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Sunday, April 21, 2024 | Back issues
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Obama Restarts Nation’s Nuclear| Power Plants With $8 Billion Loan

WASHINGTON (CN) - President Obama unveiled $8 billion in loans Tuesday to build the nation's first nuclear power plant in nearly 30 years, and he used it to call for Republican support in his continued push for carbon-free electricity. "Make no mistake: whether it is nuclear energy, or solar or wind energy, if we fail to invest in these technologies today, we'll be importing them tomorrow," Obama said.

After legislation passed in 2005 to reduce pollution and greenhouse gasses, the Energy Department made its first loan guarantee to a solar company - the first such loan since the 1980s - as well as to battery and wind turbine manufacturers, and is now making an $8.3 billion loan to build two nuclear reactors in Burke, Georgia, with the administration promising more nuclear loans to come.

"This is a significant step by the Obama Administration to restart our domestic nuclear industry," Energy Secretary Steven Chu said during a phone conference after the announcement.

Nuclear plants currently generate 70 percent of the nation's carbon-free electricity, and roughly eight percent of the nation's total energy.

Obama announced the loan at the headquarters of International Brotherhood of Electrical Workers Local 26 in Lanham, Maryland. "To meet our growing energy needs and prevent the worst consequences of climate change, we'll need to increase our supply of nuclear power," said Obama, who has long proposed a comprehensive energy policy.

He said that getting energy from the planned nuclear plant instead of a coal plant would keep 16 million tons of carbon pollution out of the atmosphere, equivalent to taking 3.5 million cars off the road.

Republicans have championed nuclear energy, and Obama's announcement comes as a cap-and-trade bill lies stalled in the Senate. "As long as producing carbon pollution carries no cost, traditional plants that use fossil fuels will be more cost-effective than plants that use nuclear fuel," he said.

"Changing the ways we produce and use energy requires us to think anew and act anew," Obama said. "And it demands of us a willingness to extend our hand across old divides, to act in good faith, to move beyond the broken politics of the past."

The two 1,100 megawatt reactors are expected to service more than half a million homes and their 1.4 million residents. They are also expected to generate 800 permanent jobs, and to employ 3,500 construction workers.

Around the world, 56 nuclear plants are under construction, including 21 in China, six in South Korea and five in India.

Chu from the Energy Department suggested that the United States must make up for lost time in regards to nuclear power. "We've been sitting on the sidelines for far too long," he said.

The Energy Policy Act of 2005 authorized the Energy Department to issue loan guarantees for projects that reduce or prevent air pollution and greenhouse gasses.

Obama's budget proposes the tripling of loan guarantees to develop nuclear facilities from $18.5 billion to $54 billion, which Chu said is enough to fund seven to 10 reactors.

In 2008, petroleum provided 37 percent of the nation's energy, the most of any resource. Natural gas was next at 24 percent, with coal close behind at 23 percent. Nuclear power contributed eight percent and renewables composed seven percent, according to the Energy Information Administration.

Of the renewables, bio-fuels dominated, providing 53 percent of renewable energy. Hydropower gave 34 percent. Wind gave seven percent. Geothermal composed five percent and solar consisted of one percent.

Obama has supported the development of nuclear power, clean coal, and bio-fuels alongside the expansion of renewable energy, such as wind and solar.

The administration has already made the nation's largest investment in clean energy research and development, has pledged to double renewable energy capacity over the next five years, and has paid towards the construction of a smart grid that would let residents sell electricity back to power companies.

It has also raised fuel efficiency standards for cars and trucks.

But the push for nuclear plants comes with safety concerns, with the possibility of a far-reaching meltdown, and by their production of a limited amount of waste, which nonetheless emits dangerous levels of radiation for centuries and which must often be buried hundreds of feet underground.

A large nuclear reactor produces about three cubic meters of radioactive waste each year.

Nuclear energy, however, is the only energy industry that takes responsibility in managing all its wastes, unlike coal for example, which emits pollution into the air.

"These plants must also be held to the highest and strictest safety standards, to answer the legitimate concerns of Americans who live near and far from these facilities," Obama said. "That is an imperative."

In the phone conference, Chu from the Energy Department said that the new generation of nuclear plants is much safer than the older generation, in part because of a semi-automatic shut-down system to deal with a meltdown threat.

Chu said that future reactors "will be completely passively safe," using gravity to ensure that reactors facing meltdown will automatically shut off.

And in response to concerns that the utility companies could default on their loans, Chu said that despite the loan - which covers roughly 70 percent of the construction costs - the companies continue to have skin in the game.

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