[lbo-talk] [Marxism] Nuclear Economics (from GRIST)

[Shane Mage]

>
> Nuclear power is expensive and uninsurable
>
> BY PAUL GIPE
> 4 JUN 2011 1:48 PM
>
> The world's beleaguered nuclear industry continues to take a  
> battering. The "nuclear renaissance" juggernaut that once seemed  
> unstoppable now appears dead in its tracks.
>
> The cabinet of Germany's conservative government on Monday voted to  
> take the country out of nuclear permanently by 2022. Not to be  
> outdone on the right, the country's opposition parties say that's  
> not fast enough.
>
> The conservative party in the state of Bavaria has gone even further  
> and says that while it was first in German nuclear power, it will  
> now be first in exiting nuclear. Bavaria, known as the "Texas of  
> Germany" for its conservatism, gets more than 50 percent of its  
> electricity from nuclear energy.
>
> But it's the sheer cost of nuclear that may overwhelm any industry  
> "renaissance."
>
> Little data exists on the actual cost of new nuclear generation.  
> Rumors persist in Ontario, Canada, that the government's delay in  
> building its promised new reactors was due to "sticker shock" after  
> receiving costly proposals. Whatever the reason for delay, the  
> actual costs of the proposals are being hidden from public view.
>
> So policy discussions are often dependent on studies of nuclear's  
> cost by organizations with a particular axe to grind.
>
> Hey, here's some data
>
> One exception comes from the California Energy Commission (CEC), a  
> public agency mandated with the task of periodically examining the  
> costs of various electricity-generation technologies that may be  
> used in the state to meet demand. There are four operating nuclear  
> reactors in the state, two each in two locations. There is an  
> additional 900-megawatt reactor that was decommissioned by the  
> Sacramento Municipal Utility District (SMUD) after a plebiscite on  
> June 7, 1989. California is unlikely ever to build another reactor;  
> state law prohibits construction until a permanent waste repository  
> is available.
>
> Nevertheless, the CEC in its most recent Integrated Energy Policy  
> Report examined the cost of electricity from 21 different central- 
> station generation technologies. Such studies, says the CEC, are  
> useful for comparing the relative costs between technologies, though  
> the actual cost of electricity to consumers can be quite different  
> from these hypothetical studies.
>
> The detailed study considered three forms of ownership: merchant  
> plant, investor-owned utility, and publicly owned utility. Merchant  
> plants are built to serve deregulated markets and assume a high  
> degree of market risk. They may not be able to sell all their  
> electricity at any one time if their price is too high. Investor- 
> owned utilities are the traditional private companies serving a  
> regulated market. In California, Pacific Gas & Electric and Southern  
> California Edison are investor-owned. Publicly owned utilities are  
> municipal utilities, like SMUD. Publicly owned utilities pay fewer  
> taxes and have access to lower cost financing than either investor- 
> owned utilities or merchant plants.
>
> The CEC's 186-page report, "Comparative Costs of California Central  
> Station Electricity Generation" [PDF], found that a 1,000-megawatt  
> pressurized water reactor would generate electricity in 2018 from as  
> little as $0.17 per kilowatt-hour to as much as $0.34 per kilowatt- 
> hour. These results are startling: Most renewable technologies  
> today, even solar photovoltaics (PV), generate electricity for less  
> than that. Only a municipal utility could generate nuclear  
> electricity for less than the cost of solar PV.
>
> Currently, Germany pays between $0.31 and $0.41 per kilowatt-hour  
> for electricity from solar PV, which means that the cost of solar- 
> generated electricity today is equivalent to the cost estimated by  
> the CEC for a nuclear plant beginning operation in 2018. And all  
> observers, even critics, expect the cost of solar PV to continue  
> declining during the next decade.
>
> And what about insurance?
>
> In an unrelated study for the German Renewable Energy Association,  
> consultants found that nuclear reactors are effectively uninsurable.  
> The 157-page report [PDF] by Versicherungsforen Leipzig estimated  
> that the premium necessary to insure a nuclear reactor from accident  
> would cost from $0.20 per kilowatt-hour to a staggering $3.40 per  
> kilowatt-hour.
>
> Thus, the cost to insure a nuclear reactor -- at a minimum -- would  
> cost as much as the electricity itself from a nuclear plant coming  
> online in California in 2018.
>
> Earlier German studies of the cost for insuring reactors against  
> catastrophic failure found similar results. A 1999 report for the  
> European Commission on the externalities of energy found that the  
> external cost of nuclear power was $2.59 per kilowatt-hour largely  
> due to the cost of insurance.
>
> These studies indicate that the cost of nuclear energy is far higher  
> than proponents have led policymakers to believe.
>
> Renewable energy, even costly solar photovoltaics, begins to look  
> like a bargain to consumers when realistic costs of new nuclear  
> plants come to light.
> (Paul Gipe is an author, advocate, and renewable energy industry  
> analyst. His latest book is Wind Energy Basics.)
>
>
>
> Shane Mage
>
> "scientific discovery is basically recognition of obvious realities
> that self-interest or ideology have kept everybody from paying  
> attention to"
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