So what unknown but magical benefit to nuclear power exists to make nuclear so incredibly attractive to some political leaders? Unfortunately and admittedly, this author does not know.

Do We need Nuclear Energy

Prof. Steve Clemens | Lecturer Environmental Economics at Brussels business school UBI

EarthToys Renewable Energy Article

So what unknown but magical benefit to nuclear power exists to make nuclear so incredibly attractive to some political leaders? Unfortunately and admittedly, this author does not know.

Prof. Steve Clemens,
Lecturer Environmental Economics at Brussels business school UBI

An excerpt of the author’s book: A Practical Introduction to Environmental Economics, condensed and adapted for this article. 


Portfolio Theory and Energy Choices 

Governments in the US and Europe have struggled with the challenges posed by their dependence on oil, in particular foreign oil. Still today the US government is studying tapping into more domestic sources of oil as a solution. The Bush administration is considering opening access to the pristine Arctic National Wildlife Refuge in Alaska, as pro-oil lobbyists feel that the positive impacts of domestic oil justify the risk to the ecosystem posed by drilling and extraction operations.

However, it would increase US domestic oil use to 5%..., hardly worth the term solution.

Portfolio theory, developed to provide a better understanding of financial risk associated with investment strategies, indicates that the more diversified an investment portfolio, the lower its risk. Paradoxically, you could lower the total risk of a portfolio by including a particularly risky title, provided its risk is not correlated to the existing portfolio risk. You would not diversify an IT investment portfolio by adding more IT stocks. You cannot diversify away from risk by investing in 20 different internet companies, or 15 different biofuels companies. In that light, hedging against energy supply risks by adding domestic oil sources to foreign oil sources does not seem like a diversification approach. Nor does adding coal and gas to oil constitute sound diversification, although these resources do come from other parts of the world. 

Nuclear power is often included in papers defending a portfolio approach to power production. However, nuclear power does not originate from a renewable source of fuel. Uranium, plutonium, strontium and such need to be extracted from finite radioactive ores like uraninite in Canada, Australia, Kazakhstan and Russia. Moreover, there are a number of social costs that are usually NOT included in a households’ nuclear electricity bill:

  • At the level of construction of nuclear power plants.
  • At the level of decommissioning of nuclear power plants.
  • At the level of storage of spent nuclear fuel.
  • At the level of security issues.
  • At the level of damages from accidents.
Let us take a look at just a few of the above issues.

At the level of construction of nuclear power plants: Significant budget overruns are the norm, exemplified by the most recent construction site of the Olkiluoto nuclear power plant in Finland. This first new nuclear project in 15 years has been blighted by problems. After only two years of construction the project end date has had to be revised by 2 years, and the budget is set to be overrun by at least 50%, with 1.5 billion euro in losses and shocking errors in key technical specifications.

Obviously, this does not help in decision-making. When leaders need to compare and appraise several options, it can be difficult when one of the possibilities is under-estimated by 50%.

      If you had known that your mother-in-law would practically live at your place, commenting on every aspect of your life, would you still have agreed to live so close to the in-laws? Maybe that overseas job offer seems more attractive, with hindsight.

At the level of storage of spent nuclear fuel: Common nuclear fuel types, a.k.a. nuclear isotopes,  like plutonium-240 have a half-life of about 5.000 years, give or take 500 years. The stated half-life refers to a period of time needed to half the radio-activity of the isotope.

      If a 1 second exposure to ‘fresh’ Pu-240 would kill you in the following weeks, 5.000 years old Pu-240 would require 2 full seconds of exposure to kill you in the following weeks. I’m reassured now.

Needless to say, half-life periods consist of interesting information to nuclear scientists, but they are somewhat irrelevant for people who are susceptible to dying from radiation contamination and cancer. Here are the half-life periods for a few of the most common fuel types in nuclear power:

  • Pu-238: 87 years
  • Pu-240: 5.600 years
  • Pu-239: 24.000 years

And from the even more popular family of nuclear fuels, the Uranium isotope:

  • U-234: 244.000 years
  • U-235: 700.000.000 years
  • U-238: 4.500.000.000 years

So how does the nuclear industry handle and store these hazardous materials? The most common practice is to vitrify it into containers which can then be stacked and stored in special storage facilities, hopefully guarded by excessively armed military personnel. The process of vitrification consists of pouring a special type of glass around the waste nuclear fuel rod, and then encapsulate it with a lead-containing metal alloy. Vitrification does a good job in keeping in the lethal radio-activity, but its shelf-life is about 5O years, not 244.000 years, so people in the future will have to keep busy re-processing these stacks of waste every 50 years.

Clearly there is an intergenerational issue here. In the UK alone, a total of £75B - or €112 billion - of taxpayers’ money has been set aside by the government to deal with euphemistically called legacy nuclear waste. So it is not cheap either.

At the level at security issues: No need to re-discuss the 1986 Chernobyl accident here. There are so many and so frequent incidents with nuclear power generation as to constitute a permanent risk. But there is a new liability on the block: terrorism.

As the International Atomic Energy Agency which promotes (yes, promotes) the use of nuclear power, put it:

      Most nuclear power plants were built during the 1960s and 1970s, and like the World Trade Centre, they were designed to withstand only accidental impacts from the small Cessna type sports aircraft. If you postulate the risk of a jumbo jet full of fuel, it is clear that their design was not conceived to withstand such an impact.

The Bin Ladens in the world are rubbing their hands indeed. And the shipping and transport of nuclear fuels and wastes to and from handling facilities, disposal facilities, storage sites and power plants; this only makes it easier for Mr Laden’s recruits. In fact, according to reports from the International Policy Institute for Counter Terrorism, their database shows 167 terrorist incidents involving a nuclear target for the period 1970-1999 alone. And that was pre-9/11 ...

At the level of damages from accidents: No nuclear power plant in the world is privately insured. No insurance company can and wants to cover such a risk. This should be a powerful argument against nuclear power, but the leaders of a few decades ago, and soon this generation of leaders again, brushed this issue aside and assumed public liability for the damages that would be caused. In the US, this got printed in the 1957 Price-Andersen Act, exempting private utilities from having to pay damages as a result of a nuclear accident. Claims would be paid largely by federal government. Also the amount of claims from any particular accident was limited.

      If an accident destroyed only the city of New York, or it actually renders inhabitable a region comprising of large parts of the States of New York, New Jersey, Maryland, Virginia, West Virginia, Pennsylvania, Connecticut, Massachusetts and beautiful New Hampshire, the total volume of claims could not be bigger.  The selection of destroyed States here was purposefully chosen to correspond with the geographical area now inhabitable around the formerly lovely town of Chernobyl. 

The above list of externalities are real costs, not theoretical costs somewhere in an accountant’s books, someone bears these costs.

However, it is important to point out that there is a hidden argument in favour of nuclear power. This argument is so important that the above issues with nuclear power are blown away as irrelevant. It is not cost, as the above external costs can and should be internalized by government, and the KWh price of nuclear would increase dramatically. It is not security of supply, as nuclear fuel supplies are estimated at another 40 years’ worth, at current consumption level. New calculations by scientist Paul Mobbs, including the new plans of the UK government, estimate the exhaustion of rich ore reserves within 12 years. And portfolio analysis has taught us not put too many of our eggs in the same basket.

So what unknown but magical benefit to nuclear power exists to make nuclear so incredibly attractive to some political leaders? Unfortunately and admittedly, this author does not know. 

That does not mean it does not exist. There MUST be a magical reason why. And it must be because of that reason the UK government decided to step into a new nuclear age on 10 January 2008. The questions is not IF European countries will follow suit, but how many and which ones.

    Newsflash: Monday, 4 February 2008. There was a fire at Vattenfall Europe's Kruemmel nuclear plant in northern Germany. The facility, jointly operated by Swedish Vattanfall and Germany's E.ON, had already been closed since June 28, 2007 when another fire at a transformer substation caused a short circuit. Germany is in the process of phasing out nuclear power by 2020 under plans agreed by the previous coalition of Social Democrats (SPD) and Greens. The plans are being contested by the conservative parties CDU/CSU, which are currently in a coalition government with the SPD.

Good thinking indeed

 

 

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