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The Truth About the Price Anderson Act

Following up on the link we provided to yesterday's debate at Shakesville, Rod Adams has done a nice cost/benefit analysis on the Price Anderson Act.

For more information on Price Anderson, click here.

Comments

Anonymous said…
Calling the PA act a subsidy is a classic anti-nuclear canard. Rod Adams normalized the reported "subsidy", but he didn't do a cost-benefit analysis.

In fifty years, has a red cent ever been dished out as a result of PA? I don't think so. I suppose that in 1958 it might have been fair to call PA a subsidy, but it's been fifty years now.

Moreover, the "fair value" of the act is extremely small. The PA act only matters if an accident occurs where total costs exceed $10 billion. The likelihood of such a scenario is extremely small (once every million rx-yrs?), making the annual cost (or value) of PA insurance practically negligible. It's been 10,000 rx-years now for LWR, and only one incident of any note has occurred. That accident never came anywhere close to $10 billion in settlements.

Now from the standpoint of the federal government consider the benefits of the PA act. How much does the PA generate in local, state and federal taxes revenues? Based on NEI stats, it might be $7 billion or so annually, maybe even $10 billion. Much of that goes to the federal government. Some subsidy: not one red cent in exchange for billions annually.

Of course the most important benefit of the act is that 788 billion kw-hrs are NOT generated by fossil fuels. This benefit is infinite by any sane measure. I wouldn't even bother to put a dollar value on this, as the real benefit is the countless lives that were not cut short by choking on emissions from a coal plant.
Lisa Stiles said…
Actually, there were funds distributed after Three Mile Island but the total was less than $100 million, mostly from business losses and litigation costs.

Plus, the $10B cap isn't really a cap. If costs exceed that amount (which is very unlikely anyway), then Congress has the authority to decide what to do.
Anonymous said…
Thanks Lisa.

I don't believe that the $100 million figure attached to TMI-2 was paid out as part of the PA act. I think the industry paid the tab.

Yes, so essentially the federal government may or may not pick up the tab if it gets to over $10 billion. PA is merely the mechanism for streamlining the process. How anyone can view this as a subsidy to the nuclear power industry is beyond me. As a piece of insurance handed to the nuclear power industry, PA is of little value.
Anonymous said…
Lisa makes a good point that is often lost in the discussion. The "taxpayers" don't automatically pay for additional losses beyond 10 billion. (Real or imagined losses - it's a no fault structure.) Congress has to authorize any additional payments. Even if congress authorizes payments, they can recoup the payments from the industry with future assessments. As a result, the PA structure is more a no fault act than an indemnity act.

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