Tough Questions for Obama

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Joint letter to the White House opposing additional loan guarantees, National Taxpayers Union, Taxpayers for Common Sense, George Marshall Institute and the Non-Proliferation Policy Education Center.

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Experts: No Good Candidates Exist for Current Nuclear Reactor Loan Guarantee Bailout Funds, Much Less Tripled Amount Under Obama Budget Plan, Southern Alliance for Clean Energy, Sierra Club South Carolina, Sustainable Energy and Economic Development (SEED) Coalition and Nuclear Information and Resource Service.

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Subsidies Are Addictive, David Kreutzer, Senior Policy Analyst in Energy Economics and Climate Change, Heritage Foundation.

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Massive nuclear subsidies won’t solve climate change, Peter A. Bradford, Adjunct Professor at the Vermont Law School and a former member of the U.S. Nuclear Regulatory Commission (NRC).

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Industry Must Pay For Its Renaissance, Ryan Alexander, President of Taxpayers for Common Sense.

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Top Nuclear Loan Guarantee Contenders in Financial Shambles, Taxpayers for Common Sense.

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SOTU Update: Cost Estimate for Nuclear Energy Loan Guarantees, National Taxpayers Union.

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*** OBAMA ADMINISTRATION MOVES FORWARD WITH NUCLEAR INDUSTRY BAILOUT ***, Friends of the Earth.

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Tripling Loan Guarantees for Nuclear Power Would Shift Unacceptable Risks From Industry to Taxpayers, Science Group Says, Union of Concerned Scientists.

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Department of Energy Nuclear Loan Guarantees Will Set Back Race Against Global Warming, Environment America.

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How is the Department of Energy (DOE) going to protect taxpayers when there are cost overruns? If the utility is required to pay cost overuns, won’t that make them even more likely to default and leave taxpayers to pay back the loans?

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DOE is claiming that making the loan guarantee conditional on an NRC license protects US taxpayers. How does a NRC license protect taxpayers from defaults? (In the last round of construction, 44 reactors were abandoned after receiving a license -- 21 reactors were cancelled during construction, 22 were cancelled after licensing but before construction one was cancelled after construction.)

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How does DOE know how much the project costs when the Vogtle reactor design has been rejected by the NRC … and there is currently no schedule for certifying it?

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Once DOE has committed to a loan guarantees, US taxpayers are on the hook to pay back loans on defaulted projects. However, it could take a decade before it is known whether the projects default. President Obama is requesting to triple the nuclear loan guarantee program to $54.5 billion in his FY2011 budget, additional nuclear loan guarantees are said to be part of the Senate climate deal now under discussion, and Sen. Bingaman’s energy bill (S. 1462) includes unlimited loan guarantee authority. How many nuclear reactors is the Administration prepared to guarantee before insisting that nuclear power pay its own way?

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DOE is claiming that this program won’t cost taxpayers anything. According to the Government Accountability Office and the Congressional Budget Office, however, DOE is more likely to underestimate than to overestimate the subsidy cost, leaving US taxpayers on the hook when there are defaults. How much is Southern Co going to pay in subsidy cost for this loan guarantee? The nuclear industry is advocating for a 1 percent subsidy cost. DOE is saying that the average subsidy cost for renewable projects will be 10-20 percent.

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The only reason that taxpayer-backed loan guarantees are needed is because Wall Street has sent a clear signal that it won't invest in these projects since they are too risky and too prone to default; as such, no reactors will be built without a hefty dose of “nuclear socialism” in the form of government subsidies;

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Taxpayers are, in fact, very likely to end up on the hook to pay back billions in loans when financially unviable nuclear reactor projects inevitably go into default;

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There are no attractive loan guarantee candidate reactor reactors projects among the four projects targeted by DOE; and

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Far from being "ready for take-off", the so-called nuclear “renaissance” is already imploding as the result of major recent setbacks in Texas, Florida, Vermont, and elsewhere around the globe.

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New Loan-Guarantee Bailout for New Nuclear Reactors Puts U.S. Taxpayers at Risk as Department of Energy Hands Over Billions of Dollars to "Poster Child for Cost Overruns" (see experts cited in text).

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Experts: 3 Latest Industry Setbacks Further Dim Nuclear "Renaissance," Taxpayer-Backed Loan Guarantees Can’t Fix Fundamental Problems With New Reactors (see experts cited in text).

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Cooper Study Shows Trillions of Dollars in Excess Costs if US Builds 100 Nuclear Reactors (full text of study), Mark Cooper, senior fellow for economic analysis at the Institute for Energy and the Environment at Vermont Law School.