Energy Fair, based in the UK, has just launched a case before the European Commission challenging a range of subsidies to nuclear power in the UK. Among other issues, the complaint attacks artificially low caps on operator liabilities for accidents and waste disposal. They estimate that the accident liability cap alone, were it removed, would increase the price of nuclear-generated electricity by a minimum of 14 euro-cents per kWh. This would be enough to make the resource uncompetitive with alternatives.
When the World Nuclear Association (WNA), the nuclear industry's global cheerleader, describes potential damages from a reactor accident, they do so in a strategically simplistic way:
There are two basic international legal frameworks contributing to an international regime on nuclear liability: The International Atomic Energy Agency’s (IAEA) 1963 Convention on Civil Liability for Nuclear Damage (Vienna Convention), the Organization for Economic Cooperation and Development’s (OECD) 1960 Convention on Third Party Liability in the Field of Nuclear Energy (Paris Convention), and the associated “Brussels Supplementary Convention”3 of 1963. The Vienna and Paris liability conventions are also linked by a Joint Protocol adopted in 1988.
The Deepwater Horizon oil spill clearly demonstrated that really bad accidents -- the ones that the industry (and too often the government as well) say never happen -- do actually happen sometimes. Not merely a figment of some pointy-headed actuary, these low probability but very large damage events really do need to be built into government policy.
Financial Responsibility for Environmental Obligations: Are Bonding and Assurance Rules Fulfilling their Promise?
James Boyd, Resources for the Future, August 2001.
(Pre-Publication Draft). (Abstract). Inder K. Khurana, Richard H. Pettway, and K. K. Raman. Journal of Accounting and Public Policy, Vol. 20, No. 2. In this study, alternative current cost and present value are utilized to provide estimates of unfunded decommissioning costs to investigate whether investors are cognizant of these potential claims on utility net assets.
Geoffrey Rothwell, Stanford Institute for Economic Policy Research Policy Brief, January 2002.
What is the Cost of Federal Liability Protection for Nuclear Power? Determining the Price of Price-Anderson
Anthony Heyes, Regulation, Winter 2002-2003.
Friends of the Earth, U.K. Briefing provides an overview of British privatization of nuclear fuel cycle facilities and the transfer of site liabilities to the taxpayer.