Bo Tree

Nuclear Electricity: May not be cheap but essential

In 1954, when the U.S. government encouraged industry to get involved in nuclear power production, there was great hope that it would provide an inexhaustible source of cheap electricity.  This has been epitomized in the oft-quoted remark of the then AEC chairman Lewis L. Strauss, “too cheap to meter.”  Those were the days when people dreamed of many good things.  But even then Mr. Strauss and the industry analysts knew that the heavy investments required were a major impediment to the growth of nuclear power.  Beside financial considerations, people recognized early the hazards of the technology.  General Electric manager, Francis McCune, told the AEC in 1954, “no matter how careful anyone in the atomic energy business may try to be, it is possible that accidents may occur.”

So electricity production by atomic energy has become expensive as time progressed.  With President Eisenhower’s proclamation in 1953 of “Atoms for Peace,” the U.S. has helped many countries to develop the atomic knowledge for peaceful uses and generate electricity by nuclear reactors.  Currently there are 442 nuclear power plants supplying electricity to 31 countries.  They provide 17% of the world’s electricity.  In some countries, nuclear electricity is as high as 80% (such as in Lithuania, and 78% in France).  For some (such as Japan) without significant domestic oil, gas, or coal, nuclear power is essential.  In the U.S. we now have 103 nuclear power plants that provides almost 20% of our electricity.  The International Atomic Energy Agency predicts that 500 nuclear power reactors will be operating in the world by 2020.  The way the global electricity demand is increasing, The World Nuclear Association says the number of nuclear power plants could be 5000 in the year 2050.

Perhaps in the mid-fifties, one could dream of cheap nuclear electricity, but no more.  Now we know that the vision of the original proponents could not have been realized.  It is easy to find many explanations, but the most important reason is that we have progressed in many respects, and our demands have grown substantially.  The demands are not just for cheap electricity, but safety, sustainability, pollution minimization, and non-proliferation of nuclear weapons.  And people are not willing to tolerate a deficiency, no matter how much a reduction of the deficiency would cost.  So the earlier vision of cheap nuclear electricity is dead.

The cost of nuclear electricity production has gone up for several reasons.  Number one of these is safety.  This started in 1979 with the accident in the Three Mile Island reactor in Pennsylvania.  Although no one was physically hurt, it has led the way for new enhanced designs and safe operation of nuclear power plants.  Then came the Chernobyl accident in Russia in 1986.  The design of this reactor was old and did not meet the international safety standards.  This accident caused death and devastation, and, no matter what the root causes were, it did put a damper on the nuclear power industry.  People became more fearful of nuclear radiation and the nuclear industry had to install many safety improvements in all reactors in the world.  The regulatory aspects were also beefed up.  Naturally the cost of nuclear electricity went up.

As the GE Manager said in 1954, sometimes an accident can happen.  Nothing is risk free.  Even when you go out in a car, there is no guarantee you will return home safely.  There were over 6.3 million car accidents, 2.9 million injuries, and over 42, 600 deaths each year during 2002 and 2003.  Similarly nuclear power is not risk free, but the risk is very, very small.  Because the consequences could be tremendous, the nuclear people take the utmost care in designing and operating nuclear power plants.  The logic is even simpler for the utility industry – they cannot afford even the appearance of an accident, because their stock prices would go down.  That is millions of dollars.  For the safety alone, nuclear electricity cannot be cheap.

The Department of Energy has been working for the last few years to develop a new generation (Gen IV) of nuclear power reactor that will be extremely safe (for example, no accident could melt the nuclear fuel in such a reactor and no radioactivity would be released even if there was an accident), economical (it will be able to compete with other sources of electricity generation), proliferation-resistant, and generate minimum possible wastes.  The weapons proliferation concern comes from the fact that one could divert irradiated spent fuel from a reactor and reprocess it for bomb materials.  The idea of the Gen IV reactors is to minimize this possibility by several design means.  One idea is not to allow access to the spent fuel.  Another idea is to create thorium fuel (instead of uranium fuel that is currently used) which, when irradiated, becomes so hot that one cannot easily get near it.  There is, however, a cost to these improvements.

Sustainability of energy resources is an important, new element in society.  The point is that we should not use up our valuable resources and leave future generations in a bankrupt state.  Solar energy is ideal in this sense, but it can produce only a little of our electricity needs.  Coal can last for a couple of hundred years, and oil will certainly run out.  These two cannot be sustained.  And they have an environmental issue to reckon with.  In this regard, nuclear power comes ahead.

Environmental pollution is closely associated with electricity production.  Carbon emissions from burning oil, gas, and coal are trapping the Sun’s heat rather than let it radiate out to space, creating a “greenhouse” effect with far-reaching consequences for our delicate climate.  According to the UN’s Intergovernmental Panel on Climate Change, the world’s average temperature rose by 1.08 F from 1900 — 1990 alone, and could increase by another 10.4 F by 2100, depending on how much carbon dioxide is in the air.  Already high average annual temperature increases have been recorded in Alaska, the Caspian Sea, and the Antarctic Peninsula, affecting ecosystems, rainfall patterns, and damaging polar ice and glaciers.

In 1968 G. Hardin described a situation how our actions could lead to a tragedy.  Suppose there is a common grazing ground.  A man could think that if he increases his herd by a few, it will cost only a little more from others, but he would benefit a lot.  Then another man takes a similar step, and then another.  Soon the process leads to the loss of the grazing land and ultimate ruin of all.  It is a tragedy of the commons.  Our environment is a similar example, but in a reverse way. The environment has been given to us all.  But a rational man finds that his share of the cost of the wastes he discharges into the commons is less than the cost of purifying his wastes before releasing them.  So he easily dumps the greenhouse and other gases into the air.  That is what happens with electricity production when we use fossil fuels.  Nuclear electricity generation does not put polluting gases in the atmosphere and hence an ideal source of energy for the world, but then we may have to pay a higher price for this well being of the commons.

Sometimes, society unknowingly picks up a tab that wasn’t bargained for.  These costs are called external costs.  This is especially true for electricity generation and are incurred in relation to health and the environment but not built into the cost of the electricity to the consumer.  In particular, these costs include the effects of air pollution on human health, crop yields and buildings (e.g., the damage to historical monuments by air pollution), as well as occupational disease and accidents.

Europe has estimated the external costs for electricity production in EU countries.  The EU work, done over the last 10 years, shows that the cost of electricity from coal or oil would double and the cost from gas would increase by 30% if external costs were taken into account.  Nuclear power involves relatively low external costs due to its low impact on global warming and its low probability of accidents.  The important part of the nuclear power is that it already pays for the final storage for the nuclear fuel and decommissioning of the plant.  So nuclear electricity incurs only about one-tenth the external costs of coal.  Wind and hydro energy also present very low external costs.

One often wonders about the external cost of a hypothetical nuclear accident.  The difficulty in this regard is determining risk.  Depending on the risk factor, the external cost of such an accident is estimated to be a maximum of about 4% of the total external cost of the nuclear fuel cycle.  Although it seems little, the total external cost of electricity production could be very large for a country.  It is estimated that these costs add up to 1 – 2% of the EU’s GDP, not including the cost of global warming.  The EU suggests two ways to pay for the external costs: by taxing the damaging fuels and technologies (such as coal and gas) or by subsidizing cleaner technologies to avoid socio-environmental costs.  Either way, the consumers must bear the costs.

There is another item that is good with nuclear generated electricity: its life cycle costs that include the expenses of disposing its wastes have already been accounted for in the price.  Nuclear utilities pay early for decommissioning of the plant when retired, and pay a fee of 1 mill per kilowatt-hour of electricity for disposal of the spent fuel.  Billions of dollars exist now in these two funds.  This is not so with other power generation industries.  For example, we still do not know how to sequester and dispose of the billions of tons of carbon that are emitted everyday from the fossil fuel plants.

Electricity prices are going up all over the world, no matter where one lives or how electricity is generated in the area.  The question is, do we wish to be a part of the solution by conserving our use and paying a little more or be a part of the problem?  The bottom line comes down to what we want.  If we are unwilling to pay the price for a pollution-minimized electricity, and use coal or oil that generates the greenhouse gases, we can have it for 200 years or so, but then what?  If we are wise, it is time to buy nuclear electricity even if it costs more, and encourage its full development with breeder reactors and reprocessing of nuclear fuels.  Then there will be pollution free air and dependable electricity for generations to come.

There is a clear correlation between the standard of living of a country (measured, for example, by the GDP) and its electricity production.  The higher the per capita electricity consumption, the higher is the standard of living in the country.  If we want to increase the standard of living in the world and live in a pollution-free environment, then we have to pay the high price of electricity generated by atomic energy.  This is the real issue, not abstract debate if the once-promised nuclear electricity is still cheap.

So, yes, we have to meter it, but that would avoid the tragedy of the commons.  We only need the will and the determination of the people.

By Debu Majumdar

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