Why do Augusta nuke plants deserve taxpayer money?

UPDATE: As some of you have pointed out, the nuke plants are near Augusta. Thanks for the correction.

Johnny Isakson and Saxby Chambliss were happy to claim credit for the Obama administration’s announcement that it was guaranteeing loans that would help build nuclear reactors on Georgia’s coast. But it’s an odd thing for the two Republicans, who usually argue that the government ought to stay out of private industry.

In fact, economists might argue that the huge government subsidies are little different from the bank bail-outs and bail-outs for the automotive industry.Liberals and conservatives have argued against the federal guarantees. From the WaPo:

Nuclear power plants “are simply not economically competitive now, and therefore they can’t be privately financed,” said Peter Bradford, an adjunct professor at Vermont Law School and a former member of the Nuclear Regulatory Commission. “There are many cheaper ways to displace carbon, and there are many cheaper ways to provide for electric power supply.”

Jack Spencer, a fellow at the Heritage Foundation and a supporter of nuclear power, warned: “Loan guarantees do not a nuclear renaissance make.” He said the guarantees would “perpetuate the problems that have plagued nuclear energy for 30 years: the regulatory structure and nuclear waste [disposal] and too much government dependence.”

William O’Keefe, who heads a science-related think tank in Washington, doesn’t think the loans are such a good idea. From the WaPo:

If private companies are unwilling to risk their capital on new nuclear plants, why should the taxpayer take on part of that risk? The answer is: We shouldn’t.

The U.S. taxpayer has been subsidizing nuclear power since its inception, and it has yet to achieve its potential. Some of this is the fault of government policy, but some of it is just plain economics. The cost of a new nuclear plant has been estimated to be on the order of $4 billion, with some estimates being over $10 billion when cost overruns are taken into account. That makes the cost of nuclear-produced electricity very high.

The Obama administration is promoting nuclear power because it does not involve CO2 emissions. But that is only one criterion, and it should be judged on a cost-benefit basis. How much would new plants coming online over the next two decades reduce the climate change risk? And are there more-cost-effective alternatives for reducing that risk? There is growing evidence that the risk of climate change has been exaggerated, and that certainly weakens the case of the administration.

87 comments Add your comment

Elder Spokesman

February 23rd, 2010
12:52 pm

These thoughts have a parallel in our government’s decision to fund embryonic stem cell research. If indeed private industry is unwilling or unable to fund either program, why should the government do so?

Peadawg

February 23rd, 2010
12:54 pm

The only reason I would be ok with this is because it would create jobs… something Obama hasn’t done anything about since he got in office.

Peadawg

February 23rd, 2010
12:57 pm

Democrats have no problem using taxpayer money for their own pet projects, handouts, etc. But when it comes to create nuclear plants, which in turn creates jobs, they have a problem with it. Why is that, Cynthia?

Granny Godzilla

February 23rd, 2010
12:57 pm

This is an area where President Obama and I part company.
Until the issue of waste is resolved, new nuke plants must not be built.

That said, I would like to see investment in:

Terrapower: traveling wave reactor design

How does the traveling-wave reactor work? The basic concept is to use depleted ura- nium as a fuel and to need no more than a small amount of enriched uranium to start a reactor. The reactor would be able to operate for decades without refueling and without chemical separations. In a certain sense, the way the reactor works is well known. It’s the typical breeding concept and standard physics—U-238 going to 239, to neptunium, and finally to plutonium-239—but with a twist, which is the traveling wave. In a sense, the wave can be visualized as two waves—a breeding wave moving just ahead of a burn- ing wave that consumes the bred material. Visualize a cylinder a few meters long that contains U-238 or depleted uranium. A nugget of uranium enriched to 10 percent is put at one end of the cylinder and a wave 40 centimeters wide is built up that breeds and burns plutonium and produces a gigawatt of electricity as it propagates from one end to the other. It would take 50 to 60 years for the wave to go from one end to the other for a reasonable-sized core.

…..tried to post link to seeker blog, but alas, failed again, and comment is in moderation….ya’ll should read up on this, Bill Gates is
getting involved…

On the financial side…seems to be they want to “socialize” the cost of building these monsters while they “privatize” profits.

Let’s hope for a very lengthy delay on approval.

Scout

February 23rd, 2010
1:04 pm

Ms. Tucker:

Because of the 10th Amendment, the Federal government should not be involved in about 90% of what they are involved in. The cat is already out of the bag. The government is even involved in what you are “thinking”! It’s called “hate crime”.

Now, why we are at it, would you please name me one thing (JUST ONE) that the 10th Amendment (even with justices who invoke the “commerce clause” at every opportunity) prohibits the Federal government from being involved in.

NAME JUST ONE THING?

Scout

February 23rd, 2010
1:08 pm

P.S. to Ms. Tucker:

I assume from your position on this that you would be dead set against ANY taxpayer money ever going to newspapers (in any way) to keep them solvent?

Peadawg

February 23rd, 2010
1:10 pm

Scout @ 1:08, don’t use logic on Cynthia…it confuses her. :)

ctucker

February 23rd, 2010
1:15 pm

Actually, Scout, I would be against that, but not for the reasons you think. I’m against it because newspapers need to remain free of govt interference, and, if we took govt money, the temptation to cave in to govt requests to change a news story would be ever present. BTW, I’m not necessarily against govt loans for nuke plants. But shouldn’t conservatives be against them?

Peadawg

February 23rd, 2010
1:19 pm

“But shouldn’t conservatives be against them?”

Against actually creating jobs? No, not like Obama and his “jobs bill”.

uga_b

February 23rd, 2010
1:28 pm

You are ignoring the fact they already took the money from us, now we are just trying to get as much back as we can.

elliot

February 23rd, 2010
1:30 pm

Savannah’s nuke plants? Those plants are being built in Chatham County?

Scout

February 23rd, 2010
1:36 pm

Ms. Tucker:

#1) I am glad you are against government help for newspapers for the reasons you stated as those are the most important reasons. And yes, conservatives should generally be against these types of things (including football and baseball stadiums). The problem becomes, if you are outvoted you can’t let everything go to your liberal conspirators districts/states. Is that hypocritical? Yes, but also realistic. My vote is to stop ALL PORK.

#2) In addition, I sincerely would appreciate an answer to my 1:04 post. It’s not a trick question and I’m not trying to pin you into a corner. I have tried to think of ONE THING myself and I can’t.

If there isn’t one thing, then the 10th Amendment has no (ZERO) meaning. Since that should be an impossibility, what is it then that the Federal government can’t stick their nose in under the 10th Amendment to the Constitution.

Anyone else feel free to jump in and name something also.

Sam

February 23rd, 2010
1:44 pm

tell me again who Johny Isakson and Saxby Chambliss are?

AH

February 23rd, 2010
2:04 pm

Don’t worry folks no tax payer money will be going to this project. These are only loan guarantees. They won’t actually get any money for the project from the Federal government unless it fails to raise the funds necessary or falls completely flat. We will all get the privilege of starting to pay for these reactors in 2011, with an increase in your electric bill. (Remember that PSC vote about 2 years ago?). There is no way Southern Co. would have even started this process unless they were going to see it through to the end.

So you can relax Mrs. Turner there won’t be any taxpayer money going to Savannah nukes. Hope you sleep better at night.

rdh

February 23rd, 2010
2:33 pm

The only way another nuclear plant will EVER be built in the U.S. is if the Federal government guarantees the loans. Private companies are unwilling to risk their capital because the leftist environmental moonbats of this country will wait until they are half way through the project, bring suit against them to save some insect or snail, and halt the project after billions have been spent. I GUARANTEE that there is some environmentalist down their right now trying to find some critter or environmental condition which will stall or halt this project.

As for there being cheaper ways to produce electricity…. name them. Environmentalist and the Obama administration will work feverishly to prevent any fossil fuel powered plat to be built. Hydroelectric is a no go… no new lakes or dams will be built because they do not produce enough electricity for the environmental damage that they cause. Georgia is not suited to solar power… if there was enough cheap open space to put an array. Georgia does not have suitable space or climate for wind, either. Even if they did, it would be met with NIMBY attitudes the same way it has in nearly every other place that someone has proposed it.

We have about a half dozen ways to produce power on the scale that Georgia needs. Choose your poison. The only two real choices are coal/natural gas fired plants or nuclear plants. Nuclear is the current favored energy generation du-jour due to the fake crisis called “global warming”, so it gets the nod. But Southern Company officials wisely know that what it politically correct today could fall out of favor by the time these plants get underway, and they want guarantees that they will be able to complete this plan without having to worry about the whims of the leftist anti-capitalists.

ctucker

February 23rd, 2010
2:39 pm

AH, I remember the PSC vote. Sounds like Georgians get the shaft either way

mike

February 23rd, 2010
2:40 pm

Well said, RDH.

Ponder

February 23rd, 2010
2:41 pm

Finally, a science-based rational thought process by the WH. Hopefully this will not be derailed by the NIMBYs and environmental terrorists. See the following –

America’s 104 nuclear power plants in 31 states produce 20 percent of the nation’s power, but 70 percent of the nation’s power that does not produce greenhouse gases. Worldwide, electricity produced by nuclear plants would create 2.5 billion tons of carbon pollution if produced by coal.

Adding nuclear generating capacity quite simply is the only way to meet the nation’s increasing energy demands while holding the line on carbon emissions, or reducing them.

Other forms of non-polluting energy production are important, including wind and solar, but nuclear plants are the only non-polluting source that can produce massive amounts of power 24 hours a day regardless of weather conditions.

New nuke construction also would be a form of long-term job creation, in terms of design, construction and plant operation and support.

Politically, nuclear plant construction is more viable that at any time since the industry went into hibernation following the 1979 accident at Three Mile Island. Congress has not embraced the administration’s complex cap-and-trade proposal for greenhouse gas reductions. Nukes ensure reduced emissions and reliable power production, and the proposed guarantees offer a basis for a compromise on other aspects of environmental and energy legislation.

Congress already has authorized $18.5 billion in loan guarantees for new plants. The money is not in the form of direct spending; rather it enables nuclear plant developers to obtain financing.

Another advantage of renewed nuclear construction is that it is still an American industry. Companies such as Westinghouse and General Electric are global leaders, but have had to rely on foreign markets.

Reviving the industry also is important because some older plants will have to come off line at the end of their operating lives, just as power demand justifies new plants. The industry will not only construct new plants but replace old plants.

The key question regarding nuclear plants is waste disposal. In addition to authorizing new plants, Congress and the administration also should embrace reprocessing techniques that allow most fuel to be reused and rendered incapable of being used for weapons.

Nuclear power is a partial answer to many questions facing the economy and environment. The administration, Congress and the industry quickly should jump start its renewal.

DawgPhan

February 23rd, 2010
2:44 pm

Proud to see that the last 2 posters actually understand what is going on. The quotes are out of context, there is no real “article” and most of the comments are just drivel spouted by folks who need to say something. Thanks to rdh and AH for actually understanding the concepts you are commenting about.

Joey

February 23rd, 2010
2:45 pm

Cynthia;
I infer from your post that you oppose the loan guarantees. If true, it should follow that you would be as consistant in your positions as you profess that Georgia’s Senators should be?

So, do you oppose the bank and auto industry bail-outs, or do you support the loan guarantees?

Rick Cole

February 23rd, 2010
2:47 pm

Ms. Tucker, I salute and hardily agree with you. Let’s take it to the next level. Why subsidize anything. No subsidies for schools, Social Security, Medicare/caid, farming, banks, Haiti or Israel, inner-cities, rural areas, oil companies and green jobs, phone companies, acorn, etc., etc., etc. We should close the spigot and weld it shut.

Michael K.

February 23rd, 2010
2:54 pm

These types of pieces always remind me of an adage about causing a problem and then taking credit for solving it. The United States government is heavily involved in the electricity generation and transmission industry at every step. That’s a bad thing. However, it’s disingenuous for individuals like Ms. Tucker to blithely assert that nuclear power has been subsidized since its inception while ignoring that it has also been subjected to massive, arbitrary political costs since its inception as well. The US government giveth and it taketh away.

I do agree that nuclear facilities shouldn’t receive subsidies; however, neither should solar and wind facilities. Ideally, the government would stay out the electricity industry as much as possible and let the market determine the appropriate mix of generating technologies. As it stands, solar and wind generation receive far more subsidies per kWh than nuclear facilities (actually, we haven’t built a nuclear plant in 30 years, so they’ve received no subsidies for decades). If the tax payer shouldn’t be on the hook for nuclear energy, then the same logic should apply to solar and wind.

On another note, if the government’s goal is to reduce carbon emissions associated with electricity generation, then it’s going to have to rely on nuclear power to some extent. People who don’t understand electricity generation don’t understand that the cost of intergrating intermittent resources increases as the percent of total generation attributable to those resources increases (basically, the more wind farms you build, the more expensive they are to use). It’s kind of complicated, but it basically is a function of the fact that it is extremely expensive to store electricity.

In short, subsidies for nuclear energy are bad, but so are government regulatory processes designed to kill any potential new plant.

John Birch

February 23rd, 2010
2:59 pm

We taxpayers have been supporting much worse things for a long time, like MARTA.

ctucker

February 23rd, 2010
2:59 pm

Joey, I’m ambivalent about the loan guarantees. But I do think they should get more scrutiny than they have.

PM

February 23rd, 2010
3:02 pm

When was it decided the new nuke plant units would be in Savannah? Aren’t they slated to be a part of Plant Vogtle in Waynesboro which is no where near the “coast”.

By the way I believe the kwh/hour cost once up and running is nil for a nuclear plant so the cost/benefit in that regards might be pretty good vs. a fossil plant.

I agree wind and/or solar power needs a closer look in this country. I don’t understand why they haven’t taken off like in Europe.

Finally, I agree there should not be any more nuclear plants until we have a place to put the spent fuel. It’s stupid.

Granny Godzilla

February 23rd, 2010
3:04 pm

Ponder

you really should note when you use other peoples work….unless of course you write for the daily review or the other publications that the editorial you used appears in….

jimmy62

February 23rd, 2010
3:06 pm

I agree. Not only nuclear, but wind, solar, etc. The market is moving towards non-fossil fuels, government or not, Why? Because there are trillions of dollars to be made.

Bob

February 23rd, 2010
3:06 pm

Something that might actually help someone that pays taxes. If we can own part of GM and Chrysler, why not something that will generate a return.

Gordon

February 23rd, 2010
3:09 pm

Energy policy is in the domain of government. It is fully justifiable that the government should be involved in providing loans. Energy and Immigration are two obvious examples of where the federal government should be MORE involved, but they have been too busy being involved in things where they should be LESS involved.

Joey

February 23rd, 2010
3:13 pm

Ambivalent about the loan guarantees, but support the bail-outs. Consistancy??

conservative democrat

February 23rd, 2010
3:26 pm

Hey Peadawg Idiot,
Ask ‘em about those jobs in Kiev! Godzilla is on target here. Let’s see, a pound of carbon or a pound of plutonium, which one shall we dispose of in your back yard? Personally, I’ll take the carbon and you can dispose of that radioactive stuff where you live.
We have been promised for decades that there was an answer to the waste issue just under the Yucca flats. But, alas, they don’t want it either.
Anyone who doubts my approach should visit the area between Augusta and Savannah along the Savannah River, near the Old Savannah River Plant. This is one of the eeriest places on earth. There’s a constant fog and the place looks like something from a sci-fi horror movie. The signs warn not to stop your car or get out because the stuff is underground and poisoning everything.
And that doesn’t begin to discuss the environmental impact of getting uranium out of the ground. The Apache indians who mined the original ore have seen generations of birth defects and other side effects. Mining also polutes the ground water. So, Cynthia Tucker, some conservatives are dead set against Obama’s or anybody else’s plan for more nukes until we solve these problems FIRST. As conservatives, we want to conserve (hence, the root word) what God has provided us. Not destroy it. By the way, what’s the half-life of plutonium Cynthia? My guess is that, if Obama asked her to, c.tucker would swallow a load just to please him. If Dick Cheney had proposed this looney idea, she be totally against it! I say let’s spend this same $50 billion on clean, renewable energy sources like solar, wind, & wave.

ctucker

February 23rd, 2010
3:31 pm

conservative democrat, I’m sure there are blogs for people who want to call those with whom they disagree “idiot,” but this blog is not that place.

ctucker

February 23rd, 2010
3:31 pm

Very different circumstances, Joey

ctucker

February 23rd, 2010
3:32 pm

Gordon, Why energy but not health care?

EJ

February 23rd, 2010
3:33 pm

Finally, something I can agree with Ms. Tucker on.

I hope you can apply the same logic to other government subsidized activities in the future.

Williebkind

February 23rd, 2010
3:34 pm

RDH:

You gave me flash backs to the wackos environmental extremist! Nails into trees, or little fishes that prevent watering farms that produce food for humans, the spotted owl, and polar bears. Why do these extremist get judges to approve such craziness?

Scot Waldrop

February 23rd, 2010
3:36 pm

The reality is that energy independence should be a national priority for security and economic self-interests. By continuing to import foreign oil, we are doing nothing more than de-stablizing our economy and enriching nation states that cannot seem to prevent anti-american fervor that manifests itself in the form of terrorism. Both side should rally behind these ideals vs. maintaining opposition on either side of the global warming argument.

Nuclear power is the only current non-carbon based way to produce electricity on a scale large enough the matter. We should also exploit our carbon resource while simultaneously funding green enery (wind, solar, bio, etc.)

This should be a topic where every can rally, but too many people on both sides of the political spectrum are unwilling to compromise on vested interests. Dems hate nuclear and carbon and are adamant about punishing carbon (cap & trade). Reps are equally vested in carbon, and refuse to fund green innovation.

Don L.

February 23rd, 2010
3:39 pm

The issue of nuclear waste has been kicking around for 30 years. The US gov’t guaranteed the utilities(back in the late ’70’s that a repository would be built to house the spent fuel. Yucca Mtn. was a perfect site and Sandi Labs has proved that the transport containers are safe to be sent by rail to Nevada desert. The only risk to the US taxpayer is if unforseen regulations (i.e. from the NRC) make it economically unfeasable to continue with construction and the utilities have to default on the loans. This is unlikely since the designs are much more standardized and similar to ones being used recently in France and Japan. We must replace the aging coal and oil fired generating stations soon and nuclear power is a safe, clean, reliable source of energy allow the US to bridge the next 40 years when solar, wind, fuel cells will finally become viable options.

Scooter (the Original)

February 23rd, 2010
3:41 pm

Cynthia, as a native Georgian conservative I do dislike my tax dollars subsidizing projects in other states. But heck, if “stimulus” dollars are going to build wind farms or solar parks in places where they’ll work, why should we not get our “fair share” in the form of Nuclear Power? Should I bite my State off to spite my politics?

This seems to be the political consequence of converting from a Republic to a Democracy, the Feds take the most in taxes and act as a controlling pass through to states, who in turn do the same to local governments. Sure the Republicrats you mentioned will take the money, they’re elected to first promote our state’s interest in Washington D.C., then their politics. Your job is to be a partisan who attracts people to your philosophy. Congratulations everyone is doing there job on this one.

Scout

February 23rd, 2010
3:43 pm

So no one will answer my question ?

Granny Godzilla

February 23rd, 2010
3:47 pm

Don L

Sadly, the safety of the Yucca Mountain facility is still very much in question. I understand that Yucca did not meet the original siting criteria…..

Capital Rage

February 23rd, 2010
3:48 pm

“William O’Keefe, who heads a science-related think tank in Washington, doesn’t think the loans are such a good idea.”

I think what Mr. Think Tank is trying to say here is that muclear plants are not rocket science but rather they are science fiction if the nuclear industry cannot stand on it’s own two (mutated) club feet.

Does capitalism’s benefits justify laissez faire? or does the nature of the boom/bust cycle dictate a more hands-on approach from big government in the name of social justice?

Logic helps to answer that question: Suppose capitalism could make millionaires out of every single american: multiply 300 million americans by one million dollars, and you get 300 trillion dollars. There’s hardly that much money on the planet. Derivatives do create 100s of trillion of dollars in imaginary money, but we saw what happens to derivative extrapolations of wealth. It’s all paper coulda woulda or shoulda.

Social justice wins out. Government must do what it can to ensure social justice, including bailing out auto, bank, and energy industries. (farmers too)

Rational Citizen

February 23rd, 2010
3:50 pm

Peabrain (aka Peadawg): this just in from Reuters: “The massive stimulus package passed last year to blunt the impact of the worst U.S. recession in 70 years created up to 2.1 million jobs in the last three months of 2009, the non-partisan Congressional Budget Office said Tuesday. The package boosted the economy by up to 3.5 percent and lowered the unemployment rate by up to 2.1 percent during that period, CBO said.”

Republicans, who controlled both houses of Congress and the White House from 2000-2006, created this mess and now Obama and the Democrats are the ones trying to fix it. You and your cohorts of conspiracy theorists are like a homeowner who purposefully sets his house on fire then complains that the fire department didn’t get there soon enough to put it out.

MrLiberty

February 23rd, 2010
4:00 pm

Contrary to the ignorant posting of Gordon, we are in this mess strictly BECAUSE the government has stuck its nose into energy policy. There is nothing the federal government should have to do with energy. Drilling anywhere is a property rights issue, as is coal mining, construction and installation of wind or geothermal technologies, or even nuclear plants.

It is because we give trillions of dollars in free security to the oil companies in the middle east that we are plagued by terrorists and dependent on oil from the region. If we had never begun the process by guaranteeing to defend the house of Saud on behalf of Standard Oil back in the early 1900s, we might have avoided the entire mess that the middle east has become.

Our current subsidies for worthless ethanol which are causing food shortages world wide and every other energy policy do nothing more than divert investment away from market-sustainable energy sources and line the pockets of corn farmers and ethanol producers.

It would be nice as many have pointed out if you would recognize that government support for any venture is wrong, not just those favored by republicans. Unfortunately even most republicans don’t get it either. That’s pretty much in a nutshell why both parties must go and why so many have joined the Tea Party movement. They have figured out that the real enemy of america is its own government and the two parties that rule it for their own benefit and the benefit of their friends in big business. By the way, that’s not how the truly free market works so stop blaming the free market.

CK Hall

February 23rd, 2010
4:06 pm

I have never before seen anyone who knows everything about any subject!
I am truly amazed at your knowledge and authoritative writings of all things in the world..

Byron Mathison Kerr

February 23rd, 2010
4:07 pm

Politicians rarely have a problem with Federal funds coming into their own state. It is only when money goes to somebody else’s state that their ideologically moral objections come into play.

I saw a very sobering documentary on Chernobyl many years ago (don’t remember the name, and there have been several). But it made the film The China Syndrome (1979) seem like a light-hearted comedy by comparison.

I am neither pro nor con nuclear power, but seems like it needs to be a highly cost-effective way of producing electricity to justify the incredible dangers.

tom ferguson

February 23rd, 2010
4:09 pm

Nukes take years and way too much money to build, are pre-positioned bombs to a determined terrorist and of course leave toxic waste for uncountable future generations to deal with. there is also the proliferation issue. The book carbon and nuclear free articulates an alternative to this wasteful, dangerous direction at its website… IEER (institute for energy & environmental research).. try it. a lot of the pro-nuke arguments i hear seem ideological…. stretch alittle, question received wisdom.

Chris

February 23rd, 2010
4:15 pm

If private companies are unwilling to risk their capital on new nuclear plants, why should the taxpayer take on part of that risk? The answer is: We shouldn’t.

Hear, hear!

CG

February 23rd, 2010
4:17 pm

Ms. Tucker, get your facts straight. They aren’t Savannah nukes. They will be built on the site of the current A.W. Vogtle Units 1 and 2, which was originally designed to have 4 reactors, but only two were built. This is near Augusta, not Savannah. And the government has to guarantee the loan because a utility cannot bear the risk alone, thanks to the hysteria that took place after Three Mile Island, and the resulting cancellation of nuclear plants that were anywhere from 0 to 100 percent complete. It is not a bailout; it is a loan guarantee. Big difference.

706dawg

February 23rd, 2010
4:30 pm

Too late they already have it and spent it.

I would be more worried about the Nuclear invests made just across from SRS @ Plant Vogtle. $14Billion (with a B) for two new cooling towers contracted to be built by French owned Electricité de France.