President Barack Obama announced last week that he would offer $8 billion in loan guarantees for two new nuclear reactors and that more guarantees for nuclear power will be in the pipeline (the industry is pushing for $100 billion worth). The plan is to back nuclear power as a transitional energy source as the nation shifts to nonpolluting fuels.
What kind of economics underlies this plan? In the summer of 2007, Lehman Brothers, Goldman Sachs and four other large financial firms wrote the federal Department of Energy that nuclear plants were too risky to attract investment. The Congressional Budget Office says the risk of default on loans to the nuclear industry is 50 percent. So the industry wants the loans to be underwritten by the government—which means by the taxpayers.
Another unsolved problem relates to the magical thinking that’s been invoked on behalf of the nuclear industry ever since its inception: the idea that if we don’t have the technology to solve a problem today, we’ll have it by tomorrow, so we plunge ahead before a crucial difficulty is eliminated. Build plants now and soon we’ll have solved the waste problem! But 50 years and more after the industry got its start, the waste problem still rears its head, and no solution is in the offing.
Industry analyst Dan Scotto of Whitehall Financial told the Advocate, “I think right now if you talked to the industry, to someone who wasn’t afraid to talk, they would say Yucca [the long-proposed waste repository at Yucca Mountain, Nev.] is never going to happen. Entombment [on-site burial at nuclear facilities] is the answer and every state is going to have to make their own decision as to whether they can live with that.”
There’s a disconnect, too, between the conference room logic that favors nuclear power and the experience of real people living in real time near nuclear plants. This week the Vermont state Senate votes on whether to let the Vermont Yankee plant near Brattleboro operate until 2032 under an extended license or shut it down in 2012.
The behavior of the plant’s owner, Entergy of Louisiana, has hardly vindicated Obama’s concept; the recent discovery of tritium in water near the plant has reportedly lost Yankee some support in the Legislature. And in New York State, authorities cite Entergy’s delays in mounting adequate emergency alarm and evacuation systems (for which the government fined it $650,000) and leaks of tritium and strontium 90 into groundwater as two of several reasons they want to shut the Indian Point plant, located in the New York City area within 50 miles of 20 million people.
