Federal Risk Insurance Available for Nuclear Plant Construction
Companies building new nuclear power plants can qualify for $2 billion in federal risk insurance because of a Conditional Agreement released Sept. 25 by U.S. Energy Secretary Samuel Bodman. The insurance covers costs associated with certain regulatory or litigation-related delays that are no fault of the company and stall the start-up of these plants. Only the first six companies granted a Construction and Operating License by the Nuclear Regulatory Commission and begin construction are eligible for a risk insurance contract with DOE.
Separately, DOE announced it is plugging $19 million into research projects to develop better, cheaper batteries for hybrid electric vehicles, pending congressional approval. 3M (St. Paul, Minn.), A123Systems (Watertown, Mass.), Compact Power Inc. (Troy, Mich.), EnerDel, Inc. (Indianapolis), and Johnson Controls -– Saft Advanced Power Solutions (Milwaukee). The University of Michigan's Michigan Memorial Phoenix Energy Institute will receive nearly $2 million to coordinate efforts among DOE and its Pacific Northwest National Laboratory, General Motors, Ford Motor Company, and DTE Energy to conduct a two-year study on plug-in hybrid vehicles.
"To meet the world's growing demand for electricity and confront climate change, safe and emissions-free nuclear energy must play an integral role in our energy mix," Bodman said in a Chicago speech to the World Association of Nuclear Operators and United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry. "Conditional Agreements pave the way for risk insurance contracts that will provide the first project sponsors constructing new nuclear power plants with assistance if they face delays in expanding the use of nuclear energy across the nation."
Federal risk insurance is authorized by the Energy Policy Act of 2005. In August 2006, DOE issued a final rule that outlines a two-step process to apply for risk insurance coverage, which requires entering into a Conditional Agreement first and, if eligible, then a risk insurance contract.