Analysis of Nuclear Titles of Energy Bill

by

Daniel Hirsch

[Daniel Hirsch is the former Director of the Stevenson Program on Nuclear Policy at the University of California, Santa Cruz, and currently is President of the Committee to Bridge the Gap, a Los Angeles-based nuclear policy organization.]

At 9:45 pm Saturday night, November 15, the Republican co-chairs of the conference committee considering the Energy Bill released the full proposed text.  (Parts were released at noon Saturday, but the most critical, the 225-page tax title, wasn’t released until the evening.)  Democrats--and the news media and public--thus had only Sunday to review 1000+ pages before a Monday vote of the conference committee.  The bill is supposed to hit the House floor as early as Tuesday and the Senate Wednesday.  There thus has been almost no opportunity for scrutiny of the most significant revision of U.S. energy legislation in a decade. This was obviously the intention of its authors, who knew, as Senator Domenici put it in a press conference Friday, before the bill’s release, that they would be “duck soup” if people got any significant chance to review its extraordinary provisions.

In this analysis, the nuclear titles are briefly reviewed.  The analysis is by its nature limited, given the one day available.

Tax Title

Senator Domenici had tried and failed to get the Senate to approve an Energy Bill in July that contained billions of dollars in loan guarantees to the nuclear industry to build new nuclear power plants. The bill could not get support, so a version without those subsidies was passed.  No similar subsidies were in the House bill, either.  Domenici, however, has re-written the bill in conference to put back in that which neither chamber would previously approve, and has dramatically increased the nature of the subsidy.

Whereas the original defeated proposal was loan guarantees, the bill as rewritten by the Republican co-chairs of the conference committee would give the nuclear industry approximately $7.5 billion in direct tax credits for constructing new reactors, in the form of a 1.8 cent production tax credit. This number alone represents one of the largest industry give-aways in the entire bill, and would cost each family in America on the order of $600.  Since the credit is written to last only 8 years, but the history of such credits, as its authors well know, is that they get extended, this subsidy likely would be far larger.

This subsidy would have the public in essence pay for much of the construction or operation of new, privately-owned for-profit nuclear plants.  The industry would reap the profits, but the public would bear much of the costs.  It is rather remarkable that supposed advocates of the free market system would attempt to socialize a mature, 50-year-old industry like nuclear power.

Nuclear Title

$1.1 billion for new reactor in Idaho for hydrogen.

Domenici failed to get the Senate in July to approve a bill that would have authorized $1.1 billion to construct a new reactor in Idaho, ostensibly to produce hydrogen.  This was a cynical effort to turn the public’s desire for clean car fuels into impetus for more reactors that produce tons of long-lived reactor waste.  Every mile they would drive in a hydrogen car would contribute to plutonium, strontium, cesium and dozens of other radioactive wastes being produced--not what the public thought they were being sold in the President’s hydrogen fuels initiative.  The Senate wouldn’t go along with constructing the Idaho reactor; the House bill didn’t have construction of the reactor in it either; but in conference they have put it back.

20-year extension of Price-Anderson liability limits for nuclear power

The Senate bill would extend Price-Anderson for 10 years, the House bill for 15; the conference “compromised” on 20 years!  Price-Anderson has always been a problem for the industry to explain--on the one hand they say nuclear power is so safe we should build lots more such plants, on the other hand they say it is so dangerous and an accident so likely no one would build a reactor unless the government immunized them from most liability.  This is an immense subsidy.

Nuclear Terrorism Protection Provisions Gutted

The House bill had requirements that the NRC issue new regulations to enhance protections against attacks by terrorists considering the numbers and sophistication evidenced on 9/11. The Senate had no contradictory provisions.  The House voted overwhelmingly to direct its conferees to stick by the language; the chief House conferee indicated he would ignore the direction, and indeed the final bill released has weakened the provision so that NRC is no longer required to issue new regulations and can do whatever it wants.  Other provisions on emergency planning regarding terrorist attacks at nuclear plants have also been removed.

Proliferation Protections Eliminated

The bill reverses U.S. nonproliferation policy and permits exports of weapons-grade uranium abroad.  This will undermine two decades of efforts internationally to keep weapons-grade uranium out of commerce.

Additionally, the bill moves the country far toward reversing nearly three decades of bipartisan nonproliferation policy barring reprocessing of civilian nuclear fuel.  Reprocessing separates out weapons-usable plutonium from high level waste and is one of two methods of acquiring weapons materials.  This action would be a major undermining of the international nonproliferation regime.