5. U.S. Taxpayers Underwrite Global Nuclear Power Plant Sales

by Project Censored
Published: Updated:

The Progressive, March 2000
Title: Pushing the Nuclear Plants: A U.S. Agency Hooks Foreign Clients
Author: Ken Silverstein and Ian Urbina

Faculty Evaluator: Wingham Liddell, Ph.D.
Student Researchers: Ambrosia Crumley, Licia Marshall, Adam Sullens

The U.S. tax-supported Export-Import Bank (Ex-Im) is solidly backing major U.S. nuclear contractors such as Westinghouse, Bechtel, and General Electric in their efforts to seek foreign markets for nuclear reactors. Between 1959 and 1993 Ex-Im spent $7.7 billion to help sell American-made reactors abroad.

Most countries do not have the capital to buy nuclear power, so contractors, in order to be competitive, provide 100 percent of the financing. Ex-Im offers terms too good for Third World countries and Eastern European buyers to pass up. If the host country defaults on its loan, the Ex-Im steps in with American taxpayer dollars.

Westinghouse built the Bataan nuclear power facility in the Philippines in 1985 at a cost of $1.2 billion, 150 percent above their projections. However, the Bataan plant was never brought on line due to the fact it was near an active volcano. Despite the fact that the plant never generated a single kilowatt of energy, the Philippines still pays about $300,000 a day in interest on the Ex-Im loan that funded the project. Should the Philippines default, U.S. taxpayers will pickup the tab.

In Turkey, the Ex-Im has approved a preliminary loan in support of a Westinghouse-led consortium’s $3.2 billion bid to build the Akkuyu plant on the Mediterranean coast. The Akkuyu plant site is near an active fault line in a region that has experienced a number of strong earthquakes over the last 100 years. Despite safety and environmental concerns, Vice President Gore wrote to Turkish officials on behalf of Westinghouse. National security specialists believe that Turkey’s nuclear energy program contains a military element. Several members of the U.S. Congress have accused Turkey of supplying Pakistan with uranium enrichment technology.

The Clinton administration has also allowed American contractors to sell reactors to China, claiming the nuclear energy market of China is vital to the U.S. nuclear supply industry. Ex-Im has guaranteed a $322 million loan for two Westinghouse nuclear deals in China. This approval comes despite Beijing’s refusal to abide by nonproliferation rules established by the International Atomic Energy Act. The decision to allow the sales was reportedly made over the objections of national security advisor Sandy Berger, who cited Chinese exports of “dual-use” technology to Iran, Iraq, and Pakistan.

Estimates are that some 70 nuclear power plants will be built in Asia in the next 25 years. China will be one of the principal buyers. In 1997, President Clinton’s Export council (headed at the time by the CEO of Westinghouse) declared, “The nuclear energy market of China is critical to the survival of the U.S. nuclear power supply industry.”

“American contractors are selling a product that most people don’t want,” Dave Martin of the Toronto-based Nuclear Awareness campaign says. U.S. taxpayers are subsidizing this industry. Without Ex-Im, which offers terms just too good for Third World countries to pass up, American firms would not succeed in selling nuclear power plants worldwide.

Update by Ian Urbina

Discussion of the perils of the nuclear industry is rare enough in the mainstream media. But even less attention is paid to the U.S. funding institutions that make many of these nuclear plants possible. With virtually no oversight or public accountability, the U.S. Export-Import Bank (Ex-Im) continues to direct huge sums of taxpayer dollars toward irresponsible and inefficient projects, few of which could ever pass domestic safety standards. At the same time that the U.S. government has acquiesced to the need for cheaper, cleaner, and safer forms of energy at home, it unscrupulously peddles nuclear energy abroad to keep U.S. contractors afloat.

There have been some developments since our article originally ran. Nearly a billion dollars over budget, the Temelin plant in the Czech Republic went online on October 9, 2000. The reactor sparked massive international protests, which, on several occasions forced the closing of the Austrian-Czech border. Protests are now turning to Temelin II, a yet-unfinished second reactor at the same plant, which is scheduled for completion next year.

Antinuclear activists and members of the Austrian and Bavarian governments are vowing to block it. In Bulgaria, the Kozloduy reactors remain online. The European Union (EU) maintains that unless four of the six Kozloduy reactors are closed, Bulgaria will not be allowed entrance into the Union. The EU has also threatened to forbid Lithuania membership if it continues to postpone the shut-down of the Ignalina plant which still operates partly because of Westinghouse work and Ex-Im backing.

In Turkey, the movement to block the Akkuyu project won a stunning victory in July 2000. Stating that the project was simply too expensive and too dangerous, the Turkish government finally agreed to cancel it. Turkish president Ecevit pointed out that “the world is abandoning nuclear energy,” and said that the government would instead begin focusing on conservation, natural gas, and hydroelectric, solar and wind energy.

China remains the grand prize for the U.S. nuclear industry. With U.S.-Chinese trade relations growing closer by the day, Ex-Im will face even less difficulty in opening this market to U.S. contractors.

To follow the activities of the lending agencies behind these projects, two important sources to check out are Bank Watch (http://www.bankwatch.org) and the Bank Information Center (http://www.bicusa.org). For general information on nuclear projects, the Nuclear Information and Resource Service & World Information Service on Energy (http://www.cnp.ca) and the Campaign for Nuclear Phaseout (http://www.cnp.ca) are excellent.

Ian Urbina: iurbina2@aol.com