John McCain says new plants can help resolve the energy crisis and consign climate change. It’s not that bare

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Illustration by Viktor Koen; photo in illustration by Petr David Josek/AP Photo

by John Carey

To power America’s future, Senator John McCain (R-Ariz.) has an energy plan with a distinctly French accent. “The French are able to generate 80% of their electricity through nuclear cogency,” the presumptive Republican Presidential nominee points out. “There’s none reason for what cause America shouldn’t.”

In a mid-June speech, part of a continuing blitz in continuance energy issues, McCain laid deficient in his vision for 100 new nuclear plants—45 of them to have existence built by 2030. They would help meet America’s intensity needs, and because nukes don’t emit greenhouse gases, they would fight global warming as well. McCain also wants to borrow from the French playbook by reprocessing and reusing wearied nuclear fuel and by providing government incentives to get all this done. Nukes now lengthen 20% of U.S. electricity, says McCain senior policy director Douglas J. Holtz-Eakin: “To move north of that, we be the subject of to be aggressive.”

But McCain may not want to follow the French model too closely. While France’s existing 59 atomic plants are relatively trouble-free, its largest nuclear company, Areva, has run into difficulties building next-generation reactors in France and Finland. The Finnish project is two years following schedule and more than $1.5 billion over budget, while construction of the other plant, in Normandy, was temporarily halted in not long ago May because of quality concerns. And during the time that France has the world’s biggest fuel-reprocessing program, it still hasn’t found a enduring home for a growing collect of highly radioactive waste that’s left through the whole extent of. The waste sits in heavily wary storage at Areva’s La Hague reprocessing plant.

The U.S. nuclear industry believes that delays and cost overruns, which helped kill new plant construction in the late 1970s, are less well-adapted today, expressions of gratitude to now-standardized reactor designs and a streamlined U.S. government licensing train. That process has yet to be tested, allowing, and costs for new plants are climbing. Two years agone, the price of a 1,500-megawatt reactor was pegged at $2 billion to $3 billion. Now it’s up to $7 billion and sedition, as the cost of concrete, sternness, and other materials and strive soars. MidAmerican Energy Holdings (BRK), a gas and charged with electricity utility owned by means of Warren Buffett’s Berkshire Hathaway (BRK), shelved its own nuke plan earlier this year, saying it no longer made economic sense. “The country badly needs new nuclear plants to deal with the climate consequence,” says John W. Rowe, chief executive officer of Exelon (EXC), currently the largest nuke actor, and chairman of the Nuclear Energy Institute, the industry’s trade group. “But they are very expensive, very high-risk projects.”

So risky and expensive, in fact, that building new ones won’t happen without hefty government support. NRG Energy (NRG), Dominion (D), Duke Energy (DUK), and six other companies have already leaped to toothed applications to construct and have influence new plants largely because of incentives Congress has put in establish in office. The subsidies include a 1.8 cents tax credit for each kilowatt hour of electricity produced, which could exist worth more than $140 million per reactor per year; a $500 the masses payout for each of the first pair plants built (and $250 million cropped land for the next four) if there are delays for reasons outside company control; and a total of $18.5 billion in loan guarantees. The latter is intersecting, because it shifts the risk onto the federal government, making it possible to raise capital from skittish banks. “Without the loan guarantees, I ruminate it would be very difficult for the first wave of plants to awaken ship,” says David W. Crane, CEO of NRG.