Outdated Price-Anderson Act Affords Inadequate Coverage in the Event of a Nuclear Accident; Taxpayers Liable for Billions
Jan. 23, 2002
Outdated Price-Anderson Act Affords Inadequate Coverage in the Event of a Nuclear Accident; Taxpayers Liable for Billions
Senate Committee Considers Act Reauthorization; Would Apply to New Nuclear Plants, But Existing Ones Would Be Still Be Covered
WASHINGTON, D.C. ?The Senate should not reauthorize legislation to limit the liability of nuclear operators in the event of an accident, Public Citizen said today following a hearing by the Senate Environment and Public Works Committee. The Price-Anderson Act leaves the public unprotected and the nuclear industry unaccountable in the event of a serious accident.
“Why should the nuclear industry be let off the hook for the risks they impose on the public?” asked Lisa Gue, policy analyst for Public Citizen?s Critical Mass Energy and Environment Program. “If the proposed new generation of nuclear power plants cannot be fully insured, they should not be built.”
Witnesses at today?s hearing included former Nuclear Regulatory Commission member Peter Bradford, attorney Dan Guttman and celebrity activist Christie Brinkley, who raised concerns about Price-Anderson reauthorization.
The Price-Anderson Act was originally passed in 1957 as a temporary measure to help the nascent nuclear power industry get off the ground by providing government-backed indemnification in the event of accidents. By artificially limiting the liability of nuclear operators, the act serves as an unprecedented subsidy to the nuclear industry through foregone insurance premiums.
Under the act, nuclear power plants must buy $200 million worth of primary insurance. A second level of retrospective premiums capped at $88 million per reactor (or approximately $9.4 billion industry-wide) would be assessed in the event of an accident. However, a nuclear accident could cost as much as $500 billion, according to government estimates.
Without congressional action, the Price-Anderson Act will expire on Aug. 1, 2002, although existing nuclear power plants would continue to be covered under a grandfather clause. Led by pro-nuclear members of the Energy and Commerce Committee, the House of Representatives passed legislation last November to extend the Price-Anderson Act for another 15 years.
Of particular concern, in light of the recent Enron collapse, is the questionable financial solvency of nuclear operators in the deregulated energy market.
“Not only are the levels of coverage afforded under the Price-Anderson Act grossly inadequate, but it is uncertain whether these limited obligations could be met by nuclear operators in the event of an accident,” Gue said. “Congress should allow this outdated legislation to expire.”
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