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The nuclear industry could end up facing no risk under massive tax break subsidies in the Kerry-Lieberman climate bill, according
to an important new analysis conducted for Friends of the Earth by the
research organization Earth Track. These tax breaks totaling $9.7
billion to $57.3 billion (depending on the type and number of reactors)
would come on top of the Kerry-Lieberman measure's lucrative $35.5
billion addition to the more than $22.5 billion in loan guarantees
already slated for nuclear power.
Friends of the Earth President Erich Pica said: "Doling
out an additional $1.3-$3 billion in tax breaks per new reactor means
the industry would be at the table playing almost entirely with
taxpayer money. Industry will have little to lose when a reactor goes
belly up. While taxpayers
are bankrolling the industry's nuclear gamble they would share in none
of the reactor's financial returns. In fact, all taxpayers will
receive if the reactors are built is responsibility for disposing of
the waste. By contrast, investors stand to make billions with no risk
should their reactor gambit goes belly up and enter bankruptcy."
Earth Track Founder Doug Koplow said: "These
substantial tax breaks for new reactors greatly impede market access
for competing energy sources and worsen the already substantial risks
to taxpayers from a nuclear build-out. As has clearly been shown in
U.S. mortgage markets, the likelihood of bad financial decisions rises
sharply if only other people's capital is at risk. Kerry-Lieberman's
nuclear tax breaks do just this by replacing investor equity with
taxpayer money, and allowing investment tax credits to be claimed even
before the reactor is operating. The provision to recover credits in
the event a reactor is cancelled or suspended is unlikely to be
effective in the most likely cause of termination - a bankruptcy due to
poor economics."
The memo
evaluates three tax break subsidies, describing how they work and
estimating their subsidy value to recipients in the nuclear power
sector:
According to the Earth Track analysis:
The full Earth Track analysis is available online at https://www.foe.org/more-kerry-lieberman-nuclear-subsidies/.
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The nuclear industry could end up facing no risk under massive tax break subsidies in the Kerry-Lieberman climate bill, according
to an important new analysis conducted for Friends of the Earth by the
research organization Earth Track. These tax breaks totaling $9.7
billion to $57.3 billion (depending on the type and number of reactors)
would come on top of the Kerry-Lieberman measure's lucrative $35.5
billion addition to the more than $22.5 billion in loan guarantees
already slated for nuclear power.
Friends of the Earth President Erich Pica said: "Doling
out an additional $1.3-$3 billion in tax breaks per new reactor means
the industry would be at the table playing almost entirely with
taxpayer money. Industry will have little to lose when a reactor goes
belly up. While taxpayers
are bankrolling the industry's nuclear gamble they would share in none
of the reactor's financial returns. In fact, all taxpayers will
receive if the reactors are built is responsibility for disposing of
the waste. By contrast, investors stand to make billions with no risk
should their reactor gambit goes belly up and enter bankruptcy."
Earth Track Founder Doug Koplow said: "These
substantial tax breaks for new reactors greatly impede market access
for competing energy sources and worsen the already substantial risks
to taxpayers from a nuclear build-out. As has clearly been shown in
U.S. mortgage markets, the likelihood of bad financial decisions rises
sharply if only other people's capital is at risk. Kerry-Lieberman's
nuclear tax breaks do just this by replacing investor equity with
taxpayer money, and allowing investment tax credits to be claimed even
before the reactor is operating. The provision to recover credits in
the event a reactor is cancelled or suspended is unlikely to be
effective in the most likely cause of termination - a bankruptcy due to
poor economics."
The memo
evaluates three tax break subsidies, describing how they work and
estimating their subsidy value to recipients in the nuclear power
sector:
According to the Earth Track analysis:
The full Earth Track analysis is available online at https://www.foe.org/more-kerry-lieberman-nuclear-subsidies/.
The nuclear industry could end up facing no risk under massive tax break subsidies in the Kerry-Lieberman climate bill, according
to an important new analysis conducted for Friends of the Earth by the
research organization Earth Track. These tax breaks totaling $9.7
billion to $57.3 billion (depending on the type and number of reactors)
would come on top of the Kerry-Lieberman measure's lucrative $35.5
billion addition to the more than $22.5 billion in loan guarantees
already slated for nuclear power.
Friends of the Earth President Erich Pica said: "Doling
out an additional $1.3-$3 billion in tax breaks per new reactor means
the industry would be at the table playing almost entirely with
taxpayer money. Industry will have little to lose when a reactor goes
belly up. While taxpayers
are bankrolling the industry's nuclear gamble they would share in none
of the reactor's financial returns. In fact, all taxpayers will
receive if the reactors are built is responsibility for disposing of
the waste. By contrast, investors stand to make billions with no risk
should their reactor gambit goes belly up and enter bankruptcy."
Earth Track Founder Doug Koplow said: "These
substantial tax breaks for new reactors greatly impede market access
for competing energy sources and worsen the already substantial risks
to taxpayers from a nuclear build-out. As has clearly been shown in
U.S. mortgage markets, the likelihood of bad financial decisions rises
sharply if only other people's capital is at risk. Kerry-Lieberman's
nuclear tax breaks do just this by replacing investor equity with
taxpayer money, and allowing investment tax credits to be claimed even
before the reactor is operating. The provision to recover credits in
the event a reactor is cancelled or suspended is unlikely to be
effective in the most likely cause of termination - a bankruptcy due to
poor economics."
The memo
evaluates three tax break subsidies, describing how they work and
estimating their subsidy value to recipients in the nuclear power
sector:
According to the Earth Track analysis:
The full Earth Track analysis is available online at https://www.foe.org/more-kerry-lieberman-nuclear-subsidies/.