Washington More than $8 billion in new federal loan guarantees to build two nuclear reactors in Georgia could be the first step toward a nuclear renaissance in the United States, three decades after the Three Mile Island nuclear accident halted all new reactor orders.
With the nuclear industry poised to begin construction of at least a half dozen plants over the next decade, President Barack Obama announced the first loan guarantees Tuesday, casting them as both economically essential and politically attractive. He called nuclear power a key part of comprehensive energy legislation that assigns a cost to the carbon pollution of fossil fuels, giving utility companies more incentive to turn to cleaner nuclear fuel.
“This is only the beginning,” Obama said in designating the new federal financial backing for a pair of reactors in Burke County, Ga., to be built by Atlanta-based Southern Co. Obama’s budget would triple — to $54.5 billion — loan guarantees available for new nuclear construction.
The federal guarantees, authorized by Congress in 2005, are seen as essential for construction of any new reactor because of the huge expense involved. Critics call the guarantees a form of subsidy and say taxpayers will assume a huge risk, given the industry’s record of cost overruns and loan defaults. Reports by Congressional Budget Office and Government Accountability Office have estimated that the risk of default for new nuclear reactors could be as high as 50 percent.
“This is a pre-emptive bailout where the government has already guaranteed to saddle taxpayers with any failure that the (nuclear) industry might run into,” said Allison Fisher, an energy organizer at Public Citizen, a Washington-based consumer advocacy group.
Environmentalists say renewable energy such as wind and solar are more cost-effective than nuclear power and do not come with side effects such as radioactive waste.
But Marvin Fertel, president of the Nuclear Energy Institute, a policy organization for the nuclear industry, said the loan guarantees will spur construction of nuclear plants all over the country, reducing greenhouse gases blamed for global warming and creating thousands of high-paying jobs.
The Georgia project is expected to create about 3,500 construction jobs and permanently employ 850 people.