Bonds News

UPDATE 1-Obama to give nuclear loan guarantee to Southern Co

* Announcement expected next week

* First nuclear plant to be built in nearly 30 years (Adds quotes, background, details)

WASHINGTON, Feb 12 (Reuters) - U.S. President Barack Obama will announce a loan guarantee next week for Southern Co SO.N to build and operate two new nuclear reactors, the first new U.S. nuclear power plant in nearly three decades, an administration official said on Friday.

The loan guarantees, meant to show Obama’s commitment to nuclear energy as he fights to pass a climate change bill through Congress, would be for the first nuclear power plant to be built in nearly three decades, the official said.

“That financial commitment will be made for the construction and operation of two new nuclear reactors at a Southern Company plant in Burke, Georgia,” he said.

“The president has long believed that nuclear power should be part of our energy mix -- that’s why he has advocated for comprehensive energy and climate legislation that leverages all of our energy sources, including nuclear, to transition to a clean energy economy,” the official said.

He did not give a dollar figure for the loan guarantee.

Obama, a Democrat, has tried to reach out to Republicans who are skeptical about aspects of his proposed energy policy by emphasizing the role of nuclear power in the country’s future energy mix.

U.S. Energy Secretary Steven Chu said last month the process for approving federal loan guarantees for new nuclear power plants has become complicated, but promised the department would issues its first loan deals very soon.

The official said the guarantee to be announced next week stemmed from 2005 legislation authorizing the U.S. government to issue loan guarantees for projects that “avoid, reduce, or sequester air pollutants or greenhouse gas emissions.”

“No nuclear loan guarantees have been issued since that legislation was passed,” the official said.

“One of Secretary Chu’s top priorities have been to expedite the process to allocate the $18.5 billion in existing loan guarantee authority,” he said.

Citing information provided by the company, the official said the project would generate about 3,000 construction jobs on site and roughly 850 permanent positions to operate the reactors. About 1.4 million people will be served by the power from the facility, he said.