235 



When I talk about the changing attitude toward urgency, I am talking about 

 the attitude of the utilities. I believe the attitude of the European governments 

 has not changed, and I am sure the attitude of the Euratom organization has 

 not changed. 



... As far as the utilities are concerned — the ones who are the potential cus- 

 tomers — there is not the slightest doubt that there has been some dilution in their 

 feeling of urgency. 



THE SECOND ROUND OF INVITATIONS 



Despite the disappointing response to the first invitations and the 

 criticism of the Joint Committee, AEC Chairman McCone in 1960 

 decided to j>roceed with a second round of invitations. 257 Accordingly, 

 on September 2, 1961, the AEC and Euratom tried again. This 

 time the invitation solicited construction of nuclear power plants that 

 would come into operation no later than the end of 1965. As with the 

 first invitation, plants were to be built, owned, and operated by orga- 

 nizations of the electricity industries of the Community. The invitation 

 also stated that in order to qualify for AEC inducements, the nuclear 

 reactors had to be of a type which had reached an advanced stage 

 of development in the United States. 



FINANCING THE DEMONSTRATION PLANTS 



The demonstration power plants were expected to require a greater 

 capital investment than corresponding conventional plants. Since Eu- 

 ratom itself had no funds for the extra capital costs, the United States 

 arranged for loans through the Export-Import Bank to provide $135 

 million to finance them. The basis for this figure was explained by 

 the Department of State as follows: 258 



Assuming a total cost of $350 million, we can say that the electricity com- 

 panies will normally be able to contribute out of their own sources or otherwise, 

 around $150 million, that is the cost of conventional powerplants with the same 

 capacity. The loan to come from the United States Government being estimated 

 at $135 million, there remains a gap of $65 million to be found from other sources. 



This was a reasonable estimate of the dollar value of the nuclear 

 equipment and services to be purchased from the United States. 259 



However, by the time the money was needed, the interest rate in 

 Europe had dropped enough so that European capital was used. 



THE FUEL GUARANTEE AUTHORITY 



The invitations for the joint power program offered a guarantee on 

 fuel performance as an inducement. Authority for the AEC to 

 provide such guarantee was included in the Euratom Cooperation Act 

 of 1958 because the U.S. nuclear industry was not then ready to offer 

 the desired guarantee. Yet, only a year later the picture had changed 

 and the U.S. nuclear industry was offering guarantees of performance 

 that met or exceeded those in the invitations. Commissioner Floberg 

 attributed this change to the Euratom joint program. The U.S. fabrica- 

 tors began to offer their own guarantees because they wished to avoid 

 use of the AEC's authority, which would have required private indus- 



257 U.S. Congress, Joint Committee on Atomic Energy, Hearings. AEC Authorizing 

 Legislation. Fiscal Year 1961. 86th Cong., 2d Sess., 1960, p. 101. 



sa'U.'S. Congress, Joint Committee on Atomic Energy, Hearings. Proposed Euratom 

 Agreements, op. cit, p. 111. 

 , *» Ibid., p. 234. 



