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Giant loan guarantees could stick taxpayers with the bill At a time of deep partisan and ideological divi -sion in Washington, there aren't many issues that bring together forces from across traditional divides. So when scholars at conservative think tanks like the Heritage Foundation and taxpayer groups such as the National Taxpayers Union agree with environmentalists on something, it's time to sit up and take notice. That's exactly what's happening on the issue of federal subsidies for new nuclear power plants. Fiscal conservatives know that nuclear subsidies are a potential multibillion dollar boondoggle, while environmentalists know that - even beyond the environmental and public safety threats posed by the reactors themselves - there are far better and much cheaper solutions to our energy and global warming challenges."

"New Subsidies for Constructing Reactors Would Shift Financial Risks to Taxpayers Massive government subsidies proposed in two pending Senate climate and energy bills would shift the risk of financing and constructing new nuclear reactors from the industry to U.S. taxpayers, according to an analysis released today by the Union of Concerned Scientists (UCS). Such subsidies would disadvantage more cost-effective, less risky approaches to curbing the heat-trapping emissions that cause global warming, including energy efficiency programs and renewable energy technologies, the group said. The UCS analysis is the first to quantify the most significant subsidies for the nuclear industry proposed in the American Power Act (APA) and the American Clean Energy Leadership Act (ACELA). Those subsidies include expanded federal loan guarantees, reduced accelerated depreciation periods, a 10 percent investment tax credit, expanded production tax credits, and expanded federal regulatory risk insurance. Assuming eight new reactors are built over the next 15 years, UCS found those subsidies would amount to approximately $40 billion, or $5 billion per reactor, slightly more than half of what a typical 1,100 megawatt reactor would cost to build today. If the industry is able to secure federal approval to build the 31 new reactors it is expected to request, UCS found that total proposed subsidies could be worth from $65 billion to as much as $147 billion."

"The issue of energy subsidies is heating up. The cards are out, positions are being redefined and bargaining is in process. A concerted effort is on to get this anomaly to the maximum possible and the issue was mentioned at the just-concluded G20 summit in Toronto too. The final communiqué at the end of the G20 summit here in Toronto not only noted with appreciation the report on energy subsidies from the International Energy Agency, OPEC, OECD and the World Bank combined, but also welcomed the work of the finance and energy ministers "in delivering implementation strategies and timeframes, based on national circumstances, for the rationalization and phase out - over the medium term - of inefficient fossil fuel subsidies that encourages wasteful consumption, taking into account vulnerable groups and their development needs." The IEA, OPEC and the World Bank report on fossil fuel subsidies was prepared at the request of the previous G20 summit in Pittsburgh."

"SNP Energy and Climate Change spokesperson Mike Weir MP has warned UK government plans to fix carbon prices amount to a hidden subsidy for new nuclear power stations - despite an explicit assurance by the coalition government that no public subsidy would be used. After an exchange at energy questions in the Commons Mr Weir said: "Fixing the carbon price would amount to a hidden subsidy for new nuclear stations and blows wide open the bogus coalition claim that there will be no public subsidy for nuclear power. "There are already problems within the EU emission trading scheme over free permits and it is ludicrous to pretend the EU will agree to a carbon floor price. This leaves the UK Government in the ridiculous position of attempting to impose a carbon floor price in the UK alone. This is simply unsustainable and legally dubious."

Nuclear energy sounds like the answer to this country's energy problems, but it isn't. For decades, nuclear power has been peddled as being an efficient and inexpensive energy. In the '50s, nuclear advocates loudly promised the world that atomic power would provide electricity "too cheap to meter." That promise dissolved with the reality of reactor construction costs in the 1970s and 1980s. But the price to consumers isn't limited to just the cost of the power usage that is listed on your monthly electricity bill. It goes way beyond that. Nuclear power is not cheap. Since the very beginning the government has been heaping subsidies, which come from our tax dollars, into the building and running of nuclear plants. But these cash payments and tax breaks are not the most valuable subsidies that they receive. The most important subsidies that the investors and owners can receive come from shifting the risks onto the taxpayers or the surrounding area's population.

Nuclear energy sounds like the answer to this country's energy problems, but it isn't. For decades, nuclear power has been peddled as being an efficient and inexpensive energy. In the '50s, nuclear advocates loudly promised the world that atomic power would provide electricity "too cheap to meter." That promise dissolved with the reality of reactor construction costs in the 1970s and 1980s. But the price to consumers isn't limited to just the cost of the power usage that is listed on your monthly electricity bill. It goes way beyond that. Nuclear power is not cheap. Since the very beginning the government has been heaping subsidies, which come from our tax dollars, into the building and running of nuclear plants. But these cash payments and tax breaks are not the most valuable subsidies that they receive. The most important subsidies that the investors and owners can receive come from shifting the risks onto the taxpayers or the surrounding area's population.

Review of accelerated depreciation, investment tax credit, and production tax credit provisions of Senator Kerry's and Senator Lieberman's American Power Act In May 2010, Senators John Kerry (D-MA) and Joseph Lieberman (I-CT) released a discussion version of The American Power Act (henceforth referred to as the "K-L Bill" or the "APA"). The K-L Bill as proposed is a wide-ranging piece of energy legislation that includes a number of new subsidies to nuclear power. This memo evaluates three of those nuclear provisions, describing how they work and estimating their subsidy value to recipients in the nuclear power sector: * 5-year accelerated depreciation period for new nuclear power plants (section 1121). * Investment tax credit (ITC) for nuclear power facilities (section 1122) and the related grants for qualified nuclear power facility expenditures in lieu of tax credits (section 1126). * Modification of credit for production from advanced nuclear power facilities (section 1124). The K-L Bill includes a number of subsidies to nuclear power that were not evaluated in this memo, and as a result this memo should be viewed as one part of a larger picture of how federal subsidies distort US energy markets and fuel choice.1 The values presented

The UK is unlikely to hand out subsidies for new nuclear development, according to the UK government's new energy minister, Lord Hunt of Kings Heath, who was appointed in June. When asked whether the UK would look to support new nuclear with subsidies, he replied, "Nuclear should be commercially viable. We don't look to a subsidy to encourage development. "I believe the government's role is to get the conditions right in which people make investment - that means the planning system and the system of regulatory consent. It has a longer-term vision; that's where government puts its emphasis."

A subsidy represents a transfer of Federal Government resources to the buyer or seller of a good or service that has the effect of reducing the price paid, increasing the price received, or reducing the cost of production of the good or service. Put simply, the Federal Government promotes targeted energy outcomes, such as production of a specific fuel or promotion of conservation and energy efficiency by energy consumers through incentives such as tax credits, grants, and low interest loans.

"Sir, It is not correct to say that nuclear power is "the cheapest large-scale low-carbon electricity source" ("A nuclear Britain can lead the way on emissions", FT.com, January 8). The report "Nuclear Subsidies" from the Energy Fair group shows how the real cost of nuclear power is disguised by several subsidies. Without those subsidies, the price of nuclear electricity would rise to a level that would make it deeply unattractive to investors. There are more than enough alternatives that are cheaper than nuclear power, quicker to build, and with none of the other headaches of nuclear power."

"The White House is widely reported to be proposing additional billions of dollars in loan guarantees for the nuclear power industry. That would be a mistake, according to experts at the Natural Resources Defense Council. Following is the statement of Christopher Paine, Director of the Nuclear Program at NRDC: "A massive increase in taxpayer subsidies for nuclear power would be a mistake. "Energy sources should compete for public dollars based on how well they provide the clean, efficient and affordable power we need. On that basis, nuclear power has a long way to go. It remains a high-cost, subsidy-dependent, radioactive-waste generating, water-depleting, non-renewable energy source that still carries with it the low probability of a high-consequence accident."

"our article on the costs associated with nuclear reactors addresses a fundamental question about how we de-carbonise our energy supply, and who pays (Nuclear waste offer 'has hidden subsidy', 3 June). But the suggestion that EDF Energy was engaged in "behind-the scenes lobbying" to gain a "hidden subsidy" is wrong. We were responding to an open pre-consultation by government. This invited views from all parties, including ourselves and NGOs, on the price for radioactive waste disposal. We work hard to be part of the debate and recently set out our commitment to transparency. We have always been open that we expect to pay the full costs of decommissioning and our full share of the waste management and disposal costs from our new-build programme."

"Michael Mariotte, Executive Director for the Nuclear Information and Resource Service (NIRS) said today the estimated $140 billion in total for nuclear subsidies in Kerry-Lieberman American Power Act are wrong. The Union of Concerned Scientists released a report July 1, 2010 documenting that the legislation could be worth a total of $140 billion to the nuclear industry. Taxpayers to fund through the Federal Financing bank The NIRS further reported to its members that the House Appropriations Committee may take up a $36 billion increase in nuclear reactor loans for an increase in the construction of new reactors. This is money the NIRS says "would go to some of the wealthiest companies in the world like Electricite de France, Areva, NRG Energy, Toshiba, General Electric, and the like.""

"Breaks Under Kerry-Lieberman Wipe Out Risk for Utilities Already Benefiting From Massive Loan Guarantees Earth Track Analysis Finds That Just Two of the Subsidies Add Another $1.3 Billion to $3 Billion in Tax Breaks Per Reactor; May Make It More Likely Taxpayers Will Face Downside Risk. Washington, DC -- The nuclear industry could end up facing no risk under massive tax break subsidies in the Kerry-Lieberman climate bill, according to an important new analysis conducted for Friends of the Earth by the research organization Earth Track. These tax breaks totaling $9.7 billion to $57.3 billion (depending on the type and number of reactors) would come on top of the Kerry-Lieberman measure's lucrative $35.5 billion addition to the more than $22.5 billion in loan guarantees already slated for nuclear power. Friends of the Earth President Erich Pica said: "Doling out an additional $1.3-$3 billion in tax breaks per new reactor means the industry would be at the table playing almost entirely with taxpayer money. Industry will have little to lose when a reactor goes belly up. While taxpayers are bankrolling the industry's nuclear gamble they would share in none of the reactor's financial returns. In fact, all taxpayers will receive if the reactors are built is responsibility for disposing of the waste. By contrast, investors stand to make billions with no risk should their reactor gambit goes belly up and enter bankruptcy." "

Government will ease the way for extra plants but not provide subsidies, energy minister Charles Hendry to tell industry chiefs Energy minister Charles Hendry will today set out the government's support for new nuclear power, in the face of opposition from the Tories' coalition partners, the Liberal Democrats. Hendry will tell the Nuclear Industry Forum that there is a role for new nuclear plants, provided they do not require public subsidies."

"The nuclear industry is being offered what campaigners claim is a taxpayer subsidy on the disposal costs of waste from new reactors following a secret lobbying campaign, the Guardian has learned. The revelation will put further scrutiny on the new government's promise that there will be no subsidy for nuclear power. Liberal Democrat Chris Huhne, the new energy and climate change secretary of state, admitted to the Guardian this week that the government already faces a £4bn funding black hole over existing radioactive waste."

After 60 years and many billions of dollars in government subsidies, nuclear power should finally have to prove itself on its own merits - which evidently it cannot do in a free market. Not only are taxpayers and citizens shouldering an unfair burden of the costs of nuclear power, but, even with these subsidies, as consumers we will be forced to cover the rising costs of nuclear plant construction. These costs have consistently been well above even the high price tag quoted at the start of the project. Overruns of 50 percent or more will be paid by energy consumers, as utility rates are raised ever higher to protect guaranteed profits for investors.

It is clear that we need to address our dependence on coal and foreign oil and all the ills - from lung disease to global warming - they cause. But the question begs, does nuclear power offer a safe, affordable domestic solution? Advertisement Unfortunately, the facts suggest otherwise. The industry is dependent on subsidies and is not economically viable. Nuclear waste is problematic at best. The technology is not safe despite billions of tax dollars spent on research to try to make it safe. The claims from nuclear energy's proponents have always been too good to be true. "Too cheap to meter" was the first. Inaccurate power projections led to TVA's first nuclear plant construction program in the 1970s and '80s, leaving more than $25 billion in debt, which Tennessee Valley residents are still paying. Current estimated cost for one new 1,200-megawatt reactor is $7.5 billion. From 1950 to 1999, federal subsidies totaled around $145 billion. Cleanups of radioactive federal Superfund' sites are expensive, difficult and proceeding slowly. The fact is that they may never be cleaned up.

"Published reports indicate that the Obama Administration will announce on Tuesday, February 16, approval of a "conditional" taxpayer loan guarantee to the Southern Company for construction of two new nuclear reactors at its Vogtle site in Georgia. "If the reports are correct, this would be a repudiation of Obama's own campaign statements against subsidies for nuclear power, and the implementation of the worst energy policy excesses of the Bush Administration and failed presidential candidate Sen. John McCain," said Michael Mariotte, executive director of Nuclear Information and Resource Service, a national organization based in Takoma Park, Maryland. NIRS pointed to a video of then-candidate Obama telling voters on December 30, 2007 that he opposed taxpayer subsidies for nuclear power: www.youtube.com/watch?v=-R52J2D5QQU. During the election campaign, McCain called for construction of 45 new reactors in the U.S. by 2030. "Last time I checked," Mariotte said, "McCain lost the election. It's astonishing that his misguided and rejected energy policies live on. It is safe to say that no one voted for Obama in order to give taxpayer money to wealthy nuclear corporations." The Department of Energy's loan guarantee program for reactor construction was established by Congress at the urging of the Bush administration in 2005. In 2007, Congress authorized the program to provide $18.5 Billion in loan guarantees for new reactors. In late January, President Obama proposed nearly tripling the program to $54 Billion. "Few realize that the DOE's program extends beyond simple guarantees. In some cases at least, the loans will come directly from the taxpayers through the little-known Federal Financing Bank (FFB). Thus the taxpayers will be put in the awkward and highly risky position of both providing billions of dollars in loans to giant nuclear corporations and promising to repay the loans if the companies default," explained Mariotte. "With the Congressional Budget Office pre

WASHINGTON (June 4, 2008) - Environmental, science and public health groups today commended the Senate for beginning debate on the most comprehensive legislation to date addressing climate change and urged lawmakers to reject adding nuclear power subsidies to the bill.

Labour government plans for a new generation of unsubsidised nuclear plants have been left in tatters after the head of the UK's biggest nuclear generator warned that new nuclear stations will not be built unless the UK government steps in with financial subsidies. SNP Westminster Energy spokesperson, Mike Weir MP, seized on the admission by Vincent de Rivaz, UK boss of EDF Energy, as further evidence that nuclear power was unaffordable, unwise and unnecessary and that the SNP Government's drive for renewables was the only sensible way forward to not only create a green energy future but also provide jobs in these troubled economic times.