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Revision as of 03:52, 29 June 2005 by Benjamin Gatti (talk | contribs)(diff) ← Previous revision | Latest revision (diff) | Newer revision → (diff)The Price-Anderson Nuclear Industries Indemnity Act was enacted in 1957 as an amendment to the Atomic Energy Act. It Indemnifies nuclear power plant owners against the insurmountable risk of a nuclear accident. In addition, it makes available a no-fault insurance pool to compensate people who incur damages from a nuclear or radiological incident in the United States, regardless of who is liable. The act covers all nuclear facilities constructed before 2002 — the Nuclear Industry is actively lobbying to extend the Act in the Energy Bill of 2005.
The Atomic Energy Act, which was enacted several years before Price-Anderson, was supposed to spur the development of America's nuclear power industry. But industry did not begin constructing plants because companies were unwilling to risk the financial liability that would result from a catastrophic accident at a nuclear plant. At the same time, lawmakers in the United States Congress began to worry that there was not adequate financial protection for the public. Price-Anderson was born from those dual concerns; the act established a mechanism for compensating the public for injury or property damage in the event of a nuclear accident, and encouraged the development of nuclear power by indemnifying the industry from fault. However, the Price-Anderson Act is not without its detractors, including Greenpeace International, Public Citizen, Taxpayers for Common Sense, and other interest groups.
The pool of money — which as of 2004 stood at about $9.5 billion — is contributed entirely by the nuclear industry, primarly through power reactor licensees, who are required to have $200 million worth of primary insurance as of 2001.
In the event that claims deplete the pool of funds, the Congress of the United States would be required to consider covering the excess cost, possibly by establishing additional assessments against the industry. A catastrophic nuclear event — such as the 1986 Chernobyl accident — would arguably deplete the current pool of money. Though the Soviet Union never released official estimates of the accident's economic impact, Greenpeace International estimated it to have been about $280 billion, not including medical costs for victims. However, were similar circumstances to be repeated in America, the scale of the disaster likely would be less — Chernobyl were RBMKs, unlike American plans, and the Chernobyl units did not have containment buildings around its reactors.
The act is regarded by the Department of Energy as "essentially a subsidy" for investors in nuclear power.
Without the Price-Anderson Act, nuclear plant operators would have to insure for the full cost of any possible nuclear incident. Because no one had (or has) quantified what the maximum coverage necessary would be for a PWR or BWR, financiers were unwilling to insure the possible risk. Therefore, no private operator in the United States would have built a nuclear facility without the Price-Anderson Act. Thus the extension of the Price-Anderson Act is probably essential to the construction of future nuclear power plants in the US (see Nuclear Power 2010 Program).
Price-Anderson indemnifies DOE facilities but not the nuclear Navy (which has not had a nuclear accident).
The constitutionality of the Price-Anderson Act was challenged in 1975 and upheld by the Supreme Court in June, 1978.<--! On What Grounds? -->
Nuclear insurance pools have paid $151 million ($70 million of which was related to the 1979 Three Mile Island meltdown) and the DOE $65 million since Price-Anderson was enacted 48 years ago.
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