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Friday, July 31, 2009

Here's a sign that the U.S. government is over-regulating the nuclear power industry. Bob Metcalfe, with Polaris Venture Partners, recently wrote an op-ed in the Wall Street Journal, stating that his firm (like many others) passed on funding promising private enterprises seeking to build new nuclear power generation plants. According to Metcalfe, five of these start-ups seek to utilize nuclear fission energy (as in traditional nuclear power plants) and two additional start-up enterprises are tapping the power of the sun: nuclear fusion energy.

Polaris and other sources of private funding chose not to invest in this new breed of nuclear power plants despite the following highly appealing characteristics:

These new small reactors meet important criteria for nuclear power plants. With no control rods to jam, they are far safer than the old models -- you might well call them nuclear batteries. By not using weapons-grade enriched fuels, they are nonproliferating. They minimize nuclear waste. And they're economical.
Those are just new nuclear fission plants. Nuclear fusion plants use no radioactive materials for fuel with not risk of catastrophic events. There is only one reason why the private market is not investing in these start-up enterprises: government regulation.
The start-ups estimate that it will cost each of them roughly $100 million and five years to get their small reactor designs certified by the Nuclear Regulatory Commission. About $50 million of each $100 million would go to the commission itself. That's a lot of risk capital for any venture-backed start-up, especially considering that not one new commercial nuclear reactor design has been approved and built in the United States for 30 years [emphasis added].
The private market is producing technology that will reduce the country's carbon emissions, and the government is making it more difficult for them. Instead, U.S. Representative Zoe Lofgren of California has introduced H.R. 3177 to increase government funding for nuclear fusion energy research and development.

The government's excessive regulations of the nuclear power industry has prevented the private sector from investing in its development. As a result, the government has felt the need to spend taxpayer money where the private sector would like to invest.

Posted by Eleutherian

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