Uncertainty Surrounds Federal Loan Guarantees in Japan’s Nuclear Crisis
Naoto Kan

Experts believe that the current scenario of crisis in Japan would make it more difficult and expensive for U.S. power companies to finance the construction of new nuclear reactors which further complicates a challenging process.

In the wake of higher financing costs and reduced political support for federal loan, it is going to be difficult for the power companies to arrange cheap debt.

Standard & Poor's notified its investors saying that the events in Japan renewed public focus on the inherent risks of nuclear power and could lead to deteriorating economics for new plant construction.

Maintaining its support for nuclear power, the White House is still backing up the budget proposal for an additional $36 billion in loan guarantees for new nuclear-plant construction.

This proposal has been facing some doubts from the critics and a nuclear-power critic Rep. Ed Markey said, “After the Japanese meltdown, Congressman Markey absolutely thinks it's important to revisit whether taxpayer subsidies for new nuclear-power plants is a good idea”.

In the absence of federal loan guarantees, it would be difficult for most of the U.S. companies to secure financing to build new reactors as it was a difficult task even before this nuclear disaster.

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