While the U.S. nuclear industry tries blowing sunshine up the skirts of its wary watchers, international members of that beleaguered brotherhood are finding it more and more difficult to make the nuclear argument believable.
Japan has been working overtime, against many experts’ better judgment, to restart its own nuclear program even while the Fukushima nightmare remains unresolved. The problem is that the Japanese public are not going to be so easily led into believing it is in their best economic interests when there is so much real time evidence to the contrary.
Enter the oldest trick in the nuclear economics book: allow operators to deflect some of the insurance obligation they normally would be required to absorb.
The details have not been shared, but apparently the Japanese Diet will be considering a proposal to join an international pool of nuclear operators to spread the risk of loss from any future nuclear disaster:
Under the Convention on Supplementary Compensation for Nuclear Damage, contributions from member states will cover part of the damage payments in the event of a nuclear disaster. (U.S.Energy Secretary Ernest) Moniz welcomed Tokyo’s plan, saying Japanese ratification would help the pact come into force, Japanese officials said.
The Price-Anderson Act, passed in 1957 and updated several times since, provides just such a scheme for U.S. nukes. It allows operators of nuclear plants to compete unfairly in the market to replace fossil fuel, and keeps true renewables (which must cover their own liabilites unassisted) at an economic disadvantage.
Enacted by Congress many years ago, Price-Anderson limits the industry’s liability from any single accident and spreads the cost throughout the entire U.S. industry, who “share” a common insurance coverage by agreement with the entire insurance industry.
It’s business benefitting business in the great capitalistic embrace. The only problem is that the American taxpayers get to take up the slack should a Fukushima-scale event ever happen on our soil.
Meanwhile, the success of the nuclear industry under this gerrymandered insurance system has meant that development of true renewables has been held back; probably to the ultimate economic harm of U.S. interests.
It’s what we do.
When Price-Anderson was implemented, the U.S. nuclear reactor “fleet” was still young and sound. As the International community considers a similar arrangement, they are in a very different situation.
Saddled with aging and increasingly unprofitable reactors, the spectre of Fukushima and a growing realization that thousands of tons of nuclear waste has no where to go, it is an industry whose cup is half empty.
Of all nations, France is the largest generator of nuclear energy, which provides a whopping 85% of its electrical power. The country’s nuclear power authority, EDF, estimates that the cost of necessary repairs and safety improvements in the wake of Fukushima will total $71 billion or more by 2025.
If any of those necessary repairs and safety improvements are delayed or neglected due to declining profitability, in a shared insurance model, everyone’s risk could increase intolerably.
Why would anyone want to buy into that?