Federal tax incentives affecting coal and nuclear power economics

Journal Article · Thu Apr 01 00:00:00 EST 1982 · Nat. Resour. J.; (United States)

OSTI ID:6738603

Chapman, D

This paper analyzes the effect of federal corporate income tax incentives on coal and nuclear power developments. It estimates (1) the magnitudes of tax incentives in relationship to utility costs, (2) the relative magnitude of benefits going to coal and nuclear facilities, and (3) the influence which the time paths of tax payments and after-tax net income have upon possible incentives for premature construction and excess capacity. Utility planners currently believe that nuclear power enjoys an after-tax competitive advantage over coal plants. Investigation of investment-related credits, deductions, and exclusions in the Internal Revenue Code shows that nuclear power enjoys a more favorable tax subsidy because of its greater capital intensity. In the absence of tax subsidies, no utility would prefer nuclear power to coal generation. Tax changes now under consideration could increase the tax benefits to both without disturbing the differential advantage held by nuclear power. 43 references, 2 figures, 4 tables.

• Research Organization: Cornell Univ., Ithaca, NY
• OSTI ID: 6738603
• Journal Information: Nat. Resour. J.; (United States), Vol. 22:2
• Country of Publication: United States
• Language: English

Related Subjects

29 ENERGY PLANNING
POLICY AND ECONOMY
21 SPECIFIC NUCLEAR REACTORS AND ASSOCIATED PLANTS
FOSSIL-FUEL POWER PLANTS
FINANCIAL INCENTIVES
NUCLEAR POWER PLANTS
COAL
COMPARATIVE EVALUATIONS
SUBSIDIES
TAXES
CARBONACEOUS MATERIALS
ENERGY SOURCES
FOSSIL FUELS
FUELS
MATERIALS
NUCLEAR FACILITIES
POWER PLANTS
THERMAL POWER PLANTS
296000* - Energy Planning & Policy- Electric Power
210801 - Nuclear Power Plants- Economics- Construction & Operation- (-1987)