U.S. Department of Energy

The U.S. Department of Energy (DOE) is tasked with the mission "to advance the national, economic, and energy security of the United States; to promote scientific and technological innovation in support of that mission; and to ensure the environmental cleanup of the national nuclear weapons complex.

Ending GNEP's domestic activities
In April 2009, the Obama administration announced it was scrapping the domestic portion of the Global Nuclear Energy Partnership. Environmental groups had criticized the plans for domestic nuclear waste reprocessing as "too expensive and too dirty." Energy Department spokesperson Jen Stutsman said in a statement, "The Department has already decided not to continue the domestic GNEP program of the last administration. ... The long-term fuel cycle research and development program will continue, but not the near-term deployment of recycling facilities or fast reactors."

Loan guarantees to four nuclear companies
In June 2009, the U.S. Department of Energy (DOE) indicated that the $18.5 billion in federal funding for the first wave of new nuclear power reactors would be shared by four companies: UniStar Nuclear Energy, NRG Energy, Scana and Southern Company. "The four companies have already selected sites for their reactors and are at the front of the pack to receive licenses to build and operate them from the Nuclear Regulatory Commission" (NRC), reported the Wall Street Journal. While the four had yet to be formally named, interviews with DOE and NRC staff identified the likely companies. The decision was based on which companies had "strong development teams and plans that could be implemented quickly." The DOE also wanted to fund both "traditional" utilities and "merchant" generators, and considered foreign partners "that might be able to contribute loans or equity" a plus.

"Two of the current leaders in nuclear power, Exelon Corp. and Entergy Corp.," are not expected to receive federal funding. Both companies indicated they may not join the expected "first wave" of new nuclear reactors. "We can't build without loan guarantees," said Exelon's Craig Nesbit. Entergy's Mike Bowling said, "We don't want to be left behind, but we think this first wave will pave the way for others."

Lobbied by the nuclear industry for loan guarantees
In May 2007, The Hill reported that the Nuclear Energy Institute (NEI), along with "top banking institutions" are lobbying the U.S. Department of Energy (DOE) and Office of Management and Budget (OMB) for "more comprehensive" federal loan guarantees for new nuclear power plants. "Since the April meeting" with OMB, the DoE "has proposed that the federal government cover 90 percent of loan guarantees, higher than its original guidelines of 80 percent." 

NEI's "New Plant Finance Task Force" is telling federal agencies that without total or near-total federal loan guarantees, which "act as default protection for private lenders," nuclear power companies will "have difficulty in financing new plants, which can cost as much as $4 billion." NEI's Richard Myers said that even increasing the loan guarantees to 90% of plant costs "will probably not be workable." A DOE spokesperson said the agency was not supporting a greater than 90% guarantee because the agency must protect "the taxpayer dollar from the potential financial risks of these projects." 

In June 2008, Investor's Business Daily reported that "the DOE will begin the review process later this summer," for the Department's $18.5 billion loan guarantee program for new nuclear power plants. "The $18.5 billion may be enough to partially fund only three or four nuclear plants, analysts say. About a dozen proposals are expected to vie for the financing."

The loan guarantees can "cover up to 80% of construction costs. Utilities, some of which have formed consortiums, are expected to provide 20% in equity. The Treasury may directly finance certain projects."

U.S. Department of Energy’s Office of Fossil Energy
The DOE’s Office of Fossil Energy oversees research on carbon capture and storage, IGCC, and other coal and "clean coal" technologies through its coal research, development, and demonstration (RD&D) program. This program carries out three primary activities: (1) managing and performing energy-related research that reduce barriers to the use of fossil fuels, (2) partnering with industry to advance technologies toward commercialization, and (3) supporting the development of information and policy options for the public.

In fiscal year 2009, DOE’s coal RD&D funding was at least $681 million, and $3.4 billion was appropriated in the American Recovery and Reinvestment Act of 2009 (ARRA) for fossil energy RD&D.

U.S. Department of Energy Tax Credits, Loans, and Loan Guarantees for Coal
Title XVII of the Energy Policy Act of 2005 (EPAct 2005) established a loan guarantee program within the Department of Energy (DOE) to foster "innovative technologies." In a federal loan guarantee program, the government guarantees that it will pay lenders if a borrower defaults on a loan, helping borrowers obtain credit on more favorable terms than would be available in private lending markets. The new DOE loan guarantee program targets energy projects that meet three criteria: (1) avoid, reduce or sequester air pollutants or greenhouse gases, such as carbon capture; (2) employ new or significantly improved technologies; and (3) have a reasonable likelihood of repayment.

In 2007 DOE invited 16 projects to submit applications for loan guarantees. Two of the projects are Integrated Gasification Combined Cycle (IGCC) coal-fired power plants and one would use IGCC technology to produce synthetic gas from coal for chemical feedstocks. In 2008, DOE issued solicitations for $6 billion in loan guarantees for projects that incorporate carbon capture and sequestration (CCS) or other emissions-reducing carbon technologies into retrofitted and new coal plants, or industrial gasification activities, and $2 billion for loan guarantees for advanced coal gasification projects.

The DOE has launched a website on gasification, called Gasipedia.

Examples of Department of Energy Funding
In 2009, the DOE selected several projects for final loan guarantee negotiation. These projects included:


 * Tenaska's Taylorville Energy Center – loan coverage $2.6 billion for a 730 MW coal-fired IGCC with CCS.
 * Leucadia's Indiana Gasification SNG project – loan coverage of $1.6 billion to produce Substitute Natural Gas (syngas) from coal for sale to customers in Indiana, with proposed carbon capture for enhanced oil recovery.
 * Leucadia's Mississippi Gasification SNG project – loan coverage of $1.689 billion to produce syngas from petroleum coke feedstock, for sale to electric utilities in the region, with proposed carbon capture for enhanced oil recovery.

The Clean Coal Power Initiative
According to the U.S. Department of Energy:


 * "The Clean Coal Power Initiative (CCPI) is a 10-year, $2 billion program designed to support the Clean Coal Technology Roadmap milestones with the government providing up to 50 percent of the cost of demonstrating a range of promising technologies. CCPI is implemented through a series of five solicitations over the 10-year period, two of which have already been issued and selections made. CCPI provides the means to demonstrate those technologies proven through R&D to have commercial potential. Demonstrations are at a commercial scale in actual operating environments, which is essential to moving them to the threshold of commercialization."

According Department of Energy Fact Sheet, the multi-year Clean Coal Power Initiative (CCPI), "is driven by private-sector-proposed projects in response to a government solicitation. Potential applicants include technology developers, service corporations, R&D firms, energy producers, software developers, academia, and other interested parties. The private sector cost share must be at least 50 percent. Funding is awarded to applicants, selected as a result of these open competitions, who can rapidly move promising new concepts to a point where private-sector decisions on deployment can be made."

Round I participants:
 * Great River Energy, Underwood, ND - Increasing Power Plant Efficiency–Lignite Fuel Enhancement
 * NeuCo, Inc., Boston, MA - Demonstration of Integrated Optimization Software at the Baldwin Energy Complex
 * University of Kentucky Research Foundation, Lexington, KY - Advanced Multi-Product Coal Utilization By-Product Processing Plant
 * WMPI PTY., LLC, Gilberton, PA - Gilberton Coal-to-Clean Fuels and Power Co-Production Project
 * Western Greenbrier Co-Generation, LLC, Lewisburg, WV - Western Greenbrier Co-Production Demonstration Project
 * Wisconsin Electric Power Co., Milwaukee, WI - TOXECON Retrofit for Mercury and Multi-Pollutant Control on Three 90 MW Coal-Fired Boilers

Round II participants:
 * Excelsior Energy, Inc., Minnetonka, MN - Mesaba Energy Project
 * Pegasus Technologies, Incorporated, Chardon, OH - Mercury Specie and Multi-Pollutant Control
 * Southern Company Services, Birmingham, AL - Demonstration of a 285-MW Coal-Based Transport Gasifier

In July 2010, the DOE announced funding $67 million for ten carbon capture projects. The projects can be seen here.

Funding for University Coal Research
On May 13, 2010, DOE announced that its University Coal Research (UCR) program would provide $2.4 million in funding for seven university projects "aimed at advancing coal research and development while providing research exposure to a new generation of scientists and engineers." The projects aim to improve the basic understanding of the chemical and physical processes that govern coal conversion and utilization, by-product utilization, and technological development for clean coal, carbon capture, and integrated gasification (IGCC) projects.

The projects can be seen here.

Personnel

 * Samuel W. Bodman, Secretary
 * Dennis R. Spurgeon, Assistant Secretary of Energy (Nuclear Energy) (new position) (nominated February 13, 2006)
 * Dr. James J. Markowsky, Assistant Secretary for Fossil Energy; this position includes oversight of the research program for coal (including Carbon Capture and Storage, oil and gas and the U.S. Petroleum Reserves.

Related SourceWatch articles

 * American Council on Global Nuclear Competitiveness
 * Bush administration
 * ENERGY STAR / ENERGY STAR Challenge
 * Global Nuclear Energy Partnership
 * Nuclear Boosters
 * Nuclear Energy Institute
 * Nuclear Regulatory Commission
 * Spencer Abraham, former Secretary

External articles

 * Glen Hess, "Energy Advisory Board Abolished. Bodman decides board is no longer needed as White House sets direction for research," Chemical & Engineering News, April 11, 2006.
 * Press release, "Nuclear Council Presents Recommendations to DOE: Continued Commitment Required to Strengthen U.S. Nuclear Industry," ACGNC via PR Newswire, March 6, 2007.
 * Kevin Bogardus, "Nuclear power, banks link up in bid to get better financing," The Hill, May 24, 2007.
 * Ben Lando, "Analysis: Nuclear Loan Backing Cloudy," UPI, May 25, 2007.
 * "Nevada delegation: Yucca conflicts need investigating: Lawmakers push for a closer look into the law firm hired by the DOE for licensing procedure," Nevada Appeal (Carson City, Nevada), December 5, 2007.
 * Erica Werner, "DOE Idea: Going Private With Nuke Waste," Associated Press, March 14, 2008.
 * Press release, "U.S. Nuclear Weapons Complex: DOE Waiver Puts Livermore Homes and Plutonium at Risk," [[Project on Government Oversight], March 17, 2008.
 * Steve Tetreault, "State estimates record challenges to Yucca," Pahrump Valley Times (Nevada), April 2, 2008.
 * Judith Lewis, "Slow Train to Yucca Mountain: Will America's nuclear waste repository ever open, and, more important: should it?" Mother Jones, April 28, 2008.
 * Siobhan Hughes, "Yucca Move Is Part of Nuclear Agenda," Wall Street Journal (sub req'd), June 4, 2008.
 * Keith Rogers, "Nuclear Waste Deal Opposed," Las Vegas Review-Journal (Nevada), June 17, 2008.
 * Rob Capriccioso, "Not in my backyard anymore: Tribe wants nuclear waste site away from its lands," Indian Country Today, June 13, 2008.
 * Marcus Baram, "DOJ Slams Energy Dept Contract to Law Firm: Letter Warns That Contract Could Jeopardize Opening of Nuclear Waste Repository," ABC News, June 26, 2008.
 * Rosalie Westenskow, "Government doles out cash for clean technology," UPI, July 1, 2008.
 * Tony Illia, "Bechtel SAIC ousted as Yucca Mountain manager: San Francisco company wins $2.5 billion, five-year contract," Las Vegas Business Press, November 10, 2008.
 * Press release, "DOE Cites Bechtel National Inc. for Price-Anderson Violations," U.S. Department of Energy, December 3, 2008.
 * Annette Cary, "DOE set to fine Hanford contractor Bechtel $385,000," Tri-City Herald (Tri-Cities, Washington), December 4, 2008.
 * Steve Tetreault, "California says Yucca poses threat to people, resources," Las Vegas Review-Journal (Nevada), December 24, 2008.
 * Eileen O'Grady, "Five U.S. nuclear plants on DOE loan short list," Reuters, February 18, 2009.
 * Keith Rogers, "Federal budget will contain minimal funding for Yucca Mountain, open look for alternatives," Las Vegas Review-Journal, February 25, 2009.
 * Steve Tetreault and Keith Rogers, "McCain modifies view on Yucca project," Las Vegas Review-Journal, March 31, 2009.
 * Ken Ritter, "NRC panel begins Nevada nuclear dump hearings," Associated Press, March 31, 2009.
 * Edward Felker, "Senate budget revives 'nuclear pork': $50 billion loan guarantee plan tucked in for Energy Department," The Washington Times, April 8, 2009.
 * Jim Snyder, "Nuclear lobby presses for more loan guarantees," The Hill, June 21, 2009.