Sen. Lamar Alexander laid out a series of policies designed to advance nuclear energy and federal research in a Thursday speech.
The Tennessee Republican called for ending the wind production tax credit, doubling basic research funding, solving the problem of nuclear waste storage and removing regulations that make it costly to keep nuclear reactors running.
“We need to prepare now, by building more reactors, ending the stalemate on what to do about nuclear waste, stopping Washington from picking winners and losers in the marketplace, pushing back on excessive regulation, fueling more free-market innovation with government-sponsored research and encouraging energy diversity,” Alexander said in Washington at the Nuclear Energy Institute.
Nuclear energy’s high costs are still a snag. The multi-billion dollar reactors can’t compete with natural gas power plants, which cost a fraction of the money and time to build in the current pricing environment. And in states with deregulated electricity markets — where utilities finance construction rather than pass the costs on to ratepayers — nuclear isn’t feasible.
Two reactors being built at the Vogtle power plant in Waynesboro, Ga., serve as a cautionary tale for United States nuclear power. The next-generation reactors operated by Georgia Power, a subsidiary of Southern Co., have received $6.5 billion of the $8.3 billion of federal loan guarantees the Energy Department announced in 2010. But the project has been beset by delays, the latest coming last week at an anticipated cost of $700 million.
But Alexander said the policies he laid out would at least help nuclear power become more financially appealing. He is well-positioned to seize on the strategy he laid out — as chairman of the Energy and Water Appropriations Subcommittee, he oversees the Energy Department and the Nuclear Regulatory Commission.
From that perch, Alexander said he’s planning a series of hearings on nuclear policy. He’ll also hold a separate hearing on the NRC budget the first week of March to put the federal regulator in focus.
“I don’t think we need a big heavy-handed, Washington-based set of new rules and regulations for a national energy policy. I think actually we need less. We need fewer long-term subsidies and more money for government-sponsored research,” Alexander said in a meeting with reporters. “I’d like to help do that.”
With a new GOP-led Congress in place, Alexander said the time is ripe for passing legislation to move nuclear waste currently sitting near reactors to short- and long-term storage sites.
Yucca Mountain, the controversial Nevada waste site ferociously opposed by Senate Minority Leader Harry Reid, D-Nev., will get attention, Alexander said. Whether GOP supporters of the site, which President Obama pulled the plug on in 2009 until a federal court revived reviews in 2013, can pick up enough Democratic votes is unclear.
“There’s plenty of interest within the Republican caucus to move ahead with Yucca Mountain,” Alexander said.
Alexander will also reintroduce legislation co-sponsored by Sens. Lisa Murkowski, R-Alaska, and Dianne Feinstein, D-Calif., that would call for moving waste to interim storage areas and then to an eventual permanent repository other than Yucca. Feinstein and Alexander will also float a bill for a short-term waste storage pilot program similar to one President Obama proposed.
Addressing waste could go a long way to encouraging future nuclear projects, Alexander said. Time is of the essence — Alexander noted NEI has warned 25 nuclear reactors could retire by the end of the decade.
That’s largely because of stiff competition with cheaper natural gas power plants and wind energy, which forces some Midwest utilities to pay the electric grid to take its nuclear power to compete with subsidized wind.
Alexander said ending the wind energy tax credit would help utilities operating struggling nuclear reactors find their footing. The subsidy pays wind power producers 2.3 cents per kilowatt-hour and lasts for 10 years. The Joint Committee on Taxation puts the price tag for the one-year extension in 2014 at $6.4 billion, a payout that would occur over the decade.
The difference between that tax credit and the one that nuclear power receives is the wind incentive appears unlimited, Alexander said. The 1.8 cent per kilowatt-hour incentive for nuclear power is capped at 6,000 megawatts and lasts for the first eight years a reactor operates.
“I think we have to let the market rule,” Alexander said.
