Demand GAO investigation of DOE's "no money down" loan to giant utilities for new Vogtle reactors
April 24, 2014.
Dear Friends,
On Monday, it was reported that the $6.5 Billion taxpayer loan for construction of two nuclear reactors at the Vogtle site in Georgia was given by the Department of Energy (DOE) to the giant nuclear and fossil fuel utility Southern Company and its partner Oglethorpe Power with no down payment. Zero. Nada.
That DOE gave a loan at all for this financially risky and dangerous project was outrageous enough. But to learn that the agency abandoned all pretense of sound banking practices and taxpayer protection in its eagerness to give a nuclear loan is beyond comprehension. We need to stop this rogue department from giving out any more taxpayer money--including the $1.8 Billion still on tap for other Vogtle partners.
Act now: Urge Senate Environment Committee Chair Barbara Boxer (D-Calif.) and Committee member Sen. Ed Markey (D-MA) to demand an investigation by the Government Accountability Office of this risky and unnecessary loan.
By comparison, a previous loan offered to Constellation Energy under the same program would have required $880 million in "credit subsidy fees"--the equivalent of a down payment.
Private banks require down payments, as every homebuyer knows, on all major loans. That's to ensure the borrower takes some of the risk of the loan too. You can't buy a house these days without putting about 20% down; but the Department of Energy was so desperate to give away taxpayer money for a nuclear power project that it decided it was just fine to give a giant corporation billions of taxpayer dollars for nothing. The result is that every American taxpayer is now subsidizing the electric bills of Georgia ratepayers.
That makes no sense and it isn't just fine.
Documents obtained under the Freedom of Information Act revealed that the DOE (and the White House's Office of Management and Budget) was insisting on credit subsidy fees as least as recently as 2012--fees that even then were criticized as too small. But instead of acting responsibly to protect American taxpayers, the DOE caved in to the demands of the giant Southern Company for free taxpayer money. Indeed, Southern Company executives repeatedly and publicly said they didn't need a taxpayer loan. So they held out accepting one until the DOE just gave them the money no strings attached. Well, if Southern didn't need it, why risk taxpayer money at all?
Since the loan was first conditionally announced four years ago, much has changed: Fukushima. The rising use of natural gas (not a good thing, but real), which provides power more cost-effectively than nuclear. The stunning plunge in the costs of wind and solar power, which are now even cheaper than gas in many areas. The shutdown of old but paid-for nuclear reactors because they no longer can compete in the marketplace against renewables and gas. In Georgia, hundreds of megawatts of new solar power are being built and will provide electricity faster and far cheaper than these new atomic reactors ever could do.
Yet instead of taking these realities into account, the DOE did the exact opposite. DOE must be held accountable for its actions. NIRS and the Southern Alliance for Clean Energy have teamed up with CredoAction to do just that. Urge Sens. Boxer and Markey to demand a GAO investigation of DOE's free money gift to new nuclear reactors. Act now.
We will be printing these petitions and personally hand-delivering them to Senators Boxer and Markey. Make sure your name is on them!
An investigation of this loan by the GAO is an essential first step. Before any more sweetheart deals are given, Congress must understand what has happened and why. Another $1.8 Billion in taxpayer money for this project is still pending at DOE. And DOE has more than $10 Billion in its coffers to give to more nuclear projects. It's time to prevent any more outrageous uses of taxpayer money.
For more background on the issue, see our April 22, 2014 post on GreenWorld here.
Your continued support for our campaign against the DOE's nuclear loan program has made our work in this realm possible for the past six years. Thank you! And we're not giving up now, just because one absurdly bad loan has been granted. As you'll see from the March 2014 photo in the GreenWorld article, construction on the Vogtle reactors has a LONG way to go. We're not stopping until these reactors--and the DOE's entire nuclear loan program--are cancelled entirely. You can support this campaign here or by sending a check to NIRS, 6930 Carroll Avenue, #340, Takoma Park, MD 20912. If you are outside the U.S., can make a monthly sustaining donation, or want to use PayPal (a new feature for NIRS!), please use our Razoo site here.
Thank you so much for all you do,
Michael Mariotte
President
Nuclear Information and Resource Service
www.nirs.org
nirsnet@nirs.org
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