Sunday, June 16, 2002

Cost of nuclear power - some history

I often hear questions about federal subsidies to nuclear power in one form or another. This might be the wrong question.

I haven't yet found the document that says exactly what I want to demonstrate, if it exists at all. But you must realize that whether there were any commercial nuclear power plants or not, the US govt would still have to pay for mining uranium, transporting it, refining it, reprocessing it, and ultimately disposing of it, because the Manhattan Project and other govt initiatives long predated commercial nuclear power. And the stuff the US govt uses is nastier and more highly refined than what is used in commercial nuclear power plants, so the marginal cost of adding additional consumers is not particularly high.

So under such circumstances, what is the logical thing to do? Apparently President Eisenhower had the right idea when he initiated the "Atoms for Peace" program. With this, the govt loosened its grip upon radioactive material and technology so that private industry could develop new applications or expand the usage of existing ones. And the new consumers could then contribute to the costs of maintaining the nuclear infrastructure without obvious taxes on voters.

One particular concern was labor problems. Some nasty coal miner strikes had occurred in 1946 on Harry Truman's watch, and that liberal Democrat was forced to break them. Nuclear power offered a way to break that stranglehold on our power supplies, and Truman signed the Atomic Energy Act that very year.

But electric utility executives weren't born yesterday, and they were particularly worried about liability in case of accidents. Insurers were not willing to underwrite anything near the costs of postulated accidents. It became clear that no private firms would build nuclear power plants until the govt dealt with this. Thus was born the Price-Anderson Act capping liability in case of accidents at nuclear power plants.

Bear in mind that at this point there were no commercial nuclear power plants. So there is no way that Price Anderson can be considered pork. Rather, it is clearly an inducement for private industry to enter the market in the first place.

Likewise the govt was concerned with control of nuclear material, and electric utilities wanted no part of the new field of radioactive waste disposal. So it was agreeable to everyone that the govt would make fuel available and would handle the waste.

Why would the US govt agree to these things? Was the govt stupid? Was it fear of labor problems? Was this just Cold War politics? Something else?

Or was the real reason the exact opposite of what detractors claim? That is, perhaps the real motive was to get nuclear power plant operators to help in bearing some of the costs of the nuclear infrastructure, through their purchases of fuel and reprocessing services. In this way we can help pay our defense costs without raising taxes.

The short answer is that the commercial and the govt nuclear establishment are tightly linked, and it would be difficult to say what might fairly be called a subsidy or not. But it is clear that the nuclear fuel cycle, with all of the technological and safety problems it entails, long predates commercial nuclear power and might well long outlive it. And that the existence of other consumers of nuclear material extends the usefulness of these facilities as a minimum, and might even help support them.

There's an interesting corollary to this theory. Note that anti-nuclear groups typically are left-wing politically. Why is that? Surely fears of the shortcomings of a technology would cross over traditional political lines. So there would appear to be no rational reason for the left wing orientation of antinukers.

Except for one. Left-wingers historically have been more sympathetic to our Cold War rivals than other groups have. And those rivals were aided by anything that 1) increased costs of our defenses, and 2) reduced the reliability of our energy supplies. Both of these goals could be advanced by attacking nuclear power. So although they might claim that the govt subsidizes nuclear power in their propaganda, their behavior says otherwise.

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