Feb. 19, 2014
Nuclear Loan Guarantee: A Costly Act of Desperation for a Failing Project
Statement of Allison Fisher, Outreach Director, Public Citizen’s Energy Program
The announcement today by Energy Secretary Ernest Moniz that his agency has approved a multibillion-dollar taxpayer-backed loan guarantee for the first nuclear reactors to be built in the U.S. in more than 30 years should be viewed as a costly act of desperation for a failing project.
The $8.3 billion loan guarantee for two new reactors at Southern Company’s Vogtle plant in Waynesboro, Ga., was conditionally approved four years ago. Since then, negotiations around the terms of the loan guarantee have been extended five times. Secretary Moniz’s announcement today – that the government has finalized terms with two of three companies – accounts for just $6.5 billion of the loan. With approval for $1.8 billion of the loan still pending, the agency is clearly attempting to give momentum to the stalled project.
The construction of the two new reactors at the Vogtle plant are 21 months behind schedule and $1.6 billion over budget. This not only calls into question the decision to underwrite this risky project with taxpayer dollars, but proves that the same issues that plagued reactor construction more than three decades ago have not been resolved. Moreover, this is a technology that continues to be beset with safety issues and produces toxic wastes that we still don’t have a solution for – hardly a technology the government should be promoting and propping up with taxpayer funds.
No doubt, this is a bad deal for the American people who have been put on the hook for a project that is both embroiled in delays and cost overruns and to a company that has publicly stated that it does not need federal loans to complete the project.
This is a classic case of throwing good money after bad – an unnecessary and unconscionable decision to make with taxpayer money.