Loan guarantees sought by nuclear industry for reactor construction amount to â€˜preemptive bailout,â€™ with expected default rate of 50 percent or higher.
WASHINGTON – September 29 – A new ad from Friends of the Earth accuses nuclear industry lobbyists of seeking a “preemptive bailout” from Congress in the form of risky, taxpayer-backed loan guarantees from Congress.
“First the government bails out the banks, now all of Wall Street, at a cost of over 1 trillion dollars. So why would taxpayers ever risk billions to build nuclear power plants?” the ad asks. “With cheaper, safer alternatives, why is Congress even considering a preemptive bailout for nuclear power?”
Nuclear industry executives admit that nuclear power is so financially risky that federal loan guarantees are the only way new plants will get built. For example, Michael J. Wallace, the co-chief executive of UniStar Nuclear, told the New York Times last year that “without loan guarantees we will not build nuclear power plants.” Unfortunately, the Congressional Research Service says such guarantees could leave taxpayers with “potentially large losses.” The Congressional Budget Office estimates that the risk of default on a nuclear loan guarantee is “very high-well above 50 percent.”
“The fact that we’re already looking at a trillion-dollar bailout for the financial services industry ought to take an additional bailout for the nuclear industry off the table,” Friends of the Earth President Brent Blackwelder said. “There are cleaner, safer, more affordable ways to address the energy crisis. A multibillion-dollar preemptive bailout for the nuclear industry in the form of risky loan guarantees is not the answer.”
Friends of the Earth is encouraging Americans who don’t want billions of their tax dollars to be spent bailing out the nuclear industry to join our campaign at http://www.foe.org.