nuclear-news

The two-reactor $14 billion Vogtle plant being built in Georgia is seen as a test of the US nuclear industry’s planned “renaissance” with a new nuclear reactor design and updated construction processes all aimed at cutting time and costs.

But two Massachusetts-based energy-consulting firms, Earth Track and Synapse Energy Economics, say the $8.3 billion in federal loan guarantees backing the project were crafted with excessively favorable financial terms for the recipient companies, weak federal oversight, and possible political interference in the loan-guarantee process.      The two firms analyzed hundreds of Energy Department e-mails and financial documents released earlier this month to the Southern Alliance for Clean Energy (SACE), a green-energy watchdog group that won access to them in a Freedom of Information Act lawsuit. …..

In their report, Earth Track and Synapse say the documents reveal:

• “Potentially troubling” conversations between political appointees and borrowers over loan terms and getting the deal done.
• Credit subsidy payments, the amount that companies pay in compensation for the government loan guarantees, that appear far too low to offer adequate protection to taxpayers in the event of a default.
• An “over-reliance on external contractors” for key risk evaluations.
• Continued tinkering with credit subsidy assessment tools even after credit subsidy estimate letters were sent to borrowers, leaving taxpayers with more risk than necessary.

“Despite widespread redactions, the documents released indicate significant problems with the DOE’s loan guarantee process,” said Doug Koplow, report author and founder of Earth Track in a statement.

Under the category of “political interference,” the report cites one e-mail from DOE staff revealed tight timelines to “move our first nuclear power deal forward.” Other e-mails showed direct contact between Vogtle project borrowers and Secretary of Energy Steven Chu.  And a 2010 e-mail from Jonathan Silver, then-executive director of loan programs at the US Department of Energy, noted that “We didn’t deal with shaw” –  the company slated to do much of the reactor construction – “The white house did.”

The discussions represent “a potentially troubling blurring of financial risk review, political discussion, and potential modification of loan terms,” the report says. ….. http://www.csmonitor.com/Environment/2013/0130/Georgia-nuclear-power-plant-could-be-Solyndra-redux-report-says