February 14, 2011

Obama Proposes Nuclear Loan Guarantees of $54.5 Billion

From Bloomberg:
President Barack Obama’s 2012 budget almost triples U.S. loan guarantees for nuclear power-plant construction, funds development of a new breed of smaller reactors and spends more on “breakthrough” energy research.

The Energy Department would get $29.5 billion, a 12 percent increase, to support Obama’s proposed “clean-energy standard,” which requires 80 percent of U.S. electricity to come from low- pollution sources by 2035, according to the fiscal 2012 budget released today. The proposed standard is part of Obama’s policy “to ensure strong American leadership in the clean-energy economy,” according to the budget plan.

A program that guarantees as much as $18.5 billion in loans for construction of nuclear reactors would expand by $36 billion in 2012, to backstop $54.5 billion in lending. An initiative to develop designs for “small modular reactors” would get $67 million. Such reactors would be about a third the size of those now used by U.S. power companies, according to the department.

“We don’t think nuclear loan guarantees are a very good bet,” given the industry’s history of cost overruns, said Robert Cowin, a Washington representative for the Union of Concerned Scientists based in Cambridge, Massachusetts. “The $36 billion the president has proposed is excessive.”

Obama’s budget, which requires approval by Congress, would also expand loan guarantees for energy-efficiency and renewable- energy programs by as much as $2 billion. . . .

Obama also proposed a $36 billion expansion in nuclear loan guarantees last year for fiscal 2011. Congress failed to pass a budget last year, and lawmakers have been funding the federal government with a series of stop-gap spending measures, or continuing resolutions, which haven’t expanded the nuclear loan- guarantee program.

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