A Free-Market Energy Blog

Where is the Real Dr. Chu, Mr. President? (Climate alarmism – nuclear = not much on the supply side)

By Donald Hertzmark -- July 17, 2009

In quick succession, the Obama administration has dealt a near-death blow to new civilian nuclear reactors in the U.S.

First, the Yucca Mountain Project, a waste storage facility in Nevada, was “zeroed-out” of the 2009 budget. Second, the administration has just ended U.S. participation in a new nuclear fuel recycling project, one that would extract more energy from existing fission energy sources, and reduce sharply the high level nuclear waste from nuclear power.

Presiding over both of these decisions–that effectively terminate the feasibility of new nuclear power plants for the U.S.–is Dr. Steven Chu, Secretary of Energy, Nobel Laureate in Physics, and former director of the Lawrence Berkeley Energy Laboratory.

In contrast to the crowing of Senator Harry Reid about “killing” the Yucca Mountain Waste storage project, Dr. Chu described nuclear fuel recycling as an essential element of nuclear power for the U.S., and noted that storage of the type proposed for Yucca Mountain would be necessary for a few more years. In a 2009 interview with MIT’s Technology Review, for example, Dr. Chu specifically touted fast neutron (breeder) reactors and hybrid fission-fusion plants as good routes for future nuclear power technology.

In earlier interviews, Dr. Chu had called nuclear energy a vital component of the U.S. energy mix and restated his desire to see the share of nuclear power rise above its current level of 20% of electricity generation. “Nuclear has to be a necessary part of the portfolio, said Chu prior to his confirmation as Energy Secretary. In line with that view, license applications will be sought by investor-owned utilities for 35 new nuclear power plants over the next several years.

In comparison to a technological sure thing, Chu has noted that “making solar cheap will require ‘transformative technologies’, equivalent to the discovery of the transistor,” something that the billions spent on solar energy have so far failed to create.

Catch 22: No Nuclear Fuel Options, No Nuclear Power Plants

Under current regulations, U.S. utility companies can apply for a license to construct new nuclear power plants.  But there is just one problem. They have to have a nuclear waste plan in order to receive an operating license once construction is completed. There lies the Catch-22 of U.S. nuclear policy. Heeding the entreaties of various nuclear energy opponents, the U.S. government has effectively removed both of the feasible spent fuel options from the menu, rendering a license to build a new nuclear plant simply a good way to waste shareholder and ratepayer funds. Dr. Chu understands this and is on the record favoring new nuclear power with appropriate fuel reprocessing, but not in his current capacity as Secretary of Energy.

Will the Government Give US Our Money Back for Yucca Mountain?

Lost in the noise about nuclear policy is one alarming fact: electricity ratepayers consuming nuclear power, not taxpayers in general, have funded existing waste disposal technologies and initiatives. The Yucca Mountain project, paid for by electricity consumers, has thus far spent more than $9 billion  of the $25 billion collected from ratepayers. So the administration, by canceling the project, has treated ratepayers with exactly the type of high-handedness that bondholders of GM and Chrysler received.

So much for the rule of law when OPM (other people’s money) is involved. No word yet from the DOE on consumer refunds for the monies wasted in a dead-end project, to say nothing of the $16 billion that has been collected but not spent.

How Hard is This, Really?

Current U.S. nuclear fuel technology policy is akin to telling drivers to take 75% of the fuel out of their gas tanks and store it “someplace.” It is a proposition that simply defies logic. The technology used in U.S. nuclear reactors consumes just 5-7% of the fuel available in the enriched uranium. The rest cannot be used unless the spent fuel is reprocessed, in the words of Secretary Chu, “it has some inherent value.”

Currently, almost all of the spent fuel generated by the country’s 104 civilian reactors is stored on site (at the reactor) in cooling pools. Some of the spent fuel has been vitrified, or locked away in casks that make it unavailable for either benign or malign future use. The rest is in a form that could be readily reprocessed using current technology.

Our obtuse approach to nuclear fuel is not technologically driven. “France, whose 59 reactors generate 80 percent of its electricity, has safely recycled nuclear fuel for decades.” Enough spent fuel has been reprocessed in France to supply 14 years of operation for the country’s nuclear plants. Moreover, the MOX, or mixed oxide fuel produced in France’s Le Havre reprocessing facility, is exported to Japan, among other customers, to use in civilian power technology. Areva, the French company, is assisting in the construction of reprocessing plants in Japan and China.

Where Is the Market in All of This?

Power generators in the U.S. are faced with increasing resistance to new coal plants, the least cost solution for power generation, even with carbon separation and storage bolted onto the back end of the plant. Gas is a good option, and one that will be increasingly used as all other alternatives vanish. However, one would have to be naive to think that the anti-carbon lobby will continue to permit the bountiful shale gas resources in the U.S. to render wind entirely uncompetitive.  Already, New York State has held up permits for Marcellus Shale gas production on “environmental” grounds.  Wind and solar, as noted by Dr. Chu, are not yet serious contenders for reliable power supply. This leaves nuclear as the sole “carbon-free” reliable generation option.

Many electrons have died disputing the economics of nuclear power. In the U.S., we have learned some bitter lessons about the cost of politicizing the economics of energy. And yet we repeat these same mistakes with a new generation of nuclear power technology. Somehow, the prospect of generating electricity at a reasonable cost without all that “hot” stuff left over is unappealing to the opponents of nuclear power.

Perhaps it is time to listen to the people who vote with their own money. We have willing buyers, the electricity-consuming public, who wish for cost-effective, clean and reliable energy— not periodic outages due to calm weather or nightfall. We see nuclear technologies deployed outside the U.S. that can apparently produce electricity at competitive prices. We have domestic U.S. utilities that wish to build and operate new nuclear power plants, based on an assessment of all of the alternatives in a carbon-constrained world. We have firms willing to invest in new plants and even in fuel reprocessing, on the understanding that nuclear is the best of the carbon-free generation options. Willing buyers, willing sellers, willing investors, what could be better than that?

If we do not listen to those spending their own money, then we will have to listen to those who spend OPM. We will get less reliable, even more expensive electricity, paid for both in the electricity bill and the tax form. Dr. Chu understands energy technology well, we can only hope that Secretary Chu will heed the wisdom of his illustrious alter ego.


  1. Jim Clarkson  

    Do you think there will be no recycling unless there are federal subsidies? What about the willing investors, shouldn’t we count on the market to develop ways to handle nuclear waste? If there is no market solution then maybe there should be no nuclear power.


  2. Andrew  

    Jim-things happen without subsidies when they are profitable. So a good question is, when, if ever, will nuclear fuel recycling become economically viable?

    I don’t agree with the philosophy that one can speed innovation by throwing money at something, so I too think perhaps for the moment one shouldn’t expect nuclear to thrive.


  3. Donald Hertzmark  

    Jim, Andrew,
    In the case of waste storage (Yucca Mountain) there is not an issue of federal monies. The ratepayers have paid for the storage and the feds have confiscated the money because they can.

    With regard to fuel recycling the scale of such an activity in the US would certainly give rise to reasonable economies of operation and construction were such economies possible. Under the current prohibitions we may never know.

    If the feds do some of the seed work and then private investors take over the implementation stage, then this is no different from government support for medical research and can be justified on similar grounds. If the private investors are unwilling to invest then Jim’s open question has been answered.

    At present the industry is hostage to prohibition of any spent fuel solutions and is consequently not viable from either a regulatory or financial standpoint. The feds are now in a position of saying “hey, you guys cannot do anything with the spent fuel except store it on site and we will not give you and operation permit to do that with a new plant.” This hardly makes the case that investors are unwilling to go forward with solutions to the spent fuel issue. Like a patient on oxygen, the nuclear industry can only breathe if we get our feet off the air hose. It does not guarantee success, but may permit it.


  4. Rod Adams  


    Though I agree that the current administration has issued some conflicting statements about the future use of nuclear power, your assertion that canceling the funding for Yucca Mountain will prevent new nuclear plant construction ignores the longstanding “waste confidence ruling” first issued by the NRC in the early 1980’s. It has recently gone through a lengthy review process with the following conclusion: “. . .if necessary, spent fuel generated in any reactor can be stored safely and without significant environmental impacts for at least 60 years beyond the licensed life for operation (which may include the term of a revised or renewed license) of that reactor in a combination of storage in its spent fuel storage basin or at either onsite or offsite independent spent fuel storage installations (ISFSIs).” (http://tinyurl.com/mecm6t)

    I also see no issue with regard to fuel recycling because of a decision to stop funding the Global Nuclear Energy Partnership (GNEP), a decision that does not preclude private investment in appropriate facilities.

    Rod Adams
    Publisher, Atomic Insights
    Host and producer, The Atomic Show Podcast


  5. Donald Hertzmark  

    Dear Rod,
    Your points are well taken. I guess that the question is whether one believes that this administration is actually dealing in good faith on the nuclear issue. Surely, without affirmative support from the government, and this includes GNEP, investors in nuclear power at any stage of the fuel cycle are going to suspect that the end result will be no permits to operate resulting in an expensive hunk of junk. Would that we could de-politicize the energy business and make it less of a “what does mommy want me to do” industry, but this is the hand we are dealt at present.


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