As much as $12.6 billion in loan guarantees could be extended to help finance the next generation of nuclear energy technologies, the Department of Energy announced Sept. 30.
The draft solicitation, which has yet to be finalized and is open to public comment, is needed to help commercialize advanced nuclear projects that are often unable to secure traditional financing because of their scale and use of innovative technologies, the department said.
“This draft solicitation represents another step in the Department's commitment to help overcome the financial barriers to the deployment of next generation technologies that will diversify America's clean energy portfolio,” the DOE said in a statement.
The financing comes as competition from cheap natural gas and subsidized wind power, along with high operating and maintenance costs at aging nuclear reactors, have led operators such as Dominion Resources Inc. and Entergy Corp. to retire nuclear power plants early.
Energy Secretary Ernest Moniz and other backers of nuclear power say keeping the industry alive is necessary to achieve the country's climate goal, as nuclear power generation does not emit carbon dioxide or other greenhouse gases.
Nuclear Power's Climate Role
“If you want to fight climate change, nuclear power has to play a role,” Peter W. Davidson, executive director of the Energy Department's loan programs office, said in a statement to Bloomberg BNA.
While other nuclear technologies may apply, the Energy Department said it has identified four “key technology areas of interest” for the loan guarantees, including small modular nuclear reactors that are typically 300 megawatts or less in size and can be manufactured in factories rather than built onsite.
In addition, the department is seeking projects involving advanced nuclear reactors—projects with “evolutionary, state-of-the-art design improvements” in areas of fuel technology, thermal efficiency and safety systems, according to a DOE blog post.
The department also said it is interested in funding improvements and upgrades to existing reactors to increase efficiency or capacity, and “front-end” nuclear projects, such as uranium conversion or enrichment, according to the blog post.
Funding Small Reactors, Existing Improvements
“The nuclear industry used to be one-size fits all—but no more,” Davidson said. “We designed our new solicitation around the activity we're seeing in the marketplace.”
The draft solicitation come on the heels of a $6.5 billion Energy Department loan guarantee for the construction of two nuclear reactors at Southern Co.’s Vogtle plant near Waynesboro, Ga.—the first new reactors to be built in the U.S. in 30 years.
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