Showing posts with label We Read It so You Dont Have To. Show all posts
Showing posts with label We Read It so You Dont Have To. Show all posts

Thursday, February 28, 2013

The inherent shallowness of "market-based" arguments against nuclear

In the middle of a lengthy takedown of Taxpayers for Common Sense's recent publicity stunt press release proclaiming their "Golden Fleece" award over the DOE's recent award of $452 million for NRC licensing assistance to B&W to construct a first-of-a-kind SMR at the Clinch River site, +Rod Adams brings up an extremely insightful point almost universally neglected in "market-based" critiques of described subsidies for nuclear energy. Specifically, Rod points out a perverse, unintended regulatory consequence brought on by anti-trust laws addressed by the Price-Anderson Act, which governs financial liability in the event of a nuclear accident. (The whole thing is of course well-worth reading.)

Rod points out:
The shared liability approach [inherent to Price-Anderson], if taken without permission, would violate the anti-trust laws that prevent competitors from cooperating. Price-Anderson’s system rewards the industry for sharing detailed technical information that would normally be carefully protected trade secrets. The nuclear industry’s habit of widely sharing important information and lessons learned from experience is one of the foundations on which its excellent safety record is built.
Price-Anderson liability structure
Image: NRC 
To those unfamiliar with how the Price-Anderson liability law works, the NRC has a helpful fact sheet which explains the basics. Contrary to common portrayal, Price-Anderson does not simply act as an "escape hatch" for financial liability for nuclear reactor operators. Each reactor operator is required to hold private insurance for $375 million per individual unit; after this limit is exceeded, a second tier of insurance from cross-pooling across each operating reactor kicks in - up to $11.6 billion. In other words, the liability structure of Price-Anderson explicitly makes it such that "an accident anywhere is an accident everywhere" - there is a shared financial liability across every operator.

The dispute arises of course as to what happens above the $11.975 billion liability threshold - yet this has never actually been tested. (In fact, after Three Mile Island, the worst nuclear accident in U.S. history, $175 million in funds came solely from the "first tier" - i.e., private insurance). Critics are of course free to make their case that the cap is too low - but it first involves an honest reckoning of what the actual liability structure actually is.

More important however, arguments like this tend to underscore a common problem with many of some of these so-called "market" critiques of nuclear energy - even cursory inspection tends to reveal how thin a paint job has been applied to what is primarily a vehicle for advancing a dogmatic anti-nuclear agenda. (I say this too as someone who is almost always first disposed toward market-based solutions.)

Such a harsh critique comes primarily from the shallowness of the arguments presented - which, like TCS's "Golden Fleece," focus primarily on the seen (i.e., the DOE's licensing assistance) and less so on the unseen (i.e., the flawed NRC licensing process which makes it incredibly difficult for new market entrants to feasibly seek design certification). In other words, the "market-based" aspect is simply invoked as a shallow pretext for one-sided arguments applied solely to nuclear energy, rather than across the entirety of the energy sector.

Thus why I highlight Rod's point: A fair free-market critique of the energy industry - nuclear included - would also look at the barriers erected by government regulation (which in turn are what spur the calls for so-called "subsidies" which free-market groups generally oppose). The perverse consequences of anti-trust regulation from information-sharing are an insightful example of this; likewise there is the issue of the regulatory standard for long-term disposal of nuclear waste. For example, a geologic repository for permanent disposal of nuclear waste is required to meet a standard of no more than 10 mrem/year exposure to the public over 10,000 years, followed by 100 mrem/year up to 1 million years. (How one evaluates these begins to leave the realm of engineering and move more into the realm of divination...) To give some perspective - this involves a protection standard equivalent to less than 5% of the average background dose one receives from natural sources over the initial post-closure period, and less than 30% in the million-year period. To put it in more familiar terms, this corresponds maximum exposure equivalent to 1 chest x-ray per year in the first 10,000 years, followed by half the dose from a head CT scan (and 1/10th the dose of a whole-body CT scan) over the next 990,000 years. (Discharges from nuclear plants are regulated still more strictly, at 0.3 mrem per year maximum - less than a standard dental x-ray.)

Ask yourself this - when is the last time you've heard of a coal or natural gas facility being required to sequester their toxic wastes from the public in near-perpetuity? (Likewise even with toxic heavy metal wastes incident to the production of solar panels). How many other facilities are required to pay hourly costs for regulators evaluating license applications (much less put in the encyclopedic licensing applications to begin with)?

The point here is not simply to complain or to justify any special treatment on the part of the nuclear industry - but it does provoke a question of why more so-called "market advocates" in energy only look at one side of the coin. A deeper (and more insightful) analysis would consider the inherent barriers erected as well - including the perverse consequences of features like anti-trust regulations and unequal applications of standards for risk exposure across different energy-producing industries - rather than  cherry-picking analysis we're typically treated to presently - thin gruel, indeed.

Friday, January 25, 2013

Where's the real bottleneck for natural gas? Distribution.

As a scientist and an unabashed nerd, I love data. Particularly, I love it when ready access to data reveals things that are surprising in the face of conventional wisdom.

Graph of wholesale electricity and natural gas prices from ISO-NEAn interesting case comes up with this year's colder winter in New England. (Thankfully, I'm located in damp, icy East Tennessee, where even the threat of ice and snow manages to bring civilization to a grinding halt.) In particular, Meredith Angwin noted an interesting press release by ISO-NE (the grid operator for the northeastern United States), ostensibly pointing to record-low wholesale electricity prices, but containing something more interesting buried beneath - a slow but quite noticeable creep of wholesale natural gas prices upward to the range of $6/MMBtu (1 MMBtu = 1 million British Thermal Units).
At first glance, this seemed a bit surprising to me, given that while spot prices for natural gas have nudged a bit upward, they're still hovering well under the $4/MMBtu mark; in other words, they don't seem to be going anywhere fast. What really began to catch my eye however was the cyclic behavior of gas prices in the chart from ISO-NE, something which doesn't show up in spot prices from Henry Hub (which generally sets the market spot price for natural gas in the U.S.) 

Natural gas spot, retail, and electricity pricesLooking to verify the trend, I dug a little further around EIA's website. While unfortunately their data on "citygate" prices are a few months behind, the regular periodicity in the citygate price was likewise not there - instead, taken as an average across the U.S., spot, wholesale, and electricity costs derived from natural gas tend to have a strong correlation. Yet here we see above in the data from ISO-NE that prices clearly are deviating substantially from spot prices - what gives?

Natural gas prices spike in the NE corridorIt turns out in fact that the culprit is in distribution. A look around EIA's website brought me to this interesting report, which notes that supply bottlenecks in U.S. northeast for natural gas are expected to produce significant variances in energy prices from the rest of the U.S., and in particular from Henry Hub prices.

In essence, despite a relatively abundant supply of natural gas at the wellhead due to the proliferation of wells seeking to exploit unconventional resources, one thing the laws of physics haven't changed for is the capacity of distribution infrastructure - in other words, pipeline capacity. Natural gas doesn't really care where its end destination is - be it for electricity or home heating. Which means a cold winter can easily drive up demand and stress pipeline capacities - precisely what is occurring, according to the EIA report: utilization rates at the Algonquin compressor station have averaged around 86% for the months of November through December 2012.

Capacity versus price comparison for Algonquin compressorBasic economics can predict what happens next. Because natural gas is generally shipped across pipelines as a compressed gas, due to frictional losses across the pipeline, it must be repressurized at terminals across the pipeline network. The higher demand for gas goes, the closer to maximum capacity these terminals reach. And, as EIA data helpfully shows, the closer utilization reaches to 100%, the larger prices begin to "spread" from spot prices at Henry Hub.



In other words, while the commodity price of gas may indeed be cheap, the wholesale cost to utilities can be an entirely regional phenomenon. This is especially true in the blustery cold of New England winter, where demand is especially cyclic.

Citygate prices in the Northeast versus U.S. average
I compiled together citygate prices for natural gas across the Northeast and compared them to U.S. average citygate prices, and the effect is quite clear - states in the Northeast pay on average an appreciable premium on wholesale prices over the U.S. average wholesale, precisely due to these types of bottlenecks, particularly during times of peak demand (i.e., cold winters). Obviously, pipeline capacity has been steadily increasing in response to demand for gas, however the real issue will inevitably be cyclical "spikes" due to competing uses of gas as a heating source.

Why go to all of this trouble to look at trends in gas consumption (especially when I'm not an energy economist by trade)? Namely because it upends some recent "conventional wisdom" about energy; namely, gas prices are still a regional phenomenon.  While there are some places where supply is not as constrained by distribution capacity (or driven by cyclic consumption) and it thus makes perfect sense to look at natural gas a short-term replacement electricity source (particularly for coal), the Northeast is a shining example where this is definitely not the case. Which in turn makes efforts to shut down stable and relatively low-cost (not to mention carbon-free) baseload sources like Vermont Yankee (and Indian Point) all the more insane - despite the claims of proponents to this end, the balance of electricity from these plants would not be made up from renewables but rather almost certainly come from natural gas. To which again, low spot prices for natural gas are in fact a remarkably poor indicator - especially if one considers what adding an additional consumption driver would look like in terms of utilization "bottlenecks" during times of peak demand (i.e., winter).

I still remain unconvinced of the argument that wholesale natural gas prices are set to explode (and so stand by my bet with Rod Adams) - namely because of the fact that an abundance of known, recoverable supplies makes economics of the raw commodity relatively self-correcting. (In other words, as gas prices go up, so too will the number of wells, pushing prices back down to an equilibrium). However, revolutions in the recovery of gas from novel geology hasn't changed the fundamental physics of pipelines - which in turn may be the real constraint to natural gas growth as an electricity source, at least on a regional scale.

Update: Via Twitter, Rod Adams points to an EIA alert from yesterday about natural gas prices and capacity in the Northeast, given the recent cold snap. Current local spot prices at Algonquin and Transco Z 6 NY (a New York-based distribution hub) are around ~$30/MMBtu - almost 10 times the Henry Hub spot price, with utilization factors reported to be at over 85% capacity. As Rod puts it, "Winter happens."

Wednesday, January 16, 2013

DOE's spent fuel strategy: Not a bang but a whimper

There is a hallowed tradition in Washington known as the "Friday Document Dump," in which news and announcements the government wishes to bury are strategically timed for Friday afternoons, when such announcements tend to fall through the cracks of the typical news cycle (i.e., assuming reporters are even present to cover the event, the strategic timing tends to ensure it will miss the weekend papers, thus effectively "burying" the story by the time the new week rolls around).

DOE SNF strategy wordle
In this storied tradition, the Department of Energy released the Obama administration's response to the Blue Ribbon Commission report last Friday to relatively scarce media coverage. In fact, one would be hard-pressed to find any coverage in many of the major papers; what little coverage there was can be found in the Washington Times, Platts (an energy publication), and the Las Vegas Review-Journal. (Needless to say, the timing appears to have had its intended effect).

AREVA's NextEnergy blog and Nuclear Diner have already posted some of their thoughts on the release, but after reading the DOE's report I have to say I've felt a bit underwhelmed. As a friend remarked, it's a document "laying out the next set of milestones for the nation's spent fuel management program to miss." I wish I could say he was joking.

Some of the major highlights:
  • An emphasis upon a flexible, staged, consent-based process for locating a permanent geologic repository for used nuclear fuel designed to be adaptive to potentially changing circumstances.
  • A new, independent waste disposal organization charged with overseeing used fuel management and disposal, along with legislative action to reform allocation of the Nuclear Waste Fee paid by operators to allow for greater operational flexibility and independence.
  • Short-term emphasis upon siting a pilot interim storage facility for used nuclear fuel, with a triage priority of relocating fuel from decommissioned reactor sites first. Operations would begin in 2021.
  • Transitioning toward an operational interim storage site with sufficient capacity to meet the existing federal government's liabilities under the Nuclear Waste Policy Act of 1982; operations to begin in 2025.
  • Making "demonstrable progress" toward locating and characterizing a potential geologic repository with a target operations date of 2048.
Copy Pasta
Much of the above points are relatively familiar, essentially retreading what has already been detailed in the original BRC report findings (thus begging the question of why a 14-page response would take so very long). And, for the most part, the BRC findings, translated to the DOE report, are not bad findings - however it's hard to find where the DOE's report has added much at all to the discussion aside from a blanket endorsement.

Perhaps to the disappointment of the AREVA (who emphasized reprocessing as a viable fuel cycle strategy in their blog response), the report seems to go out of its way to minimize the potential role of reprocessing in a future U.S. fuel cycle strategy - in fact, one point which stuck out to me was in that the DOE report recommended that the scope of the waste management organization (referred to as a "management and disposal organization, or "MDO" - because if there's one thing Washington loves, it's acronyms...) should be explicitly constrained to explicitly exclude reprocessing. Here's the relevant quote:
In addition, the mission of the MDO will need to be carefully defined. For example, funding made available to the MDO should be used only for the management and disposal of radioactive waste. While this could include the management and disposal of waste resulting from the processing of defense materials, the MDO itself should not be authorized to perform research on, fund or conduct activities to reprocess or recycle used nuclear fuel. These limitations on the MDO mission are consistent with the recommendations of the BRC.
Thus, it would strongly indicate a commitment to a once-through fuel cycle for the time being. Among other factors cited to support this decision was ORNL research I'd highlighted in my previous post, which indicated that most of the current used nuclear fuel inventory (98%, in fact) could be consigned to direct disposal even assuming a future closed nuclear fuel cycle.

With respect to the emphasis on interim storage, I have to admit to having a somewhat adverse reaction while reading the report - namely because of the jarring disparity between words and deeds. In particular, such a ready-made pilot facility for interm storage based upon local consent has already been proposed - Private Fuel Storage. PFS existed as a consortium of nuclear utilities; it negotiated a contract with the Skull Valley Band of the Goshute Indian Tribe located in Utah (located about 70 miles SSW from Salt Lake City).

PFS had been attempting to open a privately owned and operated interim storage site for over ten years (it first filed a license application with the NRC in 1997); in the process, it has been a political football of multiple administrations in the ongoing battle over Yucca Mountain. Ultimately, PFS received an operating license from the NRC in 2006, yet various shenanigans from both the state and federal level prevented it from ever opening. (The Bureau of Land Management refused to allow for the expansion of a rail line to ship fuel to the reservation, and the state of Utah continued to block any shipments of spent fuel canisters to the site along Utah highways. Despite the fact that as a Native American tribe the Skull Valley Band is legally autonomous from the state of Utah, the state government found plenty of other ways to frustrate the intentions of the Goshute Tribe and PFS.) 

Roughly two weeks before the DOE report was released, PFS finally announced its intention to withdraw its license from the NRC - namely because it was clear that the process was going nowhere (and licenses aren't free). Thus, a jarring chasm between word and deed - clearly, a pilot interim storage site already existed - one which had the consent of the local government (in this case, the Goshute Tribe); however, the Obama administration has shown little inclination to intervene. One is left to wonder then how any other future site could hope to get off the ground when a ready-made solution such as this one is abandoned to state-level sabotage; one can easily see such a scenario playing itself out with states blocking shipments to interim sites located outside their borders based on the Utah example.

Particularly depressing about the overall strategy is in its relative lack of ambition; a planned operating date for an interim storage site which would happen a mere 27 years after the original timeline obligated by the Nuclear Waste Policy Act (and 43 years after the act was first passed), with no repository in sight until I (a relatively young and spry individual at the present) am poised to retire - a full 50 years past the original deadline. (Only in the federal government is one allowed to miss a deadline by a full half-century with a straight face.)

I will be the first to say that the 1987 amendments to the Nuclear Waste Policy Act which ultimately decreed Yucca Mountain as the nation's sole geologic repository by virtue of legislative fiat was a mess. But the warmed-over copy-'n'-paste job combined with completely lackluster goals for siting a repository look like rather unseemly indicators that Obama administration's approach to the BRC process was essentially that of a stalling tactic, following their contentious decision (both politically and legally) to cancel the Yucca Mountain project. If one is to unilaterally dismantle nearly three decades of standing policy of nuclear waste disposal policy, a little more should be expected in terms of an alternative. The DOE report would not be it.

Tuesday, January 15, 2013

To reprocess or dispose? A look at fuel cycle triage

A recent study by former colleagues of mine from Oak Ridge National Laboratory raises some interesting questions about the future direction of U.S. nuclear fuel cycle. My colleagues have been presently engaged in a scientific triage study for used nuclear fuel disposition options. One of the largest parts of their work has simply been in collecting the massive amount of data on the 67,600 metric tons (1 MT = 1000 kg) of commercial used nuclear fuel in the U.S., including issues such as how long it was burned in the reactor, the fuel type, and the initial enrichment, with an objective of being able to accurately characterize the composition and location of every used nuclear fuel assembly presently in the U.S. (I also am tangentially involved in this work, funding an undergraduate for data collection and am hoping to expand my role into doing modeling work in support of this effort).

The overall goal of this work is to support a more informed decision framework to specifically look at how we deal with spent fuel inventories in the U.S. - in other words, performing a triage analysis on what fuel would be the best candidates for various fuel cycle options (including direct disposal versus recycling). Given that some fuel is inherently going to be less suitable (read: more expensive) for recovering actinides as future fuel material, the goal is to sort out what can be disposed of immediately and what might be preserved for future fuel cycles.

Their (surprising) finding was that of the present inventory, 98% of the current used fuel inventory (by mass) could be disposed of without leaving open the option of future retrieval while still allowing for the ability to facilitate a future closed fuel cycle in the U.S. This conclusion was based upon the assumption that the U.S. would eventually open a fuel reprocessing facility; even under this assumption most of the present inventory of used nuclear fuel is not needed to support such a cycle. Some of this is simply due to the large inventory of used nuclear fuel in the U.S. - at nearly 68,000 metric tons of heavy metal with the largest fuel reprocessing centers having a throughput on the order of 1,000-1,500 MTHM per year, there is simply more "legacy" fuel out there than a typical facility would ever usefully process.

Their decision analysis was based on several factors, including the value of material which would be recovered (older fuel tends to have less plutonium available for recovery, and the plutonium is of lower quality); complexity (older fuel has other complicating factors such as different types of cladding material - like stainless steel - which can complicate potential recovery and thus make it less preferable to newer fuel), and simply the amount of material needed to sustain a closed fuel cycle (given the time before such a facility would come online, it is anticipated more than sufficient inventories would be present to sustain a closed fuel cycle without drawing into older fuel). Likewise, they considered what fuel assemblies might be useful to future reprocessing research efforts by DOE (such as used, highly-enriched fuel from naval and research programs).

To many who advocate exploiting the resource potential of used nuclear fuel (myself included), this is a jarring conclusion. There has always been a tacit assumption in mind that domestic reprocessing would not only include future inventories of used nuclear fuel, but help to alleviate the pressure on current demand for geologic repository space by making use of the readily available inventories out there. Yet beyond looking at what is economically practical (i.e., prioritizing the most valuable fuel for recovery), the report brings in an eye-opening reality - given the fact that the U.S. has spent the last thirty years committed to a once-through fuel cycle track, there is simply more used fuel than a single modern reprocessing facility would have capacity to handle, especially given the stable influx of fuel coming out of future reactors which would form the foundation for a future closed fuel cycle. As a result, much of this "legacy" fuel becomes unnecessary to support such future fuel cycles.

A more important implication relates to geologic disposal itself. The plans for the (now likely former) Yucca Mountain site called for a 50-75 year "retrievability" window; in other words, the repository was to be operated for an extended period which would allow for retrieval of used fuel out of the repository for other uses. (After the retrieval period, it was generally assumed if no use case had emerged by this point, permanently closing the repository was the most reasonable option).

Designing a repository with future retrievability in mind doesn't come for free; it essentially adds another engineering constraint (read: cost) to the problem and ultimately requires further analysis of how the repository will perform in containing waste in addition to the "post-closure" period. (It also tends to bias one's choice of geology - a feature of salt-based repositories like WIPP is that they are explicitly not designed to be retrievable - the heat from nuclear waste packages generally causes salt to plastically deform around waste packages, effectively "sealing them in.")

Thus, figuring out what spent fuel has little potential prospect for future recovery represents an technical triage which can help simplify a future repository design (as well as open up options for where such repositories might be located). In essence, separating out the "wheat" (fuel more useful for recovery) from the "chaff" (fuel which has limited potential for recovery) allows for a more intelligent approach to used fuel disposition which can ultimately make constructing a future permanent geologic repository cheaper and easier.

Of course, the standard caveat applies: the hardest part of opening any geologic repository has never been technical so much as it has political. Nonetheless, the ORNL report offers a rather bracing conclusion as to what a future U.S. fuel cycle may look like, even if the decision is made to restart reprocessing in the U.S. Ultimately, the vast majority of the current inventory of used nuclear fuel may yet still be destined for direct disposal, simply due to the realities of waiting over three decades before finally deciding to reconsider our rather ill-fated national decision to abandon a closed nuclear fuel cycle.

Thursday, January 3, 2013

Scientagonism: The problem of antagonistic science communication

A recent column by Daniel Sarewitz in Nature on bridging the "partisan divide" with respect to public perception of science inspired some spirited debate over on my twitter feed yesterday. The short version goes something like this: scientists are often perceived as being in the thrall of Democrats, exposing the greater scientific enterprise to being undermined as simply another partisan front (or, alternatively factionalizing, wherein partisan camps each bring in their own "experts" an accuse the other side of "junk science). None of this is helped by scientists who go out of their way to bring on their antagonism - see, for example, the letter signed by 68 Nobel laureates endorsing President Obama over Mitt Romney in the last election (in which Sarewitz notes that of the 68, 43 have a record of public donations to candidates, and of these, only five have ever donated to Republican candidates, and none in the last election cycle). It goes without saying that, well-meaning as it may be, openly partisan activities like this aren't helping with the whole "not being perceived as a lockstep Democratic constituency" thing. (Note that I am explicitly not advocating mass abdication of scientists from the political discourse, which a genuinely terrible idea - but rather, a caution that lending one's scientific credibility to openly partisan ventures may not be in the best strategic interests of science...)

Dueling PhD banjos
Sarewitz recommends bringing together scientists with less monolithic political views together to demonstrate overall scientific consensus on key issues such as global climate change and the like, along with ensuring greater ideological balance in high-profile scientific advisory panels. The overall of goal of such an enterprise would be in restoring a public perception of science as a bipartisan enterprise - and in particular, inoculating policies based on scientific recommendations as simply being based upon "partisan science" - or to use a favorite expression - bringing in the "dueling PhD's." Unfortunately, while Sarewitz correctly diagnoses the problem, his solution falls far short.

The deeper problem here antagonism - both perceived and real. Dan Kahan (of the Yale Cultural Cognition Project) has prolifically written about the issue of "Cultural Cognition" - in other words, how our individual values can (unconsciously) conspire to shape perceptions of risk to accommodate our pre-existing worldviews (something I've discussed prior in how this relates to public perception of risk and nuclear energy) - also known as motivated reasoning. In essence, the mind rebels against cognitive dissonance and will do what it takes to ensure such is resolved - namely by shaping our perceptions to confirm previously-held beliefs. Ideology, as it turns out, is an extremely effective marker for predicting risk perception - and more distressingly, these differences in perception grow more pronounced with "high-information" individuals, strongly pointing to the existence of motivated reasoning.

So what does all of this have to do with antagonism? Quite simply: everything. People will by nature rebel against information perceived to be antagonistic to their worldviews - downplaying evidence of phenomena that threatens their worldviews. (Kahan notes how this cuts several ways - both in how the threat of global climate change threatens market-oriented views of individualists and hierachists, and how the associations of nuclear power with "big business" and highly concentrated capital raises the hackles of those of more egalitarian and communitarian mindsets.) These associations are particularly acute when said scientific issues are charged with a single solution - such as in the case of climate, direct government intervention into the economy to regulate carbon dioxide emissions.

One of the more interesting outcomes of some of Kahan's experimental work has been in strategies toward de-polarization - science communication strategies which seek to minimize these perception gaps, namely by presenting scientific information in a way which seeks to minimize antagonism toward deeply-held values.  An example of this depolarization with respect to climate change is of course nuclear energy (along with geo-engineering); when communication of climate risks is presented with policy prescriptions of increased use of nuclear energy or new technologies such as geoengineering, individuals oriented toward skepticism of climate risks become more receptive - in other words, the use of framing has a demonstrable de-polarizing effect. Why? Namely because the science is now presented in a context where it is no longer threatening to the worldview of the listener.

And yet too often in science communication (and at times among nuclear advocates as well) there is the very opposite at work - science is presented as antagonistically as possible to the audience - as if somehow dismissing climate skeptics and religious fundamentalists as stupid and venal will cow them into belief. (Once again, to my horror I have seen the same phenomenon at work in certain discussions over nuclear energy - where those representing the house will shout down any who dare trespass in their domain instead of making any attempt at reasonable engagement.)

The same goes as well for the policies that from the science - absolutist arguments that inherently tie science to one favored set of policies - rather than a panoply of potential solutions. Such strategies are practically an open invitation to partisanship and motivated reasoning, and yet all too often are the standard for how high-profile science communication on controversial issues gets done. (Similarly, attempts to reconcile the idea of science as not being fundamentally incompatible or at odds with various political and religious values are frequently dismissed as at best naive and at worst "selling out" science.) It is in these cases where members of the scientific community in fact become their own worst enemies - namely in hardening an opposition predicated on the idea that certain scientific findings are fundamentally antagonistic to their values (and thus we return to the realm of "dueling PhD's...")

To put it on a meta level for a moment - getting the public to accept the scientific process as a means of understanding the natural world is in essence getting them to agree upon a common source for facts. But the role of science communication is not and should not be a platform for antagonizing whatever misguided metaphysical or theological beliefs the speaker believes the audience has. In other words, science can and should speak to facts and leave issues of metaphysics to others. (Or, to put it yet another way as I did on Twitter - is your goal to change beliefs over scientific facts or religious theology?)

This problem of "dueling PhD's" - or to put it another way, competing certifications on science, and in turn what experts we trust inherently come back to these kinds of issues. Kahan recently posted an interesting four-part essay (drawing heavily on the ideas of Karl Popper) on the notion of a "Liberal Republic of Science" (IIIIIIIV) - discussing how a key issue which arises even in societies which broadly accept science as a foundation of knowledge is in the inevitable conflicts of how we certify these sources of facts - in other words, the dueling PhDs. (Kahan stresses that in his view, much of the current wrangling over hot-button issues like climate, nuclear power, and vaccines is not even a question of who accepts science as a source of knowledge as it is the process of how our values shape whose information we certify as credible - which again, comes back to how this information validates existing value systems. Kahan's argument is thus for a science of science communication.) Ultimately this once again returns to the issue of antagonism - science presented in a way which is directly antagonistic to the values of the listener will be stripped of credibility in favor of information from sources which does not antagonize values. (Thus we get to Kahan's argument for a science of science communication - determining the best means of ensuring the best and most accurate scientific information is received and accepted by the overall public.)

Growing a consensus on science as a source of knowledge (or further, developing a common understanding on the same core set of scientific facts) does not imply unanimity in policy ends (and nor should it!), namely because policy is inherently a normative process. More importantly, dropping an explicitly antagonistic communication strategy in favor of one more easily accommodating to diverse values doesn't it in any way imply "giving in" or "selling out" science (as my position has been rather uncharitably characterized). Above all else, the goal here is to get people recognize a common starting point for facts, and letting the implications - both policy and metaphysical - flow from this common starting point. Getting people to agree to the reality of climate change does not imply unanimity about what to do about it, namely because this inherently involves value judgments over the required trade-offs - and of course the same is true for nuclear energy as well. What it does do however is to ensure a more honest, reasoned, and productive discussion of the available options.

Again, however - this requires a strategy for science communication that inherently puts aside antagonism and focuses upon compatibility with existing values. Two recent posts - one by +Suzanne Hobbs Baker at the ANS Nuclear Cafe and one by +Rod Adams at Atomic Insights fit well into what I'm proposing. Both discuss the role of communicating the value of nuclear energy as a strategy for combating climate change - Suzy within the context of framing nuclear as an ally of environmentalism in the face of climate change, and Rod in regards to how because discussions of climate are often so charged even within pro-nuclear communities that such debates become toxic (and thus are often placed strictly off-limits), thus depriving the nuclear community of a key message in communicating with the public. Both of them are focusing on how presenting nuclear as explicitly compatible with concerns with the environment can perhaps help to potentially forge partnerships from communities skeptical (and even at times adversarial) to one another. (And again, to emphasize - a deep concern over how to rectify doing something about climate change while maintaining our present standard of living is one of the fundamental reasons I decided to change careers...)

This is something that I myself have tried to embrace myself when dealing with audiences hostile to nuclear (such as the NNSA hearing on disposing of surplus weapons plutonium in MOX fuel in Chattanooga, back in September). The very first thing I acknowledged to the audience is that we clearly have disparate opinions about nuclear energy (ones unlikely to be resolved in the span of a single evening) but that everyone in the room shared common concerns over peace and security - our preferred means of achieving this ("...to MOX or not to MOX, that is the question...") simply differed. I'm not so fantastically egotistical as to believe this changed the entire tone of the meeting (there were still certainly rancorous and loud comments by the opposition), but I do sincerely believe starting from a position of common values and as much as possible eschewing antagonism helped to provoke thoughtful discussions which occurred afterwards (and at least some civility during).

None of this implies stepping down antagonism in science communication is a magic-bullet or a panacea, nor will it necessarily work in all cases (such as dealing with perhaps the most hardened zealots - be they of the anti-nuclear or fundamentalist variety...) But what it can do (in fact, what folks like Kahan have explicitly demonstrated when it comes to "compatabalist" communication strategies), is that it can help to detoxify these kinds of discussions, namely by pulling people away from the brink by not threatening their deeper values. That in itself would be progress.

Thursday, December 13, 2012

Spent nuclear fuel disposal is not a "subsidy"

One thing that tends to raise my hackles without fail is when the inevitable game of "Name the Energy Subsidy!" comes up, somehow the issue of spent nuclear fuel disposition gets lumped in. Namely because spent fuel management is pretty much the opposite of what is typically thought of as a "subsidy."

To give some background - prior to 1982, the management of spent nuclear fuel was the sole province of nuclear generators. In this regard, coupled with the dual expectation that uranium resources would be relatively scarce and that fast "breeder" reactors would be used to create a virtually inexhaustible source of plutonium-based fuels from non-fissile U-238, the nuclear industry began private-sector arrangements toward chemical reprocessing and recovery of uranium and plutonium from spent fuel. (This still leaves the issue of locating a high-level waste repository for the remaining radioactive materials not recycled, however the mass and volume of said materials would be substantially reduced).

This continued until 1976, when President Ford issued a temporary moratorium on civilian reprocessing of spent fuel, followed by President Carter's (infamous) 1977 executive order permanently banning it, based on international nonproliferation concerns. (Reagan would later reverse this order, but the damage by that time had been done). This came just as plans were underway to by Allied General Nuclear Services open a relatively advanced reprocessing facility in Barnwell, South Carolina. Ford's (and subsequently Carter's) executive orders came after $500-700 million had already been committed to the Barnwell facility. It is one of many sobering lessons in the history of the nuclear industry how mercurial shifts in politics can bring about financial ruin when dealing with capital-intensive investments.

Fast-forward to 1982 - faced with a crisis in managing spent fuel brought about by the sudden halt in the domestic reprocessing industry, Congress passed the Nuclear Waste Policy Act of 1982. One of the main provisions of this act is that the federal government assumes the role of locating and constructing a suitable geologic repository for the permanent disposal of spent nuclear fuel. (The subsequent 1987 amendments, termed the "Screw Nevada" bill, amended the 1982 Act, short-circuiting the site selection process to designate Yucca Mountain as the sole candidate site, in part due perceived cost savings by narrowing down the site selection process.)

[As an aside, there are two excellent articles I can recommend to those more interested in a full treatment of the history of how we came to where we are today - the first, "The U.S. Spent Nuclear Fuel Policy: Road to Nowhere" by James M. Hylko and Dr. Robert Peltier, PE, which focuses more on the chronology of U.S. high-level waste management, and the second, a recent article in The New Atlantis, "Yucca Mountain: A Post-Mortem" by Adam White, which delves more into the politics of Yucca Mountain.]

bizzaro subsidies
However, a key facet of this bill which is often overlooked is the fact that the industry is required to pay for the cost of disposal; specifically, they pay a fee of 1 mil/kWh ($1/MWh) of nuclear electricity generated. In other words, the Nuclear Waste Policy Act is by its very nature a "polluter pays" arrangement (which really, is as it should be). To date, the Nuclear Waste Fund has accumulated nearly $30 billion (accounting for accumulated interest), while spending about $8 billion on site characterization for the Yucca Mountain Project. Only in Bizarro-world is a net payment of $22 billion from the utilities (and, by proxy, electricity consumers) to the federal government considered a "subsidy." One can quibble over whether the sum is sufficient - right now the fee generates about $750 million per year - but the fact is, no one's getting a free ride on that front.

So I was somewhat distressed to see the waste "subsidy" canard come up this discussion of energy subsides over at Scholars and Rogues. Specifically, a couple of quotes jumped out at me:
The continuing cost of such temporary storage, and the nearly $100 billion needed for “research, construction and operation of the geologic repository over a 150 year period” at Yucca Mountain, is a subsidy for the nuclear industry.
Fifty-five thousand tons of spent fuel rods, with no permanent home in sight, suggest nuclear subsidies will continue. But before Congress, presumably with White House “cooperation,” ends any energy subsidy, perhaps they’ll take time out from their internecine bickering to actually produce a coherent national energy policy that reflects all available technologies and considers the viability of energy technologies in light of fossil fuel emissions decimating the global climate.
spent fuel pool subsidyHuh? In what universe is an industry tasked with the responsibility of paying for its own waste disposal (particularly after the utter and repeated failure of the federal government to live up to its contractual obligations with utilities) a "subsidy?" Much of the rest of the article contains some risible arguments about subsidies to the nuclear industry (the value of the Price-Anderson Act is a contentious issue, namely because while it does act as a liability backstop for nuclear accidents, not a single dime has ever been paid out under the act; further is the cross-insurance requirement that literally guarantees "an accident anywhere is an accident everywhere"); however, given that I have a day job, I really didn't feel like debating every single claim. Needless to say though, the issue about calling waste management a "subsidy" struck me as profoundly incorrect.

So, in the spirit of Rod Adams, I left a comment, but I decided to share my comment here as well. (Forgive my long-windedness...)

I will leave the debate over some of the "subsidies" you bring up for others, but there is one major issue I must take issue with - you state the cost of spent nuclear fuel storage is a cost borne by taxpayers (i.e., a subsidy). This is most explicitly not true.

First, the cost of on-site storage is explicitly paid for by the generating utilities (i.e., under the law, this is their obligation) - not the federal government. Second, per the Nuclear Waste Policy Act, nuclear operators have been required to pay a fee of 1 mil/kWh of nuclear electricity generated (i.e., $1/MWh) to cover the costs of geologic disposal. (Per the NWPA, the federal government assumed the responsibility for permanent geologic disposal - in 1987, this was amended to select the Yucca Mountain site.)

In this time, the federal government has collected nearly $30 billion (including accumulated interest) from the utilities to cover the costs of Yucca, with about $8 billion being spent in site characterization. This most certainly does not look like a subsidy in the conventional sense.

One can argue whether the nuclear waste fee is sufficient to cover future costs - at present, the waste fund accumulates about $750 million per year, and will continue to do so as long as the reactor fleet operates. One could likewise argue with your characterization of "no permanent solution" - geologic disposal, by its very nature, is designed to be a "permanent" solution, namely by placing spent fuel in long-term isolation from humans and the environment. And this is not the only waste disposition strategy available - other strategies, like reprocessing to separate out shorter-lived fission products from still-useful actinides can both substantially reduce waste volume and the overall long-term radioactivity (i.e., the actinides, like Pu and other fissionable heavy metals, are the majority of the "long tail" of radioactivity in spent fuel - nearly all of the rest is gone after around 300 years). However, I would also point out that it was political decisions by the federal government in the 1970s that ended U.S. reprocessing efforts being undertaken by private industry - and thus left the federal government in the role of assuming responsibility for spent fuel disposal.

Overall though, the fact that the nuclear industry is responsible for paying its own way with regards to spent fuel disposal significantly undercuts the argument that this constitutes a "subsidy" in any form.

Meanwhile, what other energy sector requires that hazardous wastes be so methodically isolated from humankind until the end of time? Certainly coal ash has toxic heavy metals (lead and mercury) which never become less toxic, as do older generations of photovoltaic cells. I don't say this to diminish the challenge in responsibly managing nuclear waste, but rather to point out that this is a more universal problem - the only difference is that nuclear is the only sector actually held to account for this negative externality, including paying for the actual costs of permanent disposal.

Saturday, October 20, 2012

Does nuclear lack a natural constituency?

A quick Turing test from the prior round of U.S. presidential debates - see if you can spot the speaker:
We have increased oil production to the highest levels in 16 years. Natural gas production is the highest it's been in decades. We have seen increases in coal production and coal employment.
Look, I want to make sure we use our oil, our coal, our gas, our nuclear, our renewables. I believe very much in our renewable capabilities; ethanol, wind, solar will be an important part of our energy mix.
Number three, we've got to control our own energy. Now, not only oil and natural gas, which we've been investing in; but also, we've got to make sure we're building the energy source of the future, not just thinking about next year, but ten years from now, 20 years from now. That's why we've invested in solar and wind and biofuels, energy efficient cars.
Let's take advantage of the energy resources we have, as well as the energy sources for the future. And if we do that, if we do what I'm planning on doing, which is getting us energy independent, North America energy independence within eight years, you're going to see manufacturing jobs come back. Because our energy is low cost, that are already beginning to come back because of our abundant energy.
In order: Obama, Romney, Obama, Romney. Most notably, while the word "energy" showed up 40 times during last Tuesday's debate, "nuclear" showed up only twice (and only once in the context of energy, within the throwaway line given by Governor Romney above). Compare and contrast with coal (22 appearances), natural gas (8 appearances), oil (26 times), wind (7 times), and solar (3 times).

It is consistently puzzling how an energy source which supplies about 20% of U.S. baseload electricity and the overwhelming share of its carbon-free energy portfolio manages scarce mention in debates over energy. Instead we have two candidates practically tripping over themselves to extol the virtues of increased fossil fuel production (which, depending on your constituency, will sometimes include a nod to chimerical "clean coal" or carbon sequestration technology) but who can barely suffer more than an obligatory mention of nuclear.

It isn't because either candidate seems particularly hostile to nuclear (at least, not openly); both have quietly supported nuclear, generally in the context of "all of the above" energy policies which differ primarily in the respective weight given to fossil exploration and renewables. It would seem, as I have often asserted, in a world both where energy scarcity and environmental impacts of energy are at the forefront, opposition to nuclear is a self-marginalizing position. So why it is exactly that it fails to merit more than passing mention? Consensus doesn't seem to be it; if the above ideological Turing test is any indication, both Obama and Romney seem intent upon defying traditional expectations by endorsing (however insincerely) traditionally-favored energy resources of their opponents. (As a result, we have such scintillating "debates" as to which candidate really loves fossil exploration more...)

The superficial answer commonly given in response to this of course would be that fossil interests (and perhaps, by proxy, renewables, if one is the conspiratorial type) represent tremendous financial interests, and thus, political interests. But this explanation only goes so far - particularly when one looks to polling data as to how energy preferences break down within the public.

Rather, I am inclined to wonder if this is a case of where nuclear, unlike fossil and rewnewables, lacks a well-defined constituency - being relegated to a tepid, forgotten center (where it enjoys broad, lukewarm support by many and hot, focused opposition at the fringe). It is perhaps progress (and a keen awareness of the urgency brought on both by the need for action on climate change and developing abundant future energy resources) that nuclear is no longer seen as ideologically confined to the rightward end of the political spectrum; but instead I am forced to once again go back to the hypothesis that we are seeing energy as a marker for pre-existing cultural affinities.

To wit - for all of the talk by both Romney and Obama on developing coal resources, does either seriously expect to see any significant new developments in coal-fired electrical capacity? (A telling example of the direction of things to come is TVA's shuttering of the John Sevier coal plant, which was recently replaced by a combined-cycle natural gas facility. In a single year, TVA's coal portfolio has shifted down from around 50% to 30% - with the gap entirely being made up for by gas.) Even if one does believe new coal-fired generation will emerge, does either seriously believe this will emerge when projected costs for so-called "clean coal" outstrip the production costs of new nuclear?

Or, more importantly, if support for nuclear was more than token for both candidates, why is it exactly than in Romney's 21-page energy plan, the proposals for nuclear come down to a single bullet point: "Revitalize nuclear power by equipping the NRC to approve new designs and to license approved reactor designs on approved sites within two years." (How this will be accomplished is left as an exercise for the reader). Note the striking absence of any mention of small modular reactors and their potential to revitalize export-driven manufacturing in the U.S., or even such basic measures as reforming antiquated laws restricting vitally-needed foreign investment in new domestic nuclear capacity - nuclear, it would seem, is an afterthought. Nor is it any better with Obama, where his campaign's "issues" site for energy lists oil exploration and (inexplicably) clean coal (one gets the feeling we're actually back in the Bush years), but fails to even mention nuclear.

The very fact that the Romney campaign would speak effusively of renewables as an improbable part of a vague, "all-of-the-above" energy strategy while Obama bafflingly promotes both fossil exploration and dubious "clean coal" technology (see also, vaporware) point to an effort to reach voters not on the rational basis of carefully-considered energy policy, but rather, in a word, pandering. (Yes, quel surprise indeed coming from a political campaign).

So why is this? Because again, by and large for the public, I am largely convinced that support for particular energy sources comes not from their practical value but from what these represent. It is immaterial as to whether availability and diffusivity inherently limit the ability of renewables to produce electricity at the large, consistent scales required to power modern civilization - because these sources, at their core, represent aspirational goods which somehow magically disconnect environmental consequences from energy. Fossil resources represent abundance - an energy abundance which can be found here at home, supporting an economic fantasy of "energy independence" powered by domestic, low-cost energy sources (to which environmental concerns are ancillary).

What brings this charade crashing down is the dissonance with how each of these sides deals with the issue of nuclear. If the latter camp truly cared about abundance, nuclear would plausibly be of co-equal priority - uranium resources are relatively abundant in the U.S., and most of the uranium it imports are from friendly countries like our neighbors to the north. Further, nuclear is relatively cheap - particularly once plants are built - and those plants can supply energy for entire generations at tiny marginal costs. Thus, if it was simply about energy abundance, one would expect more than simple tepid support - one should see more folks like Lamar Alexander exhorting the country to double our current fleet by building a hundred new nuclear reactors. But they don't. Instead we are given platitudes extolling the virtues of abundant natural gas and coal - not uranium.

Meanwhile, as to the former crowd that values minimizing environmental impacts, it is immaterial as to what backs up intermittent sources (i.e., it's the same resources in which they claim they are attempting to displace). If the plausible goal were to eliminate CO2 and air pollution as much as possible, one would think that nuclear, given its high capacity and availability, would be at the vanguard of the movement. And yet it is shockingly absent - instead, once again, natural gas and ephemeral promises of "clean coal" (which, in fairness, is probably more about a cynical electoral sop to coal-producing states than it is a serious policy proposal) take the fore. Constantly we hear from these same people theoretically devoted to the cause of creating a clean energy future about the virtue and necessity of natural gas as a "bridge" fuel - as if carbon-free nuclear energy simply did not exist. (Or as if natural gas did not pose a far more substantial risk in terms of deaths per unit energy produced).

What nuclear seems to lack here is the existence of a natural constituency  Again, look at what a rational examination of the expressed interests of our two major constituencies above should theoretically produce - nuclear, by all accounts, should be a hands-down consensus winner. Yet instead it is relegated to scarcely a mention in high-profile debates.

Again, it is far better for nuclear not to exist solely in the thrall of one ideological pole, given the ease at which it can be marginalized on a partisan basis. But perhaps the bigger issue now is that nuclear, enjoying a broad but shallow public consensus, finds itself politically homeless.

Tuesday, June 26, 2012

Deconstructing anti-nuclear economic myths - a response to Veronique de Rugy

Let me start things off with a disclaimer - I am not an economist. I don't even pretend to be an economist; I'm a nuclear engineer by training (I hold Ph.D. in Nuclear Engineering). That notwithstanding, economics (and specifically, the economics of energy) are a side interest of mine. So it was with mixed interest and trepidation when I read a recent piece by libertarian economist Veronique de Rugy from the upcoming July issue of Reason, entitled "No to Nukes."

Plausibly, de Rugy's animating complaint (given Reason's market-oriented focus) is in the subsidies for new nuclear (specifically, when I followed up with de Rugy on Twitter, she pointed out the issue of loan guarantees, although nowhere does this specifically appear in her piece). The piece itself is nothing new, however - the bulk of it is in fact a retread of a suspiciously-timed nuclear hit piece which appeared literally two weeks after the Fukushima disaster. (One gets the distinct impression that, despite her protestations to the contrary, de Rugy is more than happy to dance on what she perceives to be nuclear's grave, particularly given her timing and choice of targets.) In reality, the piece seems to follow on to a frustrating trend of pro-fossil contrarianism as of late, particularly in libertarian circles (contrarian in the sense of singling out the most economical, carbon-free competitor to fossil fuels for special scorn on economic grounds); although perhaps this contrarian turn owes to the fact that conservative heavyweight think tank Heritage has cornered the market in advocating nuclear energy as a free-market energy source. (Who said hipsterism is limited to fashion and terrible beer?)

de Rugy's piece begins with an overly long introduction detailing to the reader why nuclear power was destined to fail to live up to its promises, including citing public opinion which she describes as having " remained steadfast against the technology ever since [Three Mile Island]" (although someone may want to refer de Rugy to the latest polling data on the subject), along with other issues, such as "[d]isputes over waste disposal [which] have never been resolved" (once again however, these are political rather than technical matters).

Finally we get to the meat of the matter - it would appear that a restart of the nuclear industry is, "[...]not just bad politics. It’s awful economics." Well.


To this end, de Rugy characterizes the recent decision by the NRC to grant Southern Nuclear company a license to build two new AP1000 units at the Vogtle site - the first new units in 30 years, as "[...]an act of desperation by a president who has realized he is running out of other options." Fortunately, contrary to the opinions of a economists with a particular axe to grind, the decision to award Southern Company is not in fact in the hands of the president, nor are operating licenses granted upon individual opinions about economic viability of the project - they are voted on by the commissioners of the NRC on the basis of safety alone. This fundamental misunderstanding of the process is pervasive throughout the rest of the piece.


Levelized cost of electricityMuch of the piece is particularly scarce on actual sources and utterly devoid of hyperlinks (however, given the fact that the piece is a re-tread of her prior post-Fukushima piece, most of her sources appear to be taken from there). de Rugy cites a 2009 MIT study by Ernest J. Moniz and Mujid S. Kazim as evidence of nuclear's uncompetitive costs; one assumes she is referring to MIT's "Future of Nuclear Power" project which includes cost projects of nuclear compared to other conventional fossil sources under a variety of circumstances. In the 2009 update, it reports the following cost comparison: assuming current cost of capital, coal clocks in at 8.4 ¢/kWh, natural gas at 6.5 ¢/kWh, and nuclear at 8.4 $/kWh. The authors specifically note however that this includes a current "risk premium" to capital costs for nuclear - recalculating capital costs at comparative market rates (absent the "risk premium"), they come up with a number far closer to gas and coal: 6.6 ¢/kWh. Even assuming the risk premium stays, with a carbon capture and storage the cost for coal and gas quickly reaches near-parity with nuclear once more. Such an analysis is also borne out in applying levelized cost of electricity estimates to EIA data, resulting in similar conclusions.

Taking up the example of the French (with their nuclear-heavy energy portfolio), de Rugy asserts that because of the France's (state-subsidized) industry, French consumers pay more for electricity. Specifically, she writes:
But producing nuclear energy in France is not magically cheaper than elsewhere. French citizens are forced to pay inflated costs to support grand government schemes, such as the decision made 30 years ago to go nuclear at any cost after the first oil shock in 1974. 
EU electricity prices
Really? Going to the data, the opposite is in fact true: France has one of the lowest retail electricity prices (the 7th lowest in the E.U.); compare this to Germany, which has recently phased out nuclear entirely, which pays the second-highest rate. (Again, these are not hard things to find, but something de Rugy asserts with no evidence and in clear contradiction of the data.) She might try to argue that consumers pay indirectly, but nowhere has evidence been presented to support this, nor is it supported by retail electricity price data.

de Rugy's main thrust here of course is that capital costs for nuclear in the U.S. are little different than those than in nuclear-friendly France, relying on the analysis of the Vermont Law School's Mark Cooper, an individual who isn't exactly private about his own agenda when it comes to nuclear. (Hint: he's not a fan.) Again, one gets the impression the data is being cherry-picked to fit the desired conclusion. de Rugy makes an incomplete comparison here, citing the high "overnight cost" estimates for nuclear capital costs compared to coal and natural gas, while neglecting to inform her readers that this alone is a highly misleading comparison. (To see how this process is properly unpacked, even with natural gas still coming out favorably compared to nuclear, I invite you to see how Dr. James Conca unfolds the data).

To wit: "overnight" cost is a rough estimate of total capital cost (i.e., total money which must be invested to build the plant), assuming the plant "overnight" - i.e., without the borrowing costs (in other words, interest on loans which continues to pile up while plants are being built and not generating revenue), something which particularly dominates nuclear costs. However, a more accurate comparison is the levelized cost of electricity  (LCOE)- something which calculates both the capital cost and operations & maintenance costs (which include fuel - a cost which dominates natural gas economics). The LCOE calculates the "break-even" cost of electricity from a plant given the projected costs over the plant's lifetime, with a reasonable discount rate (for example, the expected return of ~3% on treasury bonds) over the life of the facility. Given that the expected lifetimes of different facilities can vary widely by type (i.e., the current fleet of nuclear plants will almost all be relicensed to operate for a total of 60 years, with some potentially operating up to 80 with facility improvements and upgrades), this makes for a more useful comparison of the actual cost of electricity. Once again, something absent from de Rugy's analysis.

Indeed, taking this out to the logical extension - if nuclear plants were wholly unprofitable to build and operate, why in the world then would operators of the existing fleet of 104 reactors not simply turn each one off tomorrow, much less put a dime into maintenance outages which run up into the millions of dollars? The answer of course is because this is not true; nuclear plants are indeed expensive to build (due to capital costs, including the borrowing costs associated with construction times), but the marginal cost of power from a nuclear unit is tiny - namely because most of the cost is in the cost of capital itself. Nuclear in this sense represents the opposite economics of natural gas, which has a low front-end cost but whose costs are generally dominated by fuel price. (Thus, the levelized cost - something de Rugy does not look at - is extremely dependent upon assumptions of future fuel prices - hence why nuclear is often seen as a hedge against future fossil fuel price increases.)

However, de Rugy comes back with the follow-up that such estimates of nuclear cost come "after taking into account a baked-in taxpayer subsidy that artificially lowers nuclear plants’ operating costs." Looking at the broader picture of historical energy subsidies however, this point doesn't seem to carry the impact de Rugy seems to think it does - from the period of 1950-2010, nuclear has been the recipient of about 9% of total federal energy subsidies, compared to a shocking 44% for oil. (For those following at home, the rest include: Natural gas - 14%, Coal - 12%, Hydro - 11%, Renewables - 9%, Geothermal - 1%). Most of nuclear's subsidy has, contra de Rugy, not been focused on the regulatory side (although the study does point to an approximate regulatory subsidy of $16 billion over the total time period) but R&D, which should surprise few who are conversant with the history of nuclear. (Oil, by contrast, receives the whopping share of its calculated subsidies from tax policy and regulation, while natural gas has almost exclusively benefited from tax policy).


Claymore mine
Image: Wikipedia
Notably absent from de Rugy's analysis is how the most important subsidy fossil fuels (especially coal) have come to rely upon, which is treating the atmosphere like an open cesspool. Indeed, looking to the above costs from the MIT study, were we truly dealing with a "level playing field" in the sense that carbon-intensive industries were required to give their waste products the same degree of scrutiny that nuclear already does, the much-ballyhooed "cost difference" largely vanishes. (Again however, discussions of energy subsidies invariably seem to only go one way: like a claymore.)


No doubt though de Rugy is invoking the issue of nuclear liability insurance of course (known under the moniker of the "Price-Anderson Act", passed in 1957). What is not noted is the exact taxpayer liability to date under Price-Anderson - which is exactly $0. Again, contrary to the claims of nuclear opponents like de Rugy who dress up their objections in economist's language, nuclear is not "uninsurable" on the private market - in fact, each nuclear unit is required to carry an individual liability of $375 million; following the exhaustion of the individual commercial policy, each operator-licensee is required to kick in up to another $111.9 million (pro-rated), producing what amounts to a collective cross-insurance arrangement of $11.975 billion. One can dispute whether such a sum is "sufficient," but the idea that the industry is utterly absolved of tort liability is clearly at odds with the the current reality.

When I pressed de Rugy over what particular subsidies she was complaining about and why her complaint so specifically singled out nuclear (looking at her publication history, there is nary an article devoted to the issue of energy subsidies for other sectors), she responded by pointing me to an analysis she did on the market-distorting effects of loan guarantees. (This after I pointed out that I was in favor of removing all subsidies - but it would seem, like many in the punditry business, the conclusion comes first).

Frankly, I won't get into all of the analysis - because once again, I am not out to defend loan guarantees or any other form of energy subsidy. However, one thing that did jump out at me once more was the use of extremely cherry-picked data in her report - the few items that do mention nuclear (most of the piece pertained to loan guarantees for solar - which incidentally, was not required to pay the credit subsidy fee which nuclear was) are, shall we say, "factually challenged." de Rugy rolls out the several-times-over debunked trope of the 50 percent default rate with nuclear loan guarantees - based on poorly-documented projections over a program which was never passed. While de Rugy immediately pointing out that the CBO revised this number (without specifying how much), the supporting evidence she gives to this revision doesn't even pertain to civilian nuclear power - rather, the study she points to is a comparative economic analysis of nuclear power for naval propulsion.

The only other nuclear-specific studies de Rugy cites in this study come from Peter Bradford - a well-known anti-nuclear activist with the Nonproliferation Policy Education Center (simply google "Bradford" and "nuclear" if you don't believe me) - along with Henry Sokolski (also affiliated with the same). The extremely selective use of sources known to have a hostile agenda to nuclear (that is, when the sources even accurately refer to de Rugy's claims) again strongly implies a rushed, cherry-picking approach that implies a "conclusion-first, evidence later" approach that is all too familiar with established punditry. Indeed, it might make for impressive-looking studies (and good sound bites), but it hardly suffices for serious scholarly work. Indeed, if the evidence is as strong as she claims it to be, it would behoove her case greatly to find such evidence from more objective and less clearly agenda-driven sources.

Of course, all of this is the problem: even rather sloppy studies like this, particularly when attached to someone with a Ph.D. in economics, sound plausible and require the time and energy to deconstructing their myriad of errors and misplaced assumptions - something which amounts to a non-trivial task for one when most of their day is typically occupied by honest employment, alas.

Friday, April 13, 2012

Cultural cognition of risk and perceived risks of nuclear

In a bit of a departure from the typical discussion, I wanted to delve deeper into a topic of some personal interest to me and of particular relevance to nuclear communication - that of risk perception by the public. As a scientist, people like me are trained to view risk in objective, impersonal terms - i.e., evaluating risk in strictly scientific, quantitative terms. One of the unending sources of frustration for the technical community is in the fact that this is not how the general public perceives risk - in fact, quite the opposite. Many times, people will blithely accept particular risks - driving, air travel, smoking, certain recreational activities - and yet recoil in horror at the unarguably lower risks presented by technologies such as nuclear energy (especially in comparison to energy alternatives such as coal and even natural gas).

Often, it's the first inclination of technically-minded folks to simply dismiss these people as irrational, even stupid. And yes, this is certainly easy - even satisfying (particularly on days when I'm feeling especially curmudgeonly...). It's also terribly unproductive. In light of this, I wanted to dig deeper into the idea of how public perceives risk, drawing on an established body of literature (again, perhaps most famously through projects like the Yale Law School's Cultural Cognition Project).

Understanding "perceived risk"

A particular school of thought in the social science of risk perception, known as the Cultural Theory of Risk, purports that the relative perception of risk - and ultimately, the determination of "acceptable" risk, is governed by cultural factors exogenous to strictly technical evaluations of risk alone. In other words, despite the fact that flying is safer than driving, people perceive the latter to be less safe due to other, outside factors. Thus a key element in understanding how risk is perceived by members of the public (i.e., the "non-technical" community) requires understanding the factors which tend to weigh upon evaluations of risk - in other words, factors which promote perceived risk. These include:

  • Involuntary exposure
  • Lack of personal control
  • High/catastrophic consequences 
  • Inequitable distribution of risk
  • Lack of familiarity
  • Lack of perceived benefit
  • "Dread" factors (e.g., cancer)
  • Irreversible consequences

In this way, risks of higher probability but more moderate consequences (e.g., natural gas explosions, coal waste accidents, etc.) are viewed as more "acceptable" despite much lower probabilities of harm from sources such as nuclear accidents. By the same token, risks which are mundane and taken up voluntarily - think smoking, etc. - are viewed as acceptable despite well-known and demonstrably higher probabilities of harm. 

Values and risk perception

An outgrowth of the Cultural Theory of Risk (or perhaps simply an alternative model altogether, although arguably not entirely incompatible) is the theory known as Cultural Cognition of Risk, which posits that deeply-held values influence how risks are perceived and processed by members of the public - and thus, which risks are seen as more prominent. Cultural Cognition (and the Cultural Cognition Project) seek to explain gaps in public perception of risk by looking at the correlations of risk perception to values - in other words, looking at why different political and cultural groups show wide disparities in perceived risks of large social issues, such as global climate change and other divisive issues.

value axisCultural Cognition divides value systems into two main axes. Roughly speaking, the vertical axis corresponds to values about how social goods (wealth, power, duties, and entitlements) are distributed, with "hierarchical" orientations favoring their distribution according to relatively "fixed" social markers - age, sex, race, etc. - and thus seeking to maintain these orderings. Conversely, egalitarian values tend to reject the idea of ranked hierarchies in the distribution of social goods. Along the horizontal axis is the relationship of the individual to society - leftward emphasizing a higher emphasis upon individuals and competitiveness, rightward emphasizing group solidarity over the individual. (An example of this can easily be observed in Eastern versus Western cultures, and in particular the expectations of individuals with respect to their societies.)

For those familiar with the Nolan Chart, or its variant, the Political Compass, there is a relatively intuitive mapping between the values proposed by Cultural Congition and the Personal/Economic liberty axes in each one (i.e., at the top left would be considered "conservatives," bottom right "liberals", bottom left "libertarians," and top right "populists"). Thus, the familiar partisan splits in nuclear energy support begin to grow more clear as one draws associations between the commonly held values of self-identified liberals, conservatives (and of course, libertarians!).

The central thesis of Cultural Cognition is that risk perception tends to be oriented along lines that remain harmonious with one's social values - risks which appear to challenge one's social values are minimized, which risks which speak to concerns of social values are heightened. Many of the topics studied under these lines of thought tend to include divisive social issues such as the role of gun ownership, abortion, nanotechnology, and indeed, nuclear power (in particular, nuclear waste management). Thus Cultural Cognition theory posits that differences in perceived risk due to major social issues comes from a reconciliation of information about risk with deeply-held personal values, thus explaining the gap in risk perception between different groups.

Education alone is not enough

Bringing this back to the subject of nuclear, it seems like once we understand what drives perception of risk, this should be enough to influence such perceptions more in line with actual facts. Yet one of the most discouraging findings in the literature on cultural cognition of risk is in that simply educating people is insufficient on its own, despite the naive assumption that such efforts bring about familiarity, thus diminishing outsized perceptions of risk. Why is this? Cognitive dissonance. For individuals already negatively predisposed toward a subject (i.e., nuclear energy), the presentation of new information produces an uncomfortable state of dissonance, which the natural mental reaction is to resolve. Typically this is done by dismissing the conflicting information and seeking reinforcing information from "trusted" sources, thus perhaps illustrating why, in spite of repeated debunking, some myths just won't die. And indeed, this is something we've seen before - again and again.

Going yet further, proponents of the Cultural Cognition hypothesis posit that educating participants on topics to which they were begin previously uninformed can actually produce a polarizing effect in attitudes. An example of this is a study in participant attitudes in nanotechnology, where most individuals have little starting information. The presentation of educational materials on the risks and benefits of nanotechnology actually had the effect of polarizing these individuals, despite the same information being presented - again implying that education on its own does not necessarily lead to broad accord.

Does this mean education is hopeless? Not at all - but what it does mean is that education must be carried out in a way which minimizes cognitive dissonance, namely by engaging with the value system of the listener.  That is, in presenting information in such a way which affirms rather than challenges the deeply-held values of the audience, said persons are more likely to be open to processing this new information and challenging previously-held beliefs.

In my last post, I alluded to the fact that individuals holding an "individualist" value persuasion were more likely to be open to evaluating risks of global climate change if nuclear power is presented in this context as the solution to climate change, rather than regulation. (Joe Romm, are you listening?) In this case, it is a matter of a message speaking to the values of the listener - individualists tend to be more prone to considering technological solutions to social problems and disinclined to solutions which encroach upon private, market-oriented mechanisms to social ordering. 

As a personal aside, I will say as someone with a similar worldview, the connection between nuclear energy and climate change made a similar impression upon myself - that is, in evaluating climate change as a problem to be solved through human ingenuity rather than imposed impoverishment, a discordance is removed - it is possible to reconcile a concern for climate change with previously-held values.

Obviously, this works with different value orientations as well - those with egalitarian value systems can arguably be brought around to support nuclear energy if it is seen as affirming egalitarian social values - two examples which come to mind are those of energy poverty and the inherently unequal outcomes of climate change, which would disproportionately impact the world's poorest nations (i.e., those incapable of adapting to climate change through economic and technical means).

Summing it up

To summarize - providing education and facts are good, useful even - but on their own insufficient without presenting those facts in a context which engages with the deeply-held values of the audience. To produce actual engagement - and even inducement to support - requires a producing a context of facts compatible with the values of those one is trying to reach. In other words, for the case of nuclear, it means going beyond education and comparative evaluation of risk (again, to emphasize, both of which are valid in and of themselves) and placing these within the framework of how this speaks to the values of the audience.

For individualists (who the research shows already tend to have a lower perceived risk attached to nuclear energy), this might mean presenting nuclear energy as a practical solution to climate change - something which has the spillover benefit of bringing about thoughtful consideration of the issues of climate change itself. For communitarians and egalitarians, this might mean both engaging in a demonstration of how nuclear energy can serve to mitigate much larger, more inequitable risks while meanwhile also honestly engaging concerns over safety and inter-generational equity issues like waste management. In other words, validating these concerns while demonstrating that these are issues which we take seriously and continue to devote considerable attention to.

None of this is a silver-bullet solution for engaging with the public, but it provides an illuminating context for which to facilitate a more productive discussion over energy.

A passage which struck me while I was researching this topic was when one proponent of cultural rationality (i.e., arguing that emotional reactions to risk have validity as moral, "normative" evaluations, alongside strictly technical, "positive" evaluations of risk) argued that members of the technological community do not have a privileged view of the normative factors associated with risk, particularly with respect to nuclear (the paper was on perceptions of nuclear risk in light of Fukushima) - that is, while members of the technical community have a privileged view of technical facts, they do not have a privileged view of overall assessments of what constitutes acceptability in risk - a normative judgement.

All of this of course is true. In as much, in my mind it is the job of the nuclear professionals (as members of the "technical community") to do our best to provide an accurate technical framework for these evaluations of risk by the public, such that they can make the most sound decisions on risk. Meanwhile it is the job of nuclear communicators and advocates to speak to values, as to produce more fair evaluations of both the benefits and risks of nuclear, particularly in the context of available energy choices.