U.S. re-enters nuclear frayPresident Barack Obama announced earlier this week the increase of federal loan guarantees for new nuclear projects to revive the American nuclear energy industry, which had been put on hold for the last three decades.
The Energy Department approved a federal loan guarantee of more than $8 billion to build twin reactors in Georgia, paving the way for the first nuclear power plant construction since the partial meltdown at Three Mile Island in 1979 led to a practical moratorium on new facilities.
The capital influx into the reactor business suggests a change of direction in the U.S. energy strategy toward cost-effective, low-carbon energy generation. The decision underscores the U.S. choice for commercial use of nuclear power as the cheapest way to produce power while reducing greenhouse gases associated with global warming.
When announcing the resumption of reactor construction, President Obama referred to three Asian countries emerging as commercial nuclear powers. Of 56 reactors now under construction in the world, China accounts for 21, Korea six and India five. These countries are creating new jobs and demand for technology, Obama said. He made it clear that the decision to revive reactor construction was part of a broader strategy to generate clean energy as well as jobs and new technology. To meet its target for cuts in greenhouse gases, the United States must construct 180 reactors by 2050. The administration is poised to create another renaissance for the nuclear reactor business.
The U.S. boost in nuclear investment poses both a challenge and an opportunity for us. We hope to build 80 reactors abroad by 2030, on the momentum from the multibillion-dollar project won in the United Arab Emirates last year.
If the U.S. makes inroads into the reactor industry, the global market is bound to get bigger and competition fiercer. U.S. companies may own core technology to construct reactors, but they have been more or less out of the business for the last three decades.
We can capitalize on the market’s growth through our advanced technologies in reactor design, construction and operation. U.S. nuclear companies are already tapping Korean competitors for partnerships. If local firms join with their U.S. counterparts, they may gain an upper hand in winning new orders in that country as well as other parts of the world. Local companies must lay out a careful strategy to cash in on a potential new boom in the U.S. nuclear reactor business.