Nuclear Power on Life Support

Obama isn’t building more nuclear power plants; he only said he will provide loan guarantees to do so.

At first glance, it’s a sensational headline. Barack Obama, of all people, the hope of every progressive, is promoting nuclear energy as an economical and environmentally friendly source of energy for the future. Backers of nuclear energy see this as a breakthrough; after three decades of no progress on building new nuclear reactors, the United States will now throw massive support to nuclear power just as China and Russia have done.

But there are reasons to question the headlines. First of all, Obama has only said the government will guarantee loans for such constructions — something George W. Bush also did with no practical results. It doesn’t mean the reactors have construction approval. Some see Obama’s announcement as being merely a strategy to get Republicans to back new environmental regulations.

But even if the United States should actually begin construction of new reactors, that’s a long way from assuming that a new nuclear boom has begun. On the contrary, the fact that Obama is willing to make $8 billion loan guarantees for two new reactors clearly shows that nuclear power is practical only with massive government assistance. Politically neutral Citibank recently came to the same conclusion.

Nuclear power plants calculate they would have to sell their electricity over the long term at eight cents per kilowatt hour to be competitive. But for the foreseeable future, other sources of generation, such as wind or solar power, are able to do the same. Putting the nuclear power industry on government life support may be a solution to short-term revival, but the numbers don’t indicate it will permit them to survive over the longer term.