From Streams to Lumps: Transforming Long-Term Incentives into Up-Front Financing for New Nuclear Construction

Conference · Sat Jul 01 04:00:00 EDT 2006

OSTI ID:21020998

George, Glenn R ^[1]

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1. International Energy Capital Markets, Nomura Securities International, Inc., 2 World Financial Center, Building B, 21. Floor, New York, NY 10281 (United States)

The Energy Policy Act of 2005 is an important development in the financing of new nuclear capacity in the near- to mid-term in the U.S.A. Key features of the Act, including production tax credits, loan guarantees, funding support, and 'standby support', are intended to provide significant incentives for new nuclear development, construction, and operation. There is a mismatch, however, between the nature and extent of incentives being offered and what is needed to spur nuclear plant deployment in light of power market uncertainty, utility investor wariness, and the need to raise significant capital before a nuclear construction project can be launched. In this paper, the author addresses these issues through the lens of financial tools and techniques. The paper considers various ways in which long-term streams of subsidies can be transformed into up-front financing for new nuclear capacity. Securing and related financial structures are among the mechanisms considered for potentially bridging the temporal gap between flows of financial benefits conferred legislatively and lumps of capital required by developers and investors in advance of a construction program. (authors)

• Research Organization: American Nuclear Society, 555 North Kensington Avenue, La Grange Park, IL 60526 (United States)
• OSTI ID: 21020998
• Country of Publication: United States
• Language: English

Related Subjects

22 GENERAL STUDIES OF NUCLEAR REACTORS
CAPACITY
CAPITAL
CONSTRUCTION
ENERGY POLICY
FINANCIAL INCENTIVES
FINANCING
MARKET
NUCLEAR POWER PLANTS
REACTOR OPERATION
SEVERANCE TAX
STREAMS