Nuclear risks

The three mile Island nuclear power plant in the United States. A file picture. Ever since the accident there in 1979, people in the U.S. have been concerned about nuclear power.-AFP

The nuclear industry turns its eyes to Asia as nuclear power is far from being the favoured child of Wall Street.

Not far from where I live is a nuclear power plant. Vermont Yankee has operated in the rural town of Vernon since 1972. Every so often, Hattie Nestel of the Citizens Awareness Network sends a message to alert us to leaks at the plants, some serious enough to cause a shutdown. The air quality in our valley is abysmal, a consequence not only of the atmospheric leaks, but also of a century-old power plant that has corroded the environment. From Nestel we also learn that Yankees owner, Entergy, wants to extend the reactors lifetime beyond its decommission date of 2012. Although the nuclear industry is mounting an extensive campaign to bill itself as a clean, green source of energy, Nestel says, standard operations at any nuclear power facility are neither safe nor clean. Daily radioactive releases are widely distributed into the biosphere and food chain. Studies have shown that when these radionuclides enter the body they cause a statistically significant increase in various types of cancers, infant mortality, and birth defects.

In January 2007, Nestel and six other women chained themselves to the entry of Vermont Yankee, shutting the plant down for over an hour. Calling the power plant a danger to all life, these women (the oldest, Frances Crowe, was 87) indicted the Nuclear Regulatory Commission (NRC) for failing to follow State and federal law properly. If the NRC would do nothing, it was for ordinary citizens to take action.

Ever since the Three Mile Island accident in 1979, people in the United States have been concerned about nuclear power. Environmental activists such as Nestel warn of the danger of leaks and explosions. The nuclear industry has done little to ameliorate these fears. One power plant, at San Onofre in California, sits on a fault line that awaits a major earthquake. This does not inspire confidence. It is the bear market for nuclear power that allowed Entergy to buy Vermont Yankee for less than its construction cost ($180 million).

Despite this bargain price, Entergy has been running Yankee far beyond its capacity (120 per cent over) and reaping substantial profits (in the hundred millions a year). A pro-industry NRC has helped Entergy. The government commission has consistently allowed Yankee to override the lifetime of the plant and to set aside important safety regulations. All this enabled the plant to be profitable, although the threat of closure hangs over it, as does that of accidents.

Without the subsidy from the government and a pliant regulatory apparatus, nuclear power is far from being the favoured child of Wall Street. In fact, the expansion of nuclear power has been halted more because of fears of its economic costs than because of its social or environmental costs. The latter provides the context for the overall insecurity over nuclear power, but it is the former that drives away unsubsidised private capital.

During the last two decades, there has been growing talk of a nuclear renaissance in the U.S. Most of this is buzz from the nuclear industry, notably the firms that build reactors (such as Westinghouse) and those that run power plants (such as Entergy and Duke Electric). When Vice-President Dick Cheney convened his secret task force on energy security in 2001, he surrounded himself with executives from major power companies (such as Enron), including those from the nuclear firms. The current rise in oil prices and the talk of peak oil drew presidential candidate John McCain to pledge that the U.S. will have 45 new nuclear power plants under his watch.

One reason for this jubilation is a new reactor designed by Westinghouses engineers, the AP1000, and comparable technology from General Electric. New technology, it is argued, avoid the kind of dangers associated with the Three Mile Island plants. On the strength of its designs, Westinghouse has sold reactors to Japan and China and hopes to enter the Indian market as well. Tejpreet Chopra, the head of GE India, told Business Week: At this point, were just waiting to see how much capacity the government is willing to add and where. The US-India Business Councils Ron Somers invoked the phrase nuclear renaissance in light of the vast profits to be gained from Indias potential nuclear expansion (the cost is estimated to be about $150 billion).

But in the U.S., Westinghouse has faced problems from the normally pro-industry NRC. Duke Energy is in the midst of a battle to build a nuclear power plant in the Blue Ridge region of South Carolina, using Westinghouse reactors. Design flaws in the reactor forced Westinghouse to withdraw technical papers from their filings to the NRC. In response, the NRC wrote to Westinghouse on June 28, saying that it had put on hold any approval of new nuclear power plants until these design flaws were addressed.

The NRC argument does not address the environment or public health; it is geared entirely toward cost. Challenged by various public interest lobbies, the NRC argues that until Westinghouse is clear about its designs it would not be viable for the agency to rule on cost estimates, and so to judge whether nuclear plants are more efficient than renewable technologies or fossil fuel-based power plants. The Blue Ridge Environmental Defence Leagues petition to the NRC argues that since neither the NRC staff, Duke nor the [Defence League] know at this time what the final design will be, the certification of a new reactor in South Carolina should be suspended. The NRC accepted this argument.

The Blue Ridge region is home to the last nuclear power plant to be commissioned in the U.S., Watts Bar 1 run by the Tennessee Valley Authority. Opened in 1996, the plant took 23 years to build and went astronomically over cost. Wall Street has been uneasy funding any nuclear project, which is why whatever projects have been in the works end up relying upon government subsidies and advances from ratepayers.

The Energy Policy Act of 2005 offers financial incentives for new reactors. Despite these advantages, Warren Buffet, the legendary investment guru, spent $13 million to research the viability of building a nuclear plant in Payette, Idaho. But his MidAmerican Nuclear Energy Company decided against the plant in January 2008.

Florida Power & Light says that its power plant in southern Florida will cost anywhere between $6 billion and $9 billion, with no guarantee that it might not cost even more. Public Service Commissions give approval for these kinds of plants with no viable reactor designs and a very vague set of financial documents.

Environmental activists no longer simply warn about accidents and spillage. They have now taken to emphasise costs and, in particular, the subsidy from the government and the advance taken from ratepayers towards potential plants. Environmentalists argue that taxpayers should not be saddled with costs that cannot be estimated. The cost overruns led Forbes to call the nuclear industry the largest managerial disaster in history.

Nestel bemoans that the federal government spends less on research on renewable energy sources than what it costs to build one nuclear power plant. But if the NRC continues to question the new technology from Westinghouse and if Wall Street remains bearish about investment in nuclear, then the search for an alternative might become more viable. Meanwhile, the nuclear industry had turned its eyes to Asia. Yen, renminbi and rupees beckon, even as the dollars dry up.