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Edited on Thu Mar-11-10 04:08 PM by kristopher
They have tried to shave the data to preserve the ILLUSION of cost competitiveness.
Also, if the MIT analysis is such a good benchmark, why the hell is the present reality so very, very, very far from their 2003 projections?
I'd say that Schrader-Frechette's analysis is spot on:
Abstract Merck suppressed data on harmful effects of its drug Vioxx, and Guidant suppressed data on electrical flaws in one of its heart-defibrillator models. Both cases reveal how financial conflicts of interest can skew biomedical research.
Such conflicts also occur in electric-utility-related research. Attempting to show that increased atomic energy can help address climate change, some industry advocates claim nuclear power is an inexpensive way to generate low-carbon electricity.
Surveying 30 recent nuclear analyses, this paper shows that industry-funded studies appear to fall into conflicts of interest and to illegitimately trim cost data in several main ways. They exclude costs of full-liability insurance, underestimate interest rates and construction times by using ‘‘overnight’’ costs, and overestimate load factors and reactor lifetimes. If these trimmed costs are included, nuclear-generated electricity can be shown roughly 6 times more expensive than most studies claim. After answering four objections, the paper concludes that, although there may be reasons to use reactors to address climate change, economics does not appear to be one of them.
Climate Change, Nuclear Economics, and Conflicts of Interest Kristin Shrader-Frechette Sci Eng Ethics DOI 10.1007/s11948-009-9181-y
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ETA: I forgot to address the bullshit claim that government subsidies will reduce the "cost of capital". that is horseshit. Shifting the risk to the public sector doesn't reduce the cost of capital, it just means that losses normally calculated upfront and added into the capital costs are deferred and paid later by the public sector.
Based on current industry practices, CBO expects that any new nuclear construction project would be financed with 50 percent equity and 50 percent debt. The high equity participation reflects the current practice of purchasing energy assets using high equity stakes, 100 percent in some cases, used by companies likely to undertake a new nuclear construction project. Thus, we assume that the government loan guarantee would cover half the construction cost of a new plant, or $1.25 billion in 2011.
CBO considers the risk of default on such a loan guarantee to be very high—well above 50 percent. The key factor accounting for this risk is that we expect that the plant would be uneconomic to operate because of its high construction costs, relative to other electricity generation sources. In addition, this project would have significant technical risk because it would be the first of a new generation of nuclear plants, as well as project delay and interruption risk due to licensing and regulatory proceedings.
In its 2003 Annual Energy Outlook, the Energy Information Administration (EIA) projects that production from new nuclear power plants would not be cost-competitive with other power sources until after 2025. EIA also reports that current construction costs for a typical electricity plant range from $536 per kilowatt of capacity for natural-gas-powered combined- cycle technology to $1,367 per kilowatt of capacity for coal-steam technology. Although construction costs could diminish significantly as a new generation of nuclear plants are built, a new nuclear power plant starting construction in 2011 would have a construction cost of about $2,300 per kilowatt of capacity. By 2011, that cost would result in capital costs that are 40 percent to 250 percent above the cost of capital for electricity plants using gas and coal. Because the cost of power from the first of the next generation of new nuclear power plants would likely be significantly above prevailing market rates, we would expect that the plant operators would default on the borrowing that financed its capital costs.
That is based on a host of assumptions that are more favorable than now exists.
The economics have gotten worse, the risks have increased, and more of the risk (80% vs 50%) have been shifted to the public sector via loan guarantees.
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