Nuclear subsidy simile


in Economics, Politics

Countries that build nuclear reactors are, in some ways, like parents whose children run lemonade stands. The children get the ingredients for free and sell them for less than they are worth. Parents are usually willing to pay the difference, because they like to see their children hard at work. People who actually want lemonade for the lowest possible price would do best to find the kids with the least sense and the most generous parents.

{ 5 comments… read them below or add one }

R.K. April 22, 2008 at 11:30 am

You could argue that they are more like parents who lend their children money to start a business.

The question is whether nuclear ever gets out of the teething period and into genuine profitability.

. April 22, 2008 at 2:53 pm
. May 23, 2008 at 11:58 am

CBO Nuclear Report, Pt. 2: Construction Cost Peril

By John Geesman on nuclear subsidies

The notable assessment of the future role of nuclear power, published this month by the Congressional Budget Office, derives significance less from its breadth or depth than from the insight it provides into the thinking of Congress’ official fiscal scorekeeper. The report, assembled at the direction of revered nuclear champion Senator Pete Domenici, casts a wary (though bleary) eye at construction cost risk.

. June 15, 2015 at 3:25 am

The final option for Areva is to declare itself bankrupt, with major implications for the French economy and the credibility of France’s entire nuclear enterprise. The only certainty is that French taxpayers will pay dearly for Areva’s follies and fiascos.

Meanwhile potential purchasers of EPRs and investors in Areva would do well to bear the following in mind. Twelve years after the first EPR was ordered there is not a single working example of the reactor, and the earliest projected date for completion of the first EPR is 2018 – and no surprises if that slips to 2020.

Would you bet your pension fund on Areva and its EPR technology?

. June 15, 2015 at 3:26 am

The implications of Finland’s ordeal reach far beyond its borders. After three decades of struggling to gain traction through an aggressive lobbying and PR campaign, the nuclear power industry is on the verge of global resurgence. More than 100 new nuclear plants are being built or planned around the world. In the United States, there are thirty-five reactors on the drawing board, with licensing applications for twenty-six of them already under review by the Nuclear Regulatory Commission (NRC)—the first batch the agency has seen since 1978. These projects enjoy a broad public backing that would have been unthinkable a decade ago: a recent poll by Zogby Interactive found that two-thirds of all Americans support the construction of new reactors on U.S. soil. And this support cuts across political lines, with half of all Democrats favoring more nuclear power. Liberal opinion makers, such as New York Times columnist Thomas Friedman, have also endorsed the nuclear option. Wired magazine has repeatedly urged readers to “Go Nuclear.” Even a few longtime foes of atomic energy, like House Speaker Nancy Pelosi, now argue it “has to be on the table.” As for President Barack Obama, both he and his energy secretary, the Nobel Prize–winning physicist Steven Chu, have offered at least qualified support for expanding the use of nuclear power in the United States.

What’s behind this dramatic reversal? The short answer is that climate change has shuffled priorities. Nuclear power may have some unsavory side effects, like radioactive waste and the risk of meltdowns. But no other energy source can deliver vast quantities of low- or zero-carbon energy at a price that rivals natural gas and coal, as the industry has promised the new breed of reactors will do. With this in mind, many people who once dismissed atomic power out of hand have come to view it as a vital, if imperfect, tool in the struggle to salvage our warming planet.

But as Finland’s experience shows, the reality may be far messier than the industry lets on: a growing body of evidence suggests that new nuclear construction projects are prone to the same setbacks as those undertaken a generation ago, when lengthy delays and multibillion-dollar cost overruns were commonplace. This raises serious questions about the potential of nuclear power as a front-line solution in the battle against climate change.

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