210 



FINANCING AND OPERATING COMMERCIAL NUCLEAR POWER PLANTS 



The economic uncertainties of nuclear power in the 1950s and its high 

 capital costs in comparison with conventional fossil-fuel power plants 

 caused supporters of Euratom to urge that it become directly involved 

 in financing and management of commercial nuclear power plants. The 

 concept that Euratom might become the European equivalent of a 

 Tennessee Valley Authority, however, did not survive in the Treaty 

 of Rome. The Treaty limited Euratom's scope to facilitating invest- 

 ment and ensuring the construction of basic facilities for nuclear 

 power. Euratom is authorized to collect and analyze investment in- 

 formation for its members. But it has no authority over the decisions 

 of the national electricity industries and their investors. This limita- 

 tion made it politically acceptable for the United States to work with 

 Euratom. For the United States Government to have offered technical 

 assistance and other support to a foreign body dedicated to state 

 generation of electricity probably would have raised opposition because 

 of the predominance of private enterprise in the U.S. electric power 

 industry. Thus, Euratom's role evolved in the direction of a broker 

 rather than a prime mover in the commercial use of nuclear energy in 

 Europe. 



CREATING A NUCLEAR COMMON MARKET 



Commercial nuclear energy in Europe needed an internal market 

 large enough to justify the requisite investment of economic, human, 

 and physical capital. Proponents of Euratom expected it to create a 

 nuclear common market which would permit a more economic alloca- 

 tion of resources, and the use of the most modern techniques of special- 

 ization and mass production. The resulting increase in productivity 

 of capital and labor was expected to contribute to higher living stand- 

 ards, to general economic growth, and to facilitation of social changes 

 in Europe. 



The Treaty of Rome laid the basis for such a market. It provided for 

 the unhindered commerce of certain goods and the free movement 

 of labor, capital, and services for nuclear energy. Items to move with- 

 out tariffs, taxes or quantitative restrictions included nuclear ores, 

 fissionable materials, radioactive isotopes, and goods peculiar to the 

 nuclear industry. Likewise, free movement of labor seeking employ- 

 ment in the European nuclear industry was to be assured to properly 

 qualified nationals of the six Common Market nations. 



JOINT ENTERPRISES I AN INNOVATION IN INTERNATIONAL ORGANIZATION 



The drafters of Euratom hoped to create a nuclear industrv which 

 could compete against those of the United Kingdom and the* United 

 States in world markets. To avoid the limitations of fragmentation 

 among many, relatively small industrial concerns, the Treaty of Rome 

 provided for joint enterprises to carry out "undertakings of outstand- 

 ing importance to the development* of the nuclear industry in the 



Community ""'Joint Enterprise status confers special advantages 



including recognition as a legal personality, and exemptions from cer- 

 tain taxes, duties, and charges. In return, a Joint Enterprise is re- 



»• Article 45. 



