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Loan guarantees pave way for first new U.S. nuclear reactors in years

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Obama pitches nuclear power
STORY HIGHLIGHTS
  • NEW: Modern reactors far safer than pre-Three Mile Island reactors, energy secretary says
  • NEW: Loan applications for more nuclear facilities being considered, Steven Chu says
  • NEW: GOP senator from Georgia praises Obama's decision as "a step in the right direction"
  • 3,500 on-site construction jobs and 850 permanent operations jobs projected, officials say

Washington (CNN) -- President Obama announced $8.3 billion in loan guarantees Tuesday for two nuclear reactors to be built in Burke County, Georgia.

A new nuclear power plant has not been built in the United States in three decades.

The new reactors are to be part of an expansion of an existing nuclear facility near Augusta, Georgia, operated by Atlanta-based Southern Co.

The loan guarantees will help create 3,500 on-site construction jobs and 850 permanent operations jobs, administration officials claimed. The reactors will help provide power to over 550,000 homes and 1.4 million people, it said.

"This is only the beginning," Obama said during a visit to an International Brotherhood of Electrical Workers training facility in Lanham, Maryland. "We'll continue to provide financing for clean energy projects ... across America."

The president acknowledged that construction of new nuclear facilities will meet with some political resistance. Nuclear development has traditionally been opposed by more progressive elements of the Democratic Party. But nuclear power, he said, remains the country's largest source of fuel that produces no carbon emissions.

"To meet our growing energy needs and prevent the worst consequences of climate change, we'll need to increase our supply of nuclear power. It's that simple," he said.

At the same time, the president argued, traditional Republican proponents of nuclear power should acknowledge that comprehensive energy legislation is needed to help provide incentives to make clean energy more profitable.

Any new nuclear facilities, he promised, will "be held to the highest and strictest safety standards."

Leading congressional Republicans -- including both Georgia senators -- were quick to praise Obama's decision.

"This announcement represents a step in the right direction," said Sen. Saxby Chambliss, R-Georgia. "The power generated by [the Burke County facility] is safe, reliable, emissions-free and environmentally responsible."

Nuclear power critics, on the other hand, slammed the administration's decision to back the construction of new reactors.

The Department of Energy is putting taxpayers on the hook for bailing out costly and dangerous nuclear reactor projects...
--Energy analyst Ben Schreiber, who works with Friends of the Earth
Video: More nuke plants: Good or bad?
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"The last thing Americans want is another government bailout for a failing industry, but that's exactly what they're getting from the Obama administration," energy analyst Ben Schreiber said in a press release issued this past weekend.

Schreiber works for the progressive group Friends of the Earth, which opposes nuclear power.

"The Department of Energy is putting taxpayers on the hook for bailing out costly and dangerous nuclear reactor projects when the loans used to finance those projects default. This is great news for Wall Street but a bad deal for Main Street."

The risk of default is high, Schreiber argued, while nuclear power "remains unsafe and dirty."

Energy Secretary Steven Chu, in turn, claimed that modern nuclear reactors are far safer than those built prior to the accident at Pennsylvania's Three Mile Island in 1979.

Chu also told reporters in a conference call that one of the reasons the Georgia facility was the first to receive a federal loan guarantee is the project's low probability of default.

He added that the administration is now considering at least a half-dozen additional loan applications for nuclear facilities.

We are working "as hard and as fast as we can" to "recapture the lead in nuclear technology," Chu said. America has been "sitting on the sidelines... for far too long."

Obama's proposed fiscal year 2011 budget triples loan guarantees for nuclear power plants to over $54 billion, the White House noted.

CNN's Suzanne Malveaux, Evan Glass, Deirdre Walsh and Alan Silverleib contributed to this report.

 
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