Southern Alliance for Clean Energy Hounds DOE for $8.3 Billion Nuclear Loan Guarantee Transparency

Energy Secretary Chu

The Southern Alliance for Clean Energy (SACE) has asked a court to force the Department of Energy (DOE) and Southern Co. to provide information pertaining to the DOE loan guarantee for the construction of two new nuclear reactors at Southern Co.'s Plant Vogtle in Georgia.

Shortly after President Obama announced the DOE had offered a conditional loan guarantee for the Plant Vogtle project in February 2010, SACE filed a Freedom of Information Act (FOIA) request for records pertaining to loans.

Now, two years later the Tennessee-based organization claims the Department is still withholding "meaningful public disclosure to taxpayers of the risks to which they are exposed in the massive commitment of $8.33 billion in conditional federal loan guarantees to Southern Company."

With a large portion of the country up in arms about the recent government backed clean energy bankruptcies, SACE raises some good questions: Why is the DOE so resistant to releasing specific and clear information regarding the details of the loan guarantees -- what is there to hide? And, considering the current criticism of government-backed loans, why hasn't the Department upped its transparency?

“Given some of the lessons learned and political games developing from the Solyndra loan guarantee case, it’s unacceptable and inconsistent that the much larger Vogtle loan isn’t getting more intense scrutiny when the potential risk to taxpayers is much greater. The DOE needs to operate with more transparency now – not less,” says Stephen A. Smith, SACE'S executive director.

Apparently, in the 133-page document the Department did produce (20 months after the FOIA response deadline) it failed to provide the information SACE wants to analyze -- the terms of the guarantee and the subsidy fee estimates.  In the words of the DOE, "the loan guarantee terms and credit subsidy fee estimates were withheld as confidential information belonging to the power companies."

SACE feels that the Nuclear Regulatory Committee is just days away from approving a Combined Construction and Operating License (COL) to Southern Co. for the Vogtle project and that now, more than ever, the public needs to know the risk involved in the loans they are fronting. The $8.33 billion loan is 12 times that of the loan guarantee awarded to the now bankrupt Solyndra and, according to SACE's research, the risk of a loan for new nuclear reactor construction is "very high".

Indeed, the NRC could be close to a COL issuance. Over the last six months the Vogtle project has received its Final Safety Evaluation Report (FSER) and, perhaps more importantly, had its reactors approved. Crossing a huge milestone in late December 2011, the NRC approved the new reactor design developed by Toshiba Corporation subsidiary Westinghouse Electric Company -- leaving just the COL approval before the Vogtle project can officially break ground.

Perhaps the irony here is that as part of its mission, SACE is a clean energy advocate -- one that may have supported a Solyndra type loan in Tennessee. In fact, in October, Nick Alderson posted on the non-profit's blog that "while the failure of Solyndra is unfortunate, it does not, as some have claimed, make the case that using public funds to attract private investment is a bad idea. Especially here in Tennessee."

This is not to say that government transparency is not paramount, especially in regards to the public's money. However, it does raise the question -- if the $8.3 billion was to be invested in solar or wind power generation would SACE be working so hard to get the funding facts straight?

And, on the other hand, where are the voices from those are investigating the loan guarantee to Solyndra as a crime?  Why are they not demanding further scrutiny regarding the Vogtle guarantee which dwarfs the size of Solyndra?

Image Credit: United States Government Work via Flickr.