Nuclear Costs
Estimates for new reactor construction costs continue to sky-rocket. Conservative estimates range between $6 and $12 billion per reactor but Standard & Poor's predicts a continued rise. The nuclear power industry is lobbying for heavy federal subsidization including unlimited loan guarantees but the Congressional Budget Office predicts the risk of default will be well over 50 percent, leaving taxpayers to foot the bill. Beyond Nuclear opposes taxpayer and ratepayer subsidies for the nuclear energy industry.
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The Wall Street Journal, in an article entitled "Troubled Chinese Nuclear Project Illustrates Toshiba's Challenges," shows how its not just U.S. new atomic reactor costs overruns and schedule delays causing a "nuclear nightmare" for one of Japan's largest corporations, and a global leader of the nuclear power industry.
"Burning money" graphic designed by Gene Case of Avening Angels was featured on The Nation Magazine's cover in 2003, accompanying Christian Parenti's feature article on the nuclear power relapse in the U.S.As reported by Bloomberg, Toshiba-Westinghouse has been plunged into a financial "nuclear nightmare" -- with losses, over just the past few trading days, amounting to $4 to 5 billion (yes, with a B!) -- losses amounting to more than 40% of its stock value. This is due to cost overruns, mounting into the billions of dollars, and years-long schedule delays, at four new reactor construction sites in the U.S.
The debacle stems from Toshiba-Westinghouse's acquisition of the Chicago Bride & Iron (CBI) new reactor construction firm, in a vain attempt to get control of already astronomical, but still skyrocketing costs, at the Vogtle 3 & 4 reactors construction site in Georgia, as well as the Summer 2 & 3 reactors construction site in South Carolina.
Toshiba-Westinghouse's AP-1000 (so-called Advanced Passive, 1,100 Megawatt-electric) reactor design was touted as the flagship of the so-called "Nuclear Renaissance," not only in the U.S., but internationally.
However, Arnie Gundersen of Fairewinds Associates, Inc., working for a coalition of environmental groups, many years ago identified a potentially fatal flaw in the design's containment. This could result in catastrophic amounts of hazardous radioactivity being pumped into the environment, in the event of an AP-1000 reactor core meltdown.
Besides Toshiba-Westinghouse's financial free fall, the public also faces mounting monetary risks.
In Georgia, the nuclear utilities have got state residents -- and the American public -- coming and going: Southern Nuclear, Georgia Power, et al. are charging ratepayers Construction Work in Progress (CWIP), or advance cost recovery, "nuclear tax" surcharges on their electricity bills, to fund construction of Vogtle 3 & 4.
But in addition to that, the Obama administration awarded Vogtle 3 & 4 an $8.3 billion (yes, with a B!) federal nuclear loan guarantee. And even the loan itself came from the taxpayer-funded U.S. Finance Bank.
If the Vogtle 3 & 4 project goes belly up, Georgia ratepayers could have invtested billions of dollars, without ever seeing a single kilowatt-hour of electricity generated at Vogtle 3 & 4; U.S. taxpayers could be left holding the bag for the entire nuclear loan guarantee, as the Obama administration did not see fit to require any (a 0% credit subsidy fee) nuclear utility skin in the game whatsoever!
Vogtle 3 & 4's $8.3 billion nuclear loan guarantee puts at risk more than 15 times the amount of taxpayer money lost at the Solyndra solar loan guarantee default. And Vogtle 3 & 4's risk of default was judged to be higher than was Solyndra's, when both projects were just getting going.
Although Summer 2 & 3 did not seek federal nuclear loan guarantees to finance construction, CWIP charges alone in South Carolina have been severely onerous. Around 20% of ratepayers' electric bills are going towards construction of the two AP-1000s, with no end in sight for the out of control increases in the two reactors' price tags.
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Reuters has also reported on this story: "Battered Toshiba out of easy options to plug nuclear hole."
So too has the Wall Street Journal: "Toshiba Shares Plunge Further Over Problems at Nuclear-Power Subsidiary."
The Wall Street Journal video news clip summary at the link immediately above reports that Toshiba stock has tanked more than 40% in just the past few trading days!
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The Wall Street Journal, in an article entitled "Troubled Chinese Nuclear Project Illustrates Toshiba's Challenges," shows how its not just U.S. new atomic reactor costs overruns and schedule delays causing a "nuclear nightmare" for one of Japan's largest corporations, and a global leader of the nuclear power industry.
NEIS posted the following comment in response to the AP article, and the passage of the Exelon Nuclear bailout in IL:
NEIS COMMENT:
If Gov. Rauner really and truly believes that, " closing the plants would have "devastated the two communities," then he should have worked to bail out the potentially devastated communities, not the hugely profitable private corporation.
For over 2 years our organization argued that the State must insist that a "just transitions" program be instituted to protect reactor (and perhaps coal) communities from the withdrawal of "company town" utilities. Absent such a proactive plan, this "bailout tango" will be repeated in the future when Byron, LaSalle, Dresden and Braidwood start to become "unprofitable" for Exelon. We spelled out potential funding mechanisms, which are eminently negotiable. We left copies of this plan at the offices of over 40 legislators and state officials, including Governor Rauner's office, Rep. Madigan's office, Sen. Cullerton's office, the AG's office, and numerous individual legislators including Sen. Radogno, the Clean Jobs Bill sponsors, and others. We personally gave copies to Sen. Chapin Rose, and representatives from the Quad Cities chamber of commerce and City Administrator of Clinton. We made it part of our testimony before the House and Senate Energy Committees. We urged that it become a topic of discussion and negotiation in the current legislation.
No luck.
Evidently. legislators love 6-hour public hearings, and annual bailout proceedings. It's much easier to pass the bills along to disempowered ratepayers than to engage in responsible governance. Happy holidays, all.
--David Kraft, Director, Nuclear Energy Information Service, Chicago--
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But it isn't just the anti-nuclear left which opposes the Exelon Nuclear bailout.
As Tweeted out by Scott Stapf of the Hastings Group:
Grover Norquist is President and Founder of Americans for Tax Reform, a right wing conservative group.
An op-ed has been published by Crain's, written by Dave Lundy, director of the Best Coalition. Best Coalition is described as a diverse group of consumer, business and energy interests.
IMMEDIATE ACTION NEEDED!
There may still be a chance to stop the Exelon Nuclear bailout in IL, for as Utility Dive reports
Tell IL Governor and Legislators and Legislative Leaders that Exelon Nuclear Bailout is Outrageous!
If this bailout goes through, then those three dirty, dangerous, and expensive reactors will keep operating. This means more high-level radioactive waste generation, and worsening safety risks at these age-degraded, 40+ year old reactors!
