By Ayesha Rascoe
WASHINGTON Feb 18 The Obama administration will
announce that it has finalized $6.5 billion in loan aid to build
the country's first new nuclear reactors in more than 30 years,
sources said on Tuesday.
The announcement, expected on Wednesday, follows four years
of wrangling between the government and energy company Southern
Co over the terms of the loan agreement, which was
initially offered in February 2010 to support the construction
of two new reactors at the Vogtle nuclear plant in Georgia.
The conditional agreement totaling $8.3 billion provided
loan aid to Southern's Georgia Power unit as well as project
co-owners Oglethorpe Power and Municipal Electric Authority of
While loan assistance to Georgia Power and Oglethorpe will
be finalized Wednesday, the $1.8 billion loan guarantee to MEAG
The Department of Energy said on Tuesday that U.S. Energy
Secretary Ernest Moniz would make a major announcement about the
administration's "all of the above" energy strategy and a "path
toward a low carbon energy future" at the National Press Club on
Wednesday at 12:30 p.m. EST (1730 GMT).
The department declined to comment about the specifics of
In 2010, the loan deal for Southern was expected to be the
opening salvo in an emerging U.S. nuclear power renaissance. But
record low natural gas prices, tepid growth in electricity
demand and the lack of a federal cap on carbon emissions have
kept any such revival at bay.
Now only a few new reactors are projected to be built and
Vogtle is the only nuclear power plant to receive a federal loan
guarantee so far.
Southern's drive for a loan guarantee also got caught up in
the political fallout from the high profile 2011 bankruptcy of
solar panel maker Solyndra, which had received a federal loan
The Obama administration added requirements after Solyndra's
collapse that complicated negotiations over Southern's loan
deal, which was initially expected to be finalized in 2012.
Southern owns 45.7 percent of the Vogtle expansion project,
making it the project's largest stakeholder.
When contacted regarding the announcement on the loan
guarantee, Southern reiterated comments made in January by its
CEO Tom Fanning during a call with analysts after its quarterly
earnings that the company had delivered its documents to the
"Since that time, the company has been working through a
series of steps that must be taken prior to closing," a Southern
Southern's Georgia Power unit is leading a utility
consortium that is building two 1,100-megawatt Westinghouse
AP1000 reactors at a projected cost of more than $14 billion.
Southern Co shares closed up 2 cents at $42.54 in Tuesday
trading on the New York Stock Exchange.