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Is there a Nuclear Revival in the United States?

Nuclear Power Plant Three Mile Island in Harrisburg, US. On March 28, 1979, there was a cooling system malfunction that caused a partial melt-down of the reactor core. Photo: CC-BY-NC-SA joelsp

March 14, 2011
Michele Boyd

Introduction
The pervasive view both inside and outside of the United States is that the U.S. is having a nuclear revival – or in the parlance of nuclear proponents, a “nuclear renaissance”. This perception is the result of a well-funded lobbying and public relations campaign conducted by the nuclear industry for more than a decade. The industry has succeeded in obtaining large subsidies and positive rhetoric (“safe, clean nuclear power”) from elected officials.

In May 2001, the Bush Administration released its National Energy Policy, which embraced the construction of new reactors as a key component.1 The Energy Policy Act of 2005, which largely enacted this policy into law, included $7 billion in subsidies, plus loan guarantees and other incentives for new reactors. The Obama Administration has continued to supply both the rhetoric and subsidies, including announcing the first nuclear loan guarantee for two reactors in Georgia.

The media has also been a cheerleader for the nuclear industry. Since the early 2000s, slews of media reports have predicted the “nuclear renaissance”, dismissing the unresolved economic, waste and safety problems of nuclear power.2 Recent articles have discussed the “setbacks” and “challenges” in the so-called renaissance, but the press generally continues to assume that it will happen.

An examination of what is actually happening “on the ground”, however, with the enormous economic and technical issues facing the proposed new reactor projects in the U.S., results in a very different conclusion. The fact is that the U.S. will start to construct as many new reactors as the federal government and states are willing to heavily subsidize, but the projects may never be completed.

With the long construction periods, decreased electricity demand and rapidly increasing costs of new reactors, large subsidies may still not be enough to make a new reactor project competitive with cheaper alternatives, especially natural gas, efficiency, and a range of renewable technologies. Nor are large subsidies for a few first-mover reactors sufficient to kick-start the industry and make the technology economically competitive without subsidies.

The question facing U.S. policymakers is whether to attempt to restart an industry that will require large taxpayer subsidies indefinitely. This paper will examine whether there is a nuclear revival in the U.S.

Part I examines the current status of existing reactors in the U.S., the Nuclear Regulatory Commission’s rush to rubber stamp 20-year license renewals, and public opposition to relicensing these aging reactors.

Part II looks at the key actors who are part of the decision-making process about whether build newreactors, and what influence they have on the process.

Part III then describes the existing federal and state subsidies for new reactor construction. Part IV reviews the status of proposed reactor projects in the US.

Finally, Part V examines the new and expanded federal subsidies that were proposed in the 111th Congress, and explores whether all of these subsidies are enough to create a viable nuclear revival in the U.S.



Table of Contents
  • Introduction and Overview
  • Part I: Nuclear Reactor Status Quo in the U.S.
    • NRC: Watchdog or Rubber Stamp for License Extensions?
    • Safety Problems with Aging Reactors
  • Part II: Actors and Their Influence in the Decision to Build New Reactors
    • The Nuclear Industry
    • Electric Companies
    • U.S. States
    • Nuclear Regulatory Commission
    • Congress
    • The Administration
    • The Public
  • Part III: Existing Federal and State Nuclear Subsidies 13
    • Massive Federal Subsidies for New Reactors 13
    • Most Crucial Nuclear Subsidy: Loan Guarantees 13
    • Nuclear Loan Guarantees: Just How Risky Are They? 14
    • State Subsidies Shift Costs and Risks to Ratepayers 14
  • Part IV: Status of New Reactor Projects
    • Reactor Design Problems May Delay New Licenses
    • Leading New Reactor Projects Are Troubled
  • Part V: New Reactors – Still Not Economically Competitive
    • More Federal Nuclear Subsidies Proposed
    • A Competitive Industry Cannot be Built on Subsidies
  • Conclusion