Caviar anyone? New report highlights nuclear power subsidies

This blog was written by Sara Barczak, former Regional Advocacy Director with the Southern Alliance for Clean Energy.

Guest Blog | March 8, 2011 | Energy Policy, Nuclear

“In sum, trying to solve global warming with nuclear power is like trying to solve world hunger with caviar,” –Ellen Vancko, Union of Concerned Scientist’s Nuclear Energy & Climate Change Project Manager

Despite over 50 years of government subsidies to support the U.S. nuclear power industry’s development and operations, the industry is still not economically viable, according to a recent report released by the Union of Concerned Scientists (UCS). The report, “Nuclear Power: Still Not Viable Without Subsidies,” found that more than 30 subsidies have supported every stage of the nuclear fuel cycle, from uranium mining to long-term waste storage. Added together, these subsidies often have exceeded the average market price of the power produced. According to the report, “This means that buying power on the open market and giving it away for free would have been less costly than subsidizing the construction and operation of nuclear power plants. Subsidies to new reactors are on a similar path.

As stated in the UCS press release, “Without these generous subsidies, the nuclear industry would have faced a very different market reality,” said Doug Koplow, the author of the report and principal at the Cambridge, Massachusetts-based consulting firm, Earth Track. “Many of the 104 reactors currently operating would never have been built, and the utilities that built reactors would have been forced to charge ratepayers even higher rates.”

This important report is timely given that the Obama Administration has asked for an additional $36 billion for taxpayer-financed federal nuclear loan guarantees. This would be in addition to the $18.5 billion in conditional loan guarantees already authorized for new reactor proposals. Early last year, an $8.3 billion federal loan guarantee was awarded to Southern Company and its utility partners’ proposal to build two more nuclear reactors at Plant Vogtle in Georgia. As Congress tackles the 2012 budget, a recent Wall Street Journal/NBC poll shows that cutting subsidies for new reactor construction is the single most acceptable budget cut for the American public — 57% find cutting nuclear subsidies is either completely or mostly acceptable (see p.15 of the poll results).

As shown in Figure 1 of the UCS report, fission R&D — even excluding federal research on military reactors — captured nearly half of all federal energy R&D funding between 1950 and 1993; fission and fusion combined received 62 percent, or six times the support for all renewable technologies put together.

To learn more about the historical subsidies to the nuclear industry, along with the subsidies associated with building new nuclear reactors, join Southern Alliance for Clean Energy on Tuesday, April 5, 2011 at 12 pm ET as Ellen Vancko of UCS and report author Doug Koplow participate in a SACE-hosted webinar to discuss their report findings.

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