2012/09/17

Prognosticating the Cost of Energy in 2030


Business leaders in Japan argue that abandoning nuclear power could lead to corporations moving overseas. 
Another nuclear disaster could lead to 120,000,000 Japanese citizens wanting to do the same.

Rokkasho Nuclear Fuel Facility, Aomori Prefecture, Japan

The Democratic Party of Japan has announced that it will commit to a phase out of nuclear power by the year 2030, but they announced the next day that construction can resume on two new plants that could be permitted to run until 2050. The two announcements were contradictory, and anti-nuclear activists suspect a cynical ploy to win the next election. The majority of the public wants to be nuclear free, so the political prize up for grabs is obvious. After the election, and as time goes on, the policy could shift in any direction. Nonetheless, the nuclear industry and other business groups are taking the announcement seriously, just in case Prime Minister Noda might really be serious about what he is pledging. The battle to frighten and confuse the public has begun.
The Mainichi reports business groups saying that if Japan abandons nuclear power by 2030, the average monthly energy bill for multi-person households would swell to 32,243 yen, compared with 16,900 yen in 2010 - as if anyone could know how much a liter of gasoline or a kilogram of enriched uranium will be worth, in Japanese currency, eighteen years from now! Are they really that stupid, or do they just think the general public is that stupid?
For the record, I live in a “multi-person” household of five people, and our average monthly bill is about 9,200 yen, and that includes heat, air conditioning, hot water and cooking. With a solar panel on the roof, we sell back to TEPCO about 1/3 of the amount we consume. We conserve a lot, seldom use the air conditioning, and get by without suffering too much. Japanese electricity consumers have a lot of room to make future gains in efficiency and benefit from new energy technologies. One reason the figure of 16,900 yen is so high is that so many Japanese families live in un-insulated, poorly-made homes that devalue as fast as cars. A rational energy policy would also be a rational housing policy.


Who can predict what will happen to currency by 2030?

The more dubious claim is in the threat of businesses to relocate. Japan is in steep demographic decline and deindustrialization has been happening for a long time, and these trends were sure to continue with or without a nuclear disaster and a shift away from nuclear energy. Energy consumption will decline regardless of energy policy. Japan has been doing massive deficit spending for a long time, and when it is done borrowing money from domestic savers, it will have to borrow on the international market, at which time the world’s third largest economy could become the next Greece. It is extremely disingenuous for these business groups to cry that the sky is falling now just because the country will have to gradually replace the source of 30% of its electricity. These protestations are more likely to be rooted in the fear of losses within the nuclear industry. Furthermore, businesses that make the threat to relocate easily forget that any place they might go to can be struck with its own costly problems. Honda, for example, built a big operation in Bangkok only to see it submerged in the great flood of 2011, and Panasonic is presently seeing a plant in China attacked by a mob protesting Japan's claim to the Senkaku Islands.
Another false argument that has arisen is in the cries of foul over the Rokkasho nuclear waste facility in Aomori Prefecture. Decades ago the prefectural government agreed to host a nuclear waste reprocessing facility there with the understanding that the Rokkasho site would not be for permanent storage. Waste would come in, be reprocessed into MOX fuel (a blend of plutonium and uranium) and then be sent out as fuel for nuclear reactors. The domestic technology for reprocessing never worked, so fuel had to be shipped to Britain and France for reprocessing then reimported. The entire plan was a miserable failure even before the Fukushima meltdowns, but now that the nuclear phase out has been announced, the governor of the prefecture feels betrayed. Aomori’s irrational protest consists of telling the rest of Japan that it must continue with nuclear energy because Aomori doesn’t want to store the waste product of nuclear energy. It’s good for you but bad for us. However, safety may be the least of their concerns. Kazuaki Nagata in the Japan Times reports, "These areas stand to lose huge government subsidies if the fuel cycle spigot is turned off." 
One can sympathize, but only to the extent one sympathizes with a young woman who got pregnant before her fiancé skipped town. Aomori was warned about the false promise of nuclear waste storage and reprocessing. The dangers were known. Activists tried to stop it, but local and prefectural politicians were seduced by the false promises of national politicians and corporations. It is too late to complain about this situation now. Aomori’s problem just underlines how critical it is for Japan to completely stop creating more nuclear waste. Temporary storage is full and extremely dangerous, and there is no long-term solution.

They hate to say, "I told you so."

Further argument about the costs of continuing with nuclear energy appears in the list below. It borrows some phrasing and arguments from the organization Don’t Nuke the Climate, while I’ve added extra commentary to some of the points.

1. In order to prevent the worst effects of climate change, global greenhouse gas emissions must be reduced by at least 80% below 1990 levels by 2050. Industrialized countries, the main producers of greenhouse gas emissions, must reduce their emissions by 40% by 2020. It takes about a decade to build one single reactor, so the nuclear option is definitely no answer to the urgency of the fight against climate change. Nuclear energy only amounts to 2.4% of global energy use. It is a very marginal energy, and even the practically impossible goal of doubling capacity would make little difference while increasing environmental hazards and imposing costs that could be spent on better projects.
2. Reactor meltdowns have devastating economic and health impacts. No private insurers want to cover this risk. Ultimately, governments must compensate for damages, but full justice for the people affected could be enough to bankrupt a nation.
3. Private nuclear operators benefit from enormous public subsidies, direct and indirect, without which they could not commission a nuclear reactor. Nuclear projects cannot be privately financed. Future costs and liabilities are too uncertain for private capital, so all new construction requires massive state support, such as the federal loan guarantees promised for the nuclear plant under construction in Georgia, USA.
4. 75% of global greenhouse gas emissions are produced by sectors of the economy which don’t depend on electricity. The nuclear option is therefore irrelevant for those sectors. Some nuclear advocates say that nuclear could play a role in replacing gasoline if it were used to create hydrogen fuel or power electric vehicles. Yet it is unlikely that uranium supplies could increase enough, and nuclear generating capacity expand enough, to make a significant difference in reducing consumption of fossil fuels.
5. Nuclear energy is not necessary to reduce greenhouse emissions. Increased energy efficiency and investment in certain types of renewable energies can reduce greenhouse emissions. A solution is at hand for the intermittency (energy storage) problem.
6. Nuclear energy has a carbon footprint. Power plants are often shut down for maintenance and repair – sometimes for very long periods while their safety is under review. Southern California Edison is presently billing its customers $54 million per month for the cost of maintaining the idled San Onofre Plant. During down time, energy is used to cool reactors and spent fuel pools. When a plant is decommissioned, more energy has to be expended in a process that lasts many years. Carbon fuels are burned in mining uranium and transporting it. Enriching uranium requires large energy inputs, many of them used for heat dissipation. The cooling machinery releases CFC gasses (permitted by the Montreal Protocol!) which have a large global warming impact. As time goes on, the quality of available uranium ore decreases, requiring more energy inputs to extract the same energy output of the better ores of yesteryear.
7. Since 1974, the OECD countries have officially committed 55% of their energy research budgets to nuclear energy, i.e. 250 billion dollars. One has to wonder if the world would be better off if more of this money had been spent on developing energy alternatives.
8. The future costs of decommissioning nuclear power plants and managing radioactive waste will reach hundreds of billions of dollars. It is dubious to claim that abandoning nuclear energy will lead to more expensive energy in the future. No one can predict the cost of energy ten or twenty years from now because there are too many uncertainties regarding climate change, technological developments, shifting economic fortunes of countries, political upheaval and the occurrence of high risk, low probability events (like the earthquake–tsunami-meltdown of 2011/03/11) which can suddenly negate all assumptions.
9. There is little assurance to be taken from the thirty-five year record of major nuclear power plant accidents. Three Mile Island, Chernobyl and Fukushima were horrible, but one might be tempted to say that the world carried on anyway. However, these three disasters could have been much worse if things had gone a little differently. They are better looked at as warning shots over the bow that we should be reacting to. Many reactors in the U.S. don’t have the good containment dome that saved TMI from being much worse than it was. A second, much worse explosion at Chernobyl was averted in the early days of the crisis. That explosion could have left Western Europe uninhabitable. 80% of Fukushima fallout blew out over the ocean only because the wind was blowing to the northeast. If the spent fuel fire at reactor 4 had not been controlled, Tokyo would be uninhabited today. There is no reason to take comfort from the way these accidents turned out. As bad as they were, none of them was the worst accident that is possible.
10. All assessments of nuclear energy’s appropriate role in the energy mix would be cancelled by a major accident in the US or Western Europe. In these countries, there are stronger democratic, legal and media institutions, and the public would just not have as much tolerance for the official contempt for victims that occurred in Fukushima and Chernobyl. And the hazards are real. A risk engineer from the US Nuclear Regulatory Commission recently told a journalist, “The probability of Jocassee Dam [upstream from the Oconee NPP in South Carolina] catastrophically failing is hundreds of times greater than a 51 foot wall of water hitting Fukushima Daiichi. And, like the tsunami in Japan, the man-made 'tsunami' resulting from the failure of the Jocassee Dam will - with absolute certainty - result in the failure of three reactor plants along with their containment structures.
11. The hotter the weather, the more unsafe it becomes to operate power plants: 1/4 of French nuclear reactors had to be shut down in 2003 because of the summer heat wave.
12. As climate changes, droughts and flooding become more frequent. Yet the production of nuclear energy requires 25,000 times more water per kWh than wind or solar energy. Coal, gas and oil generators require cooling also, and, of course, hydroelectric facilities are dependent on a stable flow of water. Climate change brings heightened risks to many forms of electricity generation.
13. It’s too late to speak of a solution to the nuclear waste storage problem. The waste has been created and there is nowhere to put it. Radioactive waste remains dangerous for hundreds of thousands of years. There is no solution to prevent radioactive substances from leaking into the environment. All we can do now is stop adding to the pile and find the least bad way to handle what exists.
14. More reactors mean more equipment and more nuclear material spreading across the world.
15. The real solutions to fight climate change exist: energy efficiency, energy saving, increase in renewable energies…fighting deforestation, transition towards sustainable farming, economic re-localization, etc… This may not seem like a desirable “solution” because it will mean living with less and recognizing that the laws of physics impose their own rules on economic growth. Neither science nor religion promised us air conditioning.

For the opposing point of view, read the arguments of an Indy race car driver who has been bought and paid for by French nuclear giant Areva. The industry’s prospects look grim if this is what it has to resort to in order to find the next generation of nuclear engineers.

More background on Japan's stalled nuclear fuel recycling dreams:

Kazuaki Nagata. "Vicious nuclear fuel cycle proving difficult to break." The Japan Times. September 18, 2012.

Stephen Hesse. Japan's Nuclear Phase Out: Is it all Smoke and Mirrors? The Japan Times. September 23, 2012.





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