Archive for September, 2012
Thursday, September 27th, 2012
By William Tucker
The news this week that Allison Macfarlane, chairman of the Nuclear Regulatory Commission, has hired Mary J. Woolen, former executive director of Keep Yellowstone Nuclear-Free as her director of external engagements is just another straw in the wind of what to expect from Washington in the next few years.
Macfarlane was appointed on her credentials as an expert on nuclear waste. Her signal contribution was her 2006 book, Uncertainty Underground: Yucca Mountain and the Nation’s High-Level Nuclear Waste, which argued that finding a permanent repository such as Yucca Mountain wasn’t necessary because spent fuel could safely be stored in dry casks for decades, perhaps even 100 years. “We have plenty of time to deal with the problem,” was her mantra.
All this held out some hope that Macfarlane’s Nuclear Regulatory Commission was not going to become another Anti-Nuclear Regulatory Commission, as it has so often in the past. Her argument dovetailed nicely with both camps. For the antis, it meant that Yucca Mountain was unnecessary and could rest comfortably in the grave dug for it by Macfarlane’s predecessor Gregory Jaczko, whose sole mission as chairman was to prevent the repository from being built in Harry Reid’s home state.
But Macfarlane’s stance was also encouraging to the nuclear industry because it confirmed what they had long argued, that spent fuel is much more a technological challenge than a metaphysical roadblock that puts an end to all nuclear development. So it seemed as if some kind of progress might be possible.
All this might have been a premature. I had some indication of where Macfarlane was really coming from about three years ago under very unusual circumstances. Al Gore was testifying before Congress about global warming and for the first time I was watching at home on C-Span. At some point, a Senator asked him whether reprocessing wasn’t an option and he replied with grand irony, “Reprocessing only make the problem worse!”
Environmentalists always love this argument. It makes the opposition look so stupid. Here they think they’re solving a problem and in fact they’re only making it worse! What incompetence!
“Why did it make it worse?” the inquiring Senator asked. And Gore proceeded to quote MIT professor Allison Macfarlane, who had told him in a personal conversation that when you reprocess, you end up with more waste than you started with.
I had heard this argument from the usual sources, but I was surprised to hear it from someone who was posing as a disinterested scholar. At that point, it seemed as if Macfarlane was trying to bring some rationality to the subject.
So, sitting in Piermont, New York watching Gore testify on my computer screen, I called her up. She also had an associate professorship down at George Mason at the time and I forget at which place I located her, but anyway, within a few minutes I had the reporter’s dream experience of talking with Macfarlane even as Al Gore was quoting her on C-Span.
How, I asked her, did reprocessing make the problem worse?
“It’s just a matter of chemistry,” she said. “You have to add some chemical reagents to separate out the different elements. So in the end you have more material.”
Yes, but this takes no account that you were separating 95 percent U-238, which is considered low-level waste, from the remaining 5 percent plutonium and actinides, which are the bad stuff you have to put in Yucca Mountain. You’re reducing the problem by a factor of 20, aren’t you? The French store all their high-level waste in one room.
Well, waste was still waste, she said, whether it was high-level or low-level, and so her statement stood.
It quickly became obvious that, despite her aura of detached neutrality, Macfarlane was just another crusader feeding lines to the anti-nuclear activists so they could go around the country scaring people to death with them. Of course whatever confidence Macfarlane may have had that spent could be stored safely for decades has quickly been shattered by the D.C. Court decision overturning the Waste Confidence Ruling. And so we’re back to square one and all thoughts about 70-year hibernations in dry casks have been forgotten. Once again, “nuclear waste” is the irremediable obstacle to the expansion of nuclear energy.
Now nobody really expects there will be any more new construction licenses issued until Vogtle and Summer projects are completed, which may be six to ten years from now. But in the meantime the NRC can occupy itself over the question of whether we’re going to pull a Japan and close down Vermont Yankee and Indian Point, leaving Vermont and New York to compete over who can import the most electricity from the Hudson Bay.
So that’s where we are with the NRC. Meanwhile, there should be more than a few good patronage jobs to hand out to those loyal soldiers who have labored long and hard in the vineyards trying to close out the season on nuclear power.
Monday, September 24th, 2012
By William Tucker
Last week the National Institute of Standards and Technology introduced a "net-zero" suburban home in Gaithersburg, Maryland. A 4,000-sq-ft, two-story frame dwelling with a gabled roof and a garage, it looks just like any other subdivision model – maybe a little large, in fact – except it runs entirely on solar energy.
The house has both solar hot water and PV panels on the roof. Computers parcel out every bit of energy consumption. The phantom occupants are a family of four ,with a 14-year-old and an 8-year-old, and the computers even decide that the 14-year old will take a longer shower and use more hot water than the other family members.
How does the house keep the lights on and the refrigerator running when the sun isn't shining? Well, the house is still connected to the grid. When the sun is in full force, it puts its extra power onto the grid and receives credit through negative metering. Then when its own energy is not available, it takes power off of the grid in exchange for the credit it has accumulated. Taking all this into account throughout the year, the NIST computers calculate that the house will come out about even. Hence, net-zero outcome.
Pretty good, eh? When can they start putting one in my neighborhood?
Well, wait a minute. There's just one problem with all this. While it may look as it one house can operate in this matter, what happens when there are hundreds or thousands of them. Then the utility has a problem.
The sun is going to shine on all of them at the same time. That means the utility is going to have to absorb lots of solar electricity. It may use some of it to reduce peak power requirements in other parts of the grid, but if it absorbs too much, it’s going to have to waste it or tell other providers to shut down. That may give the illusion that we are “replacing coal or nuclear” with clean, free solar energy.
But the shutdown will only be temporary. Once the sun goes into hiding again, demand will jump up again. So for a more reliable electricity provider – whether it’s the utility or a merchant company – it's a pretty bad deal. Although their fixed costs will remain, they won't be able to sell as much power to offset those costs. Moreover, as Robert Bryce frequently points out, ratcheting coal plants up and down to meet differing loads is very wearing on the boiler and will lead to early depreciation.
What's needed here, of course, is a technology for storing electricity so that a power generated at one time can be called upon at another. Storage at the household level might be feasible – expensive but still feasible. There are people who have filled their basement with rechargeable battery systems that cost tens of thousands of dollars in order to make a vindictive case against the utility by taking themselves off the grid. But the NIST plan has no such contingency. Instead it simply dumps the storage problem back in the power company.
Ordinarily the independent systems operator would charge a premium for any form of generation that is not "disputable," since there’s a cost to everyone else for power that can’t be relied upon from one hour or day to the next. But of course most ISOs have been told they can’t do this because it "discriminates" against solar or other renewables.
This has already happened with wind. In several service areas, ISOs have tried to make wind providers accept a lower price to compensation for unreliability. But this has been disallowed by the Federal Energy Regulatory Commission and others on the grounds that renewable energy has other benefits.
The player who is going to make out the worst here is nuclear. Reactors run all the time, often for nearly two years straight, usually at the same level of output. They are the ultimate base load power. There is no no sense in trying to turning them off and on for a few hours or even a day or two at a time. If wind or solar generation produces excess power that can't be stored anywhere, someone is gong to have to eat those losses and it is the reactor that probably won't get paid.
All this has a very familiar ring to it. The government sets a policy goal and imposes it on the private sector. The private sector starts to lose money putting it into practice. The government tells the private sector its goals are more important and that if the private sector can’t survive the new regime it’s because “the market doesn’t work.” And if the market doesn’t work, then the only thing to do is have the government take over the whole operation. Can anybody say “student loans?”
Thursday, September 20th, 2012
By William Tucker
I confess I really blew this one. I wrote my column Monday on how San Francisco environmentalists were testing reality by putting up a ballot measure to tear down the Hetch Hetchy Dam, which provides the City by the Bay with 85 percent of its fresh water and half its electricity. I thought that pretty much described the sort of thing that can go on in San Francisco.
Stupid me. I did not realize on that very same day, the San Francisco Board of Supervisors was taking a vote on something even more outrageous – voiding its decades-old contract with nuclear-using Pacific Gas & Electric in order to put itself in the hands of . . . . well, wait until you find out.
Here’s what happened. On Monday the 11-member board voted 8-to-3 to complete what supporters are calling a four-decade-old crusade to wrest the city out of the hands of nuclear-oriented “private profit” and create a municipally owned electrical company power company that will embrace renewable energy. “There are many people in San Francisco who don’t mind paying a little bit more to get clean energy and to make sure that they’re no longer buying nuclear power,” said Supervisor David Campos in summing up the vote.
Now this business of municipal utilities is an old, old thing. During the Progressive Era of the 1920s it was supposedly the route to energy nirvana. Granted, government-owned power companies have some advantages. They don’t have to pay taxes. They get lower interest rate on tax-exempt municipal bonds. So the government subsidizes them in a variety of ways. But now there’s a new rationale – a municipal utility will allow “we the people” to produce electricity with wind and solar and all the nice things instead of bad old nuclear energy. “The long-term goal is to really do our own generation,” said Ed Harrington, the outgoing manager of the California Public Utilities Commission who actually delayed his retirement in order to shepherd the law through the city legislature.
Well of course the people of San Francisco aren’t quite ready to start powering the city with backyard windmills and rooftop solar collectors the way Amory Lovins envisioned. So for the meantime they have chosen a White Knight to start them on this journey. It is - are you ready for this? – the Shell Oil Company. Yes, the big bad oil giant of the Netherlands and Texas – now being sued by the Sierra Club for drilling in the Arctic – has decided to get into the renewables game by setting up an energy trading company called “CleanPower SF” (amazing what you can do with a name, isn’t it?). Shell’s shell company has emerged as the sole bidder to provide “100 percent renewable energy” to half the population of San Francisco.
Alright, let’s start with the first question. Where is CleanPower SF/aka/ Shell going to get all this renewable energy? Well, they’re going to buy it out of state. Nobody’s talking about covering the Presidio, Marin County and the Peninsula with 40-story windmills and 12-square-mile solar “farms” –yet. Instead, CleanPower SF will buy contracts naming wind and solar electricity generated in Utah or Nevada – or “renewable credits” generated somewhere even more distant – and sell it to San Francisco at what could end up being double the price. Roughly half the city’s 375,000 electrical customers are to be assigned to the program. For a year they will be able to opt out. After that, if they’re happy paying higher rates – or aren’t paying attention – they’re stuck. The hope goal is to end up with 90,000 customers in the program. Critics are calling it “coercion” and they are undoubtedly right. Voters have twice rejected ballot proposals to create a municipal electric company in San Francisco but this time it is being sneaked in the back door.
So what’s going to happen? It’s easy to foresee. In about a year some enterprising reporter will discover that the electricity that 150,000 San Franciscans have been buying off the grid is no more “green” than what they are buying today. Electricity is electricity. If CleanPower SF contracts for wind power from Nevada, that just means someone else will be buying the coal power from Utah. Nothing has changed. The contract says specifically the Shell subsidiary has no obligation to build any new wind farms or solar generators. Comparisons with Enron will be in order. Soon the scandal will erupt of how the Board of Supervisors was “duped by Big Oil.”
What’s really interesting is how all this is pitting the renewables-through-municipal-ownership against the Tear-Down-Hetch-Hetchy clan. Here’s the way columnist Bruce Blog in the radical San Francisco Bay Guardian tries to resolve the situation:
The vote to start public power in San Francisco comes none too soon. The tear-down-the-Hetch Hetchy dam forces have put the nice-sounding Proposition F to study draining the Hetch Hetchy reservoir on the fall ballot. . . . The Guardian's position is that the dam is in place and should only be torn down after the city has real public power and is able to find and afford an adequate new source for the city's water and power supply. And that, let me emphasize, will be a massive undertaking involving billions of dollars and incredible political challenges.
Well, good luck to all these folks. But it sure is nice to know that Diablo Canyon will keep humming along right in the midst of all this controversy.
Monday, September 17th, 2012
By William Tucker
You can’t make this stuff up. For years I’ve been pointing to the Sierra Club’s low-profile campaign to tear down the Hetch-Hetchy Dam in California as an example of sheer environmental hypocrisy. While opposing everything else in sight in favor of “renewable energy,” the Club has also been quietly trying to undo one of the successful renewable energy projects ever built.
To date the campaign had been carried out on the Sierra Club’s website, where the press can ignore it and could go on showering the Club with praise every time they oppose an oil refinery or a LNG terminal. But now the opponents have come out of the closet. Under a new umbrella group, Restore Hetch Hetchy, California environmentalists have put a referendum on the ballot this November saying the City of San Francisco must begin to take steps to dismantle the dam that supplies the city with one-third of its electricity and 85 percent of its water.
Will the City of San Francisco vote to put itself out of business? Don’t be surprised if they do. And will the press finally wake to the idea that the Sierra Club and other environmental groups may be a little impractical in their desires? That’s no sure thing either.
The campaign to tear down Hetch-Hetchy has a long and curious history. The current ballot initiative will only require the City of San Francisco to spend $8 million to draw up plans for a new water system. That blueprint would then be put before the voters in 2016. So there’s plenty yet to come. But the first official move against the dam was actually taken by Donald Hodel, Secretary of the Interior under Ronald Reagan, who in1987 called for a study to see what the natural effects of tearing down the dam might be. The study concluded that the valley’s original tree cover could probably be restored with 50 years.
The move by a Republican Administration stirred confusion in the environmental movement. Sierra Club President Carl Pope later charged that Hodel had taken the initiative only to embarrass Democrats by turning the San Francisco city government against it. If that was Hodel’s strategy, it certainly worked. Diane Feinstein, then the mayor of San Francisco, told the Los Angeles Times, “All this is for an expanded campground? . . . It’s dumb, dumb, dumb,” and is still a major opponent. Even Nancy Pelosi opposes the move. Also lined up against the environmentalists is Silicon Valley, usually an avid supporter. “It basically sends a signal to businesses that a basic necessity — water — is at risk, and it calls into question whether or not businesses would want to stay and invest here,” Mike Mielke, vice president for environmental policy at the Silicon Valley Leadership Group, told The New York Times.
Remarkably, while most of the concern has focused on the water supply, which supplies three other counties in the Bay Area as well, nobody seems to be paying much attention to the electricity. The turbines at the O’Shaughnessy Dam (named after its original designer) generate 500 megawatts, about half San Francisco’s consumption and one-third of the demand from the Bay Area. There’s nothing in the referendum that says how that’s going to be replaced, yet the New York Times story doesn’t even mention power.
Hetch Hetchy has been a sore point for preservation groups ever since its beginning, pitting Sierra Club founder John Muir against Theodore Roosevelt and the budding Conservation Movement. The beauitiful Hetch Hetchy Valley is within Yosemite National Park, 17 miles north of the main valley, to which it was often favorably compared. San Francisco suggested damming the valley in 1903 but was turned down until the San Francisco Earthquake of 1906, which created great sympathy around the country for the beleaguered city. Even then, Congress did not authorize construction until 1913 and the dam was not completed until 1923.
The proposed project caused a fatal split in the budding Conservation Movement. Muir, the son of an Ohio religious family, who had left home as a young man to walk to the Gulf of Mexico, and ended up living alone in the High Sierras for decades, publishing books and eventually becoming famous. Roosevelt enlisted his help in the early days of the Conservation Movement and they camped together famously while Roosevelt was President. But Hetch-Hetchy split the partnership down the middle. Roosevelt and Gifford Pinchot defined Conservation as the “wise use of nature’s resources,” while Muir wanted all-out preservation. The Roosevelt faction won, but the Sierra Club has never forgotten.
The problem of reconciling the preservation of nature with the march of human progress has dogged the Sierra Club throughout its history. In the early 1960s, while the Club was opposing dams in Glen and Grand Canyons, Nobel-Prize-Winning nuclear scientist Glen Seaborg briefly persuaded them to back nuclear energy as the sensible alternative. The Club proposed a reactor in place of Glen Canyon and also supported PG&E’s Diablo Canyon. But executive director David Brower eventually reneged on the decision and led an in-house rebellion. He was defeated by a faction led by Ansel Adams, the famous photographer, but Brower left to found Friends of the Earth, which became uniformly anti-nuclear. The Sierra Club eventually reverted to being anti-nuclear itself – just as it recently embraced natural gas fracking for a brief time before turning against it again.
So what will the Sierras and other environmental groups suggest now to replace Hetch-Hetchy’s 500 megawatts, which play a big part in keeping the lights on all over the Bay Area? Nobody has said anything yet but you can bet it will have something to do with solar energy.
On that they may be able to take an example from the 900-megawatt Rancho Seco reactor in Sacramento, which S. David Freeman, another environmental crusader, persuaded Sacramento voters to close down in 1989 during his brief tenure as chairman of the Sacramento Municipal Utility District. Freeman promised to turn the 2000-acre reactor site into a garden of solar collectors. He did, and they generated about two megawatts. In 2006 this grand solar experiment was supplemented by the 500-MW, gas-fired Cosumnes Power Plant, which now occupies the reactor site.
Thursday, September 13th, 2012
By William Tucker
The first returns are in from Fukushima and the news is good – although it may not amount to much. No incidence of thyroid cancer has been found among 80,000 children examined in the prefecture.
What tempers this finding is that thyroid cancer usually takes four to five years to show up anyway. It’s been less than two years since the accident. In fact, when doctors did find one incidence of thyroid cancer they quickly said it couldn’t have been related to the nuclear accident because cancer would take five years to develop. So what was the use of the study in the first place?
Oh well, the good news is that nothing unexpectedly bad showed up from the first tests. As The Asahi Shimbun reports:
A total of 425 individuals were found to have either a lump of 5.1 millimeters or larger or a cyst of 2.1 centimeters or larger and were told to undergo further tests. Of those individuals, further tests were conducted on 38 individuals, and one was found to have thyroid cancer while 27 were diagnosed as having a benign tumor.
Although the report doesn’t specify, apparently this is not out of line with what would be expected in a similar population.
At Chernobyl, 6,000 people, mostly children, were eventually diagnosed with thyroid cancer and about a dozen died. The cancer is easily treated but sometimes involves removal of the thyroid gland. Iodine-131 is the cause and the main route of exposure is through the food chain. At Chernobyl no one realized this at first and no precautions were taken. At Fukushima every precaution was taken and there does not seem to have been any unnecessary exposure. I-131 has a half-life of only eight days and disappears entirely in a month so the danger is short-lived.
No one has ever decided exactly how many people died or made sick by the Chernobyl accident. The World Health Organization’s 2005 report put the total at 60 and speculated that 4,000 people could eventually die of cancer. The 60 figure was remarkably small, considering that about half these people died in the immediate explosion and the Russians brought in soldiers to throw radioactive material off the roof of the complex with their bare hands. But Greenpeace and other anti-nuclear organization have always called the report a “whitewash” and put out their own estimates of 60,000 dead since the accident and 400,000 long-term. These numbers are achieved by applying the “no safe dose” hypothesis across the board and assuming that the smallest exposures will cause some cancer.
In 2006 Greenpeace scored a huge coup by getting the New York Academy of Sciences to publish a large volume of dubious studies that put the death toll from Chernobyl at over a million. There was the inimitable Dr. Ernest Sternglass attributing an uptick in breast cancer in Connecticut in the 1990s to fallout from the accident in the Ukraine. Other studies were from doctors in Eastern Europe who were obviously intent on incriminating their former Soviet overlords. Standards of proof were not high. The introduction specifically states, “Today’s scientific protocols . . . are not perfect and it is necessary and justified for the whole of society to analyze the consequences [of the accident].” In other words, some of this stuff may not be accurate but we want to put it out there anyway just to see what happens.
Ted Rockwell has labored long and hard trying to get the Academy to disavow the study, but to no avail. "They keep saying they don't take sides on the issue and are just promoting scientific discussion," says Rockwell. "But meanwhile Greenpeace gets to send it all over the world with the implicit stamp of approval from all those Nobel Prize winners on the letterhead."
At the same time, it seems clear that some of the long-range consequences might have been downplayed in the UN Report. Natassia Astrasheuskaya is a Reuters journalist who grew up in a heavily contaminated area of Belarus. Although she was born three years after the accident, she has an enlarged thyroid and says that many people she grew up with have the same condition. But she also notes that some of the worst consequences came from the stigmatization of being a “child of Chernobyl.”
Sympathetic foreigners started organizations to help us. They brought children to Europe for several weeks each summer so that we could fix our teeth, eat healthier food and clean our lungs with fresh air. I was eight when I got to be among the lucky ones to visit England for a month. That was also when I realized it was shameful to admit I was a “child of Chernobyl.” Afraid of radiation in food, an English family refused the box of chocolates I brought from Belarus. “Chernobyl” was the only word they said to me pushing the box away as if it was poison.
There have already been reports of Fukushima victims suffering the same kind of shunning – being refused admission at hotels and told that they are "radioactive." As the UN Report concluded, the greatest damage to the victims may be psychological.
It may never be possible to sort out exactly what happened after Chernobyl. Much of it was obscured by the opaqueness of the former Soviet Union and is now being exaggerated by scientists from former Soviet satellites eager to cast aspersion on their old oppressors. But I have heard stories from neutral observers of children being brought to Europe years afterwards while wasting away from the effects of the accident.
With Fukushima all this will be much easier to sort out. The region of exposure has been much smaller and everything is open to full scientific observation. Fingers crossed, the indications so far are that there have been no serious consequences.
Monday, September 10th, 2012
By William Tucker
If you should happen to be near Chattanooga on Tuesday, be sure to stop in at the Tennessee Valley Authority hearings on MOX fuel at the Chattanooga Convention Center, 1150 Carter Street to say a good word about plutonium reprocessing. It’s going to have a big impact on the future of nuclear energy.
There’s a lot at stake and nuclear opponents know it. Areva is nearing completion of its $5 billion Mixed Oxide (MOX) Fuel Facility at the Savannah River Site in South Carolina, where it will be reprocessing 34 tons of weapons-grade plutonium left over from the Cold War Era. The project comes from a 1999 deal struck by the Clinton Administration whereby both we and the Russians would each recycle 34 tons of weapons-grade plutonium as a step toward ridding the world of nuclear weapons. The Russians are fulfilling their end of the bargain. Whether we will do our may depend on what happens in Chattanooga this week.
The problem is that anti-nuclear groups are trying to block reprocessing, fearing it might work. That would leave them without their favorite tune about nuclear, “What Are You Going to Do with the Waste?” You might think anyone concerned with weapons proliferation would be dancing in the streets at the idea of ridding the world of 34 tons of plutonium. But no, anti-nuclear groups are taking the long view. They want to block reprocessing, knowing that if a lot of weapons-grade plutonium is left sitting around, people will get discouraged about nuclear technology and want to give it up altogether. That will be the real agenda in Chattanooga tomorrow.
Anti-nuclear groups have been trying to halt the Savannah River project for years. They haven’t succeeded and so they have gone on to the next best thing – trying to prevent any reactors around the country from buying fuel form the MOX plant. When the press found in March 2011 that Hanford was considering buying fuel from South Carolina, for instance, it was because nuclear opponents broke the story, giving it their own spin. As the Seattle Times reported: “Officials at the Columbia Generating Station, on the Hanford nuclear reservation, have been quietly discussing the use of so-called mox fuel for at least two years — but had hoped to keep the fact out of the news.” As soon as their deliberations made the papers, opponents were able to shout it down. [http://seattletimes.com/html/localnews/2014539881_plutonium19m.html
Their biggest triumph, however, was a front-page story in The New York Times on April 10, 2011 entitled “New Doubts About Turning Plutonium Into Fuel.” The “doubts” turned out to be those of the Edward Lyman of the Union of Concerned Scientists. As the Times reported:
Eleven years after the government awarded a construction contract, the cost of the project has soared to nearly $5 billion. The vast concrete and steel structure is a half-finished hulk, and the government has yet to find a single customer, despite offers of lucrative subsidies. . . [C]ritics say there is an increasing likelihood that the South Carolina project will fail to go forward and will become what a leading opponent, Edwin Lyman of the Union of Concerned Scientists, calls a `plant to nowhere.’
Even at that time, the TVA was singled out as perhaps the best hope for completing the nuclear fuel cycle:
The most likely customer, the Tennessee Valley Authority, has been in discussions with the federal Department of Energy about using mox to replace a third of the regular uranium fuel in several reactors — a far greater concentration than at the stricken Japanese reactor, Fukushima Daiichi’s Unit No. 3, where 6 percent of the core is made out of mox. But the T.V.A. now says it will delay any decision until officials can see how the mox performed at Fukushima Daiichi, including how hot the fuel became and how badly it was damaged.
Those evaluations are now apparently complete and the TVA is preparing to move ahead. Their opponents will be ready. Greenpeace has already opened an office in Chattanooga and has had “nuclear zombies” roaming the streets in preparation for Tuesday’s hearing.
One issue that may come up at the hearings will be the attempt to envelop the whole project in scandal. The Times took a crack at this in the 2011 story:
A cheaper alternative, encasing [the plutonium] in glass, was canceled in 2002 by President George W. Bush’s administration. The energy secretary at the time, Spencer Abraham, is now the non-executive chairman of the American arm of Areva, a French company that is the world’s largest mox producer and is primarily responsible for building the South Carolina plant.
The implication, of course, was that vitrification would have been far preferable but Secretary Abraham managed to prevent it, to Areva’s advantage – and then landed a job as a reward. I had just finished co-writing a book with Secretary Abraham (Lights Out!: Ten Myths About (and Real Solutions to) America's Energy Crisis) and so I called him up and asked him what had happened. Here is what he told me:
“When the Clinton Administration first struck the deal with the Russians in 1999, the hope was to reprocess all our plutonium into MOX. But our nuclear scientists came back and reported that nine tons of our plutonium was contaminated and could not be recycled. So instead the Clinton Administration agreed to reprocess the good 25 tons and vitrify the remaining nine. The Russians, however, were wary of vitrification. Their scientists believed the process could be reversed and somebody could eventually recover the plutonium. They had developed reprocessing and decided to recycle all 34 tons. The deal was closed in 1999. Since Areva, the French nuclear giant, was the only Western corporation that could do the technology, they got the contract to build the Savannah plant.
“All this happened long before I was appointed President Bush's new Energy Secretary in 2001. By the time I got in, however, the scientists had come back and said they had developed a way of reprocessing nine tons of contaminated plutonium after all. So it became a question of whether to reprocess 25 tons and vitrify the other 9 or reprocess it all. We figured it would be too expensive to do both, since we'd have to build two different facilities. The Russians were still very set on reprocessing so we decided in order not to jeopardize the agreement, let’s go ahead and reprocess it all. That’s why we dropped the vitrifying part."
Abraham did take a job with Areva a year after leaving his Secretary’s job in 2005, but it was done in complete accordance with federal law. And that’s the sum and substance of the scandal hatched out of the brains of the Union of Concerned Scientists.
No, what really concerns the people who will be demonstrating in Chattanooga on Tuesday is that plutonium reprocessing might work. Because if it can be done for weapons-grade material, then it can certainly be done for spent fuel rods as well. And if spent fuel can be reprocessed, then there will be no arguing, “What are we going to do with the waste?”
So be prepared to hear lots of stories this week about the horrors that will abound from putting MOX fuel in Tennessee Valley reactors. Because if the TVA agrees to accept the material from South Carolina, the path to new nuclear construction will be open.
Friday, September 7th, 2012
By William Tucker
Last column I asked whether it might be worth reviving the idea of a carbon tax country as part of an overall at tax reform. Actually, there’s a good example at hand – Australia. So far, however, the results have not been encouraging.
After several years of debate, the Labor Party administration of Prime Minister Julia Gillard finally imposed a carbon regime that began last July. Although commonly referred to as a “tax,” the system is really a permitting scheme that will morph into cap-and-trade-type emissions trading scheme in 2015. The government initially issued unlimited permits at a price of $23 a ton. All businesses emitting more than 25,000 long tons of CO2 per year must buy them. The price will then rise 2.5 percent per year until 2015, when the government will start limiting permits and emissions trading will begin. In 2018, the price will be linked to the European Trading Scheme.
As you can see, Australia is trying to do an awful lot in one swoop. This has created a lot of problems. The first is in the bookkeeping. By imposing the penalty at the smokestack, the government is forced to run around taking measurement at several hundred different point sources. Even municipal garbage dumps are being metered for methane. The possibilities for miscalculation and fraud are rampant. Already there are stories of vendors raising prices by claiming they are impacted by the carbon tax when they aren’t. On top of that, the government has yielded to the noisiest complaints by giving free permits to some of the worst emitters.
Second, for whatever reason, whenever such a tax is imposed governments feel compelled to give the money right back to exactly the same people who are paying the tax. This comes under the well known rule in Washington that it is impossible to get everyone agree on anything unless everybody takes something away from the table.
Part of the tax will fall on residential households through increased electricity rate, so nearly everyone in the country has been granted a tax reduction. This is as it should be since you don’t want the program for becoming just an excuse to expand the government. But it has also become yet another opportunity for redistribution. The cutoff below which people pay no income tax was raised from $6,000 to $18,200 at the start of the program and will rise to $19,400 next year. That’s a lot of compensation for an estimated 9.1 percent increase in electric bills. Everyone in Australia making below $80,000 will get something with people below $25,000 getting the lion’s share.
Businesses and industries with coal-fired generators will also be compensated. Out of an anticipated $8 billion in revenues, $4.5 billion will be refunded to companies that burn coal. There will also be low-interest loans and other forms of redress. All this as a reward for burning coal.
As a result, it wasn’t surprising last week when two months into the new regime the headline in the Brisbane Times was, “Carbon Tax Leaves Big Polluters Better Off.” According to a study performed by the European consulting firm, Frontier Economics:
[B]rown coal generators are, at the very least, around $400 million better off than if the Gillard government carbon pricing scheme had never been implemented. More likely, the gain in value . . is around $1 billion.
When this outcome was revealed, the government immediately responded by canceling plans to pay coal generators to close down some of their plants by 2020. The whole thing had become a reward for polluters Needless to say, this infuriated green groups, who never liked the program much anyway.
It’s fairly easy to see what has gone wrong here. The government is trying to do too much, micromanaging the entire economy instead of simply putting a few clear incentives in place and letting the chips fall where they may.
The first mistake is the attempt to monitor every smokestack. Why not tax carbon at the source. Impose a charge on coal, oil and gas at the mine or wellhead, according to their carbon content. Production records are very well established and it would be surpassingly easy to administer. The levy would be assessed far more widely and therefore could be lower for everyone.
One reason the government didn’t take this route is because it didn’t want to hit the transport sector. This would affect too many people, particularly rural residents. But the whole point of a program like this is to change behavior. Raising gas prices would encourage people to buy more fuel-efficient cars and maybe inspire the auto companies to produce vehicles that can run on cheaper, low-carbon natural gas. Perhaps farm prices should be a little higher to account for the energy they consume. Maybe suburban sprawl shouldn’t be so easy. Governments try to do this by mandating better gas mileage or electric vehicles but what you end up with is cars no one wants to buy because gas is still too cheap.
In order to make any reduction in carbon emissions you are going to have to change behavior somewhere. Thus, the revenues should not be given back to companies that are burning coal but distributed across the entire economy. Only then will we see the behavioral changes we desire.
Of course the best way to reduce carbon emissions would be to develop nuclear electricity but here Australia falls short again. The country has no commercial reactors and has even considered banning its uranium exports, second largest in the world behind Kazakhstan. In 2006, the government-sponsored Switkowski report concluded that a carbon tax would allow nuclear to compete with Australia’s notoriously cheap coal. (The country remains the world’s largest exporter and practically keeps Japan running.) It was the Switkowski report that eventually led to the Gillard Administration to adopt the carbon regime. Unfortunately, nuclear got lost in the shuffle. As a result, all that remains is a mishmash that accomplishes little except to leave the various parties wrestling over the spoils.
Tuesday, September 4th, 2012
By William Tucker
As the possibility looms that Republicans may be back in control of the White House after the election, a debate has once again arisen over whether the nation should consider adopting a carbon tax.
The ground is constantly shifting under this issue. Back in 2007, when cap-and-trade was first being suggested, Steve Hayward, Kenneth Green and Kenneth Hassett of the American Enterprise Institute put out a paper reasoning that a carbon tax would be much easier to administer and would accomplish the same goals without so much government intervention in the economy.
This summer such prominent Republicans as former Secretary of State George Shultz began promoting the idea that a carbon tax could be part of a general effort to overhaul the tax code, using the carbon levy to reduce other streams of revenue such as personal income and corporation taxes. Former South Carolina Congressman Bob Inglis, defeated in a primary by the Tea Party in 2010, started and “Energy and Environment Initiative” at George Mason University in which he is urging Republicans to embrace climate change and the carbon tax.
Faced with the possibility that a carbon tax could be on the agenda in January, think-tank conservatives have suddenly begun to change their minds. In July, Green retracted his previous position:
I no longer believe that such a tax (or, for that matter, other eco-taxes) can be implemented in the sort of ideal, economically beneficent way that people favoring individual liberty, free markets, or limited government might sanction. . . . A carbon tax would simply become another general revenue raiser and a step in carbon-seduction. "Oh, come on, you've already accepted the tax, now let's do cap-and-trade and regulation."
Two weeks ago, Derrick Morgan, vice president of the Heritage Foundation, made an even more elaborate case in a paper entitled “A Carbon Tax Would Harm U.S. Competitiveness and Low-Income Americans Without Helping the Environment.” So even before the proposal gains ground in some areas of conservative opinion, others are turning against it.
First off, there is great irony to all this switching back and forth by principled economic thinkers. Both cap-and-trade and the carbon tax were originally conservative proposals, designed in the Milton Friedman spirit of using market mechanisms and economic incentives to achieve environmental ends instead of government “command-and-control.” When conservatives first broached these ideas (Shultz wrote a cover piece for Harper’s in 1979), environmentalists were originally apoplectic, charging that either system would “legalize pollution” and “make it so only the rich could pollute.”
Their unwillingness to accept the logic of market mechanisms eventually melted away after the first Bush Administration wrung a compromise out of Congress and got it to agree to try cap-and-trade in 1991 in dealing with the problem of sulfur emissions. (Remember “acid rain?”) The results were absolutely spectacular. The original EPA estimate had been that cleaning up sulfur emissions would cost anywhere between $3 billion and $12 billion per year for the first ten years. By 2003, the clean-up had gone 22 percent beyond the original goals and cost only $800 million a year. Environmentalists became the world’s biggest supporters of cap-and-trade, insisting that it used to curb Europe’s carbon emissions. The reason the Obama Administration chose cap-and-trade for reducing carbon emissions is because of these successes.
What worried Hayward, Green and Hassett in 2007 was that the success of cap-and-trade in reducing sulfur might not carry over to the larger carbon market. While sulfur is only emitted from a few power plants using high-sulfur coal, carbon comes from tens of thousands of sources across the entire economy. The bookkeeping would be a nightmare and require a huge government bureaucracy. Also, cap-and-trade standards tend to turn mushy and get bogged down in frauds such as the Chinese companies that have thrown up polluting factories in China and then closed them and sold the “carbon offsets” to European countries. The AEI scholars argued that a straight tax on carbon fuels – gas, coal and oil – would be much easier to administer and resistant to fraud.
So why the think-tank turn against the carbon tax now?
Both Green’s and Morgan’s initial argument is that they doesn’t trust Congress. Green writes:
[W]atching states loot "dedicated" eco-taxes for general revenue, seeing the emergence of more proposals for revenue-raising carbon taxes to finance continued deficit spending, and generally bearing witness to endless insincerity on the part of greens and their allies, I have to admit that my friends in the free-market movement were right.
Morgan quotes Barbara Boxer saying that the proceeds from cap-and-trade permits should not be used to lower business taxes but to reduce taxes for the middle class.
Now leaving aside whether the middle class might benefit from greater business activity, the comment does seem to indicate that any proceeds from a carbon tax might end up as just another means of redistributing income. But remember we’re talking about a situation where the Republicans could control at least the White House and the House of Representatives. Barbara Boxer might not have as much power in a new regime and Republicans might be able to secure a reduction in income and business taxes by dangling a system of reducing carbon emissions before a Democratic Senate.
But Morgan doesn’t stop there. He goes on to argue that a carbon tax would be a general tax on manufacturing, spreading across the entire nuts-and-bolts economy and reducing our international competitiveness.
The flaw in this argument is that it regards the current industrial situation as static. If a carbon tax makes electricity more expensive then things will stay that way forever. But the point of a carbon tax is to level the playing field for other forms of generation that do not produce carbon dioxide. Most prominent among these, of course, is nuclear power. If the increases costs of power can be temporarily offset by lower business and capital gains taxes, the overall impact on the industrial economy could be muted.
Nuclear has long been stymied by cheap coal. Now it is being shut out by cheap natural gas. But if both these forms of energy were made to pay the cost of their air emissions – which is a legitimate concern – then nuclear would become far more attractive. And although policy analysts at the Heritage Foundation and AEI do not seem to recognize it, building nuclear today would make electricity much cheaper in the long run and be a boon to America’s industrial future.
Not surprisingly, Morgan also argues that “choosing to place a tax on carbon is an endorsement of the theory that man-made emissions of GHGs have a significantly harmful effect on the environment.” In other words, his underpinning assumption is that we can forget about all this global warming stuff. But as summer temperature records fall and warmer winters become more common , it is becoming increasingly clear that global warming worriers may have a point. You don’t have to believe that New York City will be underwater in 20 years to be concerned about the buildup of carbon dioxide in the atmosphere. If you are, then nuclear obviously has an important role to play. A carbon tax would be an excellent place to start in reviving the nuclear construction effort.