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HOME > TOPICS > Nuclear Power Economics      
National Journal, "More Nuclear Aid Would Bomb Economics."

NPEC's executive director writes for the National Journal in a blog questioning the merits of federal subsidies for nuclear power.

Jan 12, 2010
AUTHOR: Henry Sokolski
More Nuclear Aid Would Bomb Economics (PDF) 104.05 KB

More Nuclear Aid Would Bomb Economics

Late last year, the bipartisan congressionally mandated Commission on the Prevention of Weapons of Mass Destruction Proliferation and Terrorism, upon which I serve, made several nuclear-related recommendations. Perhaps the most important of these is that the U.S. should work to strengthen the nonproliferation regime by discouraging the use of government financial incentives in the promotion of nuclear power. For all the fiscal and energy policy reasons already detailed on this blog, this recommendation rightly ought to be applied to all energy commercialization projects -- nuclear or nonnuclear -- across the board. Yet, the WMD commission determined that this recommendation was particularly salient in the case of nuclear power because of the serious nuclear weapons proliferation implications of failing to do so.

Large nuclear reactors do not just boil water. They also produce scores of bombs worth of nuclear weapons-usable plutonium annually that can be chemically stripped out from the spent fuel in a relatively short amount of time. In addition, these reactors are fueled with low enriched uranium that can be diverted and enriched into weapons grade uranium. It is no accident, therefore, that every major weapons state first mastered the operation of a large reactor before acquiring its first bomb. France, the U.S., Russia, the U.K. and India all made most of their first plutonium bombs from plutonium produced in reactors tied to the electrical grid. Even the vaunted "proliferation-resistant" light water reactor used by the U.S. produces not just power, but the tritium the U.S. needs for its thermonuclear weapons arsenal. North Korea demanded that the U.S., Japan and South Korea supply it with two modern power reactors so it might have the electricity it needed in exchange for giving up its own nuclear reactor activities . Ultimately, however, the U.S. decided it could not trust North Korea with such machines, each of which could produce roughly 50 bombs worth of near weapons grade plutonium in their first 12 to 15 months of operation. Before the U.S. gave up trying to kill Iran's large power reactor project at Bushehr, both presidents Clinton and Bush opposed its completion on nuclear proliferation grounds.

Nor are such nuclear programs easy to safeguard against illicit military diversions. This much has been demonstrated by the nuclear inspections gaffs we have seen in Iraq, Iran, North Korea, Syria, Algeria, Taiwan, Japan, and South Korea and the many bombs worth of plutonium and uranium products that go missing as "material unaccounted for (MUF) at declared nuclear fuel making plants. Rather than rely in international inspectors, Israel bombed Syria's large reactor in 2007 and Iraq bombed Iran's Bushehr reactor in the early 1980s even though all of these states signed the Nuclear Nonproliferation Treaty and have nuclear safeguards agreements with the International Atomic Energy Agency. These violent votes of no confidence in international nuclear inspections, as well as other deadly covert operations taken against other nuclear projects, highlight the security concerns these "civilian" activities raise when sited in dangerous regions.

What does any of this have to do with whether or not we should pile on additional nuclear subsidies to support the construction of new commercial power reactors in the U.S.? Plenty. If, after more than a half century of government subsidies and federal research and development support, nuclear power should finally turn out to be the cheapest, quickest way to produce electricity and to reduce carbon emissions, it would be difficult to prevent its increased use commercially not only here but abroad. Even if other countries might use this technology to illicitly acquire what they need to make nuclear bombs, the lure of export profits would be hard to resist. The nuclear weapons proliferation risks would simply be an additional price we would pay and try somehow (however fecklessly) to limit.

Yet, if nuclear power is so risky investment that no private bank (domestic or foreign) will invest in building new plants, why should our government go out of its way to do so by offering new, additional loan guarantees or other nuclear-specific subsidies? Wouldn't the granting of such largesse only make it even more difficult for the U.S. to discourage the governments of Syria, Saudi Arabia, Algeria, Iran, Egypt, Jordan, Iraq, Libya, and Turkey from making similar nuclear specific investments? All of these states have access to inexpensive, relatively clean burning natural gas that could fuel much cheaper advanced gas-fired plants but, then, arguably, so does the U.S. On what economic grounds might we be able to object to them building an $8 billion nuclear power plant and spending further billions on related infrastructure? And if we could not, why and how could we reasonably object to them making their own nuclear fuel? True, this is even more uneconomical and unprofitable than building the power reactor, but only slightly so: A small, crude reprocessing plant could be built for a fraction of the cost of a single new larger power reactor. Would we tell them that they cannot be trusted with such technology even though chemical reprocessing is less complicated than nuclear power production?

As it is, Adam Smith's "invisible hand" clearly favors nuclear nonproliferation and sound energy policies. Creating a biased competition with more nuclear-specific federal subsidies for commercial power reactor projects, though, does not. Indeed, it is a bad business, which is best not done at all.

The Nonproliferation Policy Education Center (NPEC), is a 501 (c)3 nonpartisan, nonprofit, educational organization
founded in 1994 to promote a better understanding of strategic weapons proliferation issues. NPEC educates policymakers, journalists,
and university professors about proliferation threats and possible new policies and measures to meet them.
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