Nuclear Industry Lobbyists Battle Fallout From Japan Reactor Crisis

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In his final State of the Union address President Jimmy Carter dedicated five paragraphs to a discussion of nuclear energy and safety. It would take twenty-four years before another President discussed nuclear energy in a State of the Union again. Since then, no State of the Union has been without a call to build more nuclear plants.

This period, stretching from the middle of the first decade of the 21st century to now, has been referred to as the “nuclear renaissance.” Republicans and Democrats have both supported the construction of new nuclear power plants. This cross-party agreement, and the so-called “nuclear renaissance,” may come apart as the crisis at the Fukushima Daiichi nuclear plant in Japan continues.

On March 11 the Fukushima Daiichi nuclear power plant suffered major damage from a 9.0 earthquake and the ensuing tsunami. In the following days the plant’s condition has deteriorated dramatically. Evidence has emerged of partial meltdowns in three reactors at the plant. Explosions have occurred at three reactors, while a fire broke out at a fourth. A small, dedicated group of workers remains at the site in an attempt to avoid a full meltdown at the plant. Traces of radioactivity are being found as far as Tokyo, although not at harmful levels yet.

As public opinion on nuclear energy collapses, the nuclear industry’s lobbyists in Washington have begun to take their case to lawmakers.

According to BusinessWeek, the Nuclear Energy Institute and lobbyists for Exelon have held meetings with lawmakers and staff on Capitol Hill on March 14 to explain that reactors in the United States “can withstand disasters such as the earthquake and tsunami that crippled nuclear reactors in Japan.”

Having invested large sums of money in lobbying and campaign contributions over the past seven years, the industry is not without its share of allies.

Lobbying, PAC Contributions

An analysis of the lobbying expenses of electric utilities operating a majority of the nation’s nuclear reactors and the main industry trade group show a doubling on lobbying spending since 2004. The industry’s lobbying jumped from $27 million prior to the nuclear-friendly Energy Act of 2005 to nearly $54 million in 2010. Not all of this lobbying has been directly focused on growing the nuclear industry, but the key bills spurring much of the lobbying activity have included major government support for nuclear power plant growth.

The industry’s lobbying team is filled with former government officials, sixty-eight percent of them, including twelve former congressmen. Among them, former Sens. Trent Lott and John Breaux lobby for Entergy, former Rep. Dick Gephardt works for Progress Energy, and former Sen. Don Nickles holds Southern Co. as a client.

These connections undoubtedly help connect industry policy priorities to the congressional process drafting legislation on energy and climate issues.

Over the same period, the industry increased its spending on campaign contributions through political action committees (PAC). According to data obtained from TransparencyData.com, contributions increased from $3.5 million in the 2004 cycle to approximately $4.5 million in both the 2008 and 2010 cycles. These contributions, while favoring Republicans overall, track closely with party control of Congress and the White House. Industry contributions did not shift to the Democrats until after the 2008 cycle swept the party into the White House and large majorities in both the House and the Senate.

Much of the shift to Democratic campaigns came as President Barack Obama had promised to overhaul the nation’s energy policy with legislation aimed at reducing fossil fuel use to mitigate the effects of climate change. This would include increased support for nuclear energy.

The new Democratic president’s push for more nuclear energy came after the nation’s biggest nuclear power company strongly backed his candidacy.

Illinois-based Exelon was one of the biggest corporate backers of then-Sen. Obama’s 2008 presidential run. The company’s director, John W. Rogers, served on Obama’s finance committee and bundled $193,598 to the Illinois senator’s campaign, according to the Center for Responsive Politics. Rogers also sat on the president’s Inaugural Committee and donated $50,000 to the 2009 Inauguration. ComEd CEO Frank Clark bundled $75,100 in contributions to the Obama presidential campaign. (ComEd is a subsidiary of Exelon.)

Former White House Chief of Staff Rahm Emanuel made millions when he joined an investment bank in Chicago and shepherded through the merger deal between PECO Energy and Unicom that created Exelon.

Exelon operates seventeen nuclear reactors in the United States, the most of any company in the nation.

Focus on legislation, subsidies

While the industry has touted the “nuclear renaissance” there have always remained concerns of cost overruns in the construction of new plants. Alleviating this problem through loan guarantees, which some describe as subsidies, has been the key policy that Congress and two presidents sought to implement to help increase the country’s nuclear capacity.

In 2005, Congress enacted and President George W. Bush signed the Energy Policy Act of 2005. The Energy Policy Act included $18.5 billion in loan guarantees for companies building new nuclear reactors. This was the first foray in government policy to aid the nuclear industry during the “renaissance” period.

During the first two years of the Obama administration energy companies focused on the attempt by Congress and the White House to rewrite the nation’s energy policy with a focus the reduction of fossil fuel use and the increase in renewable, or non-emitting, forms of energy production. The White House made it very clear that this would include nuclear energy.

The President’s budget has included an increase in loan guarantees for nuclear construction in both his FY 2011 and FY 2012 budgets. The proposal would add $36 billion to the program’s already existing $18.5 billion. This priority for the industry has remained stalled in the budget morass of Congress since it was first proposed in 2010. The administration, however, has tapped the $18.5 billion loan guarantee fund to back two new reactors to be built at the Southern Co. operating plant in Georgia.

In 2009 the House of Representatives passed a bill to create a cap and trade system for carbon pricing that also included substantial investment in renewable energy. The Nuclear Energy Institute praised the House’s passage of the bill for “the inclusion of provisions promoting greater use of clean-energy technologies, including nuclear energy.” The climate bill, and spending to increase the nation’s nuclear capacity, ultimately stalled in the Senate.

Post-Fukushima

The future for the nuclear industry suddenly looks far more difficult than the one policy makers saw just two years ago. While the president and congressional Republicans remain dedicated to increasing nuclear power in the country others, some who have supported nuclear energy recently, are calling for a review of all current and future reactors.

The first wary comment came from Sen. Joe Lieberman, who had worked on a Senate energy bill in recent years and supported more funding for nuclear expansion, “I don’t want to stop the building of new nuclear power plants, but I think we’ve got to quietly, quickly put the brakes on until we can absorb what has happened in Japan as a result of the earthquake and the tsunami and then see what more, if anything, we can demand of the new power plants that are coming on line.”

Last week Senate Democrats on the Environment and Public Works Committee questioned Nuclear Regulatory Commission chairman Gregory Jaczko over safety at plants in the United States. Sen. Frank Lautenberg voiced concerns later echoed by other members of the committee, “We’ve got an inferno in front of us and we have to make sure that we do whatever we can to stop it.”

Jaczko has promised a full review of nuclear reactors.

Secretary of Energy Steven Chu has acknowledged that there will be a review of reactors and that the future siting of new reactors may change due to concerns about natural disasters. Chu told Fox News, “Certainly where you site reactors and where we site reactors going forward will be different than where we might have sited them in the past, I would say.”

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