Friday, May 21, 2010

Obama seeks $9 billion more in nuclear loan guarantees

Energy Sec. Chu calls for support for three short-listed new reactor projects

2006_AESilverProof_O_180Congress will get a pair of requests for new energy loan guarantees of $9 billion each – one for nuclear energy and one for renewable energy technologies including solar and wind. The move comes as the gulf oil spill continues to spiral out of control bringing home to the Obama White House the perils of over-reliance on fossil fuels and offshore oil development.

The nuclear part is needed to complete support for the remaining three short-listed reactor projects on the Department of Energy list released earlier this year. The renewable energy piece comes at the insistence of House Speaker Nancy Pelosi (D-Calif) who wants it to replace funds shifted from the Economic Stimulus Bill to the wildly popular ‘cash for clunkers’ program.

The Washington Post reports May 20 that the request follows two decisions to award nuclear loan guarantees to the Southern Company kast February for its Vogtle twin reactor project and this month to Areva for its Eagle Rock uranium enrichment plant.

Status of climate legislation

The request is separate from section in the Energy & Climate legislation introduced by Sen. John Kerry (D-Mass) which adds $36 billion for nuclear energy loan guarantees. The prospects for passage of the bill in the Senate are dim right now. That could change as the White House ramps up its campaign to get the nation’s international climate change commitments embedded in legislation.

The urgency of action was highlighted this week by three reports from the National Academy of Sciences that call for limits on greenhouse gas emissions and establishing a price for carbon. The reports titled “America’s Climate Choices” lay out the need to cut U.S. CO2 emissions by 50-80% from 1990 levels by 2050.

Raising the loan ceiling

Steven-ChuEnergy Sec. Steven Chu (right) said April 28 in congressional testimony that there was not enough ceiling in the current loan guarantee program to cover the three remaining projects on DOE’s short list. He asked Congress for $13 billion in new loan authority and got most of it with this measure for $9 billion. He emphasized that nuclear power plants are carbon emission free sources of electricity to meet base load demand.

Last February President Obama announced the first award of $8.3 billion. The other three projects awaiting loan guarantees are Constellation’s Calvert Cliff’s III in Maryland, Scana’s V.C. Summer Station in South Carolina, and NRG’s South Texas Project.

South Carolina is home to Sen. Lindsay Graham who is a pivotal figure on the Republican side of the Senate for the Energy & Climate legislation. He balked earlier this month at helping to swing other Republican Senators to support the bill after Sen. Majority Leader Harry Reid (D-Nev.) switched priorities on the legislative calendar to emphasize immigration reform.

The Scana project involves two Westinghouse AP1000 reactors. Supporting the loan guarantees for the the project could influence Graham to swing back into the Administration’s camp on the climate bill and by rounding up needed Republican votes.

The separate request for $9 billion in additional loan guarantees is expected to be attached to a defense-related spending bill scheduled to clear Congress by Memorial Day.

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2 comments:

DocForesight said...

Has anyone done the math on how a 50-80% reduction in CO2 from 1990 levels actually looks like?

donb said...

Dan Yurman wrote:
The renewable energy piece comes at the insistence of House Speaker Nancy Pelosi (D-Calif) who wants it to replace funds shifted from the Economic Stimulus Bill to the wildly popular ‘cash for clunkers’ program.

Note to Nancy Pelosi: No replacement funds here. This is a cash for (renewables) clunkers program.