By Andy May

The financial risk is too great.

Updated post (2/21/2017)

In any discussion of the future of energy, nuclear power generation is brought up. Once a nuclear power plant is built and operating, it can produce cheap electricity reliably for decades. Further, in terms of human health, some claim it is the safest source of energy in the U.S. Others, like Benjamin Sovacool, claim the worldwide economic cost (worldwide total: $177B) of nuclear accidents is higher than for any other energy source and nuclear power is less safe than all other sources of energy except for hydroelectric power. Some of the costs could be due to an over-reaction to nuclear accidents, especially Chernobyl and Fukushima.  Others have much lower fatality estimates than Sovacool, it is unclear how many later cases of cancer are, or potentially will be, due to Chernobyl.

Permitting a new nuclear power plant and building it is a problem because there have been more than 105 significant nuclear accidents around the world since 1952, out of an IAEA total of 2,400 separate incidents. Thirty-three serious nuclear accidents compiled by The Guardian are listed and ranked here and mapped in figure 1. As figure 1 shows these incidents have occurred all over the world, some are design flaws, like the Fukashima-Diachi 2011 disaster and some are due to human error, like the loss of a Cobalt-60 source in Ikitelli, Turkey.

Figure 1: All nuclear power plant incidents, source The Guardian.

There is an ongoing debate about the safety of nuclear power. Roger Graves has written persuasively that:

“… there is no justification for singling out nuclear power as being especially dangerous. The fear of nuclear espoused by much of the media is vastly exaggerated.”

There have been either 4,231 fatalities due to nuclear accidents since 1952 or fewer than 100 depending upon who is estimating.  The biggest difference is how many died due to the Chernobyl disaster.  Was it the 31 who died right away or were there thousands that died later due to radiation induced cancer as Benjamin Sovacool argues?  Either way, this is small compared to the number of fatalities due to hydroelectric dam failures, like the 171,000 people who died when the Shimantan Dam and 60 other dams, including Banqiao, broke in China in 1975 or the 4.3 million who die every year due to indoor air pollution from burning biomass or coal indoors. So, do we irrationally fear anything that glows in the dark? Or, are Benjamin Sovacool’s arguments more valid than Roger Graves? The differences are mostly due to what fatalities and costs are included in the calculation, both use reasonable methods and criteria. Either way nuclear is different from other sources and the risks are different. I’m not sure a valid safety comparison between nuclear and other sources of energy can be made.

If we include all air pollution from coal as a cost, coal becomes the most expensive and dangerous, except for hydroelectric. Yet, most of the problems are from personal, household use of coal or antiquated coal power plants with no pollution control equipment. Modern coal plants, used in western countries for decades, produce very little pollution and are safe. Households do not have nuclear power, nor do they have personal hydroelectric dams, so this seems like an invalid comparison.

It seems that nuclear power is here to stay, there are nuclear power plants all over the world after all. Why is it so hard to permit and build one? Why did Germany shut down so many nuclear plants? How serious are the dangers? We will not answer these questions here, but we can present what data we could find.

By nuclear we mean fission reactors. Fusion reactors always seem to be 20 years away and this seems unlikely to change. The most recently completed U.S. nuclear power plant, Watts Bar Unit 2 in Rhea County, Tennessee entered commercial service October 19, 2016.

Figure 2: Watts Bar Unit 2 nuclear power plant, source TVA.

Unit 2 was 80% complete in 1980. Construction was stopped at that time due to a projected decline in demand. Construction resumed in 2007. The Fukushima-Daichi disaster in 2011 caused construction to be halted again and the NRC (Nuclear Regulatory Commission) ordered some design modifications. The delays and the late design modifications caused the initial estimate cost of $2.5B to almost double. The final cost, when it was completed in 2016, was $4.7B. So, this older generation “2” nuclear reactor, from beginning to end, took over 40 years to build. Over the 40 years the cost doubled.

TVA has also spent more than six billion dollars on two partially constructed nuclear plants at their Bellefonte site near Hollywood, Alabama. These were to be Units 1 and 2. They have also applied for permits for two more plants, units 3 and 4. Recently, they announced they have no plans to finish the first two plants and withdrew their permit requests for the second two. Obviously, nuclear power plant planning and construction has its problems. The problems seem to be the uncertain permitting process, high initial costs, and the very long construction period. The long permitting and construction times complicate financing and mean that revenue, profit and demand forecasts are obsolete long before the plants are completed. Thus, as the plants are being constructed, markets change, there are periods when the project appears uneconomic, and construction is shut down. Once shut down, any project is hard to restart.

There are two big problems here. The first is a perceived danger to the public, that may or may not really exist. The second, partially caused by the first, is the huge length of time from inception to completion and the very high and uncertain front end costs. I think anyone who has ever worked in a capital-intensive business will instantly see the problem. The problem is not safety per se, it is risk. This is not an industry that can survive in the marketplace without government guarantees, the risk to capital invested and the potential liability costs are so large no private company would ever touch it. Or stated another way, only a government would be foolish enough to put their money into building a nuclear power plant.

Without a viable business outlook, nuclear is probably doomed unless the design to completion timeline is shortened. The permitting time needs to be shortened and made more certain. This means the industry needs to mature and standardize the components of their commercial reactor designs, so approval of the standard components is guaranteed. Second, construction times need to be radically shorter. Standard components will help here as well. You must be able to propose, design, permit and build a plant before your economic forecasts become useless. There is no way around this, cash flow is king, design to startup times must be short and predictable. Time is often the most expensive component in long term projects, ask any construction company or oil and gas company.

Consider what Hollywood, Alabama Mayor Frank “Buster” Duke, who worked as a pipefitter helping build Bellefonte from 1974 to 1984, said about the TVA Bellefonte construction site:

“I think this was one of the best nuclear plants TVA ever built, but it’s not looking good for any nuclear use of Bellefonte. I’m afraid everything is outdated there now like an old computer. I just hope TVA can do something with all [these] assets.”

The radioactive waste created by nuclear power plants is also a serious problem. Every year nuclear power plants, worldwide, produce 200,000 m3 of low- and intermediate-level radioactive waste and about 11,000 m3 tonnes of high level waste. In the U.S. there is no infrastructure to permanently dispose of the waste, some of which is dangerous for many thousands of years or more. Some countries, including the UK, France, Germany and Japan, reprocess their high-level waste and recycle the remaining uranium and plutonium which decreases the volume of waste. For a list showing how various countries dispose of their waste see this report by the World Nuclear Association.

Waste products are also a problem for thorium molten salt reactors. Besides generating waste, thorium reactors are a nuclear proliferation threat, as discussed by Ashley, et al., 2012 in Nature. This is because one of the waste products is 233U and 8 kg of 233U is enough for a nuclear weapon.

Nuclear power plants have many attractive features, if they don’t leak any radioactivity to the environment and their waste is safely disposed of, they are pollution free. If you can get one permitted and built (no small feat) it produces cheap power and little waste. But, it seems unlikely to be a significant source of new electricity generation due to the public fear of accidents and the high financial risk. To be sure, the actual accidents to date have not caused a lot of injuries or deaths, relative to other energy sources, but the economic cost of the accidents, and the builder and operators liability, is extremely high.

Nuclear power generation has produced no deaths in the U.S. or in the UK. A Caithness Windfarm Information Forum (CWIF) compendium tabulated a yearly UK average of 164 windfarm accidents from 2012-2016 inclusive. Over the same period, 34 of the UK accidents were fatal. In total, in the UK, there have been at least 170 fatalities due to wind farms, so by this measure nuclear is safer than wind. While the safety record of nuclear in the U.S. and in the UK is quite good, the concern is the potential catastrophe. Certainly, the economic costs of nuclear accidents are much higher than for any other form of energy at least according to Benjamin Sovacool here. Sovacool has also shown that 94% of accidental electricity generation fatalities are due to hydroelectric dams, especially one large accident at Shimantan Dam in China. The nuclear catastrophe that can be imagined is horrific, particularly with regard to terrorism. Plus, we have all that nuclear waste being stored on the surface in temporary facilities. To quote Sovacool (source):

“… , nuclear power is less safe than alternatives. When overall fatalities from other energy sources are compared independent of the amount of energy they produce, nuclear power ranks as the second most fatal source of energy supply – after hydroelectric dams – and is responsible for more onsite deaths than oil, coal, and natural gas systems (Sovacool 2008).”

Coal mining is very hazardous, especially in China. But, elsewhere it has become much safer, especially in the U.S., in recent years. Urban indoor pollution, from burning biomass (wood, dung and charcoal) and coal indoors, kills 4.3 million people each year per the World Health Organization. This is the largest killer of all energy sources.

So, although we have estimates of how many have been injured or killed by nuclear accidents that range from less than 100 to over 4,000, both numbers pale in comparison to the deaths caused by other power sources, especially biofuels, coal and hydroelectric.  By this measure, nuclear is safer.  The problem is the perceived danger from a possible nuclear accident or terrorist attack, not the actual safety record.  This fear causes expensive actions (over-reactions?) to be taken when an accident occurs, raising the accidents cost and the potential liability of the operator and builder of the reactor.

It is unlikely, after 60 years of building nuclear power stations, that the cost and time to build them has to be what we see today.  After this much time, there is no need for every reactor to be a one-off and approved piecemeal one at a time.  But, this is where we are.  It is a capital intensive business with high front end costs and the regulations and lack of standardized pre-approved components drag out the construction (no-revenue) period and private companies cannot get into the business.

I suspect that if a standardized power plant design can be agreed upon by the government and industry, a permanent storage facility built for the waste and permitting and construction streamlined; nuclear would be a success. But, until that happens, I doubt it will ever succeed. No one, outside of government, is foolish enough to invest in the industry the way it is now.