It will be weeks or maybe even early 2022 before the Department of Energy shares more details about how it will auction off $6 billion worth of credits to struggling nuclear power plants over the next five years, a DOE official said Wednesday.
“It’ll really be a little while before we have the details of exactly how the process will work,” DOE deputy chief of staff Jeremiah Baumann told Weapons Complex Morning Briefing during a virtual press call Wednesday. That could be “in the coming weeks and months,” Baumann said.
Under the just-passed bipartisan infrastructure bill, Congress authorized DOE to auction off $6 billion in subsidies from fiscal year 2022 to 2026 to nuclear power operators that post a net operating loss. That averages out to $1.2 billion a year, which congressional appropriations committees would have to provide in annual appropriations bills.
The bill also said that DOE should finish setting up that auction process by around four months, or 120 days, after it becomes law. That’s “a very fast timeline,” Baumann said, but it’s one that the agency is ready to meet. Baumann declined to say who within DOE would be in charge of setting up the auctions.
The credits are “not a universally available automatic piece that goes out to anyone,” Baumann said. “Plant owners and operators will have to submit applications to show their need and to make sure that taxpayers’ money is well spent.”
The Joe Biden administration announced Wednesday that the president would sign the bipartisan infrastructure bill Nov. 15, after the measure passed in the House on Friday.
A spokesperson for the House Appropriations Committee told Weapons Complex Morning Briefing via email Wednesday that the $6 billion proposed for the credits program is appropriated within the infrastructure bill itself, and that there is “no interaction” with the House’s fiscal 2022 federal appropriation bills or any prior annual spending legislation.
The prospect of a tax break for nuclear power arrives at a time when nuclear plants are going down much, much faster than new ones are being built. Michigan’s Palisades plant is slated to shut down in early 2022, and Indian Point in New York went dark for good back in April. Illinois’s Byron and Dresden plants, which were set to close this fall, were saved in September by a state bailout.
Addressing concerns Wednesday that the Biden administration was funnelling federal cash into a faltering industry, Baumann said that the U.S. “can’t afford to have the setback of losing a lot of carbon free electricity.”
“The bottom line is that you’ve got a lot of safe and reliable plants out there that are providing zero carbon electricity exactly when our nation and the world need it most,” Baumann said. “We think these plants are good plants that should be part of our nation’s electric infrastructure.”
Updated 11/10/21 at 4:45 p.m. Eastern time to reflect a clarification from DOE that the timeline for building the nuclear credits program is 120 days.
