Prospects dimming for global use of atomic power?; TMI: posing dilemma for Reagan free market idea

The Reagan administration's economic and energy policies are colliding in a set of initials that the White House must find discomforting: TMI. It has been 2 1/2 years since the worst nuclear accident in US history occurred at the Three Mile Island nuclear power plant near Harrisburg, Pa. But the great bulk of cleaning up radioactive material -- a job that will cost at least $1 billion -- remains to be done. Insurance money is running out, the company that owns the plant is in financial difficulty, and local people don't think they should have to foot the bill.

Does the federal government have a responsibility? Proposals on Capitol Hill would have Uncle Sam pay several hundred million dollars for cleanup costs at a time when belts are being tightened elsewhere.

Nuclear power is a unique industry that exists largely because of government promotion, research, regulation, and financial backing. In his recent National Energy Policy Plan, President Reagan insisted that nuclear power is a "safe, economical, and environmentally acceptable energy source." His lean budget contains $228 million for the highly criticized Clinch River nuclear breeder reactor.

Yet the President generally is opposed to "bailing out" troubled industries. The "free market," he maintains, must be the key to national energy and economic policy.

All of this was highlighted this week in congressional hearings on Three Mile Island.

Aside from many millions in insurance claims already paid, the federal government will have spent about $275 million through 1981 as a result of the accident, according to the General Accounting Office. But much remains to be done, including removing radioactive water and the reactor's core as well as decontaminating buildings. Officials say this will cost some $760 million.

Meanwhile, the undamaged twin reactor at TMI stands idle, utilities in Pennsylvania and New Jersey have to buy more expensive electricity from elsewhere (resulting in higher rates for customers), and the nuclear industry as a whole suffers from the concern and uncertainty that lingers with TMI.

Nuclear power advocates are pleased with President Reagan's plan to speed the licensing process and find a means of radioactive waste disposal.

"But foremost among the immediate problems is the lack of resolution regarding the cleanup of TMI," T. Louis Austin of the Edison Electric Institute, a utility trade group, told a panel of lawmakers this week. "Without a solution to this problem, we can expect a continued lack of public confidence in the safety of nuclear power."

Pennsylvania Gov. Richard Thornburgh (R) has proposed a "cost-sharing" plan that includes $190 million from national nuclear and utility industries, $245 million from the General Public Utilities Corporation (TMI's owner), $45 million from the states of Pennsylvania and New Jersey, $90 million in unexpended insurance funds, and $190 million from the federal government.

The pennsylvania congressional delegation, led by Rep. Allen Ertel (D), wants the US Treasury Department to establish a new "Nuclear Property Insurance Fund" to pay 75 percent of the uninsured cost of TMI cleanup. In the future, the fund would be built up through required premiums to be paid by all utilities operating nuclear reactors.

Except for representatives from Pennsylvania, such proposals received a less than enthusiastic reception from members of a House energy subcommittee. The general feeling is that "the industry ought to bear the burden of its mistakes," said chairman Richard Ottinger (D) of New York.

In a letter to Thornburgh, White House Budget Director David A. Stockman said "certainly a solution will only come about through the combined efforts of both the state and federal governments." The difficult decision for the administration will be just how much of a federal effort to push for.