It was pure coincidence that the release event for my detailed review of US subsidies to nuclear power -- a document a couple of years in the making -- was on March 11, 2011, the day of the Fukushima accident. I was in DC for the launch, traveling in a cab to the event with David Lochbaum of the Union of Concerned Scientists, who was also releasing a new report.
The Department of Energy (DOE) is asking Congress to provide hundreds of millions in subsidies to commercialize small modular reactors (SMR). First proposed in the 2011 budget, the Administration has committed to providing more than $500 million dollars for licensing support and research and development for these downsized nuclear reactors. A fraction of the size of conventional-scale reactors, SMRs would be manufactured by assembly line and transported by truck, ship, or rail to their destinations.
The Japanese Parliament has just passed a new law that pumps the equivalent of $26 billion into a fund to pay for damages caused by TEPCO's Fukushima disaster. This is an "initial" contribution, so more could be on the way. Rather than viewing this massive bailout to nuclear power as a failure in all dimensions of the regulatory oversight and financial assurance system of Japan, the payment is characterized as a "major step forward" by Yukio Edano, the chief cabinet secretary.
Though there have been very few quantitative estimates of the subsidy value of the accident liability cap under the Price-Anderson Act, it is clear that this value has not remained static. On the positive side, increases in required coverage over the past 20 years have provided some additional insurance, and sharp increases in plant load factors increase total kWh of nuclear-generated electricity, helping to reduce the subsidy per kWh of power.
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.
Conspicuously absent from industry press releases and briefing memos touting nuclear power’s potential as a solution to global warming is any mention of the industry’s long and expensive history of taxpayer subsidies and excessive charges to utility ratepayers. These subsidies not only enabled the nation’s existing reactors to be built in the first place, but have also supported their operation for decades.
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.