Does nuclear power now make financial sense?

[bananas]

http://www.msnbc.msn.com/id/16286304/

Does nuclear power now make financial sense?
Industry must persuade Wall St. that new advantages translate to profits

<snip>

But it’s far from clear that this new round of plants will ever be built. Even if all goes as proponents hope, the first plants won’t come online before 2014 and will cost an estimated $4 billion each. Before ground is broken for the first new plant, the power industry will have to convince state regulators and investors that the numbers add up. To do that, they face several important hurdles.

Most of these projects are expected to be financed by bonds. To help reassure investors that the bonds are a safe investment, Congress has provided loan guarantees for 80 percent of the financing for the first several projects to win NRC approval. But that critical guarantee has already hit a serious snag.

Typically, these projects would be financed with 80 percent debt and 20 percent cash or equity put up by the owner of the plant. But federal officials in charge of loan guarantees have interpreted the law to mean that those guarantees apply only to the debt portion of the financing package. Using that math, the loan guarantee — 80 percent of 80 percent — will only cover about two-thirds of the total cost. That could be more risk than Wall Street is ready to assume — especially for the projects that go first.

<snip>

[Double T]

1. 'WE' have built financially viable and successful plants decades ago.........

and there is NO REASON that it can NOT be done again; government oversight and regulations need to be REASONABLE. Americas energy independence is crucial to our future economic survival.

[jpak]

10. More US nuclear plants were canceled than completed - 110 reactors

The stranded costs of these plants were - and are - enormous: $112 billion.

Who paid for these canceled reactors????

(clue: not the utilities that owned them)

The last few US nuclear plants actually built cost $5-7 billion and took up to 23 years to complete.

US uranium production has collapsed. The US imports most of the yellowcake used by commercial reactors.

Nuclear power will never make us energy independent.

[Double T]

16. $112 Billion is a fraction of the $500+ Billion and still counting.........

for 'wars' to secure 'our' energy sources. Safe and reliable nuclear power projects are still viable BUT the government has to REASONABLE in their regulations, design and oversight. It is inexcusable that it takes 23 years to build a nuclear power plant and the 'excuses' that it does could be corrected.

[TexasProgresive]

2. I don't think there has ever been a cost benefits analysis

that takes into consideration all the costs of these plants. If these plants are economical then the power industry should foot the whole bill and that included waste disposal and not be sucking at the public teat.

[ThomCat]

3. Whatever numbers they use to justify nuclear energy

will never include realistic risk estimates, clean-up costs, and other costs they have managed to foist upon the public. The industry gets the profit and we get everything else.
x(

[GliderGuider]

4. What do you feel are "realistic risk estimates"?

When you say "cleanup costs", are you talking about cleaning up after something like a TMI accident, or are you talking about waste storage? How much do you think it would cost the nuclear industry to internalize their externalities? To put everything on an even footing, please contrast that to the cost of taking CO2 out of the atmosphere (the unfunded externality of the fossil fuel industry).

Can you put any numbers on your motherhood statements, or is this more of a "gut feel" kind of thing?

[ThomCat]

9. I don't have numbers

because I'm not an industry analyst. But you're right that the extraction energy industry does the same thing, externalizes costs.

It's not a gut reaction. It's standard accounting practices. If it doesn't impact your bottom line, it doesn't get any consideration. Polution of all kinds have always been an externalized cost.

[jpak]

11. TMI was a billion dollar accident

Decommissioning costs for existing US reactors are $23 billion.

Yucca Mountain (if it's ever built) will cost >$65 billion.

That's on top of the $112 billion in stranded costs for canceled reactors.

Disposal of the 750,000 tonnes of depleted uranium at US enrichment plants will cost >$ billion and take 25 years to complete.

[GliderGuider]

12. Ignore the stranded costs.

Stranded costs are political, not technical. What will it cost us to clean the CO2 out of the atmosphere? Frankly, in this world of billion-dollar coal plants (as in the TXU plants), your numbers don't seem all that high to me.

Here is an excerpt from http://www.uic.com.au/nip08.htm">one article on costs:

Comparing electricity generation

For nuclear power plants any cost figures normally include spent fuel management, plant decommissioning and final waste disposal. These costs, while usually external for other technologies, are internal for nuclear power.

Decommissioning costs are about 9-15% of the initial capital cost of a nuclear power plant. But when discounted, they contribute only a few percent to the investment cost and even less to the generation cost. In the USA they account for 0.1-0.2 cent/kWh, which is no more than 5% of the cost of the electricity produced.

The back-end of the fuel cycle, including spent fuel storage or disposal in a waste repository, contributes up to another 10% to the overall costs per kWh, - less if there is direct disposal of spent fuel rather than reprocessing. The $26 billion US spent fuel program is funded by a 0.1 cent/kWh levy.

French figures published in 2002 show (EUR cents/kWh): nuclear 3.20, gas 3.05-4.26, coal 3.81-4.57. Nuclear is favourable because of the large, standardised plants used.

I don't think you can successfully argue against nuclear power on a pure cost basis, especially in comparison to other base-load technologies.

[jpak]

14. The utilities did ignore the stranded costs - they passed them on to the rate payers

If these costs are insignificant, why isn't the nuclear industry paying them???

(cuz they are enormous and they don't have the cash)

The nuclear industry has $56 billion in pending law suits against the DOE because the DOE didn't remove and dispose of the spent fuel THEY created and THEY made money on.

If they are successful, US taxpayers will be holding the bag for this too ($56 billion + $65 billion = what???)

And let's look at the defunct commercial spent fuel reprocessing plant in West Valley NY.

It produced 1250 kg of plutonium (worth $10-20 million), went bankrupt and was dumped into laps of NY and US taxpayers.

It will cost $4-8 billion to clean up.

The GOP/Cheney Energy Bill of 2005 gave away these goodies to the Nuclear Energy Institute (nuclear lobby shills) to build 6 GW of new nuclear capacity....

50% of the cost of the license application (hundreds of millions of $$$)

1.8 cents per kWh tax credit ($6 billion)

taxpayer guaranteed loans up to 80% of construction costs ($15 billion)

and the taxpayers will pay most of the costs for spent fuel disposal.

such a deal

[GliderGuider]

15. Everything you're saying seems to point to the need for better regulatory oversight.

It doesn't seem to be an argument against nuclear power per se, but rather against the (specifically American) nuclear industry as it's presently organized and regulated. The regulatory situation in the United States seems to be broken, and that appears to be where the excess costs are coming from.

Why would you throw out the entire industry rather than fix the oversight and legislation? Isn't that throwing the baby out with the bathwater?

[jpak]

17. Mo' Betta Oversight = make the nuclear industry pay its own way

It's a mature energy industry and had the support of the entire US science and engineering establishment to get it off the ground...and tens of billions in taxpayers subsidies and R&D since then.

Sink or swim - no more corporate welfare...

[ItsTheMediaStupid]

5. I wonder if risks of nuclear waste have been overstated

Also, there are plants on the drawing board that reuse most of the dangerous isotopes created and have much less waste to deal with.

This question needs to be examined with an open mind, by the environmentalists as well as the utilities.

Continuing to make electricity with coal will kill us via climate change.

What other options do we have?

[bananas]

8. Al Gore discussed it in his major policy address last year

You can read the transcript or watch the video: http://www.nyu.edu/community/gore.html

The "carbon wedges" study lists some options: http://www.theclimategroup.org/index.php?pid=549

[soothsayer]

6. Nuke energy in Europe is really, really expensive. I hate it and

don't want to see any more built here or anywhere.

[GliderGuider]

7. What would you like to see instead?

AFAIK, you have four realistic options:

Coal, which will kill us all.
Wind, which has issues related to variability, capacity and aesthetic acceptability.
Biomass, which is energy-expensive (low EROEI) and has capacity issues.
Conservation, which has its own negative exponential curve related to cost/megawatt saved.

We need to do the last three, of course, but to argue that nuclear is simply not an option opens up the field to coal. If you argue that neither coal nor nuclear are acceptable, you are stuck with renewables that at this point have significant issues,and conservation.

[jpak]

13. Renewables and efficiency are the only realisitic options

Eight EU nuclear plants were shut down last year with a total capacity of 2236 M"W"

In comparison, the EU installed 6000 MW of wind turbine capacity and >837 MW of PV capacity last year.

And that doesn't include biomass, biogas or geothermal additions.

Anyway you run the numbers, renewables are beating the pants off nuclear in Europe.

Coal is not the required "only" option for nuclear.

[Dead_Parrot]

18. Conservation is vital, whichever generating route you take.

Remember, we're going to need an absolute shitload of power to replace oil in the near future: whatever the mix of biofuels/hydrogen/electric transport we come up with, They are all energy intensive processes. If we don't have the capacity, we're going to see Fischer-Tropsch plants springing up like mushrooms all over the planet.

Bluntly, the alternative to conservation is liquefaction. And we really don't want to go there.

[GliderGuider]

19. Agreed.

Conservation is a key part of all this. The thing that has me worried about conservation is I don't know how far we can take it. We picked a lot of low-hanging fruit in the '70s and '80s. I know there's a lot that can be done in the USA, but what about the world as a whole? Europe is doing everything they can already and there probably won't be more than a few percent to be gained there. Developing countries are even worse prospects for oil conservation, due to the already low per-capita oil usage and the scarcity of capital funds to support the necessary infrastructure changes.

70% of the oil used today is for transportation. The US uses 20 Mbpd. If you doubled the mpg of all American vehicles (or boosted it by half and cut vehicle miles traveled by a quarter) you'd save 35% of the oil, or 7 Mbpd - 8% of world consumption. If the rest of the world did half as well (they have less fat to trim, remember), we'd save a combined total of 18 Mbpd out of the 80+ that we use. That's not insignificant, but it's a reduction of only 20% or so. You'd have to phase it in over 10 years to let people absorb the fleet replacement costs, so we'd be cushioned against a 2% annual global decline in oil production.

Look at the news from Cantarell. Ghawar is going to go over in much the same way within five years. North Sea production (British and Norwegian) is declining at around 15% per year. I personally feel we'll see a rapid escalation of the global decline rate up to 5% and beyond. And we'll struggle world-wide with transportation conservation to make up 2% per annum.

Conservation is one of the keys, but the more I crunch the numbers it doesn't look like it's going to be voluntary. And no matter what we do, I think the estates of Mr. Fischer and Mr. Tropsch are going to be accruing substantial royalties in the years ahead. That really sucks.

[Dead_Parrot]

20. True, but we haven't quite got there yet

What we need, before PO starts to really hit, is a carbon tax: It would keep fossil liquefaction to a minimum, encourage the clueless masses to stop pissing away what's left, and provide a fat wedge of cash for kick-starting alternatives.

Is there still time? Probably not, but we might manage a hard landing rather than a crash.

The problem is, we'd need some sort of responsible world leadership to do it. Paging Mr. Gore...

[GliderGuider]

21. There have been innumerable suggestions as to what whe should do

Lots and lots of people, from Monbiot to Gore to Pacala and Joseph Romm have come up with good ideas: carbon wedges, carbon taxes, cap and trade systems or straight-up rationing, and on and on.

The problem with them all is the one you hit on: we'd need some sort of responsible world leadership. Even if we got a national leader with a sense of morality and a bully pulpit, I haven't seen any suggestions for how to keep a sovereign nation from opting out if they feel it's in their economic interest (or feel it's their right to follow in the development footsteps of the OECD).

[phantom power]

22. Somebody said, it's essentially asking people to be voluntarily poorer.

at least, in the short term. In that light, the most probable outcome is that disaster will have to hit before there is serious buy-in from most nations. The remaining question is, when will that disaster come, and what will the options look like then?

[jpak]

23. Ugh

Sorry PP, but stuff like that pisses me off....(cue sermonizing organ...)

Replacing incandescent bulbs with CF bulbs saves people money - it does not make them "poorer".

Replacing old energy hog appliances with Energy Star appliances saves people money - it does not make them "poorer".

Replacing the old Suburban with a new VW Bug saves people money - it does not make them "poorer".

My brother and SIL did all that and cut their electric and gas bills by more than half - they didn't appear to be any "poorer" to me...

[GliderGuider]

25. What are the opportunities for conservation like in India?

What you are saying is utterly America-centric. 75% of the problem exists outside your borders. "Voluntarily poorer" refers to reducing the overall energy the civilization uses. You know, those 470 EJ? That's a bit bigger than CFLs and Energy Star fridges.

[jpak]

27. If India and China emulate the Livin' Large US model, then there's lots of opportunity

And they can increase their standard of living without using energy inefficient appliances and devices - or fossil fuels.

In remote villages...

Switch from kerosene lamps to solar powered LEDs for home lighting...

Replace village diesel generators with PV, micro-hydro and small wind turbines...

etc...

and no it's not utterly Mericentric - energy efficiency can apply to any country in the developed and developing world.

[Dead_Parrot]

26. Um, he said said short term, and he's right.

If I have to replace a light bulb, I could buy an incandescent for a dollar, or a CF for two: If I'm living off two dollars a day (which about half of the world's population does) buying a CF bulb means not eating until tomorrow. Yeah, they'll save money in the long run, but people don't like empty bellies.

[jpak]

28. People who live off $2 a day don't have incandescent bulbs

They have candles and kerosene lamps - that cost money and will increase in price as petroleum resources are depleted.

Micro-loans and solar powered LEDs will correct that problem (note: solar lamps are being distributed by NGOs already).

[Dead_Parrot]

29. Err, yes they do

About 2,000,000,000 people have no electricity, but over 3,000,000,000 survive on $2/day (or less) - There's at least a billion people wondering what they'll do when that bulb blows.

Of course, for the cost of the Iraq war, the west could have brought each of them 2 CF bulbs, a small fridge, a portable TV and a playstation 2 (with 6 free games!). But that's a different issue. :(

[Nihil]

31. It hurts when you put it like that ...

> Of course, for the cost of the Iraq war, the west could have brought
> each of them 2 CF bulbs, a small fridge, a portable TV and a
> playstation 2 (with 6 free games!).

The surviving generations will look back and say "WTF were they playing at?"
then curse our generations for being so pathetically stupid and short-
sighted.

[bananas]

32. For $8B/month, we could've bought them more than that

1-4 nuclear plants a month
god know how many windmills
exo-buckets of white paint
etc etc

Could've had full employment in Iraq building nuke plants,
then we'd let Israel blow them up before they were turned on.
"Planned Obsolescence" we used to call it.

[jpak]

36. If they had $4 billion nuclear power plants, they could burn incandescents all day

and night on a $2 a day budget...

...and Cheney was right: conservation IS a personal virtue...

:evilgrin:

[Dead_Parrot]

24. Yeah, it's a pisser...

But we'll see. Hu Jintao seems to be heading greenwards: stick Al in the Whitehouse, get them into a meeting and we might just have a cat in hell's chance... :shrug:

[XemaSab]

30. Not according to the boss-man.

:P

[rman]

33. Uranium — The White-Hot Metal: Demand is Outstripping Supply

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=115&topic_id=80621&mesg_id=80621

In other words: no.

[phantom power]

34. In other words, huh?

The energy density of nuclear fuel is so high that

a) a price increase of 10x is nearly irrelevent to delivered energy costs

b) the total amount of mining (dirty as it is) needed to support a nuclear industry is miniscule compared to the extraction industries for coal, oil and natural gas (or iron, copper, etc, for that matter). And that is ignoring the use of fuel recycling, which isn't practiced today since it's cheap to keep digging it out of the ground even at these "white hot" prices.

[rman]

35. "In 2005 uranium mines supplied 102.5 million pounds of uranium, but demand was 171 million pounds."

http://www.marketoracle.co.uk/Article273.html

On these matters i'd rather trust a British economic website than some random DUer.

[phantom power]

37. A couple points...

1) I don't dispute the article's figures. I'm pointing out that they don't really imply any problems for the nuclear generation industry. Observe that the article is not predicting any problems either. In fact, that article is recommending uranium investment because it's a growth industry.

2) Here is what this same article has to say about nuclear power versus renewables:

Trouble is, almost all the alternate energy solutions people talk about are decades away. They're too immature, too small, or too expensive. The only solution that packs both the volume and the power to make a difference immediately is atomic power. There's simply no other that even comes close.

To wit: Your trusted source agrees with my position: that nuclear power is critical to mitigate climate change.

[jpak]

38. No, it means uranium stocks are a good buy

As uranium production falls and demand grows, yellowcake prices will skyrocket as will uranium mine stocks.

The supply/demand gap will grow - and there will be shortages...

[NNadir]

39. A lot of nuclear reactors must have shut down because of this shortfall.

Or maybe they just didn't read the "market oracle," and be oracularly informed that they were out of fuel. Does the "market oracle" have more information about the number of reactors so shut than a "random DUer" who is not as smart as you are?

You can join your fellow oracle JPak, who is about as informed as you are, in predicting the demise of nuclear power because of uranium shortages, the explosion of renewable energy, public fear of accidents, problems with so called "nuclear waste," blah, blah, blah...

Maybe you and JPak should write these people and tell them what you have learned from reading the "Market oracle:" http://www.world-nuclear.org/info/reactors.html. I'm sure they'll be inspired to cancel all of the reactors on order and under construction and will also stop proposing the reactors they have proposed.

The uranium already mined in the United States is equivalent to the world energy supply for several decades including oil, coal, natural gas, hydroelectric, and the magical wind, solar and biofuels. This would require the intermediate step of converting it to plutonium, but such conversion will probably not be economic until the price of plutonium rises to $1,000/kg, which is not likely to happen in the next 5 decades.

The number of nuclear reactors that have been cancelled because of fuel shortages, the number of reactors shut by fuel shortages remains zero. Moreover, much of the world's thorium resides in dumps because the world has too much uranium and can't be bothered with it.

Actually the world has more of a problem with excess fissionable material than it has with a shortage. For more than a decade, owing to the high energy density of uranium, the world has been living more or less off of old Soviet inventories.

Even if one is at the thinking level of a trust fund brat, one would hope that uranium shortages would become acute in the near term however, since this would increase the financial incentive for dismantling nuclear weapons and recovering the vast amounts of energy in them for peaceful purposes.

[Dogmudgeon]

40. Uh ... why not just go to well-controlled recycling/breeder reactors?

Breeders and recyclers (and, I would assume, combinations of the technologies) require much less fuel, and could be better-controlled to prevent proliferation. Such a setup could easily increase security, safety, and the financial drawbacks. And although nuclear power has a much better safety record than people are aware of, it could be made safer yet.

The reason why we don't have such reactors in the USA is because of a well-intentioned but now outdated law that's almost 30 years old.

Of course, if you're trying to make the case against nuclear power, it's understandable that you'd quote the most adverse information, but in a few years, we may not have nearly as much choice in our preferences. Energy is energy, and soon the demand will be life-or-death. Although many liberal Americans think of energy use strictly in terms of SUVs and appliances, the main demands for energy are made by industry and agriculture. No economic system, no fertilizer, no ability to sustain 6 billion+ human lives. If we can't seriously jump-start the other energy industries (solar, wind, tidal, and Republican flatus) in the next year or two, it will be down to nuclear, tar sand/shale petroleum, and coal.

--p!

[jpak]

41. Because breeders don't work and reprocessing is exorbitantly expensive

No one has successfully operated a commercial scale breeder - every single one of them experienced sodium fires or core meltdowns.

EBR-1
Teledyne EBR
Fermi 1
Phenix and Super Phenix
BN-300 and BN-600
Monju

None have actually "bred" significant quantities of plutonium.

The only commercial reprocessing plant ever to operate in the US (NFS West Valley NY) produced ~1900 kg of plutonium worth ~$20 million. The plant could not turn a profit and closed in 1972. It will cost taxpayers $4-8 billion to clean up this site.

Sellefield and THORP have experienced costly accidents.

Japan's new reprocessing plant (which is years behind schedule and over budget) will cost more than $20 billion and produce plutonium @ $2000 per kg (compared to yellowcake @ ~$60 per kg).

Uranium extracted from spent fuel contains uranium isotopes that are fission poisons and highly radioactive. They can't be used as fuel without a lot of expensive enrichment and lengthy decay times (to allow them to be safely handled).

And reprocessing does not eliminate the need for geological disposal of fission products.

[Kolesar]

43. a much better safety record? First Energy ran a nuke plant 'til it almost busted its lid

Those bastards at Davis Besse were faking and backdating reports that said that they had inspected parts of the boric-acid system when they did not. The federal regulators had a hunch that there was a problem with vessel, but the generating company lied to them so that they could keep the plant online and making money for another year.

When they finally halted operation, there was a hole the size of a football in the vessel lid. The only thing keeping the gasses inside was the thin coating of chromium.

Safety? Ohio was within weeks of a radiation release. Or worse, they could have had a cooling system failure. We will never know for sure.

http://www.google.com/search?hl=en&q=%22davis+besse%22+hole&btnG=Google+Search

[Nihil]

44. Not meaning to pile on you here TBA ...

... but why is it that ONLY the nuclear industry is held to these standards?
Yes, the setup at Davis Besse was dangerous, stupid, illegal and immoral.
Believe me, I'm not trying to defend their greed/stupidity/callousness or whatever.
My comment is that NONE (i.e., not one of the pre 2004) coal plants are being called
on their ongoing pollution that is KILLING PEOPLE EVERY DAY.

I *know* there are problems with nuclear power in the USA (though less so in the
rest of the world) but I wish people would hold the alternatives to the same damn
standard ... I'm not talking about "alternative energy" here but about the existing
"alternative to nuclear" sources that have been in industry production for years
and which will continue to provide most of the US energy requirements for years
to come.

[jpak]

42. Not to worry rman, the World Nuclear Association is concerned about the pending U shortages too

Uranium shortage poses threat

http://business.timesonline.co.uk/article/0,,9069-1735134,00.html

A GLOBAL shortage of uranium could jeopardise plans to build a new generation of nuclear power stations in Britain.

The dearth of uranium will be discussed at the World Nuclear Association’s symposium in London next month and could prove to be a major stumbling block in the nuclear industry’s attempt to have old nuclear power stations replaced with modern reactors.

While Britain has no plans to begin building a new generation of nuclear reactors, pressure has been growing to take a decision to restart a nuclear programme as a way of cutting carbon dioxide emissions that lead to climate change and reducing Britain’s reliance on imported gas.

However, a recent report by the Asia Pacific Foundation of Canada said that there was likely to be a 45,000-tonne shortage of uranium in the next decade, largely because of growing Chinese demand for the metal. Prices for uranium have almost tripled, to about $26/lb between March 2003 and May 2005, after being stable for years.

<more>

US uranium production has collapsed and the US nuclear industry is nearly totally reliant on dwindling stockpiles and imported yellowcake...

http://209.85.165.104/search?q=cache:G89SyixLCZ0J:www.eia.doe.gov/emeu/aer/txt/stb0903.xls+uranium+overview+1949+2004&hl=en&gl=us&ct=clnk&cd=1

trust a trust fund kid on this one...

:evilgrin: