A message from our director, Tom “Smitty” Smith:
Today the House and Senate are working to reconcile their different versions of the long-awaited economic stimulus package. The stakes are now higher than ever for Texans, who stand to gain from billions that could go toward developing renewable energy and efficiency in the state, reducing pollution from diesel engines, and cleaning up abandoned nuclear waste sites.
But as much as the state needs that massive investment in our energy future, there is a troubling side to the senate version of the stimulus package: Senators amended the stimulus bill to include $50 billion in loan guarantees for new nuclear plants in Texas and elsewhere in the nation.
If Congress needs a reminder why this is a bad deal, it should just ask Wall Street why it doesn’t loan money for nuclear reactors. According to the Congressional Budget Office, nuclear loans default at a rate of 50%. Banks learned long ago that these plants simply can’t be built on budget and aren’t viable without massive taxpayer subsidies. Texans are still paying for the last generation of over-budget nuclear plants each month in a hidden charge on their electric bills.
A recent report for the Public Utility Commission of Texas found the state could save 23 percent of the energy we need through energy efficiency alone. This alternative would only cost rate payers one-half to one-third the cost of building new nuclear power plants.
President Obama believes the first and best option for this country is developing new renewable energy sources. His stimulus program contains more than $10 billion in programs that would benefit Texans. If we assume that Texans would get 10 percent of the federal stimulus package, Texas could see as much as $3.2 billion for transmission line upgrades, smart meters and renewable energy loans, $1.6 billion for energy efficiency in public housing and low income housing, $2 billion for energy efficiency in schools, and $3.1 billion for improving energy efficiency in public buildings.
Texas could also benefit from an additional $2.25 billion for everything from transit and rail improvements to green jobs training and energy efficiency upgrades at manufacturing plants.
Congress is also poised to expand funding of a diesel emissions clean-up program. While Texas’ share of this money is only $30 million, it could have a tremendous health benefit by cutting 90 percent of the cancer causing soot from the dirty diesel engines that contaminate our air near highways, ports, rail yards and school yards by adding a simple filter to the exhaust.
These projects are worthwhile and would help secure our long-term energy needs. What doesn’t make sense, however, is the Senate Appropriation Committee’s decision to stick $50 billion in nuclear power loan guarantees into the bill.
Part of the reason that there were these huge cost overruns was that in the past, each plant design was different. Nuclear plant proponents point to France and say “look at how well nukes perform there.” But France has just one single cookie cutter plant design they have used over and over.
The nuclear industry promised that this time they would agree on just a few pre-approved designs, but instead they want six. The South Texas Nuclear Plant application contains more than 40 modifications to a pre-approved design. The builders of South Texas originally estimated the cost of two new reactors at $6 billion but current estimates range from $12.5 billion to$17 billion. The folks at Luminant say their two additional reactors could cost as much as $22 billion. Wall Street financiers can see the cost overruns coming and have decided that these are loans too risky without federal guarantees.
New nuclear power doesn’t make economic sense and it’s a down right nasty way to make electric power. There is no plan in place to deal with radioactive waste even after 60 years. Uranium mining sites plague the water tables near Karnes City and Kingsville. The stimulus bill has $50 million to clean up all the radioactive areas in the state, but clean up costs are estimated at $350 million.
Studies show that we can put far more people to work far more quickly in efficiency and renewable energy than in building nuclear reactors. But when the Senate decided to add in $50 billion in nuclear loan guarantees, energy efficiency spending was cut dramatically to make room in the budget. The Senate completely removed the $21 billion that the House had earmarked for energy efficiency upgrades and modernization of schools, and cut by more than half the House’s $6.2 billion budget for homeowners to make energy efficiency upgrades. How can the Senate possibly justify taking money from school children and homeowners to invest in risky nuclear projects that are not shovel ready and won’t create new jobs for many years?
We’re waiting to see what the final stimulus package will look like. Hopefully, the nuclear loan guarantees will have been removed, and the energy efficiency and renewable energy measures passed by the House will remain intact.