Nuclear Renaissance
IEER's
latest book, Carbon-Free and Nuclear-Free: A
Roadmap for U.S. Energy Policy, by Arjun Makhijani, is now available
for free download on the web at
http://www.ieer.
download is for personal, non-commercial use only. This is the first
book that we are making available for free electronic download. Hard
copies of the book will be available for sale in about two months
from RDR Press and from IEER.
This book, done in partnership with the Nuclear Policy Research
Institute, presents a roadmap for how a zero-CO2 U.S. economy can be
achieved within the next 30-50 years without the use of nuclear
power, without acquiring carbon credits from other countries, with
technologies that are now available or foreseeable, and at reasonable
cost. It is creating a lot of excitement around the country. Please
feel free to forward this e-mail to your list.
Lois Chalmers
Institute for Energy and Environmental Research (IEER)
6935 Laurel Avenue, Suite 201
Takoma Park MD 20912 U.S.A.
Phone: <?XML:NAMESPACE PREFIX = SKYPE />
e-mail: lois@ieer.org
website: http://www.ieer.
++++++++++++
Rachel's
Democracy & Health News #927, September 27, 2007
WHY
IS UNCLE SAM SO COMMITTED TO REVIVING NUCLEAR POWER?
[Rachel's introduction: The long-advertised "nuclear renaissance" got
under way this week when NRG Energy applied for a federal license to build two
nuclear power plants in Texas, enticed by an offer of free money from Uncle Sam.
"The whole reason we started down this path was the benefits written into
the Energy Policy Act of 2005," says NRG's chief executive, David Crame.]
By Peter Montague
The long-awaited and much-advertised "nuclear renaissance" actually
got under way this week. NRG Energy, a New Jersey company recently emerged from
bankruptcy, applied for a license to build two
new nuclear power plants at an existing facility in Bay City, Texas -- the
first formal application for such a license in 30 years.
NRG Energy has no experience building nuclear power plants but they are
confident the U.S. government will assure their success. "The whole reason
we started down this path was the benefits written into the [Energy Policy Act]
of 2005," NRG's chief executive, David Crame, told the
Washington Post. In other words, the whole reason NRG Energy wants to build
nuclear power plants is to get bundles of free money from Uncle Sam. Who could
blame them?
Other energy corporations are nuzzling up to the same trough. The federal
Nuclear Regulatory Commission (NRC) is expecting to receive applications for an
additional 29 nuclear power reactors at 20 sites. The NRC has already hired more
than 400 new staff to deal with the expected flood of applications.
But the question remains, Can investors be fooled twice? Financially, the
nuclear power industry has never stood on its own two feet without a crutch from
Uncle Sam. Indeed, the nuclear power industry is entirely a creature of the
federal government; it was created out of whole cloth by the feds in the 1950s.
At that time, investors were enticed by offers of free money -- multi-billion-
Now the U.S. federal government is once again doing everything in its power to
entice investors, trying to revive atomic power.
First, Uncle Sam is trying hard to remove the financial risk for investors. The
Energy Policy Act, which Congress approved in 2005, provides four
different kinds of subsidies for atomic power plants:
1. It grants $2 billion in insurance against regulatory delays and lawsuits to
the first six reactors that get licenses and begin construction. Energy
corporations borrow money to build plants and they must start paying interest on
those loans immediately, even though it take years for a plant to start
generating income. The longer the licensing and construction delays, the greater
the losses. Historically, lawsuits or other interventions by citizens have
extended the licensing timeline, sometimes by years, costing energy corporations
large sums. Now Uncle Sam will provide free insurance against any such losses.
2. Second, the 2005 law extends the older Price-Anderson Act, which limits a
utility's liability to $10 billion in the event of a nuclear accident. A serious
accident at a nuclear plant near a major city could create hundreds of billions
of dollars in liabilities. Uncle Sam has agreed to relieve investors of that
very real fear.
3. The 2005 law provides a tax credit of 1.8 cents per kilowatt-hour for the
first 6,000 megawatts generated by new plants. Free money, plain and simple.
4. Most important, the law offers guarantees loans to fund new atomic power
reactors and other power plants using "innovative" technology.
Investors need no longer fear bad loans.
One obvious conclusion from all this is that, more than 50 years into the
nuclear enterprise, atomic power still cannot attract investors and compete
successfully in a "free market." This industry still requires an
unprecedented level of subsidy and other government support just to survive.
An energy corporation'
It certainly has little to do with global warming. At the time the 2005 energy
bill was passed by a Republic-dominated Congress the official position of the
Republican leadership was that global warming was a hoax. Even now when some
Republicans have begun to acknowledge that perhaps we may have a carbon dioxide
problem, science tells us that nuclear power plants are not the best way to
reduce our carbon dioxide emissions. They're not
even close to being the best way. (Lazy journalists are in the habit
it repeating the industry mantra that nuclear power produces no greenhouse
gases. This is nonsense. Read on.)
Substantial carbon dioxide emissions accompany every stage of nuclear power
production, from the manufacture and eventual dismantling of nuclear plants, to
the mining, processing, transport, and enrichment of uranium fuel, plus the
eventual processing, transport, and burial of nuclear wastes.
A careful
life-cycle analysis by the Institute for Applied Ecology in Darmstadt,
Germany, concludes that a 1250 megaWatt nuclear power plant, operating 6500
hours per year in Germany, produces greenhouse gases equivalent to 250,000
metric tonnes of carbon dioxide per year. In other (unspecified) countries
besides Germany, the same power plant could produce as much as 750,000 metric
tonnes of carbon dioxide equivalents, the Institute study shows. (See Figure 3,
pg. 5)
The study concludes that, in the emission of global warming gases (measured per
kilowatt-hour of electricity made available), nuclear power compares unfavorably
to...
** conservation through efficiency improvements
** run-of-river hydro plants (which use river water power but require no dams)
** offshore wind generators
** onshore wind generators
** power plants run by gas-fired internal combustion engines, especially plants
that use both the electricity and the heat generated by the engine
** power plants run by bio-fuel-powered internal combustion engines
Of eleven ways to generate electricity (or avoid the need to generate
electricity through efficiency and conservation) analyzed by the Institute, four
are worse than nuclear from the viewpoint of greenhouse gas emissions, and six
are better.
[For a great deal of additional solid information showing that nuclear power is
no answer to global warming, check in with the Nuclear
Information and Resource Service (NIRS)].
A study
completed this summer by the Institute for Energy and Environmental Research
(IEER) in Takoma Park, Maryland concluded that it is feasible, within 35 to 60
years, to evolve an energy system to power the U.S. economy without the use of any
nuclear power plants or any coal
plants. See the IEER study, Carbon-Free
and Nuclear-Free; A Roadmap for U.S. Energy Policy.
So the rationale for the U.S. government's Herculean efforts to revive a
decrepit nuclear power industry cannot be based on concern for global warming or
energy independence. The facts simply don't support such a rationale.
Whatever its motivation, the U.S. federal government is doing everything in its
power to revive atomic power. In addition to removing most of the financial risk
for investors, Uncle Sam has removed other obstacles like democratic
participation in siting and licensing decisions.
Throughout the 1970s, energy corporations complained that getting a license took
too long. In response, the Nuclear Regulatory Commission (NRC) has spent more
than a decade "streamlining" the process for building nuclear plants.
Most of the "streamlining" consists of new ways to exclude the public
from information and decisions. For example, members of the public used to be
able to question witnesses during licensing hearings. No more. There used to be
two sets of hearings -- one for siting the plant, and another for constructing
the plant. No more. These two set of issues have been rolled into a single
license and a single hearing. The purpose is to accommodate the needs of the
nuclear industry, to help it survive. As attorney Tony Roisman observed
recently, "The nuclear industry has come to the agency [the NRC] and
said, 'If you don't make it easy for us to get a license, we are not going to
apply for one.'" So the agency is making it easy.
Perhaps it is natural for NRC commissioners to justify a strong bias in favor of
keeping the nuclear industry alive even if safety and democracy have to be
compromised. After all, if there were no corporations willing to build new
nuclear power plants, soon there would be no need for a Nuclear Regulatory
Commission. So NRC commissioners know in their bones that their first priority
must be to keep the nuclear industry alive. Every bureaucracy'
To grease the skids for a nuclear revival, the most important change the NRC has
made has been to creatively redefine the meaning of the word
"construction." This change was enacted in April, 2007, with lightning
speed -- six months from initial proposal to final adoption. By way of
comparison, it took the NRC eleven years to adopt regulations requiring drug
testing for nuclear plant operators.
"Construction" has traditionally included all the activities
undertaken to build a nuclear power plant, starting with site selection,
evaluation, testing and preparation, construction of peripheral facilities like
cooling towers, and so on. Even the earliest stages of siting are crucially
important with a facility as complex and dangerous as a nuclear power plant.
In April of this year, the NRC officially redefined "construction" to
include only construction of the reactor itself -- excluding site selection,
evaluation, testing and preparation, construction of peripheral facilities and
all the rest. At the time, one senior environmental manager inside NRC
complained in an email that NRC's redefinition of "construction" would
exclude
from NRC regulation "probably 90 percent of the true environmental
impacts of construction." Under the new rules, by the time the NRC gets
involved, a company will have invested perhaps a hundred million dollars. Will
NRC commissioners have the backbone to toss that investment into the toilet if
they eventually find something wrong with the site? Or will they roll over for
the industry and compromise safety?
The lawyer who dreamed up the redefinition of "construction" is James
Curtiss, himself a former NRC commissioner who now sits on the board of
directors of the nuclear power giant, Constellation Energy Group. This revolving
door pathway from NRC to industry is well-worn.
One NRC commissioner who voted in April to change the definition of construction
is Jeffrey Merrifield. Before he left the NRC in July, Mr. Merrifield's last
assignment as an NRC commissioner was to chair an agency task force on ways to
accelerate licensing.
In April, while he was urging his colleagues at NRC to redefine
"construction," Mr. Merrifield was actively seeking a top management
position within the nuclear industry. In July he became senior vice president
for Shaw Group, a nuclear builder that has worked on 95% of all existing U.S.
nuclear plants. Mr. Merrifield's salary at NRC was $154,600. Bloomberg
reports that, "In Shaw Group's industry peer group, $705,409 is the
median compensation for a senior vice president."
No one in government or the industry seems the least bit embarrassed by any of
this. It's just the way it is. Indeed, Mr. Merrifield points out that, while he
was an NRC commissioner providing very substantial benefits to the nuclear
industry by his decisions, his concurrent search for a job within the regulated
industry was approved by the NRC's Office of General Counsel and its Inspector
General. From this, one might conclude that Mr. Merrifield played by all the
rules and did nothing wrong. Or one might conclude that venality and corruption
reach into the highest levels of the NRC. Or one might conclude that after NRC
commissioners have completed their assignment inside government, everyone in the
agency just naturally feels they are entitled to a lifetime of lavish reward
from the industry on whose behalf they have labored so diligently.
As recently as this summer, Uncle Sam was still devising new ways to revive
nuclear power. In July the
U.S. Senate allowed the nuclear industry to add a one-sentence provision to
the energy bill, which the Senate then passed. The one sentence greatly expanded
the loan guarantee provisions of the Energy Policy Act of 2005. The 2005 Act had
specified that Uncle Sam could guarantee loans for new nuclear power plants up
to a limit set each year by Congress. In 2007 the limit was set at a paltry $4
billion. The one-sentence revision adopted by the Senate removed all limits on
loan guarantees. The nuclear industry says it needs at least $50 billion in the
next two years. Michael J. Wallace, the co-chief executive of UniStar Nuclear, a
partnership seeking to build nuclear reactors, and executive vice president of
Constellation Energy, said: "Without loan guarantees we will not build
nuclear power plants."
The Senate and the House of Representatives are presently arm- wrestling over
the proposed expansion of loan guarantees. In June, the White
House budget office said that the Senate's proposed changes to the
loan-guarantee program could "significantly increase potential taxpayer
liability" and "eliminate any incentive for due diligence by private
lenders." On Wall Street this is known as a "moral
hazard" -- conditions under which waste, fraud and abuse can flourish.
All these subsidies to revive a dead duck run directly counter to free market
ideals and capitalism's credo of unfettered competition. So the intriguing
question remains, Why? Why wouldn't the nation go whole-hog for alternative
energy sources and avoid all the problems that accompany nuclear power --
routine radioactive releases, the constant fear of a serious accidents, the
unsolved problem of radioactive waste that must be stored somewhere reliably for
a million years, and -- the greatest danger of all -- the inevitable reality
that anyone who can build a nuclear power plant can build an atomic bomb if they
set their minds to it. The recent experience of Israel, India, North Korea and
Pakistan in this regard is completely convincing and undeniable.
So why is Uncle Sam hell-bent on
reviving nuclear power? I don't have a firm answer and can only speculate.
Perhaps from the viewpoint of both Washington and Wall Street, nuclear power is
preferable to renewable-energy alternatives because it is extremely
capital-intensive and the people who provide the capital get to control the
machine and the energy it provides. It provide a rationale for a large
centralized bureaucracy and tight military and police security to thwart
terrorists. This kind of central control can act as a powerful counterweight to
excessive democratic tendencies in any country that buys into nuclear power.
Particularly if they sign a contract with the U.S. or one of its close allies
for delivery of fuel and removal of radioactive wastes, political control
becomes a powerful (though unstated) part of the bargain. If you are dependent
on nuclear power for electricity and you are dependent on us for reactor fuel,
you are in our pocket. On the other hand, solar, wind and other renewable energy
alternatives lend themselves to small- scale, independent installations under
the control of local communities or even households. Who knows where that could
lead?
Then I think of the present situation in the Middle East. Saddam Hussein started
down the road to nuclear power until the Israelis bombed
to smithereens the Osirak nuclear plant he was building in 1981. That ended
his dalliance with nuclear power and nuclear weapons -- but that didn't stop Don
Rumsfeld and Dick Cheney from using Saddam's nuclear history as an excuse to
invade his country and string him up.
And now something similar is unfolding in Iran. Iran wants nuclear power plants
partly to show how sophisticated and capable it has become, and partly to thumb
its nose at the likes of Don Rumsfeld and Dick Cheney -- and perhaps to try to
draw us into another war that would indelibly mark us for the next hundred years
as enemies of Islam, serving to further unite much of the Arab world against us.
Is this kind of thinking totally nuts? I don't think so. Newsweek reported
in its October 1, 2007 issue that Dick Cheney has been mulling a plan to
convince the Israeli's to bomb the Iranian nuclear power plant at Natanz, hoping
to provoke the Iranians into striking back so that the U.S. would then have an
excuse to bomb Iran. I'm not making this up.
So clearly there are more important uses for nuclear power than just making
electricity. Arguably, nuclear reactors have become essential tools of U.S.
foreign policy -- being offered, withheld, and bargained over. They have a
special appeal around the world because they have become double-edged symbols of
modernity, like shiny toy guns that can be loaded with real bullets. Because of
this special characteristic, they have enormous appeal and can provide enormous
bargaining power. Witness North Korea. And, as we have seen, nuclear reactors
can provide excuses to invade and bomb when no other excuses exist.
So perhaps Uncle Sam considers it worth investing a few hundred billion dollars
of taxpayer funds to keep this all-purpose Swiss army knife of U.S. foreign
policy available in our back pocket. In the past five years, we've already
devoted $800 billion to splendid
little wars in Afghanistan and Iraq, at least partly to secure
U.S. oil supplies. Uncle Sam's desperate attempts to revive nuclear power
can perhaps best be understood as part of that ongoing effort at oil
recovery.
Meanwhile, investors should think twice before buying into the "nuclear
renaissance" because there's another "renaissance" under way as
well: A powerful anti-nuclear movement is growing again and they will toss your
billions into the toilet without hesitation. Indeed, with glee.