At the still eye of the storm

I’m rather amused to see Finland listed as CORE, but not, France. What’s the thinking there? Or is it just that the chart wouldn’t look so attractively symmetrical?

Given the state of the major German parties, I wonder how much significance one could impute to the outcome of even a hotly-contested election. The FDP appears to be dead set on auto-asphyxiation, the SPD hasn’t any perceptible idea what to do with its trinitarian self, let alone anything or anyone else, and the Greens have clearly lost the thread. If that’s what I see when looking on from afar, perhaps the German electorate, being close enough to smell and touch as well as see, is even less sanguine about the outcome.

It reminds me very much of the default support for Obama here. If no one can save us or the situation, the theory goes, maybe we should just close our eyes and go with the person who seems the least crazy or stupid. Best we can do, etc., etc.

Crooked Timber regulars who speak German may find this interesting.
My German wife (I am American) had me take this test:
http://www.bpb.de/politik/wahlen/wahl-o-mat/bundestagswahl-2013/
It asks how you feel about various issues and matches you up with one of the German parties. We were amused to find that I was closest to the Pirates and the Left.

@ Bruce Wilder

But there is an either 5% percent or 3 direct seats election threshold. The pirates are not going to achieve either and are not going to make it into the Bundestag. So you would be somewhat wasting your vote.

Very interesting poll. I found myself closest to the Greens (74%), then Pirates (67), Left 64 and SPD 63. If you’d asked me before the poll I’d have said SPD.

I remember a similar poll in 2008 that matched one’s opinions with the US presidential candidates, when I was rather unexpectedly bracketed with Bill Richardson.

Objectively, has Merkel done a reasonably good job, or does she just look good compared to other European leaders?

My impression is she’s done a relatively good job for Germans, as Niamh alludes to here:

Yet the European dimension of German politics seems to have fallen entirely from sight. Since decision-making in the Eurozone now hinges almost entirely on the German government’s preferences, this matters a great deal.

Blimey – it’s a whole different language. (The grammar of German still defeats me – and I studied it at school. When I’m reading a Romance language I can see what’s going on & leave blanks – “We shall verb the adjective development of the noun“, sort of thing. Reading German is like listening to a detuned radio – “The thing blah shall thing but thing when blah only blah becomes.” Perhaps help it would if more German to read I tried.)

I clicked ‘neutral’ for everything I didn’t understand – about two-thirds of the questions – and ended up in a similar place to others: 61% Pirate, 60% Green, 60% Links and, um, 58% NPD.

Google translate does pretty serviceable work on the quiz.

Die Linke, the Trots, Greens and Pirates all equal to a first approximation. The SPD. Roughly as expected, really.

The same OP title could have been used for another election this weekend: Australia — although there the becalming is associated with an assumption of Opposition victory.

To what extent are the Linke still dominated by the retreads from the Socialistische Einheitspartei Deutschlands? Isn’t Gregor Gysi still very active in the party? What kind of representation does the party have from people who weren’t adults in East Germany?

On the Political Compass I’m almost in the center of the libertarian-left square. What surprised me was how close Obama and Romney are in this depiction.

I was surprised by that as well. I went through the test once as myself and ended up between the Dalai Lama and Nelson Mandela. Then I tried to go through answering as David Cameron would and ended up closer to Francois Hollande. I am not sure whether the test is flawed or I just lack empathy.

Tiny Hermaphrodit, Esq: So you would be somewhat wasting your vote.

You’d be wasting your vote, regardless. And, I don’t say that to be cynical for cynicism’s sake. German politics has broken the periphery economies, but those people don’t get to vote in German elections, and voting in their own elections does them no good.

Neoliberal politics has driven Western European democracy into a cul-de-sac, from which the various flavors of the Left, apparently, can find no exit. That’s the capital fact of European politics. The Euro is, somehow, the critical element, disabling democracy and the Left, leaving Olli Rehn to rulz! The Germans are convinced that their superior virtue distinguishes them from the suffering sinners of Iberia and the Peloponnese, while the real underpinnings of German economic success are dismantled.

The Pirates, like Beppe Grillo’s 5 Star Movement, seems to have run out humor and a platform of just say no, as far as it will go. I do credit them for identifying IP claims as the salient of destructive rent-seeking run amok.

Bruce, with those views Die Linke seems like a very good fit for you, and they will meet the 5% threshold.

On policy, maybe Die Linke would work, but I wouldn’t want to hang out with those folks; we don’t share a taste in nostalgia.

Low unemployment is made possible by a tough-minded strategy of cost containment, which has give rise to new form of ‘precarious’ jobs,

In France, there is at least one book (repeating here, haven’t read it), and a few articles saying something like “the explanation is exporting to the rest of Europe and China, not Mcjobs”.

I don’t see that take on Germany’s recent economic success elsewhere. Is it a local thing?

Hix, I’m pretty sure you already laid out what you believe is wrong with the tariff feed-in several weeks ago on another thread, but I can’t seem to find your comment. Would you mind doing another short summary here? I’ve tried to follow the arguments as relayed by the German press, but they seem to be mostly driven by ideological bluster on both sides.

I ended up on the quiz to the west and south of Die Linke. Heaven help us all! Thank God I don’t have any political “responsibility” to appeal to people to “like” me, when I form my judgments.

dsquared, I reckon it is not the deficit but the total debt that is implied. The result from the deficits since the entry in the Euro.

Hum to limit myself to the 4 biggest problems with the feed in tarif system:
-Sky high photovoltaic feed in tarifs, even after the rather questionable infant industry argument had exhaused all legitimacy caused huge costs from 2009-2012 with not much green energy to show for it. Small photovoltaic on rooftops receives higher subsidies and photovoltaic on agricultural land (which would be the cheapest solar solution) receives no subsidy at all.
-Sky high feed in tarifs for burning plants, which is very doubtfull to have any positive environmental impact at all.
-Financed through a regressive tax.
-Powerplants are included in the EU co2 certificate trade, so the feed in tarifs weaken the co2 certificate system

AFAICT, the German feed-in tariff is below the retail price of electricity, which makes “sky-high” a bit of an exaggeration. If transmission and distribution were properly priced and reflected in real-time consumer prices, the neutral feed in tariff would be the retail price less the cost of transmission to the user, who might well be next door.

Most of the problems arising at present are due to the fact that renewables are exposing the weaknesses in the existing pricing system, designed for coal and nuclear.

@JQ, you’re right that the feed in tariff in Germany is below the retail price, but I am less sure about the rest of your post. For one, the consumer retail price is about half taxes, and I presume those should be subtracted to get something like a neutral feeding tariff.

Another quibble is about your remark ‘might well be next door’. Perhaps I am reading too much I. it, but you seem to imply that local electricity production has intrinsically lower transmission and distribution costs. That’s really not the case.

After all, a grid doesn’t just transport power, it also stabilizes the voltage and phase of the supply. That’s a major driver of cost and scale. When I am consuming 2kw and my neighbour’s solar panel is producing 2kw, all is well. But when I turn a device on or off, or a cloud passes over the panels, there will be a destabilizing imbalance.

A good grid absorbs those by spreading the ripple over a large pool, and by quickly switching backups if the deviations are becoming too large. The regular power outages in some countries are partially caused by a failure to absorb enough imbalances.

To do this stabilzing, you still need a large and expensive grid even when the net flow of power is mostly localized. From what I have heard, both photovoltaic and wind power are somewhat more demanding for the grid in this respect, not less. (Electric cars on the other have potential as stabilizers, if they can coordinate their charging with the grid)

The Germans are convinced that their superior virtue distinguishes them from the suffering sinners of Iberia and the Peloponnese

In Iberia and the Pelopponnese people largely think the same things! They really do!

while the real underpinnings of German economic success are dismantled.

That’s too complex for 99.8% of voters.

Also, the SPD is really useless in terms of making a case, and many people with social-democratic ideas consider them liars and traitors (rightly, IMO). The greens are quite totalitarian and screw-the-poor without even noticing (veggie-day / high energy prizes). The Linke has enough real communists to scare away lots of votes. The pirates are too cute, and squandered a lot of trust by doing really stupid things (appointing the worst idiot they could find as head of the party, a moron by the name Pomader, and mobbing away all the headliners that could have drawn votes), and the FDP has a solid voter base they can count uppon, yet it may not be enough to get into parliament. The anti-Euro party AFD is made of grumpy old men (they are all men) with the typical sex appeal of grumpy old men. That won’t fly.

In sum, Merkels CDU just has to avoid doing something very, very stupid, and they will get loads of votes. The FDP is the loose cannon here, and if it misses entry into the parliament things could get – as boring a ever. The SPD will then take off its mask and betray its voters, and it will be the same policies as always anyway.

That’s my take of it.

@ John Quiggin 41, 46, on renewable feed-in tariffs and Germany’s Energiewende:

–“The German feed-in tariff is below the retail price of electricity, which makes ‘sky-high’ a bit of an exaggeration.”

The FIT is essentially the wholesale price of electricity purchased from the wind turbine or solar panel. It doesn’t include the extras that go into the retail price, which includes costs of transmission and distribution, taxes, etc. It also doesn’t include the costs of building and running dispatchible power plants to back up unreliable wind and solar generators when they fizzle out en masse for days on end.

Current wholesale spot electricity prices in Germany are running in the 30-40 euros/Mwh range. FITs for onshore wind are 80-90 EU/MWh, resetting to about 49 EU/MWh after 5 years. Solar FITs are about 120-180 EU/MWh, depending on the size of the rig, for 20 years. (Greater than 10 MW solar plants get no FIT; the government wants to discourage them because the grid is overloaded with solar surges.) So FITs are 2 to 4 times higher than the corresponding wholesale cost of electricity from the dispatchible generators they are allegedly displacing. The current Renewable Surcharge that funds the FITs is 5.2 euro-cents per KWh, which is about 60 percent of the average total *retail* price of electricity in the United States; it will rise another 15-20 percent next year. Electricity from wind and solar is expensive–utilities buy it only because the law forces them to.

–“The neutral feed-in tariff would be the retail prices less the cost of transmission to the user, who might well be next door.”

Your statement suggests that transmission costs from a renewable generator to a “next door” user would be priced lower because of the short distance. No, grids don’t work that way; the electricity all goes into and comes out of the grid as a whole. It’s meaningless to conceptualize specific electrons making the short journey from your rooftop solar array to the house next door; that’s like imagining that you can pour a bucket of water into a river, run downstream a hundred yards and draw out a bucket containing the same water molecules that you poured in.

The idea that wind and especially solar are a neighborly “local” power supply that obviates the need for long-distance transmission is one of the most persistent and wrong-headed green myths. In fact, system-wide transmission costs will rise, not fall, with increasing wind and solar penetration. Because they function in a chaotic surge-and-slump mode, with common-mode overproduction and failure across large areas, wind and solar require much more long-distance transmission to connect regions of local surplus and deficit than do dispatchible generators, which can ramp up and down to service fluctuating local demand.

The problem will only get worse as wind and solar penetration rises. In full sunlight your solar panels will overproduce electricity far beyond household needs, and so will all your neighbors’. To avoid shorting out the local grid, or simply wasting the electricity, that power will have to be exported hundreds of miles to a cloudier place. Conversely, when clouds cover your panels and all your neighbors’ as well, electricity will be imported from a sunnier clime hundreds or thousands of miles away.

That’s why Germany is currently spending tens of billions of euros to build more transmission capacity to shuttle wind and solar electricity around the country, with much more to come. Those systemic transmission costs are separate from the renewables surcharge and will be borne by all rate-payers rather than the wind and solar generators that are causing the need for them—yet another huge, regressive subsidy to the German renewables boondoggle.

Will Boisvert @ 47

Thanks to you also for weighing in. For my own selfish benefit, and at the risk of derailing the thread still further, I have a few additional questions:

1. Despite its seemingly overwhelming economic aspects, isn’t this primarily a political problem?

My view as an outsider, and a somewhat ignorant one at that, goes something like this: First, the direct economic costs of the Energiewende as presently constituted are enormous, and very visible. Second, the economic benefits from addressing the hitherto overlooked external costs (climate change, pollution, etc.) still look nebulous at best, and dubious at worst, to voters who hadn’t studied the issues in detail.

On the surface, at least, it must not have looked completely irrational to politicians to do the popular and easy thing first, i.e. to subsidize the generating technologies. It must also have looked an absolute no-brainer to offer skeptical consumers pondering a solar rooftop installation a sweetener in the form of direct compensation for their excess capacity. Profiting from the disaster at Fukushima must have seemed irresistible also, in that it appeared to offer politicians all the cover they needed to set a more ambitious timetable for retiring the sunk cost in nuclear generating capacity, whether the industries involved liked it or not. It also made a certain amount of sense, didn’t it, to put off addressing the huge capital investments in the grid necessary to handle the intermittent nature of renewable energy until the subsidies to the generating technologies started to show some traction?

It would have been nice if everyone had agreed on this strategy, but I suppose one should have expected organized opposition by those whose capital investments, and the return on them, were most likely to be disrupted. In a more benign political universe, no doubt even the most uncooperative of these folks might have been more easily mollified.

2. Assuming that the technical issues can be resolved, what kind of capital investments, and what sort of time frame look to you to be necessary to restructure the grid for the changes in generation pattern that accompany a wholesale change to renewables?

3. Is there a way to have done all this that would have made you and hix happy, or do you think that replacing significant fossil fuel and nuclear generating capacity with renewables in the short to medium term is in fact a chimera?

JQ says “@Zamfir You’re right about taxes, except if these are supposed to be Pigovian taxes offsetting local or CO2 pollution.”
Yeah, though I find it hard to disaggregate some truly intended Pigouvian component from all the many reasons why a tax got set at its actual level.

It is probably easier to directly consider whether feed-in tariff is at a reasonable amount given the benefits and promises of a power source, than to subtract the Pigouvian tax first an then consider whether the remainder is suitable given the benefits that are not already intended to be covered by the Pigouvian tax…

I’d say that “sky-high” is a defendable term for the past levels of the German feed-in tariff for PV, though perhaps not so much for the current levels. They were not just many times higher than the market rate for power, but also than the feed-in tariffs for other renewables, or any other subsidy or tax to compensate for the environmental effects of power generation. If solar power got a reasonable amount of money, then alternatives to it got dramatically underfunded.

In total, the Germans spent an enormous amount on PV panels. Somewhere between 50 and 100 billion euro, for a country that is far less suited to them than Australia. The money probably helped to improve the worldwide PV industry to its current level. That’s a worthwhile thing, but this cannot possibly have been anywhere near to best way to achieve that goal, let alone to improve renewable energy technology in general.

Will Boisvert is, IIRC, advocating a massive expansion of nuclear, which leads me to doubt his grasp of the economics, and to give little credence to authoritative-sounding claims he makes – my experience of nuclear advocates is that these claims aren’t reliable.

@ John Quiggin, 53:

“Will Boisvert is, IIRC, advocating a massive expansion of nuclear, which leads me to doubt his grasp of the economics, and to give little credence to authoritative-sounding claims he makes—my experience of nuclear advocates is that these claims aren’t reliable.”

John, it might make for a more edifying discussion if you could specify which of the claims that I made you consider unreliable, and why.

Folks, if anyone is interested, many of the arguments I am making are drawn from an extensive critique of the Energiewende, and especially its rejection of nuclear power, that I recently wrote for Dissent magazine. You can find it here, complete with statistics, sources and an exchange with Osha Davidson: http://www.dissentmagazine.org/article/green-energy-bust-in-germany

My mistake at 56:

That nuclear construction cost should be 370 billion euros, not $370 billion.

Couple of comments
Re: Piraten (e.g. Bruce @6 Tiny @7): Biggest issue with Piraten is that their gender politics are to the right of the CDU. Not just are women – unsurprisingly – underrepresented among their members, they show very little interest in changing this, don’t have a quota for their party lists (the CDU has a 30% quota) and have leading members calling gender quotas “boob-bonuses (Tittenbonus). To me a sexist party isn’t any more attractive than a racist one.
On the other hand, if you still would want to vote for them, you wouldn’t be throwing your vote away. For one, such a vote sends a signal about the importance of the central topics of the Piraten to other parties. More tangibly, though, since Germany campaign funding depends largely on the number of votes received, a vote for the Piraten equals a donation of 0.85 cents. So no – as long as you’re voting for a party that’s at all relevant (1% is the threshold for campaign finance), you’re not throwing your vote away. That shouldn’t be a factor. (Plus, I think it’s hard to argue even for someone firmly committed to team lesser evil in the US that the choice between Merkel and Steinbrueck has deep, existential consequences)

Re: regressive taxes – I’ve learned from Lane Kenworthy not to worry about regressive taxes. The USA has the most progressive system of taxation among all OECD countries…

Re: Greens & vegetarianism – “meat free Fridays” was indeed a proposal to canteens, certainly not a suggestion to pass a law. That said, I think this alone will have me voting Greens again. Apparently they’re still the party that says things that should be commonly accepted (like: current meat-consumption patterns are an ethical disgrace and an environmental disaster, or, back in 1998, gasoline needs to become much more expensive), but are considered “stupid” by the German equivalent of the Very Serious Persons. Incidentally, Greens & Linke also have the clearest pro-European economic policies in their platform. Finally, while the Greens don’t have the greatest record for standing up against bad policy when in power, they do have a very good record at governing. The Green-run ministries were, by all accounts, very well run during the last red-green government and they have a very good record in their ministries at the state level as well.

As for nuclear energy: If the owner of nuclear plants are able to insure their plants on the free market to a limit that’s a reasonable estimate of a worst case (as pretty much everyone else has to), I’m maybe willing to listen. Currently, in Germany, they’re covered up to about 3billion Euros, which is considered high internationally (in Will’s beloved France that sum is 100 million (!) Euros). Estimated costs of the Fukushima disaster to date are in the vicinity of 100 billion Euro, worst case estimates go as high as 6 trillion Euro. So yeah, I think JQ is right that proponents who argue nuclear power is “cheap” don’t understand economics.

You’re right. Given that there is no major German company with a male CEO and less than 10% of corporate boards are male, more than 60% of cabinet secretaries are female and the large majority of university faculty is female, we really should start addressing structural discrimination against men.

@ John Quiggin 58, on the costs of nuclear:

“Under current conditions, nuclear is uneconomic even with generous subsidies, loan guarantees, etc.”

–John, it’s arguable that over a 60+ year reactor lifetime nuclear is the cheapest energy source of all except hydro. But yes, during the first few decades when it is paying off its mortgage, it may need subsidies to compete in a neoliberal marketplace against coal and gas—just like wind and solar do.

Nuclear’s levelized cost of electricity is generally held to be cheaper than every renewable except hydro and onshore wind in good locations. But LCOE doesn’t capture all nuclear’s cost advantages. After it pays off its mortgage it has many decades left of very low-priced production, whereas wind and solar wear out in 20-30 years and thus spend most of their time in a high-priced mortgage-paying regime; so averaged over a lifetime’s service nuclear is substantially cheaper. Another difference is that wind and solar impose externalities on the grid, like extra transmission costs, that nuclear doesn’t. The biggest difference is that wind and solar are so unreliable that they require “back-up” by fossil-fueled generators that entails ongoing massive carbon emissions, so they can’t comprehensively decarbonize the energy supply the way nuclear can.

Greens demand subsidies, feed-in tariffs, renewable portfolio standards, loan guarantees etc for their preferred technologies of wind and solar, but then insist on total neoliberal austerity for nuclear—no subsidies at all, sink or swim in the marketplace. That’s inconsistent and irrational. We should compare low-carbon techs with each other, and plump for the ones that will most expediently abate fossil fuels. Nuclear has shown that it can do that faster, cheaper and more completely than wind and solar.

–“You cite the rapid construction of Gen II reactors in France and elsewhere in the 1970s as your primary evidence that a large-scale nuclear build is possible. That’s totally irrelevant today, as evidenced by the failure of all recent French projects.”

–It’s not just France. Sweden decarbonized almost all of its grid by the 1990s with half nuclear and half hydro. The United States and Japan built 100 and 55 nuclear reactors over a couple of decades, also at competitive costs. Japan built several Gen III reactors from 2000-2009, on time and on budget, at costs of about $3000 per kilowatt. South Korea has decarbonized about 30 percent of its grid with nuclear power. It also has Gen III plants under construction, with ontime five-year builds and on budget at under $3000 per kilowatt.

China is building a large reactor fleet, and has brought several reactors online recently after five-year builds, with costs of $2-3000 per kilowatt. China is also building two Gen III French EPR reactors. They will open next year after five year builds, at about $3000 per kilowatt, one half the cost of the EPRs in Finland and France.

So rapid construction of large nuclear fleets at affordable costs is the rule, not the exception, both in the past and currently.

China is an excellent test case because it is also building enormous wind and solar capacity, and the head-to-head comparison clearly shows the economic advantages of nuclear’s tremendous productivity and reliability. Last year China’s 13 gigawatts of nuclear, which cost about $33 billion to build, produced as much electricity as its 76 gigawatts of wind turbines, which cost about $115 billion to build. China’s wholesale feed-in tariff for new nuclear, at 0.43 yuan, is therefore considerably cheaper than wind’s FIT of 0.51-0.61 yuan and solar’s 0.75-1.15 yuan.

The EPRs in France and Finland indeed have horrendous delays and cost overruns. That’s because of the rustiness of an atrophied construction industry and supply chain unused to building these first-of-a-kind designs. It’s also in part because of political opposition and regulatory red tape that drives up costs. For example, the French EPR was forced into a pointless one-year “pause” after the Fukushima accident because of feckless political anxieties.

Large-scale, systematic nuclear construction programs under stable regulatory regimes, sufficient to develop economies of scale and experience, reliably yield lots of nukes at a reasonable price– as is happening now in China and South Korea.

–“Nuclear power has had a chance, under highly favorable conditions in the US since 2002. Generous subsidies and hardly any political opposition.”

John, there is tremendous political opposition to nuclear power in the States. Several states have laws banning new reactors. The governors of Vermont and New York have loudly campaigned to shutter nuclear plants in their states. Every nuclear project faces repetitive lawsuits, and the regulatory red tape is strangling.

The loan guarantees you mentioned have not yet been dispensed. The Vogtle project was awarded $8.3 billion, but has not settled terms for the guarantee with the government and may not ever; the project is proceeding anyway. The VC Summer project is proceeding without any loan guarantee. There is some subsidy; both plants will get a 2.2 cent per KWh federal tax credit on their first ten years’ electricity production, same as wind. (That subsidy is capped at the first 8 GW new nuclear build.)

The main obstacles to nuclear in the US is very cheap natural gas and slack electricity prices, which have led to the closure this year of two small nuclear plants with unusually high overhead. There’s no question that right now neoliberal electricity markets are hostile to nukes. They would be just as hostile to wind and solar were it not for subsidies and, more importantly, renewable portfolio standards that require utilities to buy wind and solar at above-market prices.

–“If you were proposing a policy for the US, what changes to the existing setup would you suggest, and how much nuclear plant would be built as a result?”

I would make three changes to the existing regime, essentially replacing financial incentives with firm statutory decarbonization targets that would include both renewables and nuclear:

1) Scrap all financial subsidies and incentives to low-carbon generators—no feed-in tariffs, no tax credits, nothing for renewables or for nuclear. Subsidies beget counteproductive market distortions, like negative pricing.

2) Change the current system of renewable portfolio standards to a “low-carbon portfolio standard,” which would include nuclear along with wind, solar and other renewables. (Biomass and biofuels should be excluded because they are too destructive of agriculture and wildlife habitat and may not even be low-carbon).

3) The low-carbon portfolio targets should be raised and speeded up, requiring a complete, 100 percent decarbonization of the grid by 2030.

It would then be up to utilities to decide how to meet the requirements. If they can decarbonize faster, cheaper and more expediently with renewables, they could do so; if they can do better with nuclear, or some mix of nuclear and renewables, they could do that as well. My guess is that on a level playing field nuclear will be the best option in most circumstances.

I think that’s a simple, rational and fair regime, and a much more vigorous response to the crisis of climate change than the current subsidies and preferments. If renewables can get the job done, great. But if they can’t, we need to let nuclear get on with it—history proves that will work.

Will, the costs of Fukushima include

1. Total write-off of four power plants
2. Large-scale & continuing attempts to prevent radiation leaks (cost at least $50 billion on latest estimates, but these are almost certainly too low)
3. Evacuation of surrounding population (160 000 people), and effective loss of their homes, farms etc for an indefinite period. Cost at least $100 000/person or $160 billion

I wouldn’t be surprised to see the eventual costs top $300 billion, or $1 billion per GW of installed nuclear in the world.

You may say that evacuation was unnecessary, but your argument from background risk doesn’t work – what matters is the risk faced by people who choose to stay in the area, and that is not negligible. In any case, the evacuations happened, and will happen again with a similar disaster

Will, there are 50 states in the US, so Vermont and NY don’t matter much. The Federal government and most states are pro-nuclear, and there is no significant protest movement (unlike against coal). The fact that no plants are being built reflects the fact that the people who have to put up the money don’t believe the kinds of estimates you are citing.

@ John Quiggin 65, on Fukushima costs:

–“Evacuation of surrounding population (160,000 people), and effective loss of their homes, farms etc. for an indefinite period. Cost at least $100,000/person or $160 billion.”

Er, that’s actually $16 billion, not $160 billion. There goes half your $300 billion price tag.

–“Total write-off of four power plants.”

Do you mean “plants” or “reactors”? Four reactors at Fukushima Daiichi are write-offs. But none of the “plants” are total write-offs. Fukushima Daiichi reactors 5 and 6 were undamaged and could be started right back up, which would help defray cleanup costs and provide much-needed cheap electricity. Both the Three Mile Island and Chernobyl plants remained in service after their accidents, running their undamaged reactors.

–“Large-scale and continuing attemtps to prevent radiation leaks (cost at least $50 billion on latest estimates, but these are almost certainly too low)”

–Right, cleaning up the Fukushima Daiichi plant is the biggest identifiable line-item. I have read figures in the $50 billion ballpark so it’s not inconceivable that it could go that high, though I doubt it.

It’s worth asking whether all that expense is justified. For example, the leaks of radioactive water that have been making headlines lately sound terrifying, but they are actually quite innocuous. The Pacific Ocean is a stupendous reservoir of natural radioactivity that dwarfs by countless orders of magnitude anything that Fukushima can add. Even if all the radioactive water were allowed to flow unimpeded to the sea for hundreds of years it would not raise the radioactivity of the Pacific by even one percent. The plant could immediately dump most of the radioactive water, which is only lightly contaminated and perfectly safe, and concentrate on decontaminating the small volume of very contaminated water before dumping that into the sea too. That rational approach would cut costs; nothing prevents it accept radiophobic superstition (and international treaties, but I repeat myself.)

–“What matters is the risk faced by people who choose to stay in the area, and that is not negligible.”

I think it is negligible. Again, even by the estimates of anti-nuclear academics, we’re talking a (purely conjectural, too small to empirically measure) toll of perhaps 1500 cancer deaths over a lifetime among a population of perhaps 150,000. That’s a one-in-a-hundred chance of dying from the Fukushima radiation, even if you never evacuate and live your whole life in the maximally contaminated evacuation zone. In other words, almost everyone living in the Fukushima EZ will never suffer any health problems from the radiation.

I’m justified in calling that risk “negligible” because people do routinely ignore risks of that size in other contexts. Your chances of dying in a car crash are about one in a hundred, yet no one stops driving or calls for the abolition of autos because of it. People smoke and drink and overeat, which pose far greater cancer risks than Fukushima EZ radiation does—everyone knows the risks but they don’t care. Living in Tokyo with its bad air quality is a greater health risk than Fukushima EZ radiation, but no one calls for the evacuation of Tokyo. Living in Denver gives you a bigger radiation dose than living in much of the Fukushima EZ does, yet no one calls for the evacuation of Denver.

The only reason people fear nuclear reactors is because of a grand cultural mythology that imputes literally magical risks to radiation levels that are actually no more dangerous than many other daily risks that we shrug off.

–“The evacuations happened, and will happen again with a similar disaster.”

–Remember, the evacuations were mandatory. People who didn’t leave voluntarily—and there were some—were evicted from their homes by soldiers in haz-mat suits. I’m against mandatory evacuations; they are a violation of human rights. (And in fact, they probably killed more people than would have died from the radiation had their been no evacuation).

You’re right that many people will evacuate during any nuclear accident. But I think that if the evacuations are voluntary instead of mandatory, and if people are given accurate information about radiation levels and likely health risks, than rationality and common sense will kick in and most people will stay in their homes. I live 30 miles south of the Indian Point nuclear plant; I know the science and the risks, and I will stay if it spews

but spread over the colossal amount of electricity nuclear reactors produce, it’s actually quite a modest cost per kilowatt-hour

This made me laugh.

@ adam.smith 72, on the costs of covering nuclear accidents:

–“The reference for the $6 trillion is the study referenced here…I’m not particularly interested in discussing the details of that estimate…You can find various similar studies that weren’t commissioned by interested parties.”

Adam, your “study” estimating a price tag of $6 trillion for a nuclear accident was paid for by Germany’s Association of Renewable Energy. That’s a trade group of businesses that are direct competitors of nuclear power and have a financial stake in stirring public opposition to nukes. I don’t know if it furthers the debate much to uncritically repeat such obviously biased sources, especially if you refuse to discuss the details and scientific merits of their estimates. Any links to the other studies that you mentioned?

–“Your back-of-the-envelope calculations on insurance costs is cute, but that’s of course not how statistics and/or risk management work. I’ve driven almost 20 years without any accidents. That doesn’t mean the cost of insuring my car is 0….But given the way you’re calculating risks, that should be the case.”

Adam, you’re mischaracterizing the calculation I did at 70. My result was not that the cost of insuring for nuclear accidents was 0. My estimate was that, if you assume a Fukushima-scale accident costing $300 billion (your own high-end cost estimate) every 25 years, then the appropriate insurance premium would be 0.44 cents per kilowatt-hour.

That actually is how insurance premiums are calculated. Actuaries estimate a probable frequency of some mishap over time, then estimate a probable payout per mishap. They then set policy-holder premiums such that they will in aggregate match the probable total payout over that period of time, plus a little extra for profit and fudge factors.

That 0.44 cents/KWh is surely an overestimate. As I argued above, if you do look in detail at the “costs” of the Fukushima spew, you find they are wildly inflated by overcompensation for nonexistent harms from radiation levels that pose no observable risk. Moreover, the frequency factor of once every 25 years for future accidents is also overstated. Nuclear power has a learning curve, and in fact nuclear accidents per reactor year have been dropping sharply over the decades.

Is Fukushima a statistical fluke, an unusually low-cost accident? No, it sure isn’t. The Three Mile Island meltdown harmed no one, on or off site, and the offsite insurance claims were settled for about $100 million.

How about Chernobyl? I don’t think there are any reliable cost estimates for that. But if you look at the empirical evidence of observable harms, you find that they are modest. The authoritative UNSCEAR study did note some serious health effects. Several dozen firefighters died from acute radiation poisoning. 6,000 thyroid cancer cases arose from the failure to warn peasants not to drink tainted milk from their cows. (Fortunately, thyroid cancer is readily treatable so only 15 deaths resulted). “Liquidators” who got the highest doses face a small increased risk of leukemia that wavers on the drink of statistical significance, which might in total account for a few hundred cancer deaths. Other than that, there is no clear evidence of any harm to civilians and “the vast majority of the population need not live in fear of serious health consequences from the Chernobyl accident.” Tragic as these deaths and illnesses are, they pale next to the yearly toll of hundreds of thousands of deaths from air pollution emitted by coal-burning power plants.

Nor is the Chernobyl Zone of Alienation actually an uninhabitable dead zone. Thousands of peasant remained there illegally after the evacuation. The Chernobyl nuclear plant, right at ground zero, kept operating for 14 years after the accident, with no notable health effects among the staff. The town of Chernobyl is a tourist trap with ambient radiation levels lower than Denver’s. The permanent closure of the zone was a hysterical overreaction to radiation levels that pose only modest health risks that we would blithely accept in any other context. $300 billion would almost surely be an overestimate of the objective damage caused by the Chernobyl fallout (as opposed to the unwarranted overreaction to it.)

Nuclear power has a substantial track-record of accidents from which to draw conclusions based on real-world evidence. A mountain of empirical data shows that the objective costs in terms of lives lost and land rendered unfit are modest to nil. The only thing wrong with my 0.44 cent estimate of the per-KWh cost of accidents is that it is undoubtedly much too large.

The alternative that you’ve suggested, Adam, is that we reckon nuclear insurance costs by cherry-picking outlandish worst-case scenarios written by business groups with a direct financial stake in fomenting anti-nuclear panic. I have misgivings about that approach. Risk assessment should be based on empirical evidence. Otherwise it’s just propagandists blowing smoke about imaginary black swans.

We should also offset the insurance costs with the value of the lives that nuclear power plants have saved by abating pollution from fossil-fueled power plants. NASA climate scientist James Hansen reckons that nuclear power has saved about 1.8 million lives net over the last few decades, with potentially 400,000 to 7 million more saved by mid-century. If we value a life at, say, $1 million, that’s a $1.8 trillion benefit so far, which over fifty years would work out to at least 1.3 cents per KWh.

By any rational pricing, the observed benefits of nuclear power drastically outweigh its conjectural risks.

VC Summer is late, but claims to be still under budget
http://www.bizjournals.com/charlotte/blog/power_city/2013/06/scana-nuclear-plant-falls-off.html?page=all

my point was that you can’t derive any reasonable estimate about the distribution of costs of disasters from two n=2 and that you can’t get a reasonable estimate about the distribution of frequencies, either (though it’d be less useless than the cost estimate). My car insurance example just illustrates that actuarial math isn’t terribly useful when you’re dealing with low frequency events.

But I’d be perfectly happy if nuclear plants had to insure liability up to 300 billion dollar. If you’re right, the costs of this are negligible. The fact that the nuclear lobby would (and does, whenever it’s considered) go crazy about that idea suggests it isn’t.

@ John Quiggin 74, on why they are building so much more wind than nuclear in the US.

–It’s all about the subsidies and preferments John, not cost advantages or the wisdom of the market.

New nuclear gets a 2.3 cent per KWh tax credit subsidy, but only for the first 6 GW of new build (so it’s already mostly used up by the Vogtle and VC Summer projects.) The tax credit also expires after the first 8 years of service, and is capped at $125 million per reactor per year; with the colossal output of an AP1000 reactor that actually amounts to about 1.4 cents per KWh. Nuclear is excluded from renewable portfolio standards except in Ohio. New nuclear is eligible for $18 billion in loan guarantees (which would actually suffice for only a few projects) but Vogtle may not get one and VC Summer definitely will not and has not even applied for one.

Wind gets a lot more. All the wind capacity built, no limit, gets the 2.3 cents per KWh tax credit for ten years on every KWh produced, no cap. Wind farms are eligible for loan guarantees, as are other renewable companies like Solyndra, as well as for many other state subsidies. Most importantly, they are eligible for renewable portfolio standards everywhere. Utilities buy wind power at above-market prices because the law requires them to.

So because wind has a captive market from RPSs, it can charge above-market prices and then make more money with the subsidy. That spells state-guaranteed profits—no wonder Wall Street loves to invest in it! But if wind subsidies and preferments were ended, no wind at all would be built because gas plants are cheaper and more profitable in the short term.

If nuclear got the kind of subsidies wind gets and were included in portfolio standards, I think a lot more reactors would get built.

Will, I hadn’t followed South Korea, so I hit Google. Every story I saw was a variant of the following

http://www.nytimes.com/2013/08/04/world/asia/scandal-in-south-korea-over-nuclear-revelations.html?pagewanted=all&_r=0

So, I can’t see South Korea as a likely model, and I’m confident from what I know about China in general, that similar stuff is happening there. You can say it doesn’t really matter, and the risks have been overblown, but what is the point if the mass of the world public is beyond reach with this kind of claim?

I honestly don’t think there is any serious chance of a large-scale shift to nuclear in time to make a substantial contribution to decarbonisation. If that’s right, then it’s incredibly damaging to advocate for nuclear by making a case for the prosecution against renewables, which is how I read you.

@ John Quiggin 81:

–“it’s incredibly damaging to advocate for nuclear by making a case for the prosecution against renewables, which is how I read you.”

John, all I’ve done is accurately point out the difficulties in cost, pacing and completeness of current efforts to decarbonize using renewables, and that nuclear power has done much better in the past and could do so now. I have not said that we should abandon decarbonization efforts, in fact I have argued that we should accelerate them greatly over current timelines advocated by greens. I do not argue that we should stop building renewables.

My only policy prescriptions are that we 1) stop shutting down nuclear plants and 2) treat new nuclear and renewables on a level playing field in decarbonization mandates and let utilities decide which technology does the job better. If you really take decarbonization seriously, and believe that renewables can do it cheaper, faster and more completely, I should think you would welcome my proposals.

I feel that you are not engaging with the substantive and detailed arguments I’ve made, nor even reading them. So I think we’re at an impasse. Readers who slog through this thread–anybody out there?–can decide for themselves which of us has made the stronger case.

@ John Quiggin 84:

“Across a wide range of policy regimes, some highly pro-nuclear, utilities aren’t choosing to invest, and are even voluntarily closing existing plants (which they wouldn’t do if your claims about operating costs were correct.)”

You’re talking about the US situation here (worldwide hundreds of billions of dollars are being invested in nuclear.) But even in the US utilities are currently investing tens of billions of dolars in 5 new reactors, as I pointed out above.

The Kewaunee and Vermont Yankee plants that you refer to have been closed because of low electricity market prices due to a glut of natural gas. They were also hurt because they were small plants with high overhead. For example, Vermont Yankee has a capacity of 620 Megawatts and a staff of 630. The Indian Point nuclear plant has a capcity of 2050 MW and a staff of 1100, so just half the per-MW staffing costs of VY.

The closure of Kewaunee and VY are tragedies for the planet—both produced many times more low-carbon electricity than all the wind turbines and solar panels in their respective states, and at a lower cost. Had nuclear plants been included in their states’ low-carbon portfolio mandates, as I have advocated, both plants might have weathered the gas glut and continued fighting climate change and air pollution for another 20 years.

As I pointed out above, no commercial wind or solar would be built in the US without subsidies and mandates, because gas is cheaper and more profitable. I’ve suggested that nuclear simply be included in the same portfolio mandates with renewables to stimulate more investment, an approach you’ve dismissed out of hand for no clear reason. I’m disappointed to see you siding with the short-sighted decisions of neo-liberal electricity markets and against wise long-term regulatory policy.

@ John Quiggin 84:

“On any remotely realistic scenario, we aren’t going to see substantial new capacity coming online before 2030. So in practical terms the choice is either renewables or disaster.”

John, there are currently some 65 new reactors under construction worldwide in Asia, Euope, North and South America, with hundreds more planned by 2030. Given that the average nuclear kilowatt produces 3 to 6 times as much low-carbon electricity per year as the average wind or solar kilowatt, and lasts two to three times longer, the decarbonization impact of these new nuclear builds will rival and possibly exceed that of all the wind and solar combined that’s built by 2030. Nuclear could accomplish even more, even faster, if purely political barriers, like Australia’s ban on commercial reactors, were removed.

I’m afraid the choice isn’t renewables or disaster, it’s renewables *and* disaster—at least if we insist that nuclear have no role. Take Germany’s Energiewende, the world’s flagship policy of prioritizing wind and solar and shuttering nuclear, which has been in place since 2000. In 1999 the fraction of low-carbon electricity on Germany’s grid was 36 percent. In 2022, when the last nukes shut down, assuming renewable targets are hit, then the fraction of low-carbon electricity on Germany’s grid will be 38 percent–a net total of 2 percent of the grid decarbonized over 23 years. That figure, according to official targets, will struggle up to 50 percent in 2030 and 80 percent in 2050, so an additional 44 percent of the grid decarbonized over 51 years. If you just count 2022 to 2050, that will be 42 percent of the grid decarbonized over 27 years. (And that’s only if you count biomass burning as low-carbon, which we really shouldn’t.) In the meantime, Germany is burning more coal and its air pollution and greenhouse emissions are rising.

That’s a disastrous performance by any standard. France, by contrast, decarbonized 90 percent of its grid from a standing start in just 20 years using nuclear and hydro. Sweden clocked similar accomplishments with nuclear and hydro.

All these facts speak for themselves. Contrary to your claims, John, the combination of nuclear and hydro can and will hit decarbonization targets much faster, much cheaper and much more completely than all-renewables schemes do.

If you really care about decarbonization, you’ll support nuclear.