The real price of nuclear energy

By Li Shang-jen 李尚仁  / 

Thu, Apr 25, 2013 - Page 8

One of the main points of contention between the government and environmental groups with regard to nuclear power is whether atomic energy is really as cheap as Taiwan Power Co (Taipower) says it is. This issue involves the question of whether Taipower has been underestimating the costs of decommissioning nuclear power stations and of processing nuclear waste.

Since Taiwan has never decommissioned a nuclear power plant, Taipower can only estimate how much the process costs. However, precedents from other countries are available for reference. For example, in the US, the cost of decommissioning a nuclear power plant is about twice the cost of construction. The Green Citizens’ Action Alliance says that Taipower estimates the total cost of decommissioning the nation’s three operational nuclear power plants at NT$67.5 billion (US$2.26 billion), but using the US’ decommissioning experience as a basis, the cost of decommissioning the three plants would be closer to NT$360 billion.

We can also consider the situation in the UK. Britain’s oldest nuclear site is the Sellafield complex, whose reactors started operating in the 1950s. The site includes a nuclear power plant, and storage pools and processing facilities for spent fuel and other nuclear waste.

In 2008, the British government outsourced the operation, management, decommissioning and waste processing at Sellafield. The contract, which is valid until 2025, was awarded to Nuclear Management Partners, a multinational consortium consisting of three companies: URS of the US, AREVA of France and AMEC of the UK. At the time, the Guardian newspaper described it as “one of the most lucrative government contracts ever,” paying the contractors £1.3 billion (US$1.98 billion) each year.

However, high profitability does not necessarily mean high efficiency. Since the Sellafield cleanup program started, its costs have exceeded the budget significantly and it has encountered serious delays. In February, the British parliament’s Public Accounts Committee reported that the estimated lifetime costs of dealing with the Sellafield site had climbed to £67.5 billion, with no sign of when the projected costs would stop rising. Some experts predict that the total cost will be in the region of £100 billion.

Admittedly, Sellafield is bigger than Taiwan’s nuclear power plants and has been in operation for much longer. Nevertheless, Sellafield shows that the task of decommissioning nuclear installations can easily involve huge hidden financial risks.

Another thing about the UK’s experience that Taiwan would do well to consider is the predicament posed by the huge amount of atomic waste that has accumulated at Sellafield. A report published by Britain’s National Audit Office says that nuclear waste stored in buildings on the site poses significant risks to the people and the environment in nearby areas.

Taiwan’s situation is even worse because, while all its nuclear power plants will eventually have to be decommissioned, a proper storage facility for its spent fuel remains no more than a mirage.

Greenpeace UK has criticized the Sellafield decommissioning program as being yet another blank check handed to the nuclear energy industry by the British government. However, while construction of a new nuclear power plant can be halted, decommissioning of old plants is an unavoidable task.

If the cost of decommissioning Taiwan’s nuclear power stations keeps going over budget and the work keeps being delayed, what will Taiwanese be able to do about it? Taxpayers will be forced to hand over not just a blank check, but a cash card with no limit.

Considering how the cost of building the Fourth Nuclear Power Plant in Gongliao District (貢寮), New Taipei City (新北市), has kept rising, can one really believe Taipower’s forecast of how much decommissioning will cost? If the Fourth Nuclear Power Plant has been a money pit, decommissioning the other three plants could turn out to be a black hole. Does the nation really want to dig yet another hole to throw its money away in?

Li Shang-jen is an associate research fellow at Academia Sinica’s Institute of History and Philology.

Translated by Julian Clegg