U.S. Desire for Short Term Profit could Lead to Nuclear Power Implosion
By
Brian Westenhaus | Mon, 13 January 2014
An American Physical Society group chaired by Roy Schwitters reports that if U.S. nuclear plants continue to shut down instead of extending operations the nation risks losing 60 percent of its clean electricity production starting as soon as 2030. That’s the baseload share that runs 100% of the time and is the lowest cost electricity for consumers. It’s an environmental and economic implosion. Four nuclear power plants, sources of low-cost low-emissions electricity, have announced closings during 2013. Power plants across the country, including ones in California, Wisconsin, Florida and Vermont, are being shut down. Meanwhile utility companies choose to build new natural gas fired plants rather than extending operation of nuclear reactors. Operators of an additional 38 reactors in 23 states are facing decisions on whether to extend operating licenses. Currently, there are approximately 100 nuclear reactors in the United States. An abyss is in sight for industry, consumers and the environment. Schwitters points out the emotional environmental reality, “Nuclear power plants provide the nation with a source of clean energy at a time when renewables such as solar and wind are not yet ready to fill the potential gap in the nation’s base power needs created by the loss of nuclear power. Utilities should consider extending the licenses of power plants, which unlike coal and natural gas plants, do not emit any major air pollutants as identified in the Clean Air Act.” The report, “Renewing Licenses for the Nation’s Nuclear Power Plant” is a warning to the public of a serious oncoming economic issue and environmental setback. It’s freely available as a pdf file in this link. The utility business had been run with multiple decade long foresight. But that has changed in the “gimme my profit now” psychology sold by business schools and well, honestly, humanity’s greedy myopic nature. It’s been sold for over a generation now and it’s clear to any world view observer that the longer view as the U.S. used to practice and is now the fundamental in business cultures like Japan and China is much superior, that when matured up becomes the short term “cash cow” of the future. It’s a hard sell when the wisdom has been lost. There should be, even to medium term observers, a great deal of anxiety. Although natural gas is cheap right now, its future remains uncertain. Questions abound concerning the availability of the gas in the U.S. and infrastructure and environmental costs associated with fracked wells. If any lesson should be clear, the consumer could lose the near million barrels a day ethanol market contribution this year, which has only been scaled up for about six years. Call ethanol off and gasoline prices will soar – again, in a totally political based action. Related article: Why has Nuclear Power become so Important to Saudi Arabia? Calls of fracking and natural gas will soar and if power plants are gas fired electricity prices will soar in another totally politically based action. People take some incredible risks when voting don’t they? Nuclear power worldwide is in a boom driven mostly about the economics. Yet four prominent climate and energy scientists recently released the open letter to world leaders, calling on them to support safer nuclear energy systems as a practical way to address global warming. The letter from Ken Caldeira (senior scientist, Department of Global Ecology, Carnegie Institution); Kerry Emanuel (atmospheric scientist, MIT); James Hansen (climate scientist, Columbia University Earth Institute); and Tom Wigley (climate scientist, University of Adelaide and the National Center for Atmospheric Research) states, “While it may be theoretically possible to stabilize the climate without nuclear power, in the real world, there is no credible path to climate stabilization that does not include a substantial role for nuclear power.” The report notes in a cursory way the economics. But in a broad sense the utility business is highly regulated such that it profits from operations, including building new plants and taking down old ones. If ratepayers realized the costs the system forces on them the indignation would be painful. Taking down a paid for nuclear power is a ratepayer’s disaster. The report points out extending operating licenses for reactors in a safe and reliable way is a smart move, as they are a “near carbon-free source of energy,” according to the APS report. The Nuclear Regulatory Commission allows power plants to operate up to 60 years, but extensions are available for an additional 20 years. The report finds that there are no technical “show stoppers” to running some plants for up to 80 years. Related article: DOE Announces Funding for Small Nuclear Reactors The authors urge utilities to consider the financial and environmental consequences of carbon emissions in their business decisions regarding nuclear and natural gas plants. Such considerations can also be factors for socially responsible investors who are concerned about increased carbon emissions in the U.S. Investors, with more than $3 trillion in assets and who use an environmental, social and governance criteria, have been effective at encouraging companies to consider environmental consequences in their business decisions. That might all be for naught, for most electric consumers the rates are driven by regulatory action that investors and managers factor in to decisions. There are lots of vested interests, the consumers who fund the entire thing, the utilities who do the work, investors who put up the capital, regulators who earn paychecks keeping the paper blizzards blowing, and countless suppliers and vendors. It’s a wide field that changes very slowly. A healthy economy can more afford to be environmentally responsible. Just how decommissioning the lowest cost baseload energy production fleet gets us a low energy cost economy is a mystery. One might suggest that when the brownouts and rolling blackouts come the first to go dark and last to light up are the broadcast, radio and cable news studios and the offices and presses of the papers and magazines. Maybe with that Sword of Damocles hanging overhead the mass media might smarten up a bit and get the word out. By. Brian Westenhaus © 2014 OilPrice.com | OilPrice.com is a CNBC Partner Site |