Cooper:Escalating Nuclear Reactor Costs Seen in Major Reversals for Industry on Wall Street and in Canada, Texas

Ratings Warning From Moody`s Followed by Mothballing of New Reactor Plans in
Ontario and Texas; Developments in Line with Cooper Report from June Projecting
Trillions in Excess Costs for Nuclear, Compared to Combination of Renewables and
More Efficiency.
WASHINGTON--(Business Wire)--
Three major developments in the nuclear power industry in late June underscore
the key findings of the "The Economics of Nuclear Reactors," a report released
on June 18, 2009 by economist Dr. Mark Cooper, a senior fellow for economic
analysis at the Institute for Energy and the Environment at Vermont Law School.
The Cooper report finds that it would cost $1.9 trillion to $4.1 trillion more
over the life of 100 new nuclear reactors than it would to generate the same
electricity from a combination of more energy efficiency and renewables.

Available online at
http://www.vermontlaw.edu/Academics/Environmental_Law_Center/Institutes_and_Initiatives/Institute_for_Energy_and_the_Environment/New_and_Noteworthy.htm,
the Cooper analysis of over three dozen cost estimates for proposed new nuclear
reactors shows that the projected price tags for the plants have quadrupled
since the start of the industry`s so-called "nuclear renaissance" at the
beginning of this decade - a striking parallel to the eventually seven-fold
increase in reactor costs estimates that doomed the "Great Bandwagon Market" of
the 1960s and 1970s, when half of planned nuclear reactors had to be abandoned
or cancelled due to massive cost overruns.

Cooper said that three late June developments provide new evidence of the
validity of the cost-related concerns documented in his report:

* On June 30, 2009, Exelon cited "economic woes" as a major factor in postponing
for up to 20 years plans to build two nuclear reactors at its site in Victoria,
Texas. (See
http://www.victoriaadvocate.com/news/2009/jun/30/gs_exelon_070109_56587/?business&local-news
for local coverage of the decision.)
* On June 29, 2009, the Government of Ontario announced that it has suspended
the competitive bidding process to procure two replacement nuclear reactors
planned for a Darlington, Ontario site. As the New York Times reported: "Two
years into a $20 billion nuclear upgrade project meant to replace aging reactors
with next-generation technology, the Ontario government postponed the entire
process on Monday, citing excessive cost and uncertainties involving the
ownership status of the sole Canadian bidder … Yesterday`s move is a setback for
the Atomic Energy of Canada Limited, the 57-year-old government-owned
corporation that has built all of Canada`s reactors and could soon be sold off
to a private investor." (See
http://greeninc.blogs.nytimes.com/2009/07/01/ontario-puts-nuclear-expansion-plans-on-ice/.)

* On June 23, 2009, Moody`s Investor Services issued a report titled "New
Nuclear Generation: Ratings Pressure Increasing." The summary to the report
included the following: "Moody's is considering "taking a more negative view for
those issuers seeking to build new nuclear power plants … Rationale is premised
on a material increase in business and operating risk … most utilities now
seeking to build nuclear generation do not appear to be adjusting their
financial policies, a credit negative. First federal approvals are at least two
years away, and economic, political and policy equations could easily change
before then …" Cooper pointed out that even though Moody`s concludes that
reactors might be financially viable once operating, the barriers to actual
permitting and affordable construction may make it impossible to reach the
operational new-plant phase. See the report summary at
http://www.alacrastore.com/storecontent/moodys/PBC_117883 and a related news
story at
http://money.cnn.com/news/newsfeeds/articles/djf500/200906250936DOWJONESDJONLINE000658_FORTUNE5.htm.

Institute for Energy and the Environment at Vermont Law School, South Royalton,
VT.
Ailis Aaron Wolf, 703-276-3265
aawolf@hastingsgroup.com

Copyright Business Wire 2009