Just as Americans are being asked to back the biggest bailout in U.S. history, Senator McCain would again put the American taxpayer on the hook for yet another corporate giveaway.

Senator McCain wants to build 100 more nuclear reactors in the U.S., 45 by 2030. But there’s an important detail that the Senator and his campaign fail to mention.  The economics of nuclear power are so abysmal that many nuclear CEO’s will not construct reactors unless the American taxpayer guarantees they wont lose money.

But the good senator and his campaign should know better.  Senator McCain has been around long enough to actually remember the implosion of the nuclear industry.  If his recollection has failed, his economic advisor Douglas Holtz-Eakin could refresh his memory. When the notion that the American taxpayer should guarantee loans to nuclear corporations was introduced in the Senate, the non-partisan Congressional Budget Office (CBO) then headed by Senator McCain’s economic advisor Holtz-Eakin found that:

CBO considers the risk of default on such a loan guarantee to be very high—well above 50 percent. The key factor accounting for this risk is that we expect that the plant would be uneconomic to operate because of its high construction costs, relative to other electricity generation sources.  http://www.cbo.gov/ftpdocs/42xx/doc4206/s14.pdf

Senator McCain’s support for nuclear loan guarantees can not be justified by the nuclear industry’s past performance.  According to the Department of Energy, the first 75 reactors built in the U.S. experienced cost overruns totaling over $100 billion and that was before the meltdown at Three Mile Island sent the nuclear industry even further into a tailspin.   

U.S. Nuclear Power Plant Construction Cost Overruns

Construction Started	Estimated Overnight Costs	Actual Overnight Costs	Percent Overrun
1966-67	$ 560/kWe	$1,170/kWe	209%
1968-69	$ 679	$2,000	294%
1970-71	$ 760	$2,650	348%
1972-73	$1,117	$3,555	318%
1974-75	$1,156	$4,410	381%
1976-77	$1,493	$4,008	269%

                                                                                                                                              (Joskow, Massachusetts Institute of Technology, The Economics of Investment in New Nuclear Power Plants in the U.S, EIA Midterm Energy Outlook Conference, April 12, 2005. Note: Figures are in 2002$/kWe )

It was this economic track record that doomed nuclear power in the U.S. and led Forbes magazine to declare that the "failure of the U.S. nuclear power program ranks as the largest managerial disaster in business history, a disaster of monumental scale." Really, who in their right mind would guarantee loans to an industry with this track record?  Obviously, not Wall Street!

Last July, six major U.S. Banking institutions (some of which have been bought or are now bankrupt) including Citigroup, Credit Suisse, Lehman Brothers, Goldman Sachs, Merrill Lynch & Morgan Stanley sent a letter to the Department of Energy (DOE).  The bankers told DOE that unless the U.S. Taxpayer backed 100% of the debt incurred by nuclear corporations that they would have difficulty “accessing capital markets.”

We believe many new nuclear construction projects will have difficulty accessing the capital markets during construction and initial operation without the support of a federal government loan guarantee.  Lenders and investors in the fixed income markets will be acutely concerned about a number of political, regulatory and litigation-related risks that are unique to nuclear power, including the possibility of delays in commercial operation of a completed plant or “another Shoreham”. We believe these risks, combined with the higher capital costs and longer construction schedules of nuclear plants as compared to other generation facilities, will make lenders unwilling at present to extend long-term credit to such projects in a form that would be commercially viable.  http://www.lgprogram.energy.gov/nopr-comments/comment29.pdf

 
The U.S. General Accounting Office (GAO) has also weighed in on these loan guarantees to the nuclear industry. The GAO recently found that the Bush Administration’s DOE does not have the oversight in place to adequately manage the loan guarantee program.  But rather than address the inadequacies identified by the GAO, the Bush administration has accelerated the loan guarantee program.  http://www.gao.gov/new.items/d08750.pdf

Senator McCain has already been warned by the CBO, the GAO and Wall Street that building new nuclear power plants is an economic meltdown waiting to happen. Even a subsidiary of Warren Buffet’s corporation Berkshire Hathaway has rejected a new nuclear reactor as economically unsound.  

Senator McCain has abandoned his straight talk when it comes to nuclear power.  The Senator needs to  explain why the American taxpayer should be put on the hook for new nuclear plants that the industry would never build if they and their stockholders had to bear the risk.

--Jim Riccio

Seven years have past since the attacks on the World trade Center and the Pentagon and now a little more than four months remain in the Bush Presidency. The American homeland hasn’t been attacked again since that horrific day, but if terrorists were to target a nuclear power plant would the nuclear industry be ready?  

The Bush administration’s nuclear regulators have forced the industry’s 104 nuclear reactors to add more guards and guns on the ground at nuclear plant sites. However, the Nuclear Regulatory Commission (NRC) has failed to adequately address the threat to both new and existing nuclear power plants and the radioactive wastes they produce.  

After September 11th, the NRC revisited the level of protection afforded nuclear plants. The nuclear industry opposed changes that would have placed nuclear security guards under federal authority and lobbied the NRC to set the security standard, known as the design basis threat, as low as possible.

Even after the 9-11 attacks, the nuclear industry argued that it shouldn’t be required to defend against terrorists since they were “enemies of the state.” And unfortunately the Bush Administration’s NRC agreed with the industry. As a result, the NRC didn’t set the new security standard based upon the actual threat to nuclear plants. Instead, then NRC Chairman Diaz, who had claimed that nuclear plants were best defended from an airliner attack at the airport, based the new security standard on what a private security force could be expected to defend against.
 
Unfortunately, the Bush administration’s NRC did not base the new security standard upon on the force, size and capabilities of the terrorists that have threatened U.S. reactors.  It based the new security standard upon the capabilities of nuclear industry’s guard force! If this nonsensical approach to defending nuclear power plants wasn’t bad enough, recent revelations of nuclear plant guards sleeping on the job and the lack of NRC oversight only serve to heighten concerns about security.

Last September, CBS News broke a story about sleeping guards at the Peach Bottom nuclear plant in Pennsylvania.  A worker at the plant had informed the NRC Region I office that security guards were sleeping on the job. However, the NRC failed to act on the information when the nuclear plant owner, Exelon, said it found no evidence. So CBS News aired videotape of the guards sleeping.  You can view the CBS story here:

http://wcbstv.com/politics/peach.bottom.nuclear.2.291442.html

The NRC has since scrambled and has tried to repair the damage to its reputation by fining the nuclear corporation; but it has also threatened the whistleblower who filmed the sleeping guards with a violation of the Patriot Act for taking pictures inside a nuclear plant!

Congressman John Dingle (D- MI) who oversees the NRC said that, "(t)he NRC's stunning failure to act on credible allegations of sleeping security guards, coupled with its unwillingness to protect the whistleblower who uncovered the problem, raises troubling questions." It should, when it comes to nuclear whistleblowers the NRC has had a long history of shooting the messenger.

Congressman Dingle isn’t the only one to take issue with the NRC’s handling of the sleeping security guards.  The NRC’s Inspector General also found fault with the agency’s handling of the allegations.  The IG found that NRC Region I failed to follow proper procedures dealing with allegations by whistleblowers and merely called Exelon to see if security guards were sleeping at the Peach Bottom nuclear plant.  The NRC IG report can be found here:

http://www.nrc.gov/reading-rm/doc-collections/insp-gen/2008/ei-07-65.pdf

Security guards have also been caught sleeping at Entergy’s Indian Point Nuclear Power Plant, 24 miles north of New York City and at the FPL’s Turkey Point nuclear plant 25 miles South of Miami, FL.  

So, how many terrorists can sleeping guards defend against?

Unfortunately, this amazing lack of regulatory rigor is emblematic of the Bush administration’s NRC since 9-11.  In order to force nuclear regulators to better defend nuclear reactors and their wastes, Senator Hillary Rodham Clinton (D-NY) and Congressman Edward J. Markey (D-MA) introduced legislation last month to correct the most glaring inadequacies.

In the House of Representatives, the legislation has been introduced as H.R. 6816, "The Nuclear Facility and Materials Security Act of 2008."

The proposed legislation would address many of the gaps in the nuclear security left by the Bush Administration’s unwillingness to regulate the nuclear industry.  If enacted H.R. 6818 would:

• Require that any new reactor built in the U.S.- be designed to withstand the impact of a large commercial aircraft;

 

• Require that spent fuel from nuclear reactors be stored in the safest manner possible while in the spent fuel pool, for the fuel to be moved to dry storage as soon as possible, and upgrading the security requirements for spent fuel storage facilities;

 

• Require the distribution of anti-radiation pills (potassium iodide or KI pills) to communities within 20 miles of our nation's nuclear power plants;

 

• Require that the Nuclear Regulatory Commission abide by a recent court decision that directed that before new or revised licenses for nuclear reactors are granted, that the potential consequences of an act of terrorism be considered; and

 

• that the highest-risk radiation sources that could be used to make a dirty bomb be equipped with location tracking technology and requiring less dangerous technologies to be used where possible.

What is truly disheartening is that this legislation is even necessary seven years after 9-11.  You’d have thought that a responsible regulator would have already addressed these threats, especially after being warned that terrorists wanted to turn reactors into pre positioned weapons of mass destruction.  Unfortunately, since 9-11, we’ve had a President and an administration that would rather lie about threats to and posed by nuclear power plants than actually defend the public health and safety.  

Hopefully the next president and new leadership at the NRC will be more responsible.

-- Jim

This post was originally published April 26, 2008:

As American nuclear corporations move toward constructing new reactors in the U.S., it’s important that we remember the downside of the nuclear industry on this 22nd Anniversary of the Chernobyl Disaster.

The fact is that none of these corporations would ever construct another reactor if they were held liable for the consequences of the catastrophic accident that could occur. Less than a month after the disaster, NRC Commissioner James K. Asselstine testified to Congress that,

While we hope that their occurrence is unlikely, there are accident sequences for U.S. plants that can lead to rupture or bypassing of containment in U.S. reactors which would result in the off-site release of fission products comparable or worse than the releases estimated by the NRC staff to have taken place during the Chernobyl accident.

That is why the Commission told Congress recently that it could not rule out a commercial nuclear power plant accident in the United States resulting in tens of billions of dollars of property losses and injuries to the public.

The nuclear industry and their propagandists would like the public to forget or ignore this nuclear disaster.  But those who forget history are condemned to repeat it.  

Unfortunately, former Greenpeace activist Patrick Moore is now one of these pro-nuclear propagandists downplaying the consequences of this disaster. In the wake of the Chernobyl disaster,  and prior to pulling a paycheck from the Nuclear Energy Institute and forming CASEnergy, he issued a document entitled:

 “SOME FACTS ABOUT THE CHERNOBYL NUCLEAR DISASTER”
by Patrick Moore, Ph. D.
Greenpeace Foundation of Canada

 

 

Mr. Moore went on to conclude that:

 

The facts concerning the Chernobyl disaster haven’t changed and neither has the nuclear industry. Nuclear power is a dangerous technology that would never be built if corporations bore the true cost and liability for the potential consequences. However, it seems Mr. Moore has either forgotten the facts about Chernobyl or has been paid to ignore them. Neither of which is acceptable.  

For more information on the Chernobyl Accident and reactor risks:

American Chernobyl: Nuclear “Near Misses” at U.S. Reactors Since 1986.
Greenpeace 2007.

Risky Business: The Probability and Consequences of a Nuclear Accident
Greenpeace

CHERNOBYL: Some Lessons  and Implications for Lower Quality Electric Utilities,  Donaldson. Lutkin & Jenrette Securities Corporation, 1986


For additional information on Mr. Moore & his current activities see:

Spinning the Atom in Mother Jones Magazine


 

Drill here, Drill Now. That’s the name of Newt Gingrich’s new petition to open oil drilling off of America’s coastlines.

Build 45 new nuclear plants by 2030 – that’s McCain’s plan to combat global warming.

They sound like simple solutions, right? In fact, they’re deceptively simple. And they’re not solutions at all.

No offshore drilling

What does drilling off America’s coastlines really mean? Will it help skyrocketing gas prices? The economy? You?

No.

According to predictions made by The U.S. Energy Information Administration last year: “Leasing would begin no sooner than 2012, and production would not be expected to start before 2017” if the moratorium on offshore drilling were lifted. The agency also estimated that U.S. oil production would increase by a mere 7 percent - about 200,000 barrels a day - by 2030, which would have an "insignificant" impact on oil prices.

So what will drilling do? It will:

• Expose whales and dolphins to potentially lethal seismic testing
• Open the possibility of oil spills on our beaches
• Line the pocketbooks of big oil companies, who are already sitting on top of 68 million acres of leased land that they aren’t drilling on at all, despite their “concern” about high oil prices

No more nuclear plants

McCain says that building 45 new nuclear plants by 2030 is a course of action “as difficult as it is necessary.” Well, he is right in one regard: It will be difficult. It takes billions of dollars and at least 10 years to bring a new nuclear reactor online.

But necessary? Hardly.

In fact, we don’t have 10 years to wait for clean energy to come online. Not that nuclear is all that clean: you still have to mine the uranium used in the reactors – and mining is a dirty, polluting process – and you have to store the nuclear waste somewhere – waste that can be around for centuries, sitting in a storage facility somewhere, susceptible to leaks. Meanwhile, we have solar and wind technologies, and several other renewable technologies, that are ready to be implemented on a large scale right now.

Which brings me to my next point: nuclear reactors cost so much, the utilities aren’t likely to build new plants unless they are heavily subsidized by the federal government. That’s billions upon billions of dollars that we could and should be investing in clean, renewable technologies – the real solutions to global warming and the true path to America’s energy independence.

So what am I asking of YOU? Well that’s actually plain old simple. Newt Gingrich has convinced more than a million people to sign his petition in support of offshore drilling. So I’m asking you to digg here, digg now. Then send a letter to McCain letting him know you're AGAINST false solutions. And if you really want to stop these false solutions from leading us astray, don’t stop there. Tell your friends about this action, send them this blog, ask them to get involved too.

Tell McCain, tell Gingrich, tell Congress: Don’t you dare drill here, don’t you dare drill here ever. And no new nukes! We demand real solutions to global warming!

Senator McCain, once lauded by environmentalists for breaking with the Bush Administration and the republican establishment by acknowledging the need to address climate change, has once again failed to offer realistic solutions to the climate conundrum.

In 2005, McCain larded up his climate legislation with billions of dollars in nuclear subsidies and lost support for his bill. His blind and unquestioning support for the nuclear industry cost him and this country the opportunity to pass climate change legislation.

(See David Corn’s article in Mother Jones, McCain’s Nuclear waste
http://motherjones.com/washington_dispatch/2008/03/john-mccain-nuclear-waste.html)

Yesterday Senator McCain called for 45 new nuclear reactors by 2030. 

The Senator obviously hasn’t learned from his mistakes….

To address climate change, we need solutions that are fast and affordable and nuclear is neither. According to NASA’s climate change guru James Hansen, we have approximately 7 years to address  the most catastrophic impacts of climate change.  Senator McCain’s call for 45 reactors by 2030 ignores this reality.  Even if the Senator becomes President, it will be another decade before any new nuclear reactor in the US generates electricity.  Nuclear power will be too late to abate climate change.  

In addition, new nuclear plants are so prohibitively expensive they may never be built.
In December, nuclear corporations told Florida regulators that a new Westinghouse designed nuclear plant would cost between $12 and $18 billion dollars – more than double earlier estimates for the very same reactors.  [A new Areva designed nuclear plant could cost as much as $24 billion.]  That same month MidAmerican, a subsidiary of Warren Buffet’s Berkshire Hathaway, became the first corporation to postpone a new reactor.  After performing their due diligence review MidAmerican found that building a new reactor did not make economic sense.  

Energy experts ranging from MIT to the Rocky Mountain Institute recognize that energy efficiency and renewable energy are a much more effective hedge against global warming than nuclear power.

Estimates vary, but every dollar spent on efficiency and renewable energy goes 5 to 10 times further in displacing CO2 than a dollar spent on nuclear power.  Wasting hundreds of billions of dollars on nuclear power would put America and the world even further behind the climate curve ball. Its time for Senator McCain to get back on the “straight talk express” and provide real solutions to climate change that America can afford and implement before its too late.

-- Jim Riccio