Nuclear power giant Westinghouse filed for bankruptcy Wednesday in a major upset to the U.S. nuclear power industry. The company had been constructing the only new nuclear reactors to be built in the country in decades. But cost overruns, delays and other problems forced it to file for chapter 11 bankruptcy protection as it seeks to restructure its business.
The company said in a statement that the "strategic restructuring" is a direct result of "certain financial and construction challenges in its U.S. AP1000 power plant projects." The company said it obtained $800 million in debt financing to help fund and protect its core businesses during its reorganization.
Westinghouse was bought by Japanese manufacturing giant Toshiba a decade ago when the U.S. nuclear power industry was growing. The nuclear industry in more recent years has been suffering from market challenges, making it more difficult for nuclear plants to compete in electricity markets dominated by low-cost natural gas power plants and renewables.
The bankruptcy announcement came less than 24 hours after President Trump announced his push to rescind President Barack Obama's suite of climate change orders and regulations for the utility industry in order to restore coal jobs. Climate change regulations are seen as beneficial to the nuclear industry because it is a zero emissions resource.
Trump's budget proposal could also pose problems for the AP1000 reactors Westinghouse has a stake in building in the Southeast. Trump's budget issued earlier this month called on the Energy Department to significantly curtail its loan guarantee program, which had benefited new nuclear power plants.
In the meantime, Trump has been pushing for the opening of Yucca Mountain in Nevada to store nuclear waste. He sent Energy Secretary Rick Perry to Nevada on Monday to talk to the governor.
Republican Gov. Brian Sandoval said he told Perry that he does not agree with the administration's desire to open the waste dump there. Trump had allocated $120 million to complete a federal license to build the waste facility, but a number of Democrats are vowing to block the funding.
Developing a permanent storage site for housing nuclear power plant waste is considered key for further expansion of nuclear power.