Our friends over at the Heritage Foundation have been developing quite an interesting portfolio of papers about nuclear energy over the last few months. Their latest is called Critics of Nuclear Power's Costs Miss the Point and addresses the relative costs of nuclear power and its pals in the renewable Club of Heroes, solar and wind.
Writers Jack Spencer and Nick Loris make points we've made here several times over but do a good job of summarizing why it might be that nuclear energy, despite up-front costs that give pause, remains the energy source to favor for emission-free electricity generation (almost sounds like a sale pitch). Here's what they say about some of those up-front costs:
Today, it is very expensive to produce nuclear-qualified components and materials because steep overhead costs are carried by only a few products. Additional production will allow these costs to be spread, thus lowering costs overall. Further savings should be achieved by applying lessons learned from initial construction projects. Because nuclear plants could have an operating life of 80 years, the benefit could be well worth the cost.
John McCain mentioned this the other day in his energy speech and here Spencer and Loris make exactly the point we did: that the potential for industry development around nuclear componentry is enormous.
But what about wind?
Despite efforts to portray these sources as viable alternatives to nuclear power, they have their own problems. They are expensive, intermittent, and inappropriate for broad swaths of the United States. For example, wind turbines are virtually useless in the Southeast, where there is little wind. Even environmental activists are beginning to oppose wind projects because they kill birds, despoil landscapes, and ruin scenic views.
Er, how about solar, guys?
Solar, Inc., the world's largest solar company, recently told investors that its largest market, the European Union, may ban its solar panels because they contain toxic cadmium telluride. To replace the cadmium model with a silicon-based model would quadruple the production costs.
We expect Solar, Inc., will find a way around this, but you get the picture. We're not sure we fully agree with the "all the alternative energy sources have problems, so a pox on all houses" approach here; it's probably fairer to say that all sources of electricity generation present challenges, from construction right up to operation, and it's up to industry, with a nudge from regulators, government and activists, to find ways to solve those challenges.
Nuclear gets the nod in a lot of corners because, in broad terms, it's well understood and has proved its worth in the long term. It's also mature enough to produce electricity less expensively than its cousins.
We cannot nod to our friends over at Heritage without dinging them for a bit of partisan zeal:
Government has no business making any decisions about nuclear power based on costs. Its role should be to provide adequate oversight and fulfill its legal obligations on nuclear waste. It is primarily private companies that produce America's power, and consumers pay for it. Their interactions in the marketplace should determine the best way to meet America's energy needs.
We'd love to believe that government has such a small role to play here; however, when the public good intersects with industrial prerogative, the insertion of government into the mix can be a net positive, welcomed as a counterbalance to the impulse to do what is most immediately profitable - which is where corporations incline, after all. Heritage always seems to assume that if you step one pace away from an unfettered marketplace, Hugo Chavez will be having a ticker tape parade on Fifth Avenue.
Very slight ding, though, on a very good piece. Take a read.