Please call U.S. Congressman John Spratt's (Democrat-South Carolina's 5th District) office at (202) 225-5501 as soon as possible.

Tell him that the fiscally conservative thing to do is to stop the $50 billion in taxpayer-backed loan guarantees that the nuclear power industry is seeking for new reactor construction.

Urge Rep. Spratt to defend Congressional oversight on annual appropriations for such loan guarantees, a taxpayer safeguard that the nuclear industry is trying to do away with.

Urge him, as U.S. House Budget Committee Chairman, to speak with House Speaker Nancy Pelosi to make sure this budget buster is excluded from the final energy bill. 

The final energy bill is behing hammered out behind closed doors right now, and will likely go to the House floor for a final vote on Dec. 4th or 5th. Please spread the word to get your friends to make calls this week too. Read below for more background information. If you have questions, please contact me.

Sincerely,

Kevin Kamps
Radioactive Waste Watchdog
Beyond Nuclear
6930 Carroll Avenue, Suite 400
Takoma Park, Maryland 20912

Office phone: (301) 270-2209
Cell phone: (240) 462-3216
Fax: (301) 270-4000
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www.beyondnuclear.org

BACKGROUND INFORMATION

Dear Friends and Colleagues in the Southeast,

Please help us to oppose language in the final federal energy bill which would exempt the U.S. Department of Energy (DOE) Loan Guarantee Program from the regulations of the Federal Credit Reform Act of 1990 designed to protect taxpayers. This legislative language, currently included in the Senate passed version of the energy bill (H.R. 6), would remove Congressional oversight from DOE's loan guarantee program, thus allowing DOE to disperse unlimited amounts of loan guarantees for the building of new atomic reactors. Most of the proposed new nuclear plants are targeted to be built in the Southeast. The final energy bill is rumored to be heading to the House floor for a final vote on Dec. 4th or 5th.

The DOE Loan Guarantee Program came into being as Title XVII of the nuclear energy friendly Energy Policy Act of 2005. Under pressure from the nuclear power industry and Wall Street, the DOE has decided that the program will now cover 100% of the loan, at up to 80% of the cost of the new nuclear reactor project. If and when these new nuclear reactor projects default on their loan repayments,  the federal government will be forced to cover the costs. This leaves taxpayers holding the bag on loan defaults that could cost hundreds of millions, or even billions, of dollars per reactor. New reactors are estimated to cost over $5 billion each, so multiple loan defaults could put taxpayers on the hook for tens of billions of dollars of liability.

Just last month, the DOE Office of the Inspector General reported that granting 100% loan guarantees for 80% of new nuclear reactors' total costs will “result in significant risk to the Government and therefore, the American taxpayer.”

The federal government has made such mistakes in the past. Thirty years ago, the federal government granted loan guarantees to jumpstart the synthetic fuels industry. The synfuels industry failed, defaulted on its federally guaranteed loans, and left taxpayers on the hook for over $13 billion.

Without congressional oversight, the current loan guarantee program for new nuclear reactors could dwarf even the synfuels debacle. The nuclear industry has requested $50 billion in loan guarantees over the next two years alone. The Congressional Budget Office has estimated the risk of default on new nuclear plant loan guarantees to be very high -- well over 50%.

Please urge Rep. Spratt to oppose this language and defend taxpayer safeguards by preserving Congressional oversight on federal loan guarantee appropriations each year. Taxpayers should not be required to finance billions, or even tens of billions, in risky loan guarantees. Rep. Spratt is Chairman of the U.S. House Budget Committee. If ever there was a budget buster, the new nuclear power plant loan guarantee program is it!

For more information on federal loan guarantees for new reactors, see www.beyondnuclear.org.