Article in the Dallas Morning News about, among other things, just how Luminant intends to pay for the nuclear power plant reactors at Comanche Peak. First up, they've already made some deals about electricty costs for the future, by preselling electricity into some markets and hedging its natural gas prices.

But here's the deal. Luminant has a huge debt burden. How does it pay, then, for the nuclear power? By going into more debt and by having you and me give Luminant loans through the Dept of Energy.

As an alternative to natural gas, Luminant in September filed with the Nuclear Regulatory Commission to build and operate two reactors at the Comanche Peak power plant in Glen Rose. While the plant is years away, Young said financing it will be tricky.

"Going forward, we’re going to be big borrowers of capital," he said. "In this financial environment, that’s going to be very expensive."

And when it comes to nuclear power, it’s going to be just about impossible without a federal guarantee, especially for a generator in a deregulated market, where costs can’t be automatically recouped from ratepayers, he said.

So if not the ratepayers, then who? The taxpayer, of course.

This month, the Energy Department announced that it will make $18.5 billion in loan guarantees. Luminant has applied for the program. But there’s a catch: Young said Luminant alone expects to borrow $12 billion of the estimated $15 billion cost of the reactors, and there are 18 other applications as well, according to the agency.

If I am understanding this correctly, the Energy Department (that is YOU AND I) are making a total of 18.5 billion available, but there are 19 applicaitons for 18.5 billion, which would mean that it would have to be split 19 different ways, if evenly. Again, if I"m calculating this correctly, that would leave a paltry 9.7 million for each application.

"The $18.5 billion falls short by a factor of 10 of what is needed to meet the nuclear need," Young said. "I don’t see us being able to raise the debt without a significant guarantee or a much bigger layer of equity — and that’s going to be hard to come by."

Why not stop letting the private equity company that owns Luminant have so much money and have them sink some of their obscene profit into the nuclear power plants? Henry Kravis of KKR made 450 million dollars last year.

All of this smacks of corporate welfare, for a private equity company that is going to jack up Luminant and then turn around and sell it off.

Luminant has already struck a deal with Mitsubishi Heavy Industries, maker of the reactors, to fund the roughly $200 million it will take to gain a permit from federal regulators. Mitsubishi Heavy could also buy up to a 12 percent stake in the new reactors with additional investment.

Certainly they wil. It's not a *could* situation. Here's the statement about the join venture with Mitsubishi in which MHI says they WILL have a 12 percent stake in the company. (As a side note, remember that these are experimental reactors)