Nukes and the Free Market

| Mon Mar. 14, 2011 12:05 PM EDT

Matt Yglesias isn't a huge fan of nuclear power, but he still thinks nukes deserve some pushback against critics who are using Japan's current nuclear woes to argue that nuclear power is inherently unsafe:

We’re currently told that the death toll in Japan will be at least 10,000 people of whom approximately zero seem to have perished in nuclear accidents. What happens when a tsunami hits an offshore drilling platform or a natural gas pipeline? What happens to a coal mine in an earthquake? How much environmental damage is playing out in Japan right now because of gasoline from cars pushed around? The main lesson is “try not to put critical infrastructure near a fault line” but Japan is an earthquakey country, so what are they really supposed to do about this?

This is a good point: energy sources of all kind cause problems. Sometimes the problems create screaming headlines (nuke meltdowns, offshore oil explosions, mining disasters) and sometimes they don't (increased particulate pollution, global warming, devastation of salmon runs). But the dangers are there for virtually every type of energy production.

Still, it's worth pointing out that the problem with nuclear power isn't so much its immediate capacity to kill people. As Matt points out, no one has died in Japan from the partial meltdowns at its damaged nuclear plants, and it's unlikely anyone ever will. The control rods are in place, and even in the worst case the containment vessels will almost certainly restrict the worst damage. [Or maybe not. See update below.] The problem with nukes isn't immediate casualties, it's economic viability:

Peter Bradford, a former NRC commissioner, said Saturday that most of those proposed projects were not viable even before the Japanese crisis because private investors were unwilling to fund them, even with government subsidies.

Experts said it was clear that the situation in Japan would further erode enthusiasm and may even affect applications for continued use of existing plants, such as the San Onofre Nuclear Generating Station in northern San Diego County.

"The reason there have been no new nuclear power plants ordered over the last 30 years is the economics of the industry," said Rep. Edward J. Markey (D-Mass.), a senior member of the House Energy and Commerce Committee. "Wall Street has been allergic to any investment in nuclear power in the United States."

This is the problem with nuclear power, at least in the U.S. Nobody really wants to invest in new nuclear plants, and post-Japan they're going to be even less willing. Even if nobody dies as a result of radiation leaks, cleaning up those plants after even a partial meltdown is probably going to be staggeringly expensive. Given that, it's perfectly reasonable for investors to adjust their priors and recalculate their spreadsheets after the events of the past few days, and that recalculation is going to make nuclear power even less attractive than it was before — and that's despite the existence of government insurance guarantees and government subsidies.

It's perfectly reasonable to argue that the problem here isn't that nukes are genuinely more dangerous or more expensive than other forms of power generation, it's that other forms of power generation aren't forced to pay for their own externalities. Charge them properly for the carbon they emit and the mercury they spew and the particulates they make us breathe and they'd be just as expensive and just as dangerous as nuclear power. I think there's a pretty good case to be made for that. Nonetheless, until we do start charging properly for all those externalities, nukes just aren't going to be cost effective and nothing is going to change that.

The answer, then, is to force coal and oil and gas power plants to pay for their externalities properly. However, our most recent attempt to make even modest progress toward that goal went down in flames and the Republican Party has made it crystal clear that they'll fight to the death to keep energy generation from ever bearing its market price. So I'm not really sure what the next step is here.

UPDATE: I'm not entirely sure who to believe at this point, but if the New York Times is right then the Japanese nuclear plants might be in bigger trouble than I thought:

Japan’s struggle to contain the crisis at a stricken nuclear power plant worsened sharply early Tuesday morning, as emergency operations to pump seawater into one crippled reactor failed at least temporarily, increasing the risk of an uncontrolled release of radioactive material, officials said.

....Workers were having difficulty injecting seawater into the reactor because its vents — necessary to release pressure in the containment vessel by allowing radioactive steam to escape — had stopped working properly, they said. The more time that passes with fuel rods uncovered by water and the pressure inside the containment vessel unvented, the greater the risk that the containment vessel will crack or explode, creating a potentially catastrophic release of radioactive material into the atmosphere — an accident that would be by far the worst to confront the nuclear power industry since the explosion of the Chernobyl nuclear power plant 25 years ago.

The containment vessel is supposed to maintain its integrity even if both the fuel rods and the pressure vessel melt down. If there's really a chance that the containment vessel will explode, then all bets are off.