WASHINGTON—U.S. Secretary of Energy Samuel Bodman today announced completion of the final rule under which the first companies to start construction of new nuclear power plants can qualify for a portion of $2 billion in federal risk insurance. The insurance, or standby support, was authorized by the Energy Policy Act of 2005, and covers six new nuclear power plants. The first two plants to start construction are eligible to recoup 100 percent of government delay costs up to $500 million per plant, and plants three through six are eligible to recoup 50 percent of government delay costs, after six months of delay, up to $250 million per plant. The following statement on the Department of Energy’s announcement is from Frank L. (Skip) Bowman, the Nuclear Energy Institute’s president and chief executive officer:
“The nuclear energy industry welcomes the completion of the federal regulation establishing the standby support program to help minimize uncertainties associated with the construction of the new nuclear power plants that are needed to strengthen our nation’s future energy security. The heat wave that has gripped so much of the country this week has led to record-high electricity demand in many states and regions. It has made all the more evident the need for new baseload power plants—nuclear power plants included.
“Development of the rule governing standby support is a necessary and appropriate step to help stimulate construction of the first of the new nuclear power plants that will be built in the United States in the decade ahead. Our belief and goal is that this insurance against government delays beyond the control of companies building the first new plants will not be needed. Still, for the benefit of the American people who rely on electricity for all facets of their lives, this delay insurance is an appropriate counterweight to the risk of unanticipated government delays in licensing and starting new nuclear plants, arising from the new and untested licensing process.
“It is noteworthy that Secretary Bodman’s announcement comes in the same week that some of our industry’s leading companies announced they have entered into agreements to procure the long lead components—including heavy forgings—necessary to build new nuclear plants. With more and more signs of potential new nuclear plant construction emerging, we applaud the Department of Energy, the Bush Administration and Congress for the steps they are taking to support this important work.”
The Nuclear Energy Institute is the nuclear energy industry’s policy organization. This news release and additional information about nuclear energy are available on NEI’s Internet site at http://www.nei.org.