0.16 Energy: nuclear power  (Page 2/3)

Fusion power has long been one of those developments that are “just around the corner. The author first heard in 1970 that fusion power was only ten years in the future. In 1980, he heard that it was ten years in the future. As late as 1990, the claim was again that it was ten years in the future.

• The principal problem is the incredibly high temperatures of the plasma involved in fusion reactors. There are machines in the U.S. and Europe still trying to develop fusion. These are called Tokamaks . Princeton has one.

Some present and historical considerations about nuclear energy

Relative costs

The cheapest non-subsidized energy available to the U.S. is that charged by Quebec Hydro: About 7 cents per kWh. Figure 16-1 indicates that nuclear is reasonably competititve with natural gas and coal, but still substantially cheaper than solar energy.

Subsidies

Nuclear power has benefited from large subsidies.

Subsidies per se are neither good nor bad. But they are most effective when they are explicit , transparent , not hidden. Subsidies to nuclear energy – in 1970 or in 2011 – could be a good or bad idea, depending on what the subsidies do. But from 1960 through at least 2013, the subsidies were largely hidden, consisting primarily of federally-imposed limits on liability for firms producing nuclear power, insulating them from much of the costs of any nucear accident.

• There are in fact good arguments for relying on nuclear energy – cheap, clean - in the sense that almost low CO ₂ emissions.

But there are two very significant externalities associated with large nuclear plants such as now used in U.S., Japan, and France (600 MW>).

1. Back End Externality – What to do about nuclear plant waste? Where to store something where radiation has a half-life of 250-500 years or for some materials even half a million years. Most states in the U.S. display a strong NIMBY attitude on this question ( NOT IN My Backyard ).
2. Middle of Nuclear Cycle – Power Generation Externality The nature of risk in nuclear energy. Nuclear energy is one of those rare examples of projects involving a very low probability of disastrous outcomes, but with a very high cost associated with the low probability event if it ever occurs. This kind of risk cannot yet be covered by private sector insurance – It can only be covered by something as large as a central government – able to pool risks.

Nuclear Energy has always had two kinds of subsidies in the U.S., Japan and elsewhere. Both subsidies have been largely concealed .

1. Least important are loan guarantees provided by governments to firms installing nuclear plants. These are large multi-billion $ projects. This means firms pay a lower interest rate on loans to build plants: a subsidy to the firms.
2. Second and most important – Implicit and explicit insurance provided by governments to limit liability of operators of nuclear plants.

The Japanese Earthquake / Tsunami / Nuclear Accident is a very good example of a risk with a very very low probability of materializing, but with a very very high impact if it does come about.