Environmental Engineering Reference
In-Depth Information
Treasury. There are also provisions for taxpayer-backed loan guarantees
for up to 80 percent of the cost of a reactor. Also granted was protection
against a nuclear catastrophe. The operator's liability was capped at $10
billion.
But even these subsidies have failed to entice investment from private
sources. Thomas Capps, former CEO of Dominion Resources, one of
the groups seeking a license for a new reactor, said in 2005 that if his
company announced it was going to build a nuclear plant, debt-rating
agencies such as Standard & Poor's and Moody's “would have a heart
attack, and my chief fi nancial offi cer would, too.”
5
A reactor meltdown, which is unlikely but possible, could cost much
more than $10 billion. The General Accounting Offi ce estimated in 1987
that a major nuclear accident could cost as much as $15 billion, and that
was more than twenty years ago. Sandia National Laboratory, working
for the Nuclear Regulatory Commission (NRC), estimated that a melt-
down would cost $56 billion to $314 billion, not including the cost of
losing the facility. (The NRC estimated a 45 percent chance of having
a meltdown by 2013.)
6
Taxpayers may have an enormous liability bill
to pay.
Polls indicate that the American public supports the construction of
new nuclear plants, although no one wants them built in their neighbor-
hood. Public Citizen concluded that the public could subsidize as much
as 80 percent of new nuclear costs. Based on public objections to bailing
out banks, insurance companies, and other fi nancial institutions in 2009,
it is not at all obvious that the public favors the idea of having the
government shoulder the fi nancial risk for private enterprises.
The owner of the infamous Three Mile Island nuclear plant in Penn-
sylvania said in 2007 that if his company wanted to start a nuclear plant
today, the licensing, design, planning, and building requirements are so
extensive it would not open for at least eight years. And even if the
company got all the approvals, it could not start building “because the
cost of capital for a nuclear plant today is prohibitive.”
7
As of 2008, all
nuclear plant construction in the world was running years late and bil-
lions of dollars over budget. In the United States, the NRC has delayed
approval on all plants under construction indefi nitely because of needed
design changes. The earliest delivery date for the prototype plant is 2012,
so other new plants will not be built for at least a decade.
The nuclear industry in 2006 quoted the cost of nuclear electricity at
1.68 cents per kilowatt-hour (wind 0.2 cents, hydroelectric 0.5 cents,
coal 1.9 cents, solar 2.48 cents, natural gas 5.87 cents),
8
but its cost
