Tag: loan guarantees

  • Obama Goes Nuclear

    This article was originally published on Counterpunch.

    Is there any chance that President Barack Obama can return to his long-held stand critical of nuclear power? Is he open to hearing from scientists and energy experts, such as Amory Lovins, who can refute the pro-nuclear arguments that have apparently influenced him?

    Obama’s declaration in his State of the Union speech on January 27 about “building a new generation of safe, clean nuclear power plants in this country” marked a significant change for him. His announcement Tuesday on moving ahead on $8.3 billion in federal government loan guarantees to build new nuclear plants and increasing the loan guarantee fund to $54.5 billion was a further major step. Wall Street is reluctant to invest money in the dangerous and extremely expensive technology.

    Before taking office, including as a candidate for president, Obama not only was negative about atomic energy but—unusual for a politician—indicated a detailed knowledge of its threat to life.

    “I start off with the premise that nuclear energy is not optimal and so I am not a nuclear energy proponent,” Obama said at a campaign stop in Newton, Iowa on December 30, 2007. “My general view is that until we can make certain that nuclear power plants are safe, that they have solved the storage problem—because I’m opposed to Yucca Mountain and just dumping…in one state, in Nevada particularly, since there’s potentially an earthquake line there—until we solve those problems and the whole nuclear industry can show that they can produce clean, safe energy without enormous subsidies from the U.S. government, I don’t think that’s the best option. I am much more interested in solar and wind and bio-diesel and strategies [for] alternative fuels.”

    As he told the editorial board of the Keene Sentinel in New Hampshire on November 25, 2007: “I don’t think there’s anything that we inevitably dislike about nuclear power. We just dislike the fact that it might blow up…and irradiate us…and kill us. That’s the problem.”

    Yes, that’s the big problem with splitting the atom—one that has existed since the start  of nuclear power and will always be inherent in the technology. Using the perilous process of fission to generate electricity with its capacity for catastrophic accidents and its production of highly toxic radioactive poisons called nuclear waste will always be unsafe. And it is unnecessary considering the safe energy technologies now available, from solar, wind and other clean sources.

    Just how dangerous it is has been underlined in a book just published by the New York Academy of Sciences, Chernobyl: Consequences of the Catastrophe for People and the Environment. Written by a team of scientists led by noted Russian biologist Dr. Alexey Yablokov, using health data that have become available since the 1986 accident, it concludes that the fatality total “from April 1986 to the end of 2004 from the Chernobyl catastrophe was estimated at 985,000 additional [cancer] deaths.” This is in Russia, Ukraine, Belarus and other countries where Chernobyl’s poisons fell. The toll, they relate, continues to rise.

    Chernobyl was a different design from the nuclear plants which the U.S., France and Japan seek now to build but disasters can also happen involving these plants and they, too, produce the highly toxic nuclear waste poisons. The problem is fission itself. It’s no way to produce electricity.

    Obama has been aware of this. As he stated at a Londonderry, New Hampshire town meeting on October 7, 2007: “Nuclear power has a host of problems that have not been solved. We haven’t solved the storage situation effectively. We have not dealt with all of the security aspects of our nuclear plants and nuclear power is very expensive.”

    He still left the door open to it. His Energy Plan as a candidate stated: “It is unlikely that we can meet our aggressive climate goals if we eliminate nuclear power from the table. However, there is no future for expanded nuclear without first addressing four key issues: public right-to-know, security of nuclear fuel and waste, waste storage, and [nuclear weapons] proliferation.”

    In his first year as president, nuclear power proponents worked to influence him. Among nuclear opponents, there has been anxiety regarding Obama’s two top aides, both of whom have been involved with what is now the utility operating more nuclear power plants than any other in the United States, Exelon.

    Rahm Emanuel, now Obama’s chief of staff, as an investment banker was in the middle of the $8.2 billion merger in 1999 of Unicom, the parent company of Commonwealth Edison of Chicago, and Peco Energy to put together Exelon. David Axelrod, now a senior Obama advisor and formerly chief campaign strategist, was an Exelon consultant. Candidate Obama received sizeable contributions from Exelon executives including from John Rowe, its president and chief executive officer who in 2007 also became chairman of the Nuclear Energy Institute, the U.S. nuclear industry’s main trade group.

    It’s not only been nuclear opponents who have seen a link between Exelon and the Obama administration. Forbes magazine, in its January 18th issue, in an article on John Rowe and how he has “focused the company on nuclear,” displayed a sidebar headlined, “The President’s Utility.”  It read: “Ties are tight between Exelon and the Obama administration,” noting Exelon political contributions and featuring Emanuel and Axelrod with photos and descriptions of their Exelon connections.

    The Forbes article spoke of how last year “Emanuel e-mailed Rowe on the eve of the House vote on global warming legislation and asked that he reach out to some uncommitted Democrats. ‘We are proud to be the President’s utility,’ says Elizabeth Moler, Exelon’s chief lobbyist,” the article went on. “It’s nice for John to be able to go to the White House and they know his name.’”

    Chicago-based Exelon’s website boasts of its operating “the largest nuclear fleet in the nation and the third largest in the world.” It owns 17 nuclear power plants which “represent approximately 20 percent of the U.S. nuclear industry’s power capacity.”

    The climate change or global warming issue is another factor in Obama’s change on nuclear power. An Associated Press article of January 31 on Obama’s having “singled out nuclear power in his State of the Union address and his spending plan for the next budget,” began: “President Barack Obama is endorsing nuclear energy like never before, trying to win over Republicans and moderate Democrats on climate and energy legislation.”

    MSNBC’s Mike Stuckey on February 9 reported about “Obama’s new support for nuclear power, which some feel may be a down payment for Republican backing on a climate change bill.”

    After the “safe, clean nuclear power” claim, Michael Mariotte, executive director of the Nuclear Information and Resource Service, declared: “Politically, Obama likely was simply parroting the effort being led by Senators John Kerry, Joe Lieberman and Lindsay Graham to gain support for a climate bill by adding massive subsidies for nuclear power, offshore oil and ‘clean’ coal. But recycling George W. Bush energy talking points is no way to solve the climate crisis or develop a sustainable energy policy…Indeed, Obama knows better. Candidate Obama understood that nuclear power is neither safe nor clean.”

    Climate change has been used by those promoting a “revival” of nuclear power—there hasn’t been a new nuclear plant ordered and built in the U.S. in 37 years—as a new argument. In fact, nuclear power makes a substantial contribution to global warming considering the overall “nuclear cycle”—uranium mining and milling, conversion, enrichment, fuel fabrication and the disposition of radioactive waste, and so on.

    Climate change is also one argument for pushing atomic energy of  another major influence on Obama on nuclear power, Steven Chu, his Department of Energy secretary. Chu typifies the religious-like zeal for nuclear power emanating for decades from scientists in the U.S. government’s string of national nuclear laboratories. Chu was director of one of these, Lawrence Berkeley National Laboratory, before becoming head of DOE.

    First established during World War II’s Manhattan Project to build atomic weapons, the laboratories after the war began promoting civilian nuclear technology—and have been pushing it unceasingly ever since. It has been a way to perpetuate the vested interest created during World War II.  The number of nuclear weapons that could be built was limited because atomic bombs don’t lend themselves to commercial distribution, but in pushing food irradiation, nuclear-powered airplanes and rockets, atomic devices for excavation and, of course, nuclear power, the budgets and staffs of the national nuclear laboratories could be maintained, indeed increase.

    That was the analysis of David Lilienthal, first chairman of the U.S. Atomic Energy Commission, which preceded the Department of Energy. Lilienthal in his 1963 book Change, Hope, and the Bomb wrote: “The classic picture of the scientist as a creative individual, a man obsessed, working alone through the night, a man in a laboratory pushing an idea—this has changed. Now scientists are ranked in platoons. They are organization men. In many cases the independent and humble search for new truths about nature has been confused with the bureaucratic impulse to justify expenditure and see that next year’s budget is bigger than last’s.”

    Lilienthal wrote about the “elaborate and even luxurious [national nuclear] laboratories that have grown up at Oak Ridge, Argonne, Brookhaven” and the push to use nuclear devices for “blowing out harbors, making explosions underground to produce steam, and so on” which show “how far scientists and administrators will go to try to establish a nonmilitary use” for nuclear technology.

    Chu, like so many of the national nuclear laboratory scientists and administrators, minimizes the dangers of radioactivity. If they didn’t, if they acknowledged how life-threatening the radiation produced by nuclear technology is, their favorite technology would crumble.

    A major theme of Chu, too, is a return to the notion promoted by the national nuclear laboratories in the 1950s and 60s of “recycling” and “reusing” nuclear waste. This way, they have hoped, it might not be seen as waste at all. The concept was to use radioactive Cesium-137 (the main poison discharged in the Chernobyl disaster) to irradiate food, to use depleted uranium to harden bullets and shells, and so on. In recent weeks, with Obama carrying out his pledge not  to allow Yucca Mountain to become a nuclear waste dump, Chu set up a “blue-ribbon” panel on radioactive  waste—stacked with nuclear power advocates including Exelon’s John Rowe—that is expected to stress the “recycling” theory.  

    “We are aggressively pursuing nuclear energy,” declared Chu in January as he announced DOE’s budget plan—which included an increase in the 2011 federal budget in monies for nuclear loan guarantees to build new nuclear plants cited by Obama Tuesday. “We are, as we have repeatedly said, working hard to restart the American nuclear power industry.”

    The $8.3 billion in loan guarantees Obama announced Tuesday is to come from $18.5 billion in guarantees proposed by the George W. Bush administration and authorized by Congress in 2005. “My budget proposes tripling the loan guarantees we provide to help finance safe, clean nuclear facilities,” said Obama Tuesday, referring to the DOE plan which would add $36 billion and bring the loan guarantee fund to $54.5. And this despite candidate Obama warning about “enormous subsidies from the U.S. government” to the nuclear industry.

    The $8.3 billion in loan guarantees is to go toward the Southern Company of Atlanta constructing two nuclear power reactors in Burke, Georgia. These are to be AP1000 nuclear power plants designed by the Westinghouse nuclear division (now owned by Toshiba) although in October the designs were rejected by the U.S. Nuclear Regulatory Commission as likely being unable to withstand events like tornadoes and earthquakes.

    Obama’s change of stance on nuclear power has led to an earthquake of its own politically. MoveOn, the nonprofit advocacy group that has raised millions of dollars for Democratic candidates including Obama, gauged sentiment of his State of the Union speech by having10,000 MoveOn members record their views. Every few seconds they pressed a button signaling their reactions—ranging from “great” to “awful.” When Obama got his line on energy, the overwhelming judgment was awful. “The most definitive drop in enthusiasm is when President Obama talked about nuclear power and offshore drilling,” said Ilyse Hogue, MoveOn’s director of political advocacy. “They’re looking for clean energy sources that prioritize wind and solar.”

    “Safe, clean nuclear power—it’s an oxymoron,” said Jim Riccio, nuclear policy analyst for Greenpeace USA. “The president knows better. Just because radiation is invisible doesn’t mean it’s clean.”

    “From a health perspective, the proposal of the Obama administration to increase federal loan guarantees for new nuclear reactors poses a serious risk to Americans,” said Joseph Mangano, executive director of the Radiation and Public Health Project. “Adding new reactors will raise the chance for a catastrophic meltdown. It will also increase the amount of radioactive chemicals routinely emitted from reactors into the environment—and human bodies. New reactors will raise rates of cancer—which are already unacceptably high—especially to infants and children. Public policies affecting America’s energy future should reduce, rather than raise, hazards to our citizens.”

    As to government loan guarantees, “The last thing Americans want is another government bailout for a failing industry, but that’s exactly what they’re getting from the Obama administration,” said Ben Schreiber, the climate and energy tax analyst of Friends of the Earth.

    “It would be not only good policy but good politics for Obama to abandon the nuclear loan guarantee program,” said Mariotte of NIRS.

    After Obama’s Tuesday declaration on loan guarantees, Paul Gunter, director of the Reactor Oversight Project of the organization Beyond Nuclear, said: “Unfortunately, the president’s decision is fuel for opposition to costly and dangerous nuclear power. It signals a widening of a divide as the administration steps back from its promise for a change in energy policy and those of us who are committed to a change.”

    “We are deeply disturbed by President Obama’s decision,” said Peter Wilk, executive director of Physicians for Social Responsibility. “Not only does this put taxpayers on the hook for billions, it prioritizes a dirty, dangerous, and expensive technology over public health.  From the beginning to the end of the nuclear fuel cycle, nuclear reactors remain a serious threat to public health and safety.  From uranium mining waste to operating reactors leaking radioactivity to the lack of radioactive waste solutions, nuclear power continues to pose serious public health threats.”

    Nuclear opponents have been disappointed in a lack of access to the Obama White House of those with a critical view on nuclear power—who could counteract the pro-nuclear arguments that Obama has been fed. Will President Obama open himself to hearing from those who question nuclear power?

    Obama has credibility trouble already. New York Times columnist Bob Herbert wrote on January 26:

        “Who is Barack Obama? Americans are still looking for the answer…Mr. Obama may be personally very appealing, but he has positioned himself all over the political map…Mr. Obama is in danger of being perceived as someone whose rhetoric, however skillful, cannot always be trusted. He is creating a credibility gap for himself, and if it widens much more he won’t be able to close it.”

  • Obama’s Atomic Blunder

    As Vermont seethes with radioactive contamination and the Democratic Party crumbles, Barack Obama has plunged into the atomic abyss.

    In the face of fierce green opposition and withering scorn from both liberal and conservative budget hawks, Obama has done what George W. Bush could not—pledge billions of taxpayer dollars for a relapse of the 20th Century’s most expensive technological failure.

    Obama has announced some $8.3 billion in loan guarantees for two new reactors planned for Georgia. Their Westinghouse AP-1000 designs have been rejected by the Nuclear Regulatory Commission as being unable to withstand natural cataclysms like hurricanes, tornadoes and earthquakes.

    The Vogtle site was to originally host four reactors at a total cost of $600 million; it wound up with two at $9 billion.

    The Southern Company which wants to build these two new reactors has cut at least one deal with Japanese financiers set to cash in on American taxpayer largess. The interest rate on the federal guarantees remains bitterly contested. The funding is being debated between at least five government agencies, and may well be tested in the courts. It’s not clear whether union labor will be required and what impact that might have on construction costs.

    The Congressional Budget Office and other analysts warn the likely failure rate for government-back reactor construction loans could be in excess of 50%. Energy Secretary Stephen Chu has admitted he was unaware of the CBO’s report when he signed on to the Georgia guarantees.

    Over the past several years the estimated price tag for proposed new reactors has jumped from $2-3 billion each in some cases to more than $12 billion today. The Chair of the NRC currently estimates it at $10 billion, well before a single construction license has been issued, which will take at least a year.

    Energy experts at the Rocky Mountain Institute and elsewhere estimate that a dollar invested in increased efficiency could save as much as seven times as much energy than one invested in nuclear plants can produce, while producing ten times as many permanent jobs.

    Georgia has been targeted largely because its regulators have demanded ratepayers put up the cash for the reactors as they’re being built. Florida and Georgia are among a small handful of states taxing electric consumers for projects that cannot come on line for many years, and that may never deliver a single electron of electricity.

    Two Florida Public Service Commissioners, recently appointed by Republican Governor Charlie Crist (now a candidate for the US Senate), helped reject over a billion dollars in rate hikes demanded by Florida Power & Light and Progress Energy, both of which want to build double-reactors at ratepayer expense. The utilities now say they’ll postpone the projects proposed for Turkey Point and Levy County.

    In 2005 the Bush Administration set aside some $18.5 billion for reactor loan guarantees, but the Department of Energy has been unable to administer them. Obama wants an additional $36 billion to bring the fund up to $54.5 billion. Proposed projects in South Carolina, Maryland and Texas appear to be next in line.

    But the NRC has raised serious questions about Toshiba-owned Westinghouse’s AP-1000 slated for Georgia’s Vogtle site, as well as for South Carolina and Turkey Point. The French-made EPR design proposed for Maryland has been challenged by regulators in Finland, France and Great Britain. In Texas, a $4 billion price jump has sparked a political upheaval in San Antonio and elsewhere, throwing the future of that project in doubt.

    Taxpayers are also on the hook for potential future accidents from these new reactors. In 1957, the industry promised Congress and the country that nuclear technology would quickly advance to the point that private insurers would take on the liability for any future disaster, which could by all serious estimates run into the hundreds of billions of dollars. Only $11 billion has been set aside the cover the cost of such a catastrophe. But now the industry says it will not build even this next generation of plants without taxpayers underwriting liability for future accidents. Thus the “temporary” program could ultimately stretch out to a full century or more.

    In the interim, Obama has all but killed Nevada’s proposed Yucca Mountain nuclear waste dump. He has appointed a commission of nuclear advocates to “investigate” the future of high-level reactor waste. But after 53 years, the industry is further from a solution than ever.

    Meanwhile, the Nuclear Regulatory Commission has reported that at least 27 of America’s 104 licensed reactors are now leaking radioactive tritium. The worst case may be Entergy’s Vermont Yankee, near the state’s southeastern border with New Hampshire and Massachusetts. High levels of contamination have been found in test wells around the reactor, and experts believe the Connecticut River is at serious risk.

    A furious statewide grassroots campaign aims to shut the plant, whose license expires in 2012. A binding agreement between Entergy and the state gives the legislature the power to deny an extension. US Senator Bernie Sanders (I-VT) has demanded the plant close. The legislature may vote on it in a matter of days.

    Obama has now driven a deep wedge between himself and the core of the environmental movement, which remains fiercely anti-nuclear. While reactor advocates paint the technology green, the opposition has been joined by fiscal conservatives like the National Taxpayer Institute, the Cato Institute and the Heritage Foundation.

    Reactor backers hailing a “renaissance” in atomic energy studiously ignore France’s catastrophic Olkiluoto project, now $3 billion over budget and 3 years behind schedule. Parallel problems have crippled another project at Flamanville, France, and are virtually certain to surface in the US.

    The reactor industry has spent untold millions lobbying for this first round of loan guarantees. There’s no doubt it will seek far more in the coming months. Having failed to secure private American financing, the question will be: in a tight economy, how much public money will Congress throw at this obsolete technology.

    The potential flow of taxpayer guarantees to Georgia means nuclear opponents now have a tangible target. Also guaranteed is ferocious grassroots opposition to financing, licensing and construction of this and all other new reactor proposals, as well as to continued operation of leaky rustbucket reactors like Vermont Yankee.

    The “atomic renaissance” is still a very long way from going tangibly critical.