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The result has been an extraordinary political coalition. Right-wingers who don't accept climate science and didn't even want the word french in their fries now wax lyrical about French reactors that reduce French emissions. Left-wingers who used to bemoan the industry's radioactive waste and corporate welfare now embrace it as an earth saver. So Congress has approved lucrative subsidies for construction, production, waste disposal, liability insurance and just about every other nuclear cost. It also approved "risk insurance" to compensate utilities for regulatory delays, even as the Nuclear Regulatory Commission (NRC) has worked closely with the industry to streamline its licensing process. And nuke-friendly states have required ratepayers to front the costs of any new construction even if the reactors are never turned on.
Nevertheless, investors refuse to bet on nukes. The steady increases in electricity demand that were supposed to justify new reactors have been wiped out by the global recession, and energy-efficiency advances could keep demand flat. Natural gas prices have plummeted, Congress appears unlikely to put a price on carbon, and the U.S. still lacks a plan for nuclear waste. It also turns out that building safe places to smash atoms is hard, especially after such a long hiatus. The U.S. has lost most of its nuclear manufacturing capacity; it would have to import Japanese steel forgings and other massive components, while training a new generation of nuclear workers. And though industry lobbyists have persuaded the NRC to ease onerous regulations governing everything from fire safety to cooling systems, it's still incredibly tough to get a reactor built.
New nukes would still make sense if they were truly needed to save the planet. But as a Brattle Group paper noted last month, additional reactors "cannot be expected to contribute significantly to U.S. carbon emission reduction goals prior to 2030." By contrast, investments in more-efficient buildings and factories can reduce demand now, at a tenth the cost of new nuclear supply. Replacing carbon-belching coal with cleaner gas, emissions-free wind and even utility-scale solar will also be cheaper and faster than new nukes. It's true that major infusions of intermittent wind and solar power would stress the grid, but that's a reason to upgrade the grid, not to waste time and money on reactors.
Anyway, there aren't many utilities that can carry a nuclear project on their balance sheets, which is why Obama's Energy Department, a year after awarding its first $8 billion loan guarantee in Georgia, is still sitting on an additional $10 billion. A Maryland project evaporated before closing, and a Texas project fell apart when costs spiraled and a local utility withdrew. The deal was supposed to be salvaged with financing from a foreign utility, but that now seems unlikely.
The utility was Tokyo Electric.
Another Perfect Storm
Pundits keep saying the mess in Japan will change the debate in the U.S., but the BP and Massey disasters didn't change the debates over oil drilling and coal mining. And the nuclear debate seems particularly impervious to facts. Obama wants to triple funding for the already undersubscribed loan guarantees, but Republicans still accuse him of insufficient nuclear fervor. So don't expect the U.S. to copy German Chancellor Angela Merkel, who just shut down seven aging plants. GOP Senator James Inhofe of Oklahoma has already rejected the idea of "a nuclear problem," suggesting that "once in 300 years, a disaster occurs." That's true if you don't count Chernobyl and you're sure nothing will happen for the next 250 years.
The industry's defenders may ignore Fukushima Daiichi, but the industry will not. It's serious about public safety, and meltdowns are bad for business; no company wants to lose a $10 billion reactor overnight. But additional safety measures cost money: in 2003 industry lobbyists beat back an NRC committee's recommendation for new backup-power rules that were designed to prevent the hydrogen explosions that are now all over the news.
It may sound unrealistic to require plants to withstand a vicious earthquake and a 25-ft. tsunami, but nobody's forcing utilities to generate power with uranium. One lesson of the past decade, in finance as well as nature, is that perfect storms do happen. When nukes are involved, the fallout can be literal, not just political.
This article originally appeared in the March 28, 2011 issue of TIME.