The pervasive view among nuclear proponents today is that the world is having a nuclear revival – or in the parlance of these nuclear advocates, a “nuclear renaissance”. We believe this perception is largely being fed by a well-funded lobbying and public relations campaign conducted avidly by the nuclear industry, particularly over the past decade.
Between 1999 and 2009, the nuclear industry spent $645 million on lobbying and almost $63 million on campaign contributions. (Boyd, 2010)
The South African government, ESKOM and several South African energy experts have been wooed to embark on a nuclear adventure by these well-funded campaigns. With this article we wish to highlight key anti-nuclear arguments and support the growing public interest anti-Nuclear community by unpacking Nuclear energy and sorting facts from fiction. Let’s take a systematic look at the considerations surrounding Nuclear energy space.
Introduction and context
South Africa spent 13 years pursuing the Pebble Bed Modular Reactor, wasting billions of Rand in the process: R9-billion was spent on research and development and another R22-billion would have been needed to complete a demonstration model (Greenpeace 2011). Fortunately this wasteful expenditure was stopped in early 2010.
But is there a Nuclear renaissance afoot? It is a well documented fact that the number of nuclear power plants in the world is actually decreasing. At the present time there are only 433 reactors in operation (there were 439 reactors in 2008: Source: IAEA and Voice of America websites). It is also a known fact that in the next 15 to 20 years more ageing plants will go offline than new ones coming into operation. The number of operating reactors is likely to decrease by 29% by 2030 if compared with 2009 data (Frogatt 2010).
So in fact what we have found is that while there is no renaissance of Nuclear energy, there is a renaissance of the proclamations about nuclear energy (Rosenkranz 2010). Furthermore, what we find in practice does not concur with what the nuclear industry publicity machine would have us believe. Let’s take a closer look.
The nuclear energy costs debate is often focused on the costs of installations. There is another dimension of costs which is fascinating – the cost of Nuclear energy marketing. The nuclear industry – strongly represented by bodies like the Nuclear Energy Institute (www.nei.org) – is vastly resourced in comparison to the public interest community that voluntarily works – usually with no budgets whatever – on drawing attention to nuclear power impacts on people and planet.
But let’s leave this aside for the moment and look at Installation costs. Nuclear reactors remain as uneconomical today as they were in the 1980s when so many were cancelled or abandoned (MIT 2009).
The most recent cost projections are, on average, four to six times as high as the initial projections (MIT 2009 & Word Watch Institute 2011).
Incorporating the lessons learned from the Fukushima accident in future investment will invariably (and appropriately) ratchet up Nuclear costs further.
Some of the global considerations that have huge financial implications and should logically rule out Nuclear as a financially feasible option are:
– Nuclear costs are steadily increasing, while alternatives are getting cheaper and becoming more attractive. Energy efficiency campaigns, public awareness of fossil fuel impacts and renewable technology learning curves are all making truly clean energy alternatives much more attractive.
– The ongoing Economic downturn has indicated a related reduced electricity demand (Citigroup 2008).
– Nowhere in the world has a satisfactory answer been found for final disposal of high level nuclear waste – that includes South Africa. (Fig 2005).
– Nuclear accidents, disasters and near-catastrophes did and do take place, even with ‘new generation’ technologies (atomicarchives.com)
– Nuclear power plants’ life time load factors are often below 70% only and hence far below the generally promised 90%. (Note: Koeberg-1’s life-time load factor is 68.34%, Koeberg-2’s is 68.89: VoA-website). South Africa is currently preparing to sign off on a potential Nuclear build which will cost R1 trillion. Where will this money come from? Loan guarantees and subsidies are insufficient to construct new reactors – invariably government has to step into the breach, drawing on tax revenues.
– A nuclear disaster (“Total Meltdown”, INES Level 7), which causes maximum damage to people, property and the environment can cost up to R60 trillion. An insurance premium to cover such an amount could reach up to R600 per kWh generated. In practical terms nuclear disasters occurring at NPPs are not insurable and the public would need to step into the breach once again (Versicherungsforen Leipzig 2011).
– The nuclear industry’s optimistic proclamation that electricity would be “too cheap to meter” is hard to comprehend. Beyond the costs of financing the risks associated with Nuclear, operational and maintenance costs are increasingly ratchetting up nuclear energy supply costs.
– Pending increased demand the price of Uranium long-term supply contracts will increase (SOMO 2011), the effect on the electricity unit costs from nuclear power stations through a doubling of uranium prices is considerable (25% according WNA 2010). Both the uranium spot price and the long-term price increased six-fold in the last 10 years.
– Nuclear power station developers face five big risks: Planning, Construction, Power Price, Operation (including a lower load factor as widely assumed for the first years of operation, especially for new designed reactors), and Decommissioning (Citigroup 2008, 2009)
– Construction, Power Price, and Operational risks are so large and variable that individually they could each bring even the largest utility company to its knees financially. (Citigroup, 2008, 2009)
By comparison, in their first 15 years in the United States, nuclear and wind technology each produced a comparable amount of energy (nuclear: 2.6 billion kWh; wind: 1.9 billion kWh), but the subsidy to nuclear outweighed that of wind by a factor of over 40 ($39.4 billion and $900 million respectively) (Goldberg 2000).
So what is driving the recent proclamations around nuclear energy?
The main driver behind the proclamations appears to be political. Energy policy since the turn of the century has been driven by two issues; climate change and security of supply. The nuclear proclamations revival is characterised by extremely low cost estimates and other bold claims, but as illustrated above, in practice one finds a somewhat different reality.
Without subsidies and guarantees from governments, new nuclear power plants can never be built (Thomas, 2010). Unless governments (through taxpayers and electricity consumers) are willing to underpin either the financing, the pricing of output and/or decommissioning costs Equity investors are unlikely to earn a competitive return on new nuclear. Political will and political perception of economic variables rather than actual economic factors is the single most important driver for new nuclear construction and that alone should be a concern for equity investors (Citigroup 2008, 2009).
The Nuclear fuel cycle, nuclear waste
There is no complete nuclear fuel cycle. In practice this cycle is open. Not one country in the world has approved an operational disposal site for isolating the high level radioactive wastes from the environment for the hundreds of thousands of years they will remain a threat. Monitoring and maintaining waste dumps over a period spanning 20 times the length of known civilisation is an unacceptable burden to place on all future generations – with no guarantees of long-term safety.
Besides electricity, nuclear power stations produce high, medium and low-grade radioactive waste which is also highly toxic.
Sweden is one of the very few countries working seriously on a high level waste disposal site. Again the cost estimates of the nuclear industry have been far too low. In order to pay for this effective waste disposal site the Swedish Radiation Safety Authority has suggested a necessary increase of costs per electricity unit generated by some 300 percent (Bellona 2011).
The highly radioactive waste produced in nuclear power plants today will have to be in secure storage even in the year 10,000 or the year 100,000 (Rosenkranz, 2010)
Nuclear vs Renewable energy and energy efficiency
Large, centralized power-generation units tend to lead to structural overcapacities and need massive supporting infrastructure (mining, railways, water supply, transmission lines, etc.). Overcapacities usually lead to lower prices, which logically encourage energy wastage – which happened in South Africa from the 1970s onwards until late 90s. South Africa’s potential for electricity base- and peak demand reduction through energy efficiency is still largely untapped due to historically low electricity tariffs. An effective public campaign could change this and cost a fraction of new centralised energy build. Moderate efforts to reduce electricity consumption through the more efficient use of energy will reduce the need for ever more large power plants.
Increasing levels of decentralised renewable electricity could easily also significantly reduce demand projection so that we can plan for flexible, medium-load complementary facilities rather than inflexible, large, baseload power plants (World Watch Institute 2011; Frogatt 2010).
The huge financial commitment which necessarily comes with a nuclear programme (R1 trillion for the current proposed South African Nuclear build programme) is a tremendous burden for the country’s citizens and the sole utility company. The risks associated could bring even ESKOM to its knees financially.
It is extremely unlikely that South Africa will be capable of finding viable means of financing both a nuclear programme and an extensive renewable energy supply programme. In a context where there is global pressure to decrease emissions, Nuclear energy then ‘looks’ like a viable option and the temptation to negate long term negative effects is strong.
In a country where there is so much social inequality the way that public money is invested should be particularly carefully handled. Given our limited financial resources and social needs, we have a moral obligation to spend public money on options that provide the cleanest and safest solutions the fastest.
Nuclear energy and climate change
Nuclear lobbyists promote nuclear energy as the silver bullet against climate change. Yes, in a very limited perspective it can be a low carbon option, but a broader view shows that it reduces and retards climate protection by saving 2–10 times less carbon per dollar—and 20–40 times more slowly—than the superior low- and no-carbon renewable energy technologies that are soundly beating it in the global marketplace (World Watch Institute 2011). In addition, the scale of funding required for Nuclear energy build would vastly reduce the allocation of funding available for clean energy development.
For nuclear power to make a meaningful contribution to reducing global CO2 emissions trends, 2,000 Koeberg-size reactors would have to be operating globally by mid-century. That means commissioning a new plant every one to two weeks from now on (Smith 2006).
Nuclear energy is not cheap. It is not safe. It is not clean.
The highly publicised nuclear renaissance is based on fiction, not fact.
Nuclear reactors are the worst option from the point of view of the consumer and society. (Cooper, 2009).
For half a century the nuclear power industry has always been big on promises but fallen short on delivery.
The Nuclear energy industry needs Climate change more than Climate change needs the Nuclear energy industry. If we want to avert catastrophic global warming, why should we opt for the slowest, most expensive, most ineffective, least flexible and riskiest option? (Nature, 2007).
South Africa has large efficiency and renewable energy resource capacities that are instantly available and cheaper than new nuclear power plants.
Our government is currently in the position to make a choice between a Nuclear compromised future and one dominated by renewables and the more efficient use and generation of energy. Having read this paper – what would you choose?
We acknowledge the factual contributions to this document of Peter Becker (Koeberg Alert) and Liziwe McDaid (Green Connection) both tireless activists who have devoted years of their lives to draw public attention to why investment in Nuclear energy is unfeasible.
Atomicarchives.com: last visited on 20/10/2011.
Bellona 2011: Swedish example shows that nuclear waste storage could be far more expensive than expected. http://www.bellona.org/articles/articles_2011/waste_costs_sweden
Boyd, Michele 2010: Is there a nuclear revival in the United States? Heinrich Boell Stiftung.
Citigroup – December 2008: European Nuclear Generation – New merchant plants bear too high a risk for equity investors
Citigroup – November 2009: New Nuclear – The Economics Say No – UK Green Lights New Nuclear – Or Does It?
Cooper, M. 2009: The Economics of Nuclear Reactors: Renaissance or Relapse? Senior fellow for economic analysis institute for energy and the environment Vermont law school.
Fig, D. 2005: Uranium Road. Questioning South Africa’s Nuclear Direction.
Frogatt, A.; Schneider, M.: 2010: Systems for Change: Nuclear Power vs. Energy Efficiency + Renewables. Heinrich Boell Stiftung.
Goldberg, M. 2000: Federal Energy Subsidies: Not All Technologies Are Created Equal, REPP no. 11 (July 2000).
Greenpeace 2011: The True Cost of Nuclear Power in South Africa. Report 2011.
IAEA website: http://www.iaea.org/programmes/a2/index.html (visited on 10th Oct 2011).
MIT, 2009: Update of the 2003 “Future of Nuclear Power” Study.
Nature 449, 664 (11 October 2007): Patterson, W.: Fifty Years of Hopes and Fears. Essay.
Rosenkranz, G. (2010): Myths about Nuclear Energy. Heinrich Boell Stiftung.
SOMO (2011): Centre for Research on Multinational Corporations. Radioactive Revenues. March 2011. A. Kate, J. Wilde-Ramsing
Smith, B. 2006: Insurmountable Risks: The Dangers of Using Nuclear Power to Combat Global Climate Change. A Report by the Institute for Energy and Environmental Research (IEER Press).
Thomas, S.; Bradford, P.; Frogatt, A. and D. Milborrow, D. (2007): The economics of nuclear power. Greenpeace. Research report 2007.
Thomas, S. (2010): The economics of nuclear power: An update. Heinrich Boell Stiftung.
Versicherungsforen Leipzig 2011: Calculation of a risk-adjusted insurance premium to cover the liability risks resulting from the operation of nuclear plants. Study. http://www.versicherungsforen.net/fs/vfl/media/leistungen/studienundumfragen/versicherungsprmiefrkkw/Pressekonferenz_02_Erklaerung_final_BEE_EN.pdf
Voice of America – website: http://tools.voanews2.com/nuclear_reactors/
World Watch Institute (2011): Schneider, M.; Frogatt, A.; Thomas, S.: Nuclear Power in a Post-Fukushima World. 25 Years after the Chernobyl Accident.
WNA – (2010): The Economics of Nuclear Power. http://www.world-nuclear.org/info/inf02.html
 NEI has over 350 members in 15 countries. More than 6,000 industry professionals participate in NEI activities and programs, providing NEI broad industry representation and enabling NEI to focus industry expertise on crucial policy matters. (Source: www.nei.org, visited on 10th Oct. 2011).
 Voice of America website: For Koeberg-1: http://tools.voanews2.com/nuclear_reactors/?reactor=KOEBERG-1&rid=628; for Koeberg-1: http://tools.voanews2.com/nuclear_reactors/?reactor=KOEBERG-2&rid=629
 Source: www.cameco.com: Cameco is one of the world’s largest uranium producers accounting for about 16% of the world’s production. For latest information on Uranium Price go to: http://www.cameco.com/investors/uranium_prices_and_spot_price/