Lobbying, global warming portend U.S. nuclear renaissance
WASHINGTON — The Obama administration soon may guarantee as much as $18.5 billion in loans to build new nuclear reactors to generate electricity, and Congress is considering whether to add billions more to support an expansion of nuclear power.
These actions come after an extensive decade-long campaign in which companies and unions related to the industry have spent more than $600 million on lobbying and nearly $63 million on campaign contributions, according to an analysis by the Investigative Reporting Workshop at American University .
Nuclear power generates about 20 percent of America’s electricity, but
many existing reactors are aging and no new plant has been authorized
since the 1979 incident at Three Mile Island , when small amounts of
radiation were released and authorities feared for days that a huge
surge might escape. That’s in part because it can cost as much as $8
billion to build a nuclear plant, and in part because the problems of
nuclear waste and safety remain unsolved.
The problem of global warming remains unsolved, too, however, and as
the nation struggles to rebound from a deep recession, building new
nuclear reactors increasingly looks to some like a big jobs program.
The industry, capitalizing on both developments, argues that nuclear
energy must be part of any effort to curb heat-trapping carbon
emissions.
Its longtime foes — environmentalists, labor unions, Democrats —
increasingly agree. “This is nuclear’s year,” said House Majority Whip
Jim Clyburn, D- S.C. , who in recent years has become one of the
industry’s champions on Capitol Hill .
Democratic Sen. Barbara Boxer of California , who chairs the Senate
Environment and Public Works Committee , has pledged that the climate
bill that’s making its way through Congress will include new
government help for the nuclear industry. Sen. Lindsey Graham of South
Carolina says he’d provide a much-sought Republican vote for the bill
if its energy provisions include help for the nuclear industry.
Some Republicans, who historically have been friendlier to nuclear
power, are pushing a plan to build 100 reactors over the next 20
years. The industry considers the forthcoming $18.5 billion in
guarantees a down payment on a more ambitious expansion.
Getting to this point has taken lots of time and lots of money, and
the debate over the safety and economics of nuclear electricity is far
from settled.
During the Bush administration, the nuclear industry got more in
electricity-related research and development funding than coal and
other fossil fuels did combined, and Congress approved the loan
guarantees.
More recently, the industry has been reaching out to newly empowered
Democrats, among them Clyburn, whose state is among the nation’s
leading nuclear-power producers. (The president’s home state of
Illinois is the biggest, and Obama and some of his closest political
allies have long relationships with Exelon Corp. , the country’s
biggest nuclear power company.)
The industry also has begun to build strong ties to important labor unions.
‘THERE ISN’T A SOLUTION WITHOUT NUCLEAR’
In the first half of last year, when Congress was considering whether
to add nuclear loan guarantees to the economic stimulus package and
was starting to work on the climate change bill, companies and unions
interested in nuclear energy spent more than $55.8 million on
lobbying, the analysis found.
Federal Election Commission records also show that industry trade
group the Nuclear Energy Institute donated a total of $99,000 to 63
candidates in the first half of 2009. Sixty percent of the money went
to Democrats. As a group, nuclear interests gave $3.5 million to
congressional candidates in the first six months of last year.
It hasn’t hurt that all these efforts have coincided with a big run-up
in energy prices and growing concern over the effects that coal-fired
power plants have on the buildup in carbon emissions and global
warming.
“We don’t believe that nuclear energy is the answer, but as you look
at needs for clean energy and the need to protect the environment,
there isn’t a solution without nuclear,” Areva spokesman Jarret Adams
said. Areva’s reactors would power many of the new plants that are on
the drawing boards.
Still, many environmental groups worry about the safety of nuclear
power. “The nuclear power industry is always going to remain several
minutes away from serious accident and disaster,” said Tom Clements ,
the Southeastern Nuclear Campaign coordinator for Friends of the Earth
, a global environmental group.
The Price-Anderson Act, passed in 1957, limits industry liability for
a nuclear accident. Most recently renewed in 2005, it requires a
private operator to buy the most private insurance possible —
currently $300 million — and assesses fees on the industry for a fund
to pay out damages above that amount if necessary. If the fund, which
now stands at more than $10 billion , isn’t enough, Congress would
decide whether to require more industry contributions or appropriate
public money. The law is now in force through 2025.
Opponents also question why nuclear power needs federal subsidies. “If
nuclear power is the right path to go down, why can’t it pay for
itself?” Clements said. “Nuclear power is going to be dependent on
subsidies and handouts, and we still get nuclear waste and the threat
of accident in return.”
The waste issue remains perhaps the biggest stumbling block.
Generating nuclear power produces huge quantities of radioactive
waste, including plutonium, a key ingredient for nuclear weapons. When
many of the current reactors were put into place, there was an
assumption that the federal government eventually would create a
national repository. After decades of debate, however, that promise
appears no closer to being met, and the plants have become de facto
storage facilities.
PLAYING THE INFLUENCE GAME
In many ways, the nuclear power industry’s efforts to win support are
a textbook case of how the influence game is played in Washington .
Besides the money spent on lobbying and campaign contributions, the
industry, led by the Nuclear Energy Institute , has created a network
of allies who give speeches, quote one another approvingly and
showcase one another on their Web sites. The effect is an echo chamber
of support for nuclear power.
While energy lobbies such as big oil and big coal have taken turns in
the spotlight, big nuke flies largely under the radar. Alex Flint ,
the Nuclear Energy Institute’s chief lobbyist, summed up the strategy
last year at a luncheon with utility officials from Southeastern
states: “Quiet.” He likes to let surrogates make the case.
For instance, Patrick Moore , who played a leading role in Greenpeace
during the 1970s, now helps lead the Clean and Safe Energy Coalition ,
known as CASEnergy Coalition . His partner is Christine Todd Whitman ,
a former New Jersey governor and Environmental Protection Agency
administrator. Both have touted nuclear power at gatherings of members
of Congress and on national television.
Left unmentioned in these settings is that the Nuclear Energy
Institute paid a public relations company to create CASEnergy, an
example of the so-called “Astroturfing” techniques that many
industries have adopted to give the appearance of grass-roots support.
Moore, who runs a consulting company based in Vancouver, British
Columbia , acknowledged the ties in an interview, referring to the
Nuclear Energy Institute as “my biggest client.” He declined to
divulge his fees. Whitman’s firm, the Whitman Strategy Group , says on
its site that it was hired by CASEnergy, but the coalition’s Web site
doesn’t mention the financial relationship. Neither does the Nuclear
Energy Institute’s site, where Whitman and Moore are quoted on the
merits of a nuclear future.
Labor is another new ally. The Nuclear Energy Institute and 20 unions
co-sponsored a “Welcome Back, Congress ” bash in a House of
Representatives office building last January. In March, Mark Ayers of
the AFL-CIO arranged a meeting between the Nuclear Energy Institute’s
president and House Energy and Commerce Committee Chairman Henry
Waxman to talk about the climate bill. The liberal California Democrat
is leading the effort to pass the measure.
It seemed to work like magic.
“Now, Mr. Waxman has not been somebody who’s been particularly open to
our agenda in the past, and yet he was very much so this time,” the
institute’s Flint told nuclear executives in May. Flint credited union
help for the changed atmosphere, quoting his boss’s description of
labor allies as “bulletproof gear.”
No one expected Waxman to lead the charge for nuclear, Flint said.
Rep. John Dingell , a veteran Michigan Democrat who was Waxman’s
predecessor as committee chairman and the top recipient of
nuclear-interest campaign contributions — more than $600,000 since
1999 — was offering an amendment to the climate bill that would create
a clean-energy bank, which would help finance an expansion of
low-carbon energy technologies. In addition to renewable energy
sources such as wind, solar and geothermal power, the capture of
emissions from coal and nuclear energy plants would be eligible for
help.
The Nuclear Energy Institute had merely hoped that Waxman wouldn’t
squelch Dingell’s proposal without a vote. Waxman not only let the
amendment in, but also voted for it.
Ayers received a call from the Nuclear Energy Institute’s
then-president soon after he took up his AFL-CIO post in 2007. Ayers
listened to his plea for help, he recalled in an interview, while
thinking that many proposed new units would be in the South and in
remote areas, generally not union-friendly territory. So he offered “a
quid pro quo here: I help you, but I want to build these plants.”
Later, a requirement in the House climate bill’s bank amendment for
“prevailing wages” at projects that receive government-backed loans
helped Ayers’ construction unions. More explicitly, the Nuclear Energy
Institute took a pro-union position for nuclear construction sites and
gave Ayers access to utility officials to pitch labor contracts.
Cementing the relationship, the institute hired one of Ayers’
lobbyists and last May, elected Ayers and an officer of the electrical
workers’ union to its board.
Third Way , which describes itself as a moderate progressive policy
organization, also has come out in favor of nuclear power. After the
Nuclear Energy Institute sent Third Way Vice President Matt Bennett to
France in July 2007 , he wrote, “We all came back with the faith of
the converted.”
Two months later, Bennett and Third Way trustee John Dyson wrote a
Boston Globe column headlined, “Just say ‘oui’ to nuclear power.” In
the second-to-last paragraph, they noted that Third Way got less than
1 percent of its budget from nuclear industry donations.
BRIDGES TO CONGRESS, WHITE HOUSE
These constituencies are important to the party that’s in power.
Disclosure records show that the industry deftly kept its traditional
base among Senate Republicans — who want 100 new nuclear units even if
the climate bill fails — while building bridges to Democrats in both
houses.
Clyburn is one example, receiving about $195,600 from nuclear energy
companies and affiliated unions since 2000, $187,000 of that in the
last two election cycles. The Nuclear Energy Institute contributed at
least $10,000 to Clyburn’s scholarship foundation, and nuclear
interests spent more than $30,000 for two six-day trips for Clyburn
and his wife. One was to inspect nuclear facilities in France , and
the other in the United Kingdom . He also owns stock valued at $15,000
to $50,000 in SCANA Corp. , a South Carolina company that’s applied to
build two reactors.
Clyburn has become a key ambassador for the industry, making ample use
of its surrogate network. He quoted CASEnergy’s Moore approvingly in
an opinion column he wrote and in a keynote speech to a convention of
Ayers’ building trades group.
He arranged a session on nuclear power for the Congressional Black
Caucus . Nuclear energy is so high on Clyburn’s agenda that he made a
point of attending Senate confirmation hearings for Steven Chu ,
Obama’s energy secretary. When Chu spoke favorably about nuclear
fission as a source of electricity, Clyburn concluded that “Obama is
not anti-nuclear or he would not have nominated Chu.”
In an interview, Clyburn said he could report progress. Four
congressional Democrats from New York , he said, are moving in his
direction on nuclear power. Carol Browner , the Obama administration’s
energy czar and a former head of the EPA , told him that it would be
inconsistent to worry about global warming and dismiss nuclear power.
He raised the issue at a congressional lunch with Obama and said he
left feeling reassured.
The industry is plugged in on its own at the White House through labor
groups and Exelon . Exelon CEO John W. Rowe is the Nuclear Energy
Institute’s past chairman and a current director.
The company, based in the president’s home state of Illinois , has
funded Obama’s campaigns since his Senate run, when employees
contributed more than $48,000 , according to CQ Moneyline, and
Exelon’s political action committee gave the maximum of $10,000 .
Exelon employees gave Obama nearly $210,000 for his presidential
campaign, according to CQ Moneyline.
Exelon’s management includes two Obama bundlers who are friends of the
president. One, director John W. Rogers , helped direct Obama’s
Illinois fundraising during his presidential race and helped plan the
inauguration. The other, Frank M. Clark , has lobbied on nuclear
issues for the company.
White House Chief of Staff Rahm Emanuel is close to Exelon , too. The
merger that created the utility was the biggest deal of Emanuel’s
brief but lucrative investment-banking career. Another White House
connection is strategist David Axelrod , whom Exelon subsidiary ComEd
once hired to create a fake grass-roots organization supporting higher
electricity rates.
Exelon lobbyist David Brown said that the company had applied for the
federal loan guarantees, but it didn’t make the cut for the first
round. Exelon hasn’t contacted its high-level White House friends, he
added.
HELP WANTED FROM WASHINGTON
The nuclear wish list is controversial. Electric utilities want more
than $100 billion in guarantees for construction that’s expected to
cost $200 billion . The Nuclear Energy Institute contends that the
guarantees wouldn’t cost taxpayers a dime because the recipients would
pay fees that should cover the cost of defaults, much the way that
auto insurers cover the cost of accidents with premiums paid by safe
drivers. However, the Congressional Budget Office concluded in 2003
that the risk of default on a nuclear loan would be “very high — well
above 50 percent.”
Critics of nuclear power say these sums would divert resources from
other low-carbon sources of electricity that don’t have nuclear’s
safety or waste issues. These include wind, solar, biomass and
geothermal generators. The clean energy bank as proposed would “be a
big nuclear-coal slush fund,” charged Michele Boyd , who lobbies for
Physicians for Social Responsibility . Carbon capture for coal and
nuclear construction are so expensive that there would be little left
over for renewables, she thinks.
Even some advocates of new reactors say that utilities should find
private financing without involving taxpayers.
“It’s a proven technology. Kick back the government and let industry
get about the business of building reactors,” said Jack Spencer , an
analyst for the conservative Heritage Foundation , a research center
in Washington .
There are other options, too, for generating more nuclear electricity.
By upgrading its existing reactors, Exelon expects to gain an
additional 1,300 to 1,500 megawatts of capacity. That’s about what a
new reactor could produce for significantly less money — a total of
$3.5 billion . No loan guarantees are needed for these projects, said
Marshall Murphy , a spokesman for Exelon’s nuclear division.
Clyburn, however, said the nuclear industry deserved help. A former
employment counselor, he finds the jobs argument convincing, and he’s
unimpressed by local opponents who argue that the seven plants in his
home state are unsafe: “Every time I talk to somebody about the
dangers, they go back to Three Mile Island ,” he said. “In fact, Three
Mile Island did not fail. . . . That process worked. So what’s the
deal?”
Most of all, Clyburn said, he wonders how the U.S. will generate
electricity in the future. “I just woke up one day and said, ‘Where
are you gonna get it?’ ” he recalled.
There’s no telling whether the industry’s expensive effort will
succeed. Witness the fate of the full-court press a week after Obama’s
inauguration.
Sen. Robert Bennett , R- Utah , who received $56,000 in
nuclear-interest donations from 1999 to 2008, pitched the addition of
$50 billion in loan guarantees for the nuclear power industry to the
economic stimulus bill. Sen. Byron Dorgan , D- N.D. , allowed it; he
chairs the energy appropriations subcommittee and has received
$190,000 in industry contributions since 1999, nearly half of that in
2007-2008. Although nuclear power plants starting a multi-year
licensing process are hardly “shovel-ready,” “You take the vehicles
you can get,” Bennett said in an interview.
The full Senate included the money, but critics protested and the
House insisted on removing the loan guarantees from the final version
of the bill.
Obama stayed out of the fight. “The president is a very smart guy,”
Clyburn said. ” The Energy Department hadn’t given out the (Bush-era
loan guarantees of) $18.5 billion . Why tie up $50 billion ?”
Since then, Chu has announced talks with four finalists for those
guarantees. “That $18.5 billion can only cover three or four, but no
more,” he told the House energy appropriations subcommittee in June.
He’d be back to ask for more, he added.
(Pasternak, formerly a reporter for the Los Angeles Times , reported
and wrote this article under contract with the Investigative Reporting
Workshop , a project of the School of Communication at American
University in Washington . Caroline Stetler and Meera Pal of the
workshop staff contributed to the reporting of this story.)
MORE FROM AMERICAN UNIVERSITY
American University’s Investigative Reporting Workshop
American University’s investigation of nuclear-power lobbying
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