. (1+ / 0-)
    Recommended by:

    This is not like Dad co-signing a loan for a child’s first car. The idea that these are just loan "guarantees" is fictitious: these are actual loans. Giant nuclear utilities will be raiding the federal treasury for money to build reactors, and they are expecting the taxpayers to bail them out if the project goes bad.

    Isn't "loan guarantee" the phrase used in the legislation? Is the legislation that authorizes them ficticious? Isn't it the same loan guarantee program that is being extended to renewable projects to the tune of even more billions? Are you saying that when FPL gets a loan guarantee for a nuclear plant that it is raiding the Treasury but somehow not raiding the Treasury when it applies for funding for a wind project? Please explain. Are you saying taxpayers would not be expected to bail out a wind project that defaulted?

    •  Eh ... NIRS is getting desperate (0+ / 0-)

      They can see the end of their nuclear disinformation campaign coming soon, so it's not surprising that their rhetoric is becoming ever more shrill, ever more arbitrary, ever more obtuse, and ever more divorced from reality.

      It's pretty funny to watch them come unglued.  We have a Democratic President in the Oval Office who is pro-nuclear, and they just don't know what to do or how to handle it.  So they run around like chickens with their heads cut off.

      An idealist is one who, on noticing that a rose smells better than a cabbage, concludes that it will also make better soup.
      -- H. L. Mencken

      by bryfry on Wed Feb 17, 2010 at 05:39:53 PM PST

      [ Parent ]

  •  Thanks for this diary (2+ / 0-)
    Recommended by:
    angelajean, Radical def

    This announcement is bad from any angle. At a time when we could be investing money into local renewable energy (how about solar panels on all schools and public buildings) this administration is choosing just about the most dangerous way to meet our country's energy needs. I suppose we're lucky we aren't doing that for the oxymoronic "clean coal" technologies (all of us who grew up in coal country know there is nothing 'clean' about coal) . . . at least not yet.

    Like matter and anti-matter, Republicans and the truth seem unable to occupy the same space.

    by dykester on Wed Feb 17, 2010 at 06:11:23 PM PST

  •  not what i heard on newshour (1+ / 0-)
    Recommended by:

    On PBS Newshour, I gleaned that the risk would be shared with private investors.  More so, even, than what's been invested in other green industries like solar and wind.  

    save our democracy!

    by thoughtful3 on Wed Feb 17, 2010 at 10:06:07 PM PST

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