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Nuclear Energy Institute
FOR IMMEDIATE RELEASE: February 04, 2008
Contact: media@nei.org, 202.739.8000 or 703.644.8805 (after hours and weekends)

Energy Department's FY09 Budget Request Reflects Need for New Nuclear Power Plants

WASHINGTON—Portending the nation’s intensifying need for additional sources of clean, reliable electricity, the Department of Energy today released a fiscal year 2009 budget request that seeks a 79 percent increase in funding for the Nuclear Power 2010 program and that extends the period during which companies that build 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 FY08. 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 FY09. 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 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 “innovative 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.

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.

The budget request would increase funding for the administration’s Advanced Fuel Cycle Initiative by $120.5 million, a 66 percent increase, to $301.5 million. The program is researching methods to “provide for proliferation-resistant technologies to recover the energy content” in used nuclear fuel and reduce the volume and toxicity of byproducts from reactor fuel. It also would increase DOE’s university education/reactor fuel programs to $3.7 million. There is no funding for the programs in the current fiscal year.

Nuclear Energy Institute President and Chief Executive Officer Frank L. (Skip) 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. The promise of nuclear energy technology extends beyond electricity production to include production of hydrogen and process heat for other applications,” Bowman said. “For these reasons, the administration’s investment in the Nuclear Power 2010 program, the used fuel management program and the loan guarantee program are welcome and warranted.

“The administration correctly anticipates a new era of nuclear plant construction as part of a diverse electricity production mix that meets the need for clean, affordable and reliable energy.”
 

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