Alternative & Nuclear Energy Makes the Cut in Obama’s 2012 budget

Photo: the author (Anna Scott) sailing on Clinton Nuclear Generating Station's cooling lake, near Clinton, IL. Courtesy of Allie Weill.

Arguing that spending in alternative energy will create jobs and increase domestic security, the Obama administration’s 2012 budget calls for an increase in energy spending, stressing support of clean and alternative energy technology. Among continued research and development funding, the proposal sets aside $3.2 billion for renewable energy and energy efficiency programs.

Nuclear energy is also back in vogue, with Obama requesting $36 billion in loan guarantees for the domestic nuclear energy. No new nuclear projects have started in the past four decades, so dedicating money to build even one power plant would completely change the industry. The Department of Energy estimates that this money could be used to construct “9 to 13 new reactors”; currently, 104 reactors operate at 65 power plants in the United States, generating about 100 billion kilowatts every year.

So if nuclear is in, what’s out? Big oil: the budget proposes slashing fossil fuel subsidies, ending preferential taxes, and reducing fossil fuel research and development funding. Other savings will also come from shutting down the particle accelerator at Fermi Lab here in Illinois, a move that was announced this January. Hydrogen cell technology is also facing severe budget cuts.

What does this mean for you? Well, if you were hoping for a hydrogen-powered car for Christmas, you might be out of luck. But if you’re looking to lower your power costs (and you’re already in the right place), this funding could help build more power plants, and lead to more renewable energy initiatives. More suppliers could help lower electricity costs, which–no matter your politics–is good news.

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Post by Anna Scott

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  1. danplechaty says:

    There are a couple of nuclear power plants already in the planning stage in the U.S., but they’ve been running into a lot of supply chain problems. Our domestic industry no longer has the capacity to make many of the parts necessary, and oversea suppliers have been overwhelmed by the increase in orders around the world, especially in places like India that are only now beginning to build power plants. Since it takes a while to start up an operation like this, and continued demand is uncertain, its unlikely that this bottleneck will disappear anytime soon.

  2. power2switch says:


    I agree with the supply chain issues, but I’d disagree that demand for nuclear power is uncertain. Granted, the politicized nature of nuclear energy makes this sector inherently uncertain, but putting nuclear projects in a proposed federal budget shows a real shift. And for many consumers, energy cost matters more than source (thankfully, since that’s what Power2Switch is all about) so I think any new entry to the electricity generation market would be desirable. Nuclear energy already produces 1/5 of all our nations energy, whether consumers are generally aware of this or not.

    Now, while the supply issue is a problem, the timescale of delays certainly aren’t on the order of 40 years (the amount of time it’s been since we last built a new plant). So I stand by my conclusion that new nuclear facilities are coming (see that Tribune link on a progress on a new reactor for a Michigan plant) and that a federal budget supporting them can only speed the process along.


  3. danplechaty says:

    I agree that new plants are likely to come to the U.S. soon, that more nuclear power is a good thing and that the government loan guarantees will go a long way in making investments in nuclear power more palatable to major utilities. What might prevent nuclear power from growing in the U.S. is regulatory uncertainty. Nuclear power would start to replace many of the coal and natural gas power plants for baseload electricity generation if a price on carbon was set (carbon tax or cap and trade), but without this utilities are playing a waiting game before making a multi-billion dollar investment that will operate over decades.
    The other uncertainty is with the disposal of nuclear waste. Plans to use Yucca Mountain as a long-term storage facility have been stalled indefinitely, reprocessing technologies are still frowned upon in the U.S., and on-site storage is beginning to fill up at many power plants. This is a major environmental issue that has seen a lot of hand-waving recently, and many utilities are loath to buy into the situation.

    1. power2switch says:

      I would argue that these loan guarantees would help take care of that regulatory uncertainty. After all, were budget items like this to be approved (because we are still discussing a hypothetical budget here), the government would be putting its money where its mouth is. What is more certain than money?
      As for the storage problems, that’s obviously an ongoing issue, and one that I believe this proposed budget doesn’t even begin to address. In my home state, Washington, voters have rejected numerous proposals to accept nuclear waste. It’s a non-starter politically, but personally I believe that if there’s money to be made of of it, it will work itself out. Granted, that is the hand waving you’re referring to. Any solutions you’ve seen that seem more likely than others?


      1. danplechaty says:

        Well, the loans will help offset regulatory uncertainty, but a price on carbon would be better. As for the waste, its a huge NIMBY problem (not in my backyard). We need to store it somewhere, but understandably no one wants to live near it. Nuclear fuel reprocessing could alleviate this problem to a certain extent, but it has its problems as well…