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Not Business but Personal: Nuclear Energy

Professor Ferdinand E. Banks
ferdinand.banks@telia.com
October 10th, 2012

"Not personal but business" is one of the famous lines delivered by Al Pachino in the film'The Godfather'. In this short contribution I move in the other direction, because nuclear energy happens to be an essential input for the maintenance of my standard of living. Without it I might have to play less indoor tennis, reduce my consumption of beef, and definitely would have to stop dreaming about long summer vacations on the French or Italian Riviera, or maybe even the Swedish west coast.

According to a European Commission report, Europe's nuclear reactors require an investment of 10-25 billion euros in order to ensure that a Fukushima-like disaster cannot take place. The expression stress-test is sometimes used when discussing the contents of this report, and in case you are not aware, it is the kind of'lingo' introduced by liars and hypocrites in the United States (U.S.) and elsewhere in order to provide a scientific nuance for their silly condemnations of the U.S. financial system.

More numbers might be useful with regard to this topic. According to the EU Energy Director, Güenther Oettinger, there are 145 reactors in the EU, and turning the 10-25 billion euros cited above into dollars, we find that that we are talking about 92-230 million dollars per reactor. It makes more sense to look at dollars per megawatt, because then we can immediately conclude that an average investment of e.g. $160 million per reactor would put the EU reactor inventory in apple-pie order. Introducing macroeconomic considerations, and employing my familiarity with the unimpressive'efficiency' (i.e. capacity factors) of alternatives for nuclear, leads me to believe that 160 million dollars is nothing less than a bargain.

At the same time I want to inform one and all that if the writers of the above-mentioned report had claimed that EU reactors could be made earthquake and tsunami'impervious' for a measly ten dollars a giga-watt (=1,000,000,000 watts), it wouldn't cause me to change the tone of this appraisal. In choosing between EU engineers and managers, and the kind of parasites and charlatans usually involved with humbug reports of the above kind, I put my trust in the former. I happen to know an enormous amount about the goofy lies and misunderstandings circulated about the frailty of nuclear, and the so-called reliability and economy of the renewable assets that people like the Swedish energy minister want to take the place of nuclear. However, regrettably, not enough to convince her and her employers to leave nuclear policies to those of us who can add and subtract.

Probably because of the Chernobyl nuclear tragedy, the two Swedish reactors across from Copenhagen were liquidated. Sweden is going to need the electric energy that has been lost, although the reactors providing it should obviously not be located across from Copenhagen and next to Malmo (Sweden). The same kind of reasoning applies to Fukushima. The basic issue here is the blatant lack of all-inclusive and imaginative regulation: the kind of regulation that prevents reactors from being wrongly situated. Occasionally I hear that the Japanese government is now determined to ensure that Fukushima is the last nuclear regulation blunder in that country.

Chancellor Angela Merkel has also promised the faithful that she will take steps to ensure that Germany is not the victim of a nuclear accident. Of course, six months earlier she assured the German people that more nuclear was essential. The reason for her change in opinion was a poll, or estimate, or nightmare indicating that in order to remain at the head of the German government after the next election in that country, she would probably require increased assistance from environmentalists and various other anti-nuclear voters outside her party.

Many observers are unconcerned about this bogus democratic foolishness, but since renewables cannot possibly replace nuclear, an actual German nuclear withdrawal would feature a very large increase in their import of electricity. Last year, at a conference in Stockholm, a Belgium researcher claimed that a German nuclear retreat could mean electricity rationing in Belgium. This caused me to tell him and everyone standing next to him that what Belgium should do is to construct a 1500 MW reactor that produces electricity only for Germany, and for which Germans would have to pay the highest electric price in Europe. As for the remainder of the electricity produced in Belgium, it would be reserved for domestic households and industries. This kind of thinking led me to recommend that Sweden should put an export tax on electricity. Why should Swedish consumers play the fool, when mistakes with the production and deployment of electricity could be ruinous for the Swedish economic future?

Earlier I said that a German nuclear retreat would begin with an increased import of electricity, and the leading energy economist in Germany, Jeffrey H. Michel, has indicated that in the course of such a withdrawal, some environmental goals/intentions would be dumped He notes that Herr Oettinger announced in a speech to Merkel's CDU that the EU must be "reindustrialised. The bottom line here is that without a resort to nuclear, reindustrialisation means more coal, a lot more coal, and so it is my sad duty to inform colleagues and students that Germany will not morph into the non-nuclear paradise and roll-model those ladies and gentlemen naively want it to become.

REFERENCE

Banks, Ferdinand E. (2012). Energy and Economic Theory. Singapore, London and New York: World Scientific.

Professor Ferdinand E. Banks
October 10th, 2012
ferdinand.banks@telia.com