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  3. California’s Nuke Plants Still Get More Subsidies Than Solar
California’s Nuke Plants Still Get More Subsidies Than Solar

California’s Nuke Plants Still Get More Subsidies Than Solar

by Chris Meehan on 09/04/2013 in Alternative Energy, Renewable Energy, Solar Energy, Solar Panels, Solar Power, Solar Rebates

Since the U.S. first started subsidizing nuclear power in 1963, it has received more support in California on an annual basis than solar power has. Now, as California Edison plans to retire the San Onofre Nuclear Generating Station, ratepayers have already paid $3.5 billion of the estimated $4.1 billion cleanup costs. Meanwhile, since the modern era of solar and federal solar incentives began in 2007, California has received about $2.17 billion in incentives, according to a new DBL Investors white paper, “Ask Saint Onofrio: Finding What Has Been Lost in A Tale of Two Energy Sources.”

Solar panels with nuclear cooling towers in background near Sacramento. Courtesy NREL.

“In keeping with our nation’s tradition of supporting the emergence of new energy sources, federal subsidies were necessary and highly-effective for the early growth of the nuclear industry and have been vital to the recent growth of the nascent distributed solar industry,” said report co-author and DBL Managing Partner Nancy Pfund. “The difference is that, despite the declining role of nuclear power in the Golden State, federal subsidies for nuclear have become a perpetuity. Meanwhile, solar subsidies are at risk of ending during the industry’s infancy, even as solar creates thousands of California jobs.”

Using dollars adjusted for 2012 levels and looking at data culled from academic literature, government documents and NGO sources, the report found that California-based nuclear energy received slightly higher levels of federal subsidies than distributed solar has in its early years. And, over nuclear power’s long history in California alone, it has received four times more subsidies—$8.21 billion in 2012 dollars—than distributed solar like rooftop solar in California. Nuclear power also has had six times longer to mature with the support of the Price-Anderson Act, which caps the liability of nuclear power producers, and other federal subsidies.

While the nuclear subsidies were originally meant to be temporary to get the new power source off the ground, they are perpetually renewed. “It remains to be seen if distributed solar will continue to have the same support that nuclear has enjoyed since its inception more than a half century ago,” the report stated. Already the solar industry has lost the 1603 grant program, and the 30 percent solar Investment Tax Credit is slated for a reduction to 10 percent in 2016 with its ultimate future remaining uncertain. 

Cumulative federal subsidies to Nuclear and solar. Courtesy DBL Investors.

Still, in their short lifespans the ITC and the 1603 grant have had a substantial impact on the solar industry, and since they were launched, have invested $2.71 billion in California. “The ITC’s impact on residential, commercial and utility scale solar across the country has been substantial,” the report said, referring to Solar Energy Industry Association (SEIA) data that found the ITC has helped solar installations grow nearly 3,000 percent since implementation. The new report was based partly on DBL’s groundbreaking 2011 white paper, “What Would Jefferson Do?,” which looked at the energy subsidies and the future of the grid in the U.S. 

 

 

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