The Department of Energy wants to give the Southern Company a nuclear power loan guarantee at better interest rates than you can get on a student loan. And unlike a home mortgage, there may be no down payment.
The terms DOE is offering the builders of the Vogtle atomic reactors have only become partially public through a Freedom of Information Act lawsuit filed by the Southern Alliance for Clean Energy.
We still may not know all the details.
SACE has challenged the $8.33 billion loan guarantee package announced by President Obama in 2010.
The documents show the DOE has intended to charge the Southern a credit subsidy fee of one to 1.5%, far below the rates you would be required to pay for buying a house or financing an education.
On a package 15 times bigger than what the federal government gave the failed solar company Solyndra, Southern would be required to pay somewhere between $17 million and $52 million. Advocates argue the fee is so low that it fails to adequately take into account the financial risks of the project. Numerous financial experts have estimated the likely fail rate for new nuclear construction to be at 50% or greater.
Furthermore, since a primary lender would be the Federal Financing Bank, the taxpayer is directly on the hook. Guaranteed borrowings are not supposed to exceed 70% of the project’s projected costs, but it’s unclear what those costs will actually turn out to be, as the public has been given no firm price tag on the project.
There is apparently no cash down payment being required of Southern as it seems the loan is designed to be secured with the value of the reactors themselves, whatever that turns out to be. In the unlikely event they are finished, liability from any catastrophe will revert to the public once a small private fund is exhausted.
Southern wanted the terms of the DOE offer kept secret, and we still don’t know everything about it. But in March, a federal circuit court judge ordered that the public had a right to know at least some of the details.
Apparently no final documents have actually been signed between Southern and the DOE. The Office of Management & Budget has reportedly balked at offering the nuke builder such generous terms. Southern has reportedly balked at paying even a tiny credit fee.
Construction at the Vogtle site has already brought on delays focused on the use of sub-standard concrete and rebar steel. The projected price tag—whatever it may be—has risen as much as $900 million in less than a year.
Southern and its Vogtle partners are in dispute with Westinghouse and the Shaw Company, two of the reactors’ primary contractors. Georgia ratepayers have already been stuck with $1.4 billion in advance payments being charged to their electric bills. Far more overruns are on their way.
The Vogtle project is running somewhat parallel with two reactors being built at V.C. Summer in South Carolina, where $1.4 billion was already spent by the end of 2011. Delays are mounting and cost overruns are also apparently in the hundreds of millions.
Southern and Summer’s builders both claim they can finance these projects without federal guarantees. But exactly how they would do that remains unclear.
Two older reactors now licensed at the Vogtle site were originally promised to cost $150 million each, but came in at $8.9 billion for the pair. The project’s environmental permits are being challenged in court over claims the Nuclear Regulatory Commission failed to account for safety lessons from the Fukushima disaster.
The terms of the guarantees are now apparently being scrutinized by the Office of Management & Budget, which reports to a White House that may be gun-shy over new construction guarantees due to bad publicity from the Solyndra fiasco.
The Nuclear Information & Resource Service has already facilitated more than 10,500 e-mails sent directly to DOE Secretary Chu.
You might ask: why should the builders of nuclear power reactors get better terms than students struggling to pay for college or working families trying to buy a home?
At least the home buyers can get private liability insurance, which the nuke builders can’t.
If mounting grassroots opposition can stop this package, it’s possible no new reactors will ever be built in the US.
So send the OMB and DOE a copy of your mortgage or student loan statement.
Demand that before they finance any more nukes, they drop your own payment to 1%, just like they’re offering the reactor pushers. Also demand the right to buy a home without a down payment.
See how far you get, and then make sure Vogtle goes no farther.
July 3, 2012 Posted by aletho | Economics, Nuclear Power | Nuclear Information & Resource Service, Nuclear Regulatory Commission, Office of Management & Budget, Southern Alliance for Clean Energy, Southern Company, Vogtle, Vogtle Electric Generating Plant | Leave a Comment
The Nuclear Menace
As the Nuclear Regulatory Commission approves a construction/operating license for two new reactors in Georgia, alarming reports from Japan indicate the Fukushima catastrophe is far from over.
Thousands of tons of intensely radioactive spent fuel are still in serious jeopardy. Radioactive trash and water are spewing into the environment. And nuclear engineer Arnie Gundersen reports that during the string of disasters following March 11, 2011′s earthquake and tsunami, Fukushima 1′s containment cap may actually have lifted off its base, releasing dangerously radioactive gasses and opening a gap for an ensuing hydrogen explosion.
There are some two dozen of these Mark I-style containments currently in place in the US.
Newly released secret email from the NRC also shows its Commissioners were in the dark about much of what was happening during the early hours of the Fukushima disaster. They worried that Tokyo might have to be evacuated, and that airborne radiation spewing across the Pacific could seriously contaminate Alaska.
Reactor pushers have welcomed the NRC’s approval of the new Westinghouse AP-1000 design for Georgia’s Vogtle. Two reactors operate there now, and the two newly approved ones are being funded with $8.3 billion in federally guaranteed loans and state-based rate hikes levied in advance of the reactors’ being completed.
NRC Chair Gregory Jazcko made the sole no vote on the Vogtle license, warning that the proposed time frame would not allow lessons from Fukushima to be incorporated into the reactors’ design.
The four Commissioners voting to approve have attacked Jaszco in front of Congress for his “management style,” but this vote indicates the problem is certainly more rooted in attitudes toward reactor safety.
The approval is the first for a new construction project since 1978. The debate leading up to it stretched out for years. Among other things, the Commission raised questions about whether the AP1000 can withstand earthquakes and other natural disasters. Even now the final plans are not entirely complete. Only two other US reactors—in neighboring South Carolina—are even in the pre-construction phase. As in Georgia, South Carolina consumers are being forced to pay for the reactors as they are being built. Should they not be completed, or suffer disaster once they are, the state’s ratepayers will be on the hook.
The industry is heralding the Vogtle approval as a major boon to the “Nuclear Renaissance.” But it comes alongside the announcement that all 17 reactors owned by the Tokyo Electric Company are shut, as are all but two of Japan’s 50-plus nukes.
Germany has decided to shut all its nukes by 2022. New reactor financing in Great Britain is under legal attack, as it is in Florida. India has announced that in 2011 it led the world in new green energy projects. China has yet to make its future nuclear commitments clear in the wake of the Fukushima disaster. And no American utility is readily available to follow in Vogtle’s path, with operating reactors in Vermont and New York’s Indian Point under fierce governmental attack. Florida’s Crystal River is beset by huge bills for faulty repair work, and may be headed for permanent shutdown. Both currently licensed reactors at California’s San Onofre are closed following radioactive leaks, and a disturbing pattern of tube holes in newly installed steam generators has surfaced at a number of reactors across the US.
But the biggest shock waves this week were caused by Tama University Professor Hiroshi Tasaka, a key advisor to Prime Minister Naoto Kan during the Fukushima disaster.
Warning that Fukushima is “far from over,” Tasaka said official assurances of the complex’s alleged safety were based on “groundless optimism.” Tasaka cited more than 1500 fuel rods dangerously exposed to the open atmosphere at Unit Four alone. The waste problem has gone nationwide, he said in a newly published book, as “the storage capacities of the spent fuel pools at the nation’s nuclear power plants are reaching their limits,”
Tasaka’s statements came as a new temperature spike unexpectedly stuck Fukushina Unit Two. For reasons not yet clear, heat releases in excess of 158 degrees Farenheit spewed from the core, prompting Tokyo Electric to pump in more water and boric acid meant to damp down an apparently on-going chain reaction. Prof. Tasaka and others warn that this in turn will contribute to spreading still more radiation into the water table and oceans.
With bitter debate raging in Japan, the US and elsewhere over the killing power of Fukushima’s emissions, the certification of a new US reactor design may someday be remembered as a bizarre epitaph for the 20th century’s most expensive failed technology.
Without state ratepayers and federal taxpayers being forced to foot the bill, new reactor construction in the US is going nowhere.
And without a final resolution to the on-going horrors at Fukushima, the entire planet, from Tokyo to Alaska to Georgia and beyond, remains at serious radioactive risk.
- Nuclear Regulatory Commission Ignores Fukushima, Green-Lights First New Reactors in 34 Years (my.firedoglake.com)
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From the Archives
By Stephen J. Sniegoski ~ 2003
Is there any evidence that Israel and her supporters have managed to get the United States to fight for their interests?
To unearth the real motives for the projected war on Iraq, one must ask the critical question: How did the 9/11 terrorist attack lead to the planned war on Iraq, even though there is no real evidence that Iraq was involved in 9/11? From the time of the 9/11 attack, neoconservatives, of primarily (though not exclusively) Jewish ethnicity and right-wing Zionist persuasion, have tried to make use of 9/11 to foment a broad war against Islamic terrorism, the targets of which would coincide with the enemies of Israel.
For some time prior to September 11, 2001, neoconservatives had publicly advocated an American war on Iraq. The 9/11 atrocities provided the pretext. The idea that neocons are the motivating force behind the U.S. movement for war has been broached by a number of commentators
To understand why Israeli leaders would want a Middle East war, it is first necessary to take a brief look at the history of the Zionist movement and its goals. … continue
Aletho News Exclusive Content
This article will examine some of the connections between the US and UK National Security apparatus and the appearance of the anthropogenic global warming (AGW) theory beginning after the accident at Three Mile Island. … continue
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