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Portending the nation’s intensifying need for additional sources of clean, reliable electricity, the Department of Energy (DOE) released a fiscal year 2009 budget request that seeks a 79 percent increase in funding for the Nuclear Power 2010 program. It would extend the period during which companies building new nuclear power plants can apply for federal loan guarantees to lower the debt-financing costs associated with the projects.
The Nuclear Power 2010 program—a cost-sharing, industry-government partnership designed to reduce the technical, regulatory and institutional uncertainties associated with construction of new nuclear power plants—would receive $241.6 million in the fiscal year that begins Oct. 1. The program receives $135 million in fiscal year 2008. Industry also would fund the program with $241.6 million.
The budget request also seeks a 27 percent increase in funding for DOE’s used nuclear fuel management program. The program receives $390 million this year and would receive $494.7 million in fiscal year 2009. Of DOE’s request, $247.3 million would come from the Nuclear Waste Fund that is financed by electricity customers who use nuclear power. The remainder would come from Defense Department accounts to support disposal of high-level radioactive waste from U.S. defense programs.
The budget request extends by two years, through fiscal year 2011, the period during which companies could seek a limited federal financial backstop for new clean-generating plants, including new nuclear plants, under the loan guarantee program authorized in the Energy Policy Act of 2005. The legislation empowers the secretary of energy to provide loan guarantees for up to 80 percent of the cost of technologies that avoid, reduce or sequester air pollutants or anthropogenic emissions of greenhouse gases.
The loan guarantees are not an actual appropriation and, therefore, do not represent an outlay of taxpayer dollars when the clean-energy projects are successfully completed. They are designed to boost investor confidence and allow worthy projects to move ahead with debt financing on more reasonable terms that ultimately will lower the overall cost of electricity generated by those projects.
According to the DOE, about one-third of U.S. electricity production is generated by carbon-free sources, and nuclear energy supplies more than 70 percent of the electricity generated that does not emit controlled pollutants or greenhouse gases into the atmosphere.
Nuclear Energy Institute President and Chief Executive Officer Frank L. Bowman said the budget request properly recognizes the need for nuclear energy to remain a key element of the nation’s diverse electricity portfolio for generations to come.
“Nuclear energy enhances our energy independence, and new nuclear power plants are essential if the United States hopes to meet its energy and environmental challenges,” Bowman said, adding that, “The promise of nuclear energy technology extends beyond electricity production to include production of hydrogen and process heat for other applications.”