Still, the loan guarantees alone might not be enough to restart the nuclear industry. One urgent need is for more trained workers, says Mujid Kazimi, a professor of mechanical engineering at MIT. It may be possible to build one or two power plants at a time, but he says to build more than that simultaneously would require increasing funding for training programs by about five times, to $10 million.
Kazimi also emphasizes that the new loan guarantees must be managed properly. The process of issuing them should be faster, for one thing: After five years, none of the $18.5 billion in guarantees included in the 2005 bill have been issued. Also, some of the terms make it difficult for companies to get financing. For example, the 2005 guarantees did not cover the entire cost of the plant–only 80 percent. Not only was the remaining 20 percent not guaranteed; it was more likely to be unrecoverable if the loan defaulted. That’s because the government insisted that it be paid back before any private creditors.
Even with the new loan guarantees, some utilities plan to wait until a few nuclear power plants have been built in the U.S. before going ahead with their own. Once company, Exelon, says it’s still concerned about whether nuclear plants will prove profitable, and emphasizes the need to find a permanent way to store nuclear waste. The Obama administration has scuttled the much debated Yucca Mountain waste repository, and announced a blue ribbon panel last week to investigate alternative ways to address waste. But the waste problem does not need to be solved immediately, Forsberg says, because current dry cask storage will remain a practical option for a century.
The new loan guarantees may be a risky political move for Obama, warns Dan Weiss, a senior fellow at the Center for American Progress in Washington, DC. He notes that while offering the guarantees has met with approval from some Republicans, it has not yet persuaded them to support the comprehensive energy and climate change legislation Obama hopes to pass.