“The blunders are all there, gentlemen, just waiting to be made”
– Savielly Tartakover (International Chess Grandmaster)





Unless I am mistaken, Mr Tartakover meant ‘ladies and gentlemen’, but regardless of what he meant, please recognize the many anti-nuclear blunders in circulation, and focus on the following. France and Sweden may still have the largest nuclear inventory per voter in the world, and they also once enjoyed the lowest electricity prices in Europe, and perhaps the world. Their nuclear reactors also have an admirable safety record, despite the ‘advanced age’ of this equipment.

Something else of interest, and which deserves close attention, is that according to the CIA ‘Fact Book’, Japan is one of the (geographically) most nuclear intensive countries in the world, but on the average its residents have the longest life expectancy in the world for residents of a major industrial power. The life expectancy in non-nuclear Denmark (and non-nuclear Norway) is below that of nuclear intensive Sweden and very nuclear intensive Japan. The CIA ‘fact book’ has Monaco at the top of life expectancies, but tiny (and rich) Monaco is ‘surrounded’ by nuclear intensive France. According to the Japanese government, there were no casualties at Fukushima that can be attributed to nuclear failure, and according to the U.S. government, none at all at Three-Mile Island. As for Chernobyl, the casualty count provided by the Russian government is not something that I repeat because it sounds too low. There are more than 400 reactors in operation today, many are being constructed at the present time, and even more are in the planning stage. I thus find it appropriate to accept that there will be well over 500 reactors in operation in a decade, and you should accept it too instead of pretending that nuclear is a lost cause. As a matter of fact, this is a good place to repeat a forecast that has disturbed readers of the manuscript version of my book Energy Economics: A Modern First Course. Some of those reactors will very likely be breeders, and according to Professor Jeffrey Sachs (of Columbia University and the Earth Institute) nuclear is the only sensible way to deal with the climate disruption problem. Many environmentalists now accept this judgement.

THE MAIN ORDER OF BUSINESS



The above introduction should get readers into the rhythm of the present short exposition. But please take my advice and do not expect this service from The International Handbook on the Economics of Energy (2009), which is more than 800 pages, and contains many articles. It ignores nuclear energy however, which strikes me and should strike you as odd, but maybe that doesn’t matter. On the basis of a brief perusal, I believe that like most publications that ignore nuclear where the real as compared to the fictional energy future is concerned, this so-called ‘Handbook’ deserves to be considered pedagogically worthless.

Thus I begin this contribution with the following important message: the nuclear facility at Fukushima was constructed about 40 years ago from blueprints prepared 5 or 10 years earlier. Suddenly it was a victim of one of the most powerful earthquakes experienced in Japan in the last 200 years, and also in the path of a destructive tsunami that featured waves up to 40 meters high along portions of a 100 kilometre stretch of the Eastern Japanese coastline. To some extent the survival of the Fukushima nuclear facility could be described as a structural miracle, and as indicated by the testimony of the Swedish diplomat and nuclear expert Hans Blix, its survival demonstrated what we have the right to expect from future generations of (technologically superior) nuclear equipment.

The bottom line here is that exuberant claims about the utility of nuclear energy should not only be tolerated, but promoted, and where the teaching of nuclear economics is concerned, as much emphasis should be put on history as on economics, because history rather than the fantasies of self-appointed nuclear experts is where the truth about nuclear is to be found.

Sweden is the perfect country in which to study energy disciplines. About 45% of the electric production capacity in Sweden (in e.g. megawatts) is accounted for by nuclear, although annually – at various times in the past – nuclear probably provided at least 50% of the electric energy (in megawatt-hours) produced in Sweden. Initially, nuclear and hydro gave Sweden some of the lowest cost and price of electricity in the world (and also some of the lowest output of carbon dioxide). The pointless deregulation of electricity put an end to that very favourable price arrangement.

More significant, the Swedish nuclear inventory of 12 reactors was installed in slightly less than 14 years, which was a feat of technological brilliance that in some respects was analogous to the expansion of the United States Navy and Air Force in the years immediately after the attack on Pearl Harbor. (At least eight of these Swedish reactors were produced by ASEA, a Swedish firm that inexplicably was moved from Sweden to Switzerland in 1988, becoming the A in ABB, or Asea Brown-Boveri.)

Something I never fail to stress in my formal lectures or informal harangues is the importance of moderately priced electricity for an industrial economy, and on that score Sweden was once in the forefront of world economies.

Unfortunately, a lovely situation of that nature turned out to be unacceptable to the local anti-nuclear booster clubs, who together with self-appointed energy experts from Sweden and elsewhere unleashed a torrent of lies and misunderstandings about nuclear energy that eventually resulted in the bad news for consumers of electricity that sometimes characterizes the Swedish electric market. During the last few years, the price of electricity to households in Sweden has occasionally been extremely high, although – wisely – electricity may still be sold to Swedish industries at a lower price.

If we take a careful look at the time series of global macroeconomic growth from the end of the second world war (WW2) to the present, we can distinguish two distinct segments. The first is comparatively smooth, and stretches from the end of WW2 until the middle of the l970s, or shortly after the first oil price shock, when energy prices began to rise in an unexpected manner. Unexpected in the sense that the countries comprising OPEC decided to take control of the energy resources within their borders.

The second segment, from the middle l970s to the present, which I discuss in my new energy economics textbook (2015), featured an irregular growth that doubtlessly resulted from occasional drastic increases in all energy prices that began with sharp increases in the price of oil, and whose impact effect was a reduction in the rate of the productivity growth in almost every industrial country.

This was a kind of ‘sneak preview’ of the macroeconomic meltdown that would begin in the latter half of 2008. Another consequence of the energy price rise – i.e. oil primarily, but also other energy resources – was stagflation, or the simultaneous occurrence of inflation and increased unemployment.

Unless national energy structures are ‘adjusted’, these miseries might accelerate if the prices of the main fossil fuels begin to escalate again, which is a misfortune that I consider possible, though perhaps not in the short run, and which I prefer not to discuss here. I will suggest however that this judgement particularly applies to oil and natural gas, and initially will likely be due to geopolitical rather than geological causes.

In case a possible ‘adjustment’ for countries like Sweden is necessary, I would like to suggest reinforcing hydro (when hydro is present), with an optimal collection of renewables and alternatives, as well as maintaining the presence of nuclear, increasing its efficiency, and eventually adopting the next generation of reactors and its variants in both present and smaller sizes. I also think it ‘politic’ to assume that nuclear will be an indispensable complement to (and not substitute for) any conceivable mix of renewables and alternatives, and also to accept that a fraction of these renewables and alternatives would be an optimal political but suboptimal economic concession to voters and politicians who are unable to understand the exterior (or historical) logic of science and engineering in or outside their countries, and to a certain extent are offended by what they understand of that logic, which happens to be the situation in Sweden.

As Sigmar Gabriel, Germany’s economy and energy minister, made clear, “we have reached the limit of what we can ask of our economy.” What he meant – but obviously could not say – was the limit of what could be asked if the proposed liquidation of nuclear energy in his country becomes a reality. Notice the word “if”, because a genuine as opposed to a synthetic dumping of nuclear will never take place in Germany or Japan. Gabriel also said that “Germany had been financing the learning curve on renewable energy for other European countries”, which might be the reason that he has called what he regards as the Swedish portion of that ‘debt’ due.

To be specific, Gabriel understands as well as I do that wind and solar can NEVER replace nuclear in Germany, nor any other civilized country, nor was that the intention of his government, even if it sounded good to persons who consider it sophisticated to believe lies and misunderstandings. The main replacement for nuclear in Germany is – and will remain for a while – imported electricity and coal, and so he contacted the Swedish prime minister (Mr Lõfven) and humbly requested that the Swedish firm Vattenfall should not abandon its coal mining activities in Germany, which may or may not have been about to happen, even though the lies that the directors of Vattenfall once spread across the world about their CCS (or ‘carbon capture and sequestration’) activities in that country probably set a new record where contempt for the intelligence of Swedish and German politicians and journalists is concerned. In addition, some of the employees of their firm actually believe the nonsense associated with CCS.

Another thing that is easily understandable, according to Jochen Eberhard – senior executive at the Fraunhofer Institute – is that “too much attention has been placed on costly renewables, and far too little on energy flexibility and flexibility of energy demand”. I’m sure that he is correct, particularly when he continues by saying that “this led to a rather high electricity price (except for firms receiving an exemption from the government where the eco-tax and various other newly conceived charges are concerned).”

Hearing this tells me that other countries should not make the mistake of trying to assist the German Chancellor (Angela Merkel) and her team, because what they are doing reduces to an irresponsible manipulation of taxes and subsidies of one sort or another. Instead, countries that export electricity to Germany should attempt to reintroduce German voters to reality rather than helping to prolong the fantasies associated with the Energiewende, and one way to do this is to reduce electricity exports to Germany, which will keep electricity prices from rising in their own countries.

Thank you for nothing, Germany, is the proper response to unworkable schemes like the Energiewende, and a gesture or gestures of disrespect should also be tendered politicians in every state or city who deem it correct to increase the price of electricity in their countries in order to make a success of the attack on living standards that will be experienced in Germany and elsewhere if the Energiewende achieves its goals!

So much for today, and for tomorrow Dr Oscar Archer, an Australian chemist, proposes that Australia should establish a facility for keeping in inventory used nuclear fuel from the remainder of the world. This fuel would then be processed and made available as fuel for the next generation of nuclear reactors (i.e. Generation 4). As an example Dr Archer cites the General Electric Hitachi Prism System, which involves a breeder reactor. However I worked for shorter or longer periods at seven universities in Australia, and never did I find it ‘politic’ to praise nuclear energy or to say anything positive about anything having to do with it, although it would not surprise me if eventually Australians found themselves in the nuclear business. (That country has large deposits of uranium, and might find more.)

The arrangement that Dr Archer favours is trade between Australia and other countries in which processed uranium ore that is ‘fuel’ for conventional reactors is swapped for nuclear ‘waste’ that will be treated/transformed and eventually turned into fuel for Australian (fast) breeder reactors. Or perhaps re-exported as reactor fuel.

Dr Archer has created a diagram which was published on www.abc.net.au, which has a useful pedagogical value, because one reason for disliking nuclear is that many persons regard anything having to do with the subject as complicated, and often presented by academics who – according to an observer who commented on some of my work – are “full of themselves”.


Two things in the diagram are important for me. Primarily the mention of the Prism System, which I suspect has important similarities to the 4th Generation reactor that billionaire Bill Gates is financing. Just as crucial is the association of Hitachi with this project, because the Japanese have been experimenting with breeder technology for many years, and my prediction now is that about 2020 – or earlier – the first successful (commercial) breeder reactors should be ready. I am without any spontaneous affection for this equipment, but I am ready to believe that the economics of nuclear electricity might be greatly changed because of a substantial reduction in the fuel cost of generating electricity as well as the availability of fuel. This is due to the ability of the breeder to exploit the more abundant isotope U-238 of uranium fuel as compared to the scarce isotope U-235.

Incidentally, there is not enough just above about the U.S., where most of the comments about the comprehensive lack of intelligence of Professor Banks in energy matters originate. For those ladies and gentlemen who insist that I am a nuclear shill, check out the latest estimates of the EIA (Energy Information Administration of the U.S. Department of Energy). At the present time about 68% (= 68%) of the electricity in the U.S. is provided by fossil fuels: coal, natural gas, and a comparatively small amount of oil. Coal provides 37%, natural gas 30% and nuclear 19% of the electricity. About 12% of the energy production in the U.S. comes from renewables and alternatives, where the largest component is waterpower (i.e. hydro) which provides about 7% of the electricity, wind (about 3.46%) and solar maybe slightly more than 1%.

Please note that renewables mean hydro, wind, biomass wood, biomass waste, geothermal and solar – it does not mean just wind and solar. By 2040 the expected picture by the EIA for electric generation is 35% of the total for natural gas, nuclear 16%,wind generation will not increase, but solar will likely double, and the rest will be coal. Does Professor Banks agree with the forecast for 2040? The short answer is NO.

Nothing has been said above about the supply of uranium, but the general belief is that there is no problem with reactor fuel once the reactors are breeders. Recently Prime Minister Narendra Modi of India and Canadian Prime Minister Stephen Harper announced a deal that will see Canada’s Cameco Corporation supply India with 3,000 metric tonnes of uranium over the next five years. Canada thus joins Kazakhstan and Russia as a supplier of uranium to India.

According to Mr Modi, this arrangement “launches a new era of bilateral cooperation and a new level of mutual trust and confidence.” He of course had a few things to say about clean energy. For instance, “The supply of uranium is important as India is keen to have clean energy. The world is worried about global warming and climate change. We want to give something to humanity through clean energy… For us, uranium is not just a mineral but an article of faith and an effort to save the world from climate change.” Well, that is certainly a beautiful thought, but as for it saving anything we’ll just have to wait and see. In any event, according to the World Nuclear Association, 52% of the world’s uranium production comes from 10 mines in six countries. The largest is in Canada, followed by one in Australia, while the largest single producer is Kazakhstan. In Africa, Niger and Namibia are big producers, and I am unaware of any predictions that uranium will be in short supply in the near future.

Now to end this story with the same format as I began. The EIA forecasts that global energy consumption will grow by about 55% by 2040, with at least 75% of that supplied by fossil fuels unless nuclear is allowed to play more than a marginal role. As for Germany and the Energiewende, the OECD and the IEA claim that even with a tax of 30 dollars per metric ton on carbon dioxide imposed on coal and natural gas, they can still outcompete wind and solar. Moreover, those organizations now admit that nuclear is the optimal source for producing electricity. For instance, using their numbers, optimal nuclear facilities in North America can produce electricity at between 50 and 75 dollars per megawatt-hours as compared to 70-80 dollars for coal based power. 60 to 90 dollars for a megawatt-hour produced using wind, while solar power might cost more. Michael Shellenberger, who was once labeled a “Hero of the Environment” by Time Magazine, now concludes that the belief that solar and wind power can displace fossil fuels is a “hallucinatory delusion”, and mentions that in 2012 solar power generated less than 5% of Germany’s electricity despite years of experimenting and over $100 billion spent in subsidies. Finally, when you think nuclear, think China: The China Nuclear Energy Association (CNEA) predicts that eight new nuclear reactors will begin operation this year. If so, that will mark the largest single-year increase in nuclear power production in China’s history. There are currently 23 reactors operating in China, with 26 under construction, and at least 50 planned. The point is to drastically reduce the consumption coal, and it is very likely that the Chinese recognize that to maximize the utility of using solar energy (which ostensibly has found favor with Chinese planners), more nuclear is required, and especially nuclear facilities with the kind of load-following ability that has been developed in France. Currently, nuclear energy accounts for less than 4% of China’s total power generation, but this is unacceptable, and the stated goal now is 58 gigawatts in nuclear power capacity by 2020. Some of power will be supplied by Chinese designed equipment such as China’s own indigenously-developed third-generation reactor, the Hualong-1 (developed by China National Nuclear Corp and China General Nuclear Power Group). Needless to say, China intends to become a world leader in the nuclear power industry during the present decade, and plans have already been made to sell the Hualong-l to countries in Asia and South America.



References


  • Archer, O. (2015). ‘Recycling Nuclear Waste for Power Generation’. 321 Energy
    (3 March).

  • Banks, F.E. (2016). Energy Economics: A Modern First Course (in process).

  • Banks, F.E. (2015). Energy and Economic Theory. Singapore, London, and New
    York: World Scientific.

  • Banks, F.E. (2007). The Political Economy of World Energy: An Introductory
    Textbook. Singapore & New York: World Scientific’




Ferdinand E. Banks has published 13 books internationally. His 13th book Energy And Economic Theory (2015) has just been published by World Scientific (Singapore, London and New York), and he is circulating an ‘ENERGY ECONOMICS 101’ textbook to colleagues and students in Sweden and elsewhere called ENERGY ECONOMICS: A MODERN FIRST COURSE (2016).

Image Barsebäck nuclear power plant in Skåne, Sweden by Jorchr CC-SA