Nuclear mattersFederal loans notwithstanding, Georgia nuclear power plant faces hurdles
The Obama administration has signaled its interest in expanding the U.S. domestic nuclear power industry by giving $8.3 billion in loan guarantees for a Georgia nuclear power plant expansion; critics say that the American tax-payer is at risk; that the original nuclear reactor design has been rejected by the NRC, and that there is no solution for the nuclear waste problem
We wrote that other day about the U.S. loan guarantees for new nuclear power reactors in Georgia. The deal is considered to be a major step toward restarting the U.S. domestic nuclear industry. It was given pursuant to the Energy Policy Act of 2005 which authorized the Department of Energy (DoE) to issue loan guarantees for projects that avoid, reduce, or sequester air pollutants or anthropogenic emissions of greenhouse gases and employ new or significantly-improved technologies.
The loan guarantee came after more than three decades during which there was no construction of new plants. The Obama administration, interested in reviving the U.S. nuclear power industry, selected Plant Vogtle, the nuclear complex in Burke County, near Waynesboro, Georgia, and its owners, including Southern Co.’s Georgia Power subsidiary. The company will share with its co-owners, including Oglethorpe Power and MEAG Power, $8.3 billion in low-interest loans that it says will lower the cost to its customers of the project’s expansion.
Atlanta Journal Constitution’s David Markiewicz writes that Vogtle plans to add two units to the pair that began operating in the late 1980s. The first of the new units is scheduled to come online in 2016, the second in 2017, at a total cost estimated at $14 billion.
U.S. energy secretary Steven Chu said Vogtle was selected because the project was “further along in the process. They had already begun some site preparation. We felt simply that this was a project that had a low probability of default.”
Markiewicz notes that critics did not wait long to criticize the loan package. The main points critics make:
- They pointed to a report from the Congressional Budget Office (CBO) that pegged the chances of default on the loan at up to 50 percent, with taxpayers on the hook.
- Even with the loans, the nuclear industry and the Plant Vogtle expansion in particular face challenges, despite talk of an anticipated nuclear “renaissance.” Southern Co. has said it expects the Vogtle expansion to receive its operating license from the Nuclear Regulatory Commission sometime in 2011, but there are troubles ahead. Last year, the NRC told Westinghouse, the designer of the shield building for the reactor planned for Vogle units 3 and 4, that it had to change the design because it might not adequately protect the reactor in the event of certain catastrophes, such as an earthquake (“NRC Rejects Westinghouse’s New Nuclear Reactor Design,” 24 October 2009 HSNW). Last week, the U.K.’s nuclear safety watchdog said it might decide to reject the same reactor design because it could be vulnerable to terrorist attacks (“U.K.: New Nuclear Reactors Might Not Stand Up to Terrorist Attacks,” 18 February 2010 HSNW).
- Then there is the longer-term problem facing the nuclear industry is the need to find a permanent home for the radioactive spent fuel that nuclear plants generate. The Obama administration pulled the plug n the planned permanent waste depository in Yucca Mountain, Nevada, so the issue of nuclear waste burial has gone back to square one.
