US Senate votes to guarantee nuclear power loans
Date: 12-Jun-03
Country: USA
Author: Charles Abbott
Senators voted 50-48 to keep the loan guarantee language in a comprehensive energy bill under debate. It would expand use of renewable fuels and subsidize a natural gas pipeline from Alaska among other steps.
Under the bill, the Energy Department could issue loan guarantees to cover up to half of the cost of constructing seven nuclear power plants with a capacity of 1,100 megawatts each, together enough power for nearly 8 million homes.
No new nuclear power plants have been built in the United States since the partial meltdown of the reactor core of the Three Mile Island plant in Pennsylvania in 1979.
Supporters said the loan guarantees would assure a variety of energy sources and reduce pressure on natural gas supplies.
Critics said loan guarantees were not necessary for an established industry and carried a high chance of significant costs to taxpayers if an owner went broke.
"Never before were the taxpayers on the hook from the get-go," said Oregon Democrat Ron Wyden, who called the guarantees unprecedented.
The Congressional Budget Office, a nonpartisan entity, said in May it considered "the risk of default on such a loan guarantee to be very high - well above 50 percent" because a plant would be "uneconomic to operate."
Construction costs are higher than conventional plants, not to mention the risks of being the first nuclear power plant in 25 years and potential delays in getting a federal license.
Energy Committee chairman Pete Domenici told reporters that "an alternative like clean nuclear power" was needed to alleviate a potential pinch on natural gas supplies.
"Just today, we had Mr. Economics himself, Dr. Alan Greenspan, say that there is not going to be enough natural gas for our needs, especially in electricity, which is growing exponentially," Domenici said, referring to the chairman of the Federal Reserve Board. Greenspan testified at a House Energy and Commerce Committee hearing on rising natural gas prices.
Nuclear plants generate 20 percent of U.S. electricity.
Earlier in the day, the Senate also:
- Voted 99-1 to set a goal of reducing U.S. oil consumption by 1 million barrels a day, or 5.3 percent, by 2013 through whatever mix of approaches the president thought best.
- Agreed 67-32 on the goal of getting 100,000 U.S. hydrogen-powered cars in use by 2013 and 2.5 million by 2020.
