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VOODOO ECONOMICS AND THE DOOMED NUCLEAR :

Paul Brown Paul Brown, former environment correspondent of researched and wrote this paper when a Press Fellow at Wolfson College, Cambridge during 2007/08. The Fellowship was sponsored by British . The views expressed in this paper are those of the author.

Making life better for people by inspiring solutions to environmental problems Friends of the Earth is: L the UK’s most influential environmental campaigning organisation L the most extensive environmental network in the world with more than 1 million supporters across five continents and more than 70 national organisations worldwide.

2 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE EXECUTIVE SUMMARY

The economics of new nuclear already £100 each for every power stations for the UK do not taxpayer in the country – and this * Voo·doo eco·nom·ics, add up. It is not possible to achieve is rising. [ \ vü-(_)dü\ \_e-k_-∂ nä- what the Government says it will do L Three of the four new reactor miks, e-k_-\∂ ], noun – build a new of nuclear designs being put forward for UK 1. Term coined by George stations in England without public construction have never been built. Bush Snr to describe Ronald subsidy. The only “third generation” nuclear Reagan’s economic policy station that is under construction, because it promised to lower New build will not be possible and the favourite to be built in taxes and increase revenues without large sums of taxpayers’ Britain, is half-built in Finland. It is at the same time. 2. Any money being pledged, and two years behind schedule and use of economics based extending the unlimited guarantees million of pounds over budget. on contradictory ideas and to underwrite all the debts of the L The nuclear industry claims gobbledegook. existing and future nuclear industry. that if planning is streamlined, nuclear licensing speeded up, and This paper exposes how badly the construction is on schedule, a new dealing with used from nuclear industry has performed nuclear station could be up and power stations is seizing up. over its entire 50 years of unfulfilled running in 10 years. Civil servants L The MOX plant that is supposed to promises, and the already escalating estimate 2021, but previous British make money by turning bill to the taxpayer. experience with untried nuclear and into new fuel has designs suggests it could be up to been a technical and financial The key points are: a decade longer. disaster. The fuel was supposed L The taxpayer has already to be the safe way of returning underwritten all the debts and The main problems at Sellafield are: of plutonium recovered liabilities of so the L The flagship Thorp reprocessing during reprocessing in the Thorp company can never go bankrupt. plant, built to extract plutonium plant to its country of origin. This This commitment dwarfs the risk to and unused uranium from used plan has failed yet the Government the taxpayer of the Northern Rock nuclear fuel, was closed for three has no policy for dealing with the nationalisation. years from 2005. It remains under ensuing economic and political L It will take 10 to 20 years before severe operating restrictions and crisis. the first new nuclear stations cannot complete its long-overdue L As a result, the promises of can be built and are producing contracts to deal with spent foreign successive governments that power in Britain. By that time the fuel. Sellafield would not become the liabilities of the existing privatised L The closure of the elderly world’s nuclear dustbin and all industry will be so great that the reprocessing plant has foreign nuclear waste would be Government will have had to been postponed, leaving the UK repatriated cannot be fulfilled. renationalise it. unable to meet its international L While Britain piles up its own and L The crisis may come much commitments to cut radioactive foreign nuclear waste there are sooner. British Energy may have discharges into the Irish . currently no plans or sites for a to start closing some of its 11 L The plants for dealing with the repository to store or dispose of nuclear stations because the only residue of reprocessing, the it. The earliest dates for a deep remaining storage space for spent volatile and dangerous heat- underground intermediate waste fuel at Sellafield, in , is producing high-level liquid waste, repository are notionally 2045 and running out. do not work as designed. The high level waste 2075. In reality L Employing more than 10,000 evaporators for reducing the there are no plans for either. people, the massive nuclear volume and the system for turning complex at Sellafield is in crisis. the liquid into glass blocks have Its reprocessing works and a constantly broken down and plutonium fuel plant are all failing underperformed. As a result the at a massive cost – annually whole Sellafield production line for

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 3 INTRODUCTION Credit: Don McPhee/Guardian Newspapers. McPhee/Guardian Don Credit: Successive British governments unfolding crisis in the existing British have announced ambitious plans for nuclear industry. a new nuclear age. Over 50 years they have promised to build families IS FAILING of identical reactors producing cheap The Sellafield nuclear site in power. Each plan has faltered. Cumbria, which houses two publicly- Delays, U-turns and cost overruns owned reprocessing works and a have turned each into a financial plant for making mixed uranium and headache for the taxpayer – while plutonium fuel called MOX, is failing. consumers’ bills have been Not one of its facilities is working as pushed up to pay the extra costs. it was designed to do. Breakdowns are costing taxpayers millions of It is about to happen again. pounds a week. The bill for keeping this site running at a continuous loss The announcement in January 2008 is about £100 a year, or £2 a week, of another new family of reactors for every taxpayer in the country, is repeating the same mistakes. amounting to £3 billion annually. Against the evidence of history and the current knowledge of the nuclear Sellafield’s intractable problems are industry the Government is displaying likely to rebound on the privatised breathtaking optimism about the part of the nuclear industry. British The 400 foot chimney of Windscale’s potential for the technology. Energy is wholly reliant on Sellafield Pile One, damaged by a fire in 1957 to reprocess and store spent fuel predicted to have caused up to 50 The economics of building new from the 14 advanced gas-cooled deaths. The picture is taken from plants, endorsed by reactors (AGRs) that it operates. the village graveyard at nearby the Government, are based on the Sellafield Limited, which runs the . figures provided by the industry site, denies space is running out – which of course has a vested and British Energy says it does interest in making them appear not believe there is any “short term the risks and costs onto the taxpayer competitive. Yet the nuclear industry threat to its operations”; but spent while private investors pocket the has never completed any project in fuel assemblies are being stacked profit. Yet that is, up to now, how Britain on time or on budget. The three deep in the reception ponds the industry has been run. In fact Government’s own figures say a because of a shortage of storage there has been no reason, if nuclear new nuclear power programme will space. If Sellafield can take no more stations were economic, why they cut gas imports by only 7 per cent spent fuel, then British Energy’s AGR should not have been built already. and carbon dioxide emissions by 4 stations will gradually have to close. The conclusion is that the industry per cent. Yet the programme for four always needs the Government to gigantic new stations will get political The Government last bailed out underwrite it. encouragement and public subsidy the privatised nuclear industry in on the false claim that Britain needs 2001 to prevent it going bankrupt. The impact of years of unfounded them for security of This resulted in an open-ended optimism and blind acceptance of and to reduce carbon emissions. commitment to meet all British the industry’s unproven forecasts Without government help these Energy’s liabilities should it become is already apparent. The Nuclear stations could not be built. insolvent a second time. The Decommissioning Authority (NDA) Government’s commitment to was founded on the notion that it Ministers seem unaware that at the Northern Rock Bank savers is small would be able to fund part of the same time as endorsing a by comparison. cleaning up of all the radioactivity new family of reactors, to be once plant is shut down at Sellafield designed and to be delivered For the new nuclear renaissance the by income from reprocessing spent by foreign suppliers, there is an Government says it will not load all fuel, thereby creating even more

4 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE waste to deal with in the future. This strategy is failing because the ABOUT THIS REPORT The Chronology is a history plant does not work as planned. This paper written by Paul of unfilled dreams and broken Technical flaws, some of which Brown, while British Petroleum promises. It is a timeline of cannot be fixed because they are sponsored Press Fellow at false optimism, grandiose and inside highly radioactive areas, have Wolfson College, Cambridge in unrealistic plans, cost overruns made nonsense of estimates of 2007/08, draws on 20 years of and false assurances. It puts potential income from plants. This is reporting the nuclear industry for in context the naivety of the causing a funding crisis at the NDA The Guardian, numerous papers current Cabinet. The history and a scaling-back of its clean-up and documents collected over of the nuclear industry makes operations. the period, and a large number one wonder how Gordon Brown of recent reports. The industry, could believe for a moment Ministers will find themselves Government and regulators have that his Government’s decision trying to deal with these escalating answered detailed questions. to give the green light to more problems at the same time as stations would usher in a new asking MPs to rubber-stamp a The paper is divided into three atomic age for Britain. revival of nuclear power. MPs parts. might want to consider that all the Part 2 examines the pitfalls available evidence suggests the Part 1 describes the crisis facing ahead for existing and new Government’s plans will mean higher operations at Sellafield – the nuclear power stations. The electricity bills for their constituents. industry’s flagship for 50 years. Government has been ignoring Technical failures across all its inconvenient information and It is already known that the taxpayer operations are driving costs up well-researched advice. A faces a £72 billion bill to clean up rapidly. Targets for reprocessing complication is its open-ended the nuclear industry; yet this figure is spent fuel, producing new commitment to underwrite sold as a problem of “legacy” wastes fuel, and dealing with wastes British Energy’s debts. This is – as if the current Government has are being missed. Despite the same company that owns no responsibility for it. Although Government assurances most of the sites on which some of these costs are historic otherwise, the site has become nuclear new build is expected liabilities from Britain’s 60-year the world’s nuclear dustbin as to take place. Yet it seems nuclear programme, they are increasing quantities of foreign inevitable that if a new building escalating precisely because current and British nuclear detritus pile programme goes ahead British Government policy is to persist with up. There is no disposal route Energy will find itself with reprocessing – even though it is for the British waste extracted at liabilities exceeding its assets demonstrably unnecessary, given Sellafield, and as yet, no plans a second time. Any shortfall that all spent fuel from the newer to return to the country of origin and the costs end up with the nuclear stations could be stored and thousands of tonnes of foreign taxpayer. The Government will disposed of at far less cost. waste. This is from nations have to take on ownership of that have sent their spent fuel any bankrupt nuclear stations; to the UK to be reprocessed. it can then choose to run them Repeated Government pledges as a nationalised industry. that the plutonium, uranium and Alternatively it could take on all waste from reprocessing this the new liabilities and give back spent fuel would be repatriated the stations to private ownership have still to be honoured. as it did only three years ago.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 5 PART 1:

Sellafield is the most closely the nuclear production line running; liquid . This waste guarded industrial complex in the over optimistic predictions made is very volatile and difficult to deal Europe. For more than 50 years to justify investment in them; and with. The recycled plutonium and this remote site in Cumbria, where a comparison with their current uranium can be turned into new 10,000 people are employed, has financial problems. fuel (called mixed oxide, or MOX). been at the frontier of nuclear In practice only a tiny quantity has technology; it is also a lynchpin of No electricity is now produced been used in this way because it is the industry in the UK. If it is not at Sellafield using nuclear power far more expensive to produce than working properly the whole industry – all the reactors are being normal uranium fuel. Many reactors feels the effects. decommissioned. Instead the site’s are not designed to use MOX and it business is to receive spent fuel is potentially more hazardous. Here the nuclear dream has turned from British and foreign reactors. into an economic and security Some is kept in storage ponds. The Sellafield nuclear recycling centre nightmare for the British taxpayer. The These are swimming pool-sized has suffered many near disastrous extent of the problems at Sellafield tanks into which spent fuel is episodes in its history; but accidents has not been fully explained to the lowered as it is delivered from power and technical and management public; nor have the potential knock- stations. To be safe, and avoid failures in the past 10 years have on effects for the whole nuclear overheating, the fuel needs to be brought this production line of linked industry. But research shows the constantly monitored and kept cool. nuclear factories to a crisis. situation is rapidly getting worse. Some is held there indefinitely but most is destined to be reprocessed. The Government’s safety HOW SELLAFIELD WORKS watchdog, the Nuclear Installations (OR DOESN’T) Reprocessing involves feeding Inspectorate (NII), placed a legal Sellafield houses several different thousands of tonnes of spent fuel requirement on the operators British plants. Because they are all linked, into two giant works that chop up Nuclear Fuels to reduce the volume leaks, malfunctions and failure to this highly radioactive material, of highly active liquors from 1,575 reach targets at one plant affect dissolve it in nitric acid, and then cubic metres in 2001 to a buffer the rest. Below is a summary of the separate and recover the plutonium stock of 200 cubic metres by 2015. main operations required to keep and uranium, leaving a residue of (Buffer levels are the amounts of

Chronology 1954: Lewis Strauss, chairman of the US Atomic Energy Commission, said atomic power would provide electricity “too cheap to meter”. The UK tried to make this promise come true by combining plutonium and electricity production in one design. Plutonium was given much greater value than gold and so the “plutonium credit” for power stations meant that on paper the electricity produced was virtually free.

6 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE Credit: GuardianCredit: Newspapers liquid waste in the system which would allow safe, efficient operation of the plant.) Technical failures in the evaporators required to do this have led to frequent and costly shutdowns – all funded by the taxpayer. The major clean-up priority at Sellafield is turning highly dangerous liquid radioactive wastes into safer glass blocks – so called vitrification.

These five important operations at Sellafield – the two reprocessing plants, the MOX plant, the evaporators and the vitrification plant – are all in trouble. They are part of the same nuclear production line to which from the UK and countries across the world is delivered. At the other end of this reprocessing conveyor belt neatly packaged new fuel and waste are supposed to be delivered back to customers. It has never worked liked that. Instead the production line has repeatedly broken down, and there are too few customers for the MOX fuel. As a result Sellafield is the 1962, Cumbria, England – Calder Hall, Britain’s first nuclear power station, home of the world’s biggest stockpile which opened in 1956.

1956: 1957: 1957: The Queen opened the first Government promises a nuclear After a disastrous fire at Windscale, two 65 megawatt dual purpose building programme to achieve the world’s worst nuclear accident reactors at Calder Hall at 5,000 to 6,000 megawatts until Chernobyl in 1986, Prime Windscale (later Sellafield). “The capacity by 1965. That would Minister told first station anywhere in the world mean 20 nuclear stations with the Cabinet he was suppressing to produce electricity from atomic four reactors each the size of the report that detailed the full energy on a full industrial scale,” ones at Calder Hall. extent of the disaster, defects according to Rab Butler, for the in organisation and technical Government at the time. The shortcomings. The facts were not public was not told the reason made public for 30 years. for the station being built was to produce plutonium for the UK’s nuclear weapons. Because of the plutonium credit the electricity was regarded as a cheap by- product.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 7 Credit: Christopher Thomond/Guardian Newspapers ChristopherCredit: Thomond/Guardian of plutonium and uranium for which there is currently no use. In addition there is an ever increasing quantity of nuclear waste, which, despite billions of pounds of investment in hardware, the industry is struggling to deal with.

TWO KEY PROCESSES FAILING There are two ends of the line for Sellafield production. Neither is working properly.

The first is the high-level nuclear waste stream, intended to produce packaged waste for deep geological storage and eventually disposal. This begins with evaporating the highly dangerous liquid nuclear waste to reduce its volume and eventually Flasks in the Vitrified Product Store at Sellafield. Light circles denote full turning it into glass blocks. flasks, dark are empty.

The second is the end-product for recovered plutonium and uranium is virtually brand new but is already the nuclear industry claimed they – the fuel called MOX. The Sellafield proving a millstone around the were being built for. From there the MOX Plant (SMP) is supposed to taxpayer’s neck. Officially its losses story turns back up the production earn foreign currency by turning are “commercial in confidence”. line to describe the crippling effects mixed oxides of plutonium and for other plants and processes uranium derived from reprocessing Below is a description of how these – which are in turn handicapped spent fuel into new fuel. The SMP two plants are failing to achieve what because of their own design flaws

1960: 1964: 1964: Government White Paper scales Government White Paper, The Magnox reprocessing plant back nuclear building plans to 3,000 Second Nuclear Programme, opened at Windscale for dual megawatts, acknowledging that says 5,000 megawatts of new purpose of producing plutonium generation was 25 per cent plant will be built between for nuclear weapons and for fast- cheaper. In fact it was admitted to 1970 and1976. This turned fuel. the House of Commons in 1963 that out to be the era of the nuclear generation was more than advanced gas-cooled reactor twice as expensive as coal. Among (AGR). Other designs were 1965: other things very large research and rejected after much dithering. Proposed building programme development costs were written off Minister for Power Fred Lee for AGRs increased to 8,000 when calculating the cost of nuclear told the House of Commons megawatts. energy. Planning restrictions for of the AGR design: “We nuclear plant were relaxed and a have won the jackpot this total of 11 Magnox stations were time – we have the greatest built, the last at Wylfa, Anglesey, breakthrough of all times.” completed in 1968. It was three years late.

8 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE and technical failures. At every stage the danger of a collapse of the is made into glass blocks have it is the taxpayer who picks up the tanks or the consequences of an failed earlier than expected. Inside bills for cleaning up. This is currently interruption in the 24-hour-a-day the sealed nuclear units, or cells, in about £100 a year, or £2 a week, for supply of electricity and water that which these processes take place each and every UK taxpayer, and are required to keep the tanks cool. the cranes and other remote handling this figure is expected to continue Liquid storage of such dangerous equipment frequently broke down rising for the foreseeable future, wastes is not a permanent solution. – probably because of the intense for a clean-up that will last at least radiation. Modifications improved the another 100 years. In 1990 a plant was built to convert plant to an output of 332 containers 1,355 cubic metres of this liquid a year by 1995 but it was still not Vitrification plant waste into 8,000 glass blocks enough to clear the backlog. For more than 40 years high-level – although even in this much safer liquid waste has been stored at state the blocks would have to be A third production line was ordered Sellafield with constant stirring closely monitored for a further 50 in the mid-1990s when it was clear and cooling to stop radioactive years before they could be placed that the technology was not working elements combining and causing an in a long-term repository. The plant, as designed. The volume of waste explosive reaction. The NII became costing £240 million, was designed was supposed to be reduced by concerned more than 10 years to clear the backlog of waste and 350 cubic metres over 14 years to ago that these storage practices allow reprocessing to continue by get it down to safe and manageable might become unsafe because of producing 600 glass blocks a year levels. Instead, in 2001 the volume the state of the tanks. This concern from two production lines, with increased because the company was repeated in the NII’s 2007 each glass block being placed in a continued reprocessing; meanwhile report. The tanks are considered the container, known as a can. The plant failures in the vitrification plant single installation most vulnerable did not function correctly. In the first meant production of glass blocks to terrorist attacks and together two years to 1993 output was limited could not keep pace. The situation contain far more dangerous to 114 containers a year. The Nuclear became so bad in September 2001 radioactivity than the Chernobyl Installations Inspectorate (NII) said a that both reprocessing plants were reactor. The Irish Government has large number of “melters” in which the closed to avoid legal sanctions by often expressed concern about liquid waste, sand and other materials the NII. At this time there were

1966: 1977: 1979: First AGR construction begins. Windscale Inquiry inspector Conservative Energy Secretary, Dungeness B in Kent becomes Justice Parker recommends David Howell, announces 10 an industrial legend for cost Thermal Oxide Reprocessing new Pressurised Water Reactors overruns and delays and the first Plant (Thorp) at Sellafield (PWRs) to be built and says that reactor is not commissioned for go-ahead on the (erroneous) nuclear power “is a cheaper form 19 years. It was still operating at assumption that plutonium would of than any only 50 per cent capacity in 1991. be needed for the fast-breeder known to man”. reactor programme.

1977: 1983: Last of seven AGR stations is Planning inquiry for first PWR at ordered for Heysham, Lancashire, Sizewell in Suffolk starts. It lasts to complete the 8,000 megawatt two years. programme. The official CEGB history described them as “one of the major blunders of British industrial policy”.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 9 THE BROKEN CHAIN: BRITAIN’S SPENT FUEL SYSTEM ISN’T WORKING

MAGNOX REPROCESSING (not working to capacity) Pu U 94 92 SPENT FUEL 100 tonnes PLUTONIUM (from UK and STORAGE AND overseas) PONDS 30,000 tonnes (nearly full) URANIUM (no known economic use)

THORP REPROCESSING (output drastically reduced)

1983: 1986: 1987: Government forced to abandon The world’s worst nuclear Sizewell B (to go alongside the dumping low- and intermediate- accident occurs at Chernobyl, Magnox station Sizewell A) level nuclear waste in the turning public opinion against approved after the Department Atlantic because of combined nuclear power. In areas of of Energy claims: “Sizewell B is environmental and union North Wales and Cumbria, likely to be the least cost option pressure. where rain fell heavily after the for new generating plant”. accident, sheep cannot be sold to market for 20 years because of contamination. In 2008 there are 1987: still 11 farms and 10,000 sheep , a company owned by the under restrictions. nuclear industry, formed to find ways of getting rid of nuclear waste.

10 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE EVAPORATE HIGHLY TOXIC AND TURN AND RADIOACTIVE INTO GLASS NUCLEAR WASTE BLOCKS (VITRIFICATION) (not working to design)

MOX FUEL (only 6 tonnes produced in five years – no hope SEND IT BACK of using existing OVERSEAS stockpile) OR STORE IT IN UK (no disposal route exists)

1988: 1988: 1988: Government abandons plans for Building of Sizewell B begins. It After the Government decides a fast-breeder reactor programme is the first of a planned, but soon to privatise electricity production to use plutonium stocks, abandoned, family of four PWR a “nuclear tax” is proposed by because it is uneconomic “for the nuclear stations. The second was financial consultants Solomon foreseeable future”. to be at Hinkley Point in Somerset Brothers. They say this will be – where at the planning inquiry necessary when the electricity the price for nuclear generation at industry is privatised to pay Sizewell is quoted as 2.3 pence for extra cost of nuclear power per kilowatt hour, later adjusted to generation compared with coal. 3.09 pence.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 11 1,550 cubic metres of high-level of vitrified waste against a target on improving production. In the liquid waste, far more than there of 250 as being one of a “wide subsequent five years to March 2008 should have been. In 2002 range of excellent performance the three lines should have produced Laurence Williams, the NII’s chief achievements”. In fact the “target” of 4,500 cans of vitrified waste; yet inspector, said it would take 15 years 250 had been arrived at after higher the total was just 1,956 according to to clear the backlog of high-level targets had been abandoned twice in the NII, which continues to express liquid waste. The third vitrification the previous two years because the concern at the plant’s operation. plant, built at a cost of £320 million, plant was failing even then to reach came on line in 2003 to tackle the dramatically reduced expectations. Had the plant functioned as waste backlog. Subsequently performance did designed then the backlog of improve slightly. The best output the waste would have been cleared Together, the three lines are plant has achieved still remains 482 by now; but production has been designed to process 900 cans of cans of vitrified waste in 2005/06, less than half that required by the vitrified blocks a year. The target just over half the original design Government’s safety inspectors. output for this production line has target of 900. But even this was British Nuclear Fuels and its been reduced repeatedly by British a short-lived level of output. The successor companies have said Nuclear Group, the British Nuclear numbers dropped back again to again and again that they were Fuels subsidiary which runs the 322 in the year to 31 March 2007. confident they would achieve the site on behalf of the NDA, and The target for 2007/08 was 450 target set by the NII of reducing now known as Sellafield Limited. cans, later reduced to 380; yet on 7 waste to “buffer levels” by 2015. It Journalists and campaigners have February 2008 only 223 cans had appears on current performance this learned over the years that this is been produced making even this will only be achieved by stopping or standard procedure at Sellafield so reduced target difficult to reach. severely curtailing the operations of managements can claim targets the reprocessing works. have been met. An example came Overall in its first 11 years the in 2003 when the chief executive vitrification plant throughput should Evaporators of British Nuclear Fuels, Norman have been 6,600 cans. In fact the The vitrification plant is not the Askew, referred in his annual report plant made just 2,400. Hundreds only technical headache in this to the production of 333 containers of millions of pounds were spent most difficult of waste streams.

1989: 1989: 1990: Magnox reactors are withdrawn Government suspends building of Nuclear levy is introduced to from electricity privatisation. new (PWR) nuclear plant beyond cover the difference between the The city would not buy the older Sizewell even though £30 million cost of generating nuclear energy stations because of looming worth of parts have been ordered and coal – adding 11 per cent to decommissioning costs. The for Hinkley C. electricity bills. Even this does taxpayer is left with the bill. not truly cover the extra cost because the original capital cost of most stations had already been 1989: written off. The idea of the levy AGRs and Sizewell B are was to pay for decommissioning withdrawn from privatisation stations. because city investors discover that the cost of generating nuclear power is far greater than that of coal.

12 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE The volume of highly radioactive The failures of the vitrification up the cost of electricity. However, liquid first has to be reduced by the and evaporator plants have it is a way of returning plutonium use of evaporators. These are like forced Sellafield to scale back its relatively safely back to its country of giant kettles, which concentrate the reprocessing operations to avoid origin. For countries like , liquid down so that it can be stored high-level waste accumulating. Not and , this is a better in readiness for turning into glass to do so voluntarily would trigger alternative than deliveries of raw blocks. This is another technology legal action by the NII. This has plutonium from Sellafield. The only on which the wear and tear caused serious implications for the industry. current use for plutonium in this raw by intense radiation seems to have As well as extra costs and potential state is for nuclear weapons and its been underestimated. Whatever the job losses, the rest of the nuclear import would be a serious political problem, the technology has not production line is affected. embarrassment for these countries, performed as planned and the three all committed to nuclear non- evaporators have had successive THE SELLAFIELD MOX PLANT proliferation. MOX fuel was seen as faults and proved unable to deal with The production of MOX fuel is the solution to returning plutonium in the volume of waste coming from the sole industrial and economic a safer form. the two reprocessing works. One of justification for the continued the evaporators has been shut since operation of the reprocessing Without the MOX plant, reprocessing 2005 although there are hopes of facilities at Sellafield. The plutonium to produce more and more surplus restarting it in 2008. Problems with and uranium recovered from spent plutonium and uranium that has corrosion shut another evaporator in fuel in powdered form are together no use is difficult to justify – even October 2006. These have now been turned into pellets. These are then though Sellafield Limited, which repaired but the third evaporator made up into new fuel rods for use operates the plant, still has money- also had to be shut as a precaution in existing reactors. This is more making contracts to do so. because of similar concerns; it is costly than traditional uranium fuel expected to re-open soon. Because made from raw and newly mined The MOX plant, which employs 660 of the poor performances of all three ore. British Energy has refused to people, has gone disastrously wrong evaporators a fourth evaporator has use it for the one British reactor that partly because of poor management, been ordered at a cost of £90 million. can take it, Sizewell B, because it and partly through legal and This will not be completed until 2011. is too expensive and would drive technical problems. First, the plant’s

1990: 1990: 1990: Cost of building Sizewell B Department of Energy admits Days after a leaked paper reveals that increases from £1.69 billion to that wave power is cheaper £2 billion could be saved if Sizewell B £2.03 billion. than nuclear, six years after was cancelled the House of Commons researchers at Harwell put Select Committee on Energy says the price of wave power at it is “profoundly concerned” about 9.8 pence per kilowatt hour. misleading statements on the cost of Current estimates are 4-5p. nuclear energy. The Central Electricity As a result of the 9.8 pence Generating Board tells the public calculation all research into inquiry into the building of Hinkley wave power was cancelled. Point C PWR that the electricity would cost 3.09 pence per kilowatt hour. During the subsequent privatisation debate the board puts forward a figure of 6.25 pence. The Department of Energy “apparently made no attempt to obtain realistic costings”.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 13 value for money was called into question. The National Audit Office revealed that the original 1993 estimate of £265 million for the cost of the plant had risen to £490 million by 2004. The ’s chief scientist, Dr Jan Pentreath said in October 1998 that the agency would never have sanctioned the plant’s construction had officials The Guardian The been asked for a licence in advance. He said he would ask for a change in the law so that in future the agency could prevent “taxpayer’s money being spent on speculative ventures”.

In 2001 the consultant Arthur D Little, acting on behalf of the Department of Trade and Industry, produced a report for the Government that was

©Steve Bell 2000 – All Rights Reserved. First published in a classic example of the nuclear industry’s approach to economics. Steve Bell, political cartoonist and creator of the If… cartoon strip has been The report wrote off the capital cost lampooning the nuclear industry for 20 years. When the Government claimed of the plant and said that over a that the Thorp Reprocessing works would be a money-spinner the building 10-year period the expected orders formed a background as a white elephant roamed across the pages of The for MOX would show a profit of Guardian. £216 million over operating costs. The figures to justify this report were not made public and many

1990: 1991: 1992: The Science and Policy Research Government announces plans International Atomic Energy Unit at Sussex University for a nuclear waste repository Agency says the building up describes as “misleading and costing between £2.5 billion and of vast stocks of plutonium at inaccurate” claims that Thorp £3.5 billion to be completed by reprocessing plants “poses would make a profit of £500 2005. a major political and security million in first 10 years. The problem”. extra cost of reprocessing spent fuel at Thorp rather than 1991: storing it is £1.7 billion to the Christopher Harding for British taxpayer, the researchers say; Nuclear Fuels says the first waste and reprocessing produces 160 will be sent back to countries times as much nuclear waste of origin before the end of the compared with storing spent fuel, decade. By 2008 none has been and is three to four times more sent back. expensive.

14 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE doubted their reliability, because ships and collecting the eight strings to a parliamentary question, Energy profit predictions were based on the of fuel (weighing only 4 tonnes) cost Minister Malcolm Wicks admitted assumptions that there would be firm the taxpayer £113 million. To date that the plant had only managed orders for MOX for the first decade, the Japanese have not re-ordered 2.6 tonnes of production in 2007 and that the plant would work as MOX and that country’s plutonium – and a total of only 5.2 tonnes since designed. Neither assumption was remains in store at Sellafield. There opening in 2001. correct. Nonetheless, faced with a is now no policy in place to deal with Government consultant’s report on it. It is guarded by the British armed The Royal Society reported in its potential profitability and the fact nuclear police force – again at the September 2007 that the MOX it was already built, the Environment taxpayer’s expense. plant, designed to produce 120 Agency granted an operating licence. tonnes of MOX fuel a year, was The Government then gave the plant Perhaps the most devastating now expected to produce only 40 the go-ahead to start up in 2001. problem is that the MOX plant does tonnes a year. This was according to not work – at least not as designed. evidence presented by the Nuclear In the event orders from Japan, In fact commissioning has taken so Decommissioning Authority (NDA), expected to be SMP’s biggest long that the first few orders from the Government quango in charge of customer, and on which the profit Switzerland and Germany for the Sellafield, to the Royal Society; but forecast was made, have never fuel could not be completed on time. on current form it may never produce materialised. Quality control To avoid penalties under breach of anything like that amount. Sellafield documents dispatched from contract this fuel had to be made in Limited’s spokeswoman said it was Sellafield with the first small a MOX plant in Belgium at British still early days and the company consignment of MOX fuel, made in taxpayers’ expense. In July 2004 hoped to ramp up production. a demonstration plant, were found the plant had still not produced any However, the accumulated financial to be falsified. In the subsequent useable fuel and its losses were put losses on the MOX plant since scandal, Japan insisted the fuel be at £600 million. In 2007 the plant it was built have now become sent back to England in the armed had still not got a full operating “commercially confidential”. This is ships which had originally delivered licence, even though this was a classic blocking tactic for refusing it but which had already made the originally expected to be granted in to reveal information under the return trip to Britain. Returning the 2003. In February 2008 in answer Freedom of Information Act.

1993: 1993: 1993: It is revealed that the 11 per cent Economists estimate that the Thorp order book for the first 10 nuclear levy on electricity bills has projected income from the years (in tonnes of spent fuel not been put aside for dealing with nuclear levy between 1990 and to be reprocessed) is Japan decommissioning costs and waste 1998 will represent a £9.1 billion 2,673, UK 2,158, Germany 969, but spent on building Sizewell B. subsidy for the nuclear industry. Switzerland 422, Spain 145, Italy , the Government- 143, Sweden 140, Netherlands owned company formed to run 53, Canada 2. By 2008 none the nuclear stations when the rest 1993: of the resultant waste has been of the electricity generating plant Completion date for Sizewell returned to the country of origin. was privatised, claims income B slips to November 1994, 11 from the new reactors would pay months later than planned. for decommissioning old stock. 1994: MPs liken this to Robert Maxwell’s Government announces nuclear stealing from the company reviews, one into whether new pension fund to finance his nuclear stations can be built business. and the second into whether the industry can be privatised.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 15 The result of technical failure, It is presented to the public as a is stored. The existing Magnox falsification of quality control data and recycling technology, which was power stations were due to close shortage of orders is – apart from the original intention, but it has not by 2010 so that the reprocessing mounting financial losses – large and turned out like that. works could complete its work by increasing quantities of unwanted and 2012; but this closure has been unusable foreign-owned plutonium The original Magnox reprocessing postponed until 2016 “at least”, and uranium being held at Sellafield works was opened in 1964 to according to the NDA. The plant at taxpayers’ expense. Continued extract plutonium from spent fuel. was originally designed to reprocess reprocessing of spent nuclear fuel The extracted plutonium could, in 1,500 tonnes of spent fuel a year from British and foreign reactors theory, be used for Britain’s nuclear and unlike Sellafield’s more modern will only make this situation worse. weapons arsenal and for use in fast nuclear facilities worked close to It will create ever larger stockpiles breeder reactors, a technology then its design capacity for many years, of plutonium and uranium for which thought a practical possibility for altogether reprocessing more than there is no use or planned disposal large-scale electricity production. 20,000 tonnes of spent fuel. It is the route. The Royal Society in its 2007 The Magnox plant, which employs workhorse that has produced most report on the problem said continuing 830 people, is still in operation and of Sellafield’s unused stockpile of to stockpile very dangerous material is set to remain open until all the 103 tonnes of plutonium and more was not a long term option. “Failure fuel from the UK’s older Magnox than 30,000 tonnes of uranium. to develop and implement a strategy reactors is reprocessed. The for the management of separated industry says that reprocessing is Recently, despite refurbishment, plutonium could result in significant the best disposal route for this fuel the deterioration through age of the avoidable costs and security risks.” because it cannot be stored for long, facilities has reduced throughput, as it deteriorates. The deterioration according to the NDA. After A TALE OF TWO REPROCESSING is due to the fact that the means of processing 1,008 tonnes in the year PLANTS – MAGNOX removing the fuel from the reactor to April 2005 the figure dropped Reprocessing of spent fuel is core, the means of transporting it to 243 tonnes and 594 tonnes in designed to recover the plutonium and of storing it all involve the fuel’s the following years. In the first 10 and uranium from fuel which has immersion in water, which corrodes months of 2007/08 401 tonnes of already been used in a reactor. the magnesium cans in which it Magnox fuel had been reprocessed.

1995: 1996, MAY: 1996, JULY: Government decides to make a “The privatisation of part of the Sell-off of the newer nuclear second attempt to privatise AGRs nuclear power industry, set out stations goes ahead. Government and still-to-be-completed Sizewell in a white paper on 9 May, looks receives £1.9 billion, less than B. Announcing plans to privatise likely to be a particularly creative the cost of building Sizewell B Nuclear Electric the Government example of the well-honed pressurised water reactor with all reduces the clean-up liabilities technique of bribing voters with seven AGR stations thrown in for from £10.5 billion to £7.2 billion their own money. In this case, the nothing. without explanation. bribe may be financed not just by selling assets that taxpayers have already paid for once, but by money borrowed from future tax payers too.” (The Economist magazine)

16 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE Comparing this performance with radioactivity from reprocessing in Thorp would also deal with spent the NDA’s three-year work plan the are supposed to be fuel from pressurised and light-water of 2005 shows how targets have “close to zero”. This agreement reactors being operated elsewhere been missed. The NDA target was meant the Magnox reprocessing in the world. However, by the time 2,520 tonnes, but the Magnox works works had to close by 2012 so that Thorp was built in the 1990s the have only managed 1,238 tonnes it could be cleaned and so that fast-breeder reactor programme had throughput so far, less than 50 per debris could be removed to bring been abandoned as economically cent. This reduction of output has measured radioactivity levels down unviable. Despite this the not been due to the ageing of the markedly by the 2020 deadline. This Government gave the go-ahead for Magnox facility but, as Sellafield commitment has been abandoned the plant. The reasoning was mainly Limited now admits, to the failure of because of the backlog of Magnox that the nuclear industry had signed the evaporators and the vitrification fuel and the closure put back to 2016 foreign contracts to reprocess spent plant downstream, which has meant “or later”, by the NDA. fuel; it claimed the £2.3 billion plant reprocessing being slowed. This would make a £500 million profit for has led to the closure of the Magnox A TALE OF TWO REPROCESSING the UK economy by reprocessing reprocessing works being postponed PLANTS –THORP 7,000 tonnes of fuel in the first 10 for at least four years. In summary, By the time a second reprocessing years of operation. Magnox still has to reprocess a facility, the Thermal Oxide backlog of spent fuel because large Reprocessing Works (Thorp), was At the time the plant had a full order parts of the nuclear waste disposal discussed in the 1970s and built book for the first 10 years and most chain have failed. 20 years later much had changed of the second decade of the plant’s in the nuclear industry. Thorp was planned lifetime. The optimism These setbacks mean the UK may designed to deal with spent fuel from that more new orders would be be unable to meet its commitment Britain’s second generation of AGRs, forthcoming was misplaced, however: made in 1998 under the OSPAR currently run by British Energy. some were subsequently cancelled Convention to progressively reduce Plutonium was no longer being and there have been no new ones. the concentration of radioactive recovered for nuclear weapons, substances in the marine but in the 1970s the dream was still Yet before the plant opened environment. By 2020 levels of to use it for fast-breeder reactors. consultants Touche Ross produced

1996: 1997: 1997, OCTOBER: Despite calls for its cancellation John Gummer, with his last It is announced that two nuclear because of delays and cost act as Environment Secretary waste stores are to be built at overruns Sizewell B opens. The refuses permission for a pilot Sellafield to take intermediate- cost of the station is £2.3 billion. deep repository for nuclear waste level waste for the next 50 years. Power generation cost is not under Sellafield partly because Another 10 planned for the future. the 3.02 pence per kilowatt hour of the industry’s faulty scientific predicted at the public inquiry but case, despite spending £200 6.25 pence, more than double the million on site investigations. The cost of coal and gas. plan to get the depository built by 2015 is abandoned.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 17 a report that supported claims that the plant would be profitable. The report was published with most financial figures expunged by civil servants. Outside the industry and Government few thought the report was reliable, and so it turned out to be – partly because the Thorp plant has never worked as designed either. In the first 11 years of operation it reprocessed 5,729 tonnes of fuel – well short of the 7,000 tonnes needed to make it profitable.

In the plant’s twelfth year only a further 51 tonnes of spent fuel had been reprocessed when a disastrous leak, unnoticed by staff for nine months until its discovery in April 2005, forced Thorp to close. It remained closed for two years while investigations and repairs were undertaken; the company was fined £500,000 for negligence, and had £2 million deducted by the NDA for failing to meet safety standards.

Credit: Photo/British PA Nuclear Fuels Subsequently the staff underwent The Sellafield MOX plant in the foreground with the Thorp reprocessing plant new safety training. The leak could behind. Both plants have failed to work as designed. not be repaired but because it can

1998: 1998: 1999: Deputy Prime Minister John Chancellor Gordon Brown House of Lords Science and Prescott signs OSPAR announces plan to privatise British Technology Committee says agreement to progressively Nuclear Fuels (BNFL), a plan later ministers should abandon policy reduce concentrations of abandoned and twice resurrected. of regarding plutonium as a radioactive substances in the It has never happened. valuable resource and reclassify marine environment as a result of it as waste. emissions from Sellafield so that by 2020 they add “close to zero” 1998: to historic levels. He says: “I was The Royal Society says stocks of 1999: ashamed of Britain’s record in plutonium are “unacceptably high, The first shipment of MOX fuel to the past but now we have shed posing an environmental threat Japan (made in the small MOX the tag of the Dirty Old Man and creating fear that some may Demonstration Facility) takes of Europe and have joined the be stolen for use in illicit nuclear place amid furious protests from family of nations.” weapons.” Caribbean countries about the dangers.

18 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE be by-passed the plant was given down. This meant the fuel slipped Society in 2007, has now also permission to test-run in 2007. back down into the ponds. It took been postponed. Even by the most Although this was judged a success until the end of March 2008 to fix the optimistic calculations Thorp will the plant did not re-start. problem, when 100 tonnes of foreign have to remain open until 2015 to fuel were moved into the plant for the fulfil contracts that were due to be The failure of the evaporators first stage of reprocessing. completed in 2003. and the slow throughput of the vitrification plant meant that, like the By then Thorp had, in effect, been STORAGE RUNNING OUT Magnox reprocessing plant, Thorp’s closed for 36 months and will never Another problem that Thorp’s waste could not be dealt with. The again operate at more than a fraction prolonged closure has caused is NDA said in November 2007 that of its design capacity. Before Thorp lack of storage space for spent fuel the only problem holding back the opened British Nuclear Fuels, the that continues to be delivered from restart of Thorp was the lack of Government-owned company Britain’s seven AGRs. In May 2007, evaporation capacity. By early 2008, that then ran the plant, estimated when the Government signalled its possibly because of the problems that the weekly cost of keeping it decision to sell a further tranche of that prolonged closure of Thorp closed would be £2 million – so a British Energy shares, the company was causing to upstream storage three-year closure is very costly warned potential buyers that if capacity (see below), Sellafield for the taxpayer. The 890 staff still Sellafield was unable to continue to Limited planned to restart the plant. have to be paid. One of the effects take spent fuel from its reactors for Because of the restriction caused by of this prolonged shutdown is that storage the company would be unable the lack of evaporator capacity until the contracts to reprocess foreign to reload them with new fuel. These 2011 the plan was to put a maximum and domestic spent fuel, claimed reactors, responsible for around of 200 tonnes of fuel a year into still to be worth £2.5 billion, still 14 per cent of the UK’s electricity Thorp for three years to try to fulfil cannot be completed. The NDA also supply, would have to be gradually its foreign contracts. Yet another said the inability to complete the shut down, the company said. technical failure struck immediately, contracts means the 2010 closure when the lifting mechanism to get date for the plant, proposed in the In October 2007 some deliveries of the fuel from the storage ponds company’s business plan, and spent Magnox fuel to Sellafield were into the reprocessing works broke reported in evidence to the Royal also suspended. Both types of fuel

1999: 2000: 2001: Japan orders investigation after Government postpones plan to Government conducts another BNFL admits forging quality sell off Sellafield until 2002 “after energy review. BNFL proposes control data for MOX fuel. the election” according to the six new nuclear stations mostly Department of Trade and Industry on the sites of Magnox stations that are closed or due to close. 2000: Japan refuses MOX fuel and is 2000: paid £20 million in compensation. BNFL announces closure dates The whole episode, which for the eight Magnox stations involves sending armed boats to – the last being Wylfa on bring the fuel back to UK, costs Anglesey in 2010, so the Magnox £113 million. reprocessing plant can deal with all 12,000 tonnes of spent fuel remaining and close in 2012.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 19 are received at the same handling which time it was expected that result the future of Thorp remains facilities. There is now a backlog of Thorp would have opened again. parlous and it may have a knock-on fuel at Sellafield to be stored and Papers obtained a year later under effect on British Energy’s ability to reprocessed. However, the NDA will the Freedom of Information Act, produce electricity from its advanced not be drawn on how much storage although heavily censored, detailed gas cooled reactors. space for spent fuel remains, nor a series of measures to relieve the how soon it will run out, stating that pressure. This included ordering a When the NDA came into existence the main reason for the suspension number of new storage flasks and in April 2005 to deal with the of shipments was a change of reorganising existing storage ponds. country’s nuclear legacy, it said it priorities ordered by the Authority in would review with the Government the nuclear clean-up programme, not In the meantime an average of whether Thorp should be closed a shortage of space. The NDA says 300 tonnes of spent AGR fuel and the remaining reprocessing the existing storage ponds have been has continued to be delivered to contracts cancelled. The NDA reorganised to squeeze as much Sellafield each year and none has confirmed in November 2007 that fuel in as possible. Sellafield Limited been cleared through reprocessing. this review was ongoing, but in said it was reorganising storage In order to free storage space for February 2008 the Department of facilities and there was “ample room these continued deliveries some Business, Enterprise and Regulatory for increasing the capacity of the of the fuel already in ponds has to Reform (BERR) denied closure was storage pond”. The company said be removed for reprocessing. The on the agenda. The Government’s the NDA was re-examining all the whole complex was designed for policy was that Thorp should remain options as far as dealing with spent a constant throughput of fuel into open until all the contracts had been Magnox fuel and would be making an Thorp. completed. Closure would cause announcement soon. serious political difficulties – partly From the information already in because it would be an admission However, these answers do not the public domain it is clear that that past Government policies alter that fact that when Thorp first Sellafield’s waste stream is not to continue reprocessing and to closed in 2005 the official line was running as planned and that there is sanction the MOX plant were serious that there was a year’s storage an increasing backlog of both spent mistakes on technical and financial space available at Sellafield – by fuel and all forms of waste. As a grounds.

2001, OCTOBER: 2001, OCTOBER: 2001, NOVEMBER: Review reports that onshore wind Government gives permission to BNFL reports to the Government, farms will provide energy at 1.5 operate the new large Sellafield its sole shareholder, that it has to 2.5 pence per kilowatt hour, MOX Plant – nine years after a “net asset deficit” – in other offshore wind 2 to 4 pence and British Nuclear Fuels’ original words, it is bankrupt. Under the nuclear power 3 to 4.5 pence. planning application and after five 1985 Companies Act for the The nuclear power price was said public consultations. directors to continue trading to be comparable to wave power, without informing shareholders long derided as too expensive it was bankrupt would be a by the Department of Trade and criminal offence. Trade and Industry. Industry Secretary Patricia Hewitt decides to create a public body, the Authority (NDA), to take on the debts and assets of BNFL.

20 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE Credit: Don McPhee/Guardian Newspapers McPhee/Guardian Don Credit:

Spent nuclear fuel being stored underwater at Sellafield to prevent overheating and await reprocessing.

2002, FEBRUARY: 2002, JULY: 2002, AUGUST: Government decides to keep Government admits nuclear clean- British Energy faces bankruptcy a new nuclear building option up bill now £48 billion – or the because the Government’s open but to not give public equivalent of a 1p rise in income tax competition regime causes subsidy. BNFL and British Energy for everyone for 20 years. Energy electricity prices to fall below the announce collaboration to build Minister Brian Wilson insists there cost of producing electricity from nine plants at a cost of £9 billion are no plans to revive the nuclear nuclear power. Government bails – but nothing else happens. industry by building new stations. out company and taxpayer foots the bill until 2086 for spent fuel management.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 21 Credit: Don McPhee/Guardian Newspapers McPhee/Guardian Don Credit: At the time of writing it is not known when Thorp will be able to fully reprocess fuel again. The NDA’s worst-case scenario was that it would stay partly closed until the new evaporator was completed in 2011. Equally embarrassing is the NDA’s statement: “If Thorp was closed permanently the NDA would consider sending the spent fuel to France for reprocessing or retaining the foreign spent fuel in the UK.”

If this happened the NDA promised there would be a public consultation. This would raise questions such as: should the fuel be returned to the country of origin or kept in Britain? Who will pay for its storage and disposal or shipment home? Is it politically acceptable to retain this fuel in Britain when there is nowhere to dispose of it – particularly when there have been repeated pledges by the Government that the UK would not become “the world’s nuclear dustbin?”. There are many more questions on these lines, all of them difficult to answer. Reprocessing spent fuel at the Thorp plant Sellafield.

2003, FEBRUARY: 2003: 2004, MAY: Government’s Energy White Government appoints Committee It is revealed that two years after Paper does not close the door on on Radioactive Waste plutonium is introduced into the new nuclear build but does not Management to review potential Sellafield MOX Plant it has still encourage it either. It describes options for dealing with the failed to produce any fuel for new nuclear power stations as problem. It is required to work in an overseas buyers and is having to an “unattractive option” and says open manner that will inspire public subcontract the work to Belgian that before any decision is made confidence in recommendations. and French MOX plants. to build more there would be the fullest public consultation. 2003, AUGUST: 2004, JULY: BNFL says Thorp reprocessing Tony Blair tells MPs that if climate 2003, MARCH: plant will close in 2010. Brian change is to be tackled nuclear Calder Hall at Sellafield, the Watson, director of the Sellafield power must be back on the world’s oldest nuclear power site says vitrification plant cannot agenda. plant, closes. work fast enough to allow Thorp to work at full production.

22 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE The Government makes light of stockpiled at Sellafield as a result of The current crop of Sellafield’s the fact the UK has nowhere to put reprocessing activities. technical failures is long-term the high-level waste – apart from and critical. In the context of a constructing a store for the glass The Nuclear Installations massive new nuclear building blocks. It also has nowhere to put Inspectorate, the Government’s programme they are not merely increasing quantities of intermediate- safety watchdog, says that repeated an embarrassment but show how level waste either. It is estimated delays and technical failures are expensive mistakes can be. The that it will be at least 2045 before causing serious problems across optimism of the nuclear industry a depository for this still very the site. And if Sellafield’s services has repeatedly proved unfounded dangerous waste is open. Meanwhile are not operating properly the entire and Sellafield shows how the the UK is running out of space nuclear industry in the UK cannot nuclear dreams of the last 50 to store fuel from its own nuclear function efficiently. As well as a years have turned sour. This vast stations – let alone that imported logjam of spent fuel from British complex is going to continue to be from reactors across the world. plants that cannot be dealt with, a very expensive operation to run. long-running foreign contracts According to the National Audit Cleaning up operations at Sellafield cannot be fulfilled. Foreign waste Office in 2008 it is creating an will cost the taxpayer the best due to be sent back to overseas “apparently ever escalating bill” for part of £8 billion in the next three customers remains at Sellafield even the taxpayer. years, according to the NDA’s though successive governments business plan, although this figure have guaranteed it would be has already increased because of repatriated. None of the countries further plant malfunctions. After that are due to have waste returned that the budget will escalate if after their spent fuel has been Britain is going to keep in control reprocessed has places to dispose of its nuclear stockpiles. There of it, and highly radioactive material are more than 100 tonnes of would cause political difficulties if it plutonium, a quarter of which was returned to any country with no belongs to foreign utilities, and facilities to receive it. 30,000 tonnes of

2004, AUGUST: 2005, MARCH: 2005, MAY: Despite repeated promises that As UK’s carbon dioxide emissions Irish Environment Minister Dick all nuclear waste should be continue to rise a Downing Street Roche criticises management returned to its country of origin spokesman says nuclear power systems at the Sellafield nuclear the Department of Trade and must be reconsidered. plant, describing them as Industry reveals that 10,000 cubic “something you’d expect from metres of foreign waste has been Homer Simpson”, after it emerges buried at in Cumbria. In 2005, MAY: that liquid high-level waste was December it becomes official Sir David King, Government escaping from a pipe at the Thorp government policy to keep chief scientific advisor, rules out plant for far bulky foreign wastes in the UK a rapid return to nuclear power. longer than first believed. and return smaller quantities of The Committee on Radioactive high-level waste to the country Waste Management warns that of origin. Income from burying Government failure to deal with foreign waste, put at £680 million, nuclear waste has made people would be used for Britain’s reluctant to support new nuclear nuclear clean-up. power.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 23 PART 2:

In March at a UK/French summit the British Energy was rescued because more nuclear power is essential to two countries agreed cooperation to shut nuclear stations down would the UK’s energy mix. It is claimed on nuclear development but have meant power shortages. The that a third generation of nuclear gave no details. British ministers privatised nuclear industry got such power plants is needed to provide again pledged there would be no a good deal it is now in the happy security of supply and combat government subsidies involved. position where the shareholders . Whether this is get the profits but, if anything goes true is disputed by many people – But everyone inside the industry, wrong a second time, the taxpayer particularly since there are many and people who have studied its picks up the bill. Or as Sir John alternatives to nuclear power. What economics, know that without Bourn, head of the National Audit is certain is that plumping for nuclear subsidy no new nuclear power Office put it in March 2006 when is not going to help the UK meet its station has ever been constructed. launching the NAO report into the carbon emissions targets by 2020, Commercial reactors without rescue: “The Department of Trade or provide inexpensive power. Government underwriting and and Industry intervened when financial guarantees cannot get the British Energy could no longer meet Although there is much evidence to backing they need from investors. its debts. As a result the taxpayer is the contrary, the Government has responsible for underwriting a large accepted the claims of the nuclear The UK’s record is particularly bad and uncertain liability. The scale of industry that it can build larger in this area. Attempts to privatise the net liability to be borne by the nuclear stations, cheaper than ever Britain’s nuclear industry by public purse will depend crucially before, at a far quicker pace. As a Margaret Thatcher in the 1980s were on British Energy’s performance in result, the Government calculates abandoned, and only went ahead in future years. It is therefore vital that that the electricity these reactors 1996 because the selling price was the Department keeps close produce will be comparable in price so low – less than the cost to the scrutiny to ensure the taxpayer’s to that of gas-fired power stations. taxpayer of building any one of the position is safeguarded.” This is true only if the price of gas eight privatised stations. Even so, stays high and under an emissions within six years, this new company, Despite the nuclear industry’s trading scheme there is, according British Energy, faced bankruptcy and dire record, detailed in this report, to Department of Trade and had to be bailed out by the taxpayer. the Government has decided that Industry assessments, a “reasonable

2005, JULY: 2005: 2006, JANUARY: Government reveals to the British Energy announces 10- Government launches new European Union that it paid year extension of Dungeness B energy review, and in July British Energy £184 million in AGR to 2018. This life extension publishes “The Energy 2004 to deal with spent fuel from means instead of the waste and Challenge” which says “new British reactors. The payments, decommissioning costs becoming nuclear power stations would which would be variable, would a liability on British Energy’s make a significant contribution to continue for another 80 years. books and pushing the company our energy policy goals”. close to bankruptcy, the station is counted as a continuing asset. 2005, AUGUST: 2006, JULY: Britain’s bill for getting rid of its Committee on Radioactive Waste own nuclear waste rises to £56 Management says repository billion, according to Sir Anthony for medium-level nuclear waste Cleaver, chairman of the Nuclear unlikely to be ready until 2045. Decommissioning Authority.

24 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE credit” of more than £25 given to WHAT TYPE OF REACTOR TO problem partly on the failure of the nuclear industry for every BUILD? everyone concerned to appreciate of carbon saved through The most likely third generation the time and resources needed for nuclear generation. nuclear plant to be built in Britain is detailed design of the reactor. the Evolutionary Pressurised Water Currently the nuclear industry does Reactor (EPR). There is one under Another failure was the lack of safety not get a financial credit for carbon construction in Finland, which was culture and the use of inexperienced saved through generating electricity. due to be generating electricity in subcontractors given insufficient Opponents say it should not receive 2009, in time to allow the country to guidance, according to the STUK. this credit because nuclear power is meet its carbon dioxide reduction Some had no experience in not a sustainable industry as it has targets under the Kyoto Protocol. constructing nuclear power plants. not solved its waste problem. As a It will be the largest reactor ever The UK’s Nuclear Installations result of opposition from non-nuclear built, at 1,600 megawatts. Delays Inspectorate has repeatedly warned states, exports of nuclear technology have dogged its construction from the Government that there are skills to Eastern Europe and developing the outset and its completion date shortages throughout the British countries were refused carbon has repeatedly been put back. In nuclear industry, which would credits under the Kyoto Protocol. December 2007 completion was seriously hamper a new nuclear The Government is, however, again delayed to summer 2011 – two building programme. This kind counting on nuclear power being years late. The company constructing of warning carries in-built delays awarded substantial carbon credits the plant, -, said: judging by the Finnish and previous in the next round of the European “The delay of the project will cost British experience. This makes the Union’s carbon trading scheme. additional work and costs” – without Minister’s public optimism that the This is essential if the Government saying how much, but it is believed first new plant in the UK would be is to make nuclear power seem to be around £1 billion. up and running by 2017 dubious – financially viable and competitive particularly when the Department of with , which An investigation into the delay by Business Enterprise and Regulatory unlike nuclear power is steadily the Finnish Radiation and Nuclear Reform paper on the economics of getting cheaper. Safety Authority (STUK), published the issue put the likely date of first in December 2007, blamed the electricity generation at 2021. As

2006: 2006: 2006: UK’s Sustainable Development Construction of Finland’s 1,600 Committee on Radioactive Waste Commission, in an eight volume megawatt Evolutionary Power Management recommends the assessment of the potential Reactor begins. It is the first development of partnerships for a new nuclear building of the third generation nuclear between the nuclear industry programme, concludes: “there power plants (and the one most and willing communities to find is no justification for a new likely to be built in Britain). It is nuclear waste disposal facilities. nuclear programme at this time, designed to be completed in 2009 Deep geological disposal is and that any such proposal at a cost of 3 billion Euros. recommended but only after would be incompatible with the proper research into uncertainties Government’s own sustainable about storage, disposal and strategy”. 2006: security issues. NDA’s lifetime plan says an end to reprocessing in 2012 will enable Sellafield to reduce discharges to “near to zero by 2020” as envisaged by the OSPAR agreement of 1998.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 25 in Finland there is the additional the constantly changing design of new stations at Sizewell in Suffolk, problem that the nuclear stations the advanced gas-cooled reactors Bradwell in Essex, Dungeness in would be unable to contribute to is said to be the main reason why Kent and Hinkley Point, Somerset. meet the UK’s 20 per cent carbon they have been liable to breakdown These agreements become dioxide reduction target by 2020. and poor performance. The next operative in 2015, well before any Neither will the UK’s new nuclear generation was supposed to be of stations are likely to be built, but build timetable fill the Department standard design, thus reducing costs indicate confidence that this is of Trade and Industry’s predicted because design and parts could be where four giant EPRs will be built. “energy gap” of 2015 caused by old replicated. The EPR design is clearly This also anticipates British Energy generating plant closing. So Britain’s still evolving, so these savings might having a serious financial interest in environmental targets will be missed not be available as claimed by the the new build – it owns eight sites and its reputation will suffer. British Government. that are the most likely contenders for nuclear new build of any type. A second EPR began construction It may be that the EPR is not the in France in December 2007 where reactor type that gets built in Britain. BRITISH ENERGY’S LIABILITIES there should be no shortage of There are other candidates, but The financial viability of British expertise. Here construction is all of them are untried prototypes Energy over a period long enough supposed to take 54 months. This is – a recipe on past and present to construct new nuclear power described as a demonstration EPR. experience for even longer delays stations is questionable. The France has announced plans to build and costly overruns. Government has a nuclear liabilities 40 to replace its existing 58 ageing fund which stood at £6.9 billion on reactors. However, a decision will not WHERE TO BUILD NEW 1 June 2007 and to which British be made until 2015 when experience REACTORS? Energy contributes each year from has been gained to see if the EPR The next question is where these profits. Liabilities are put at £4.3 works as intended. Ominously for the stations are going to be built and billion. These figures provided by UK the French have already modified by whom. The proposed sites (see the Government show that in 2008 the design being used for the Finnish p33) all contain existing nuclear the book value of the fund exceeds reactor under construction. This is stations. British Energy has signed its liabilities by £2.6 billion. However a point of interest to the UK where agreements for grid connections for British Energy’s actual liabilities are

2006, NOVEMBER: 2007, FEBRUARY: 2007, APRIL: Unlike Magnox and AGR fuel, the High Court rules that the A cost benefit analysis by the spent fuel from Sizewell B reactor Government’s nuclear Department for Business, Enterprise is stored on site in special ponds. consultation on its Energy and Regulatory Reform (BERR) This vulnerable coastal site is a Review of the previous year concludes that nuclear power is likely potential target for terrorists but was seriously flawed and to cost 3.8 pence per kilowatt hour to the security arrangements and procedurally unfair. The produce, provided all future nuclear evacuation plans for local people information on nuclear waste waste costs are discounted. It also are pronounced secret by British was not merely inadequate concludes that the first plant would be Energy, even though 300 tonnes but misleading. Prime Minister built around 2021. This would involve of spent fuel is kept there. Tony Blair says the ruling “will an eight-year pre-development period not affect policy at all”. and six years for construction. Adding four new 1,600 megawatt nuclear stations of similar design to the one in Finland would reduce total forecast gas consumption by 7 per cent – and carbon dioxide emissions by just 4 per cent.

26 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE much higher because of the cost of decommissioning the ageing nuclear power stations it owns and the share of costs it must bear for the dismantling of the Thorp reprocessing plant it uses. There is a time delay before this money is needed so these gross liabilities are discounted at a rate of 3 per cent a year until the planned closure date of decommissioning. At that point the full cost of decommissioning has to be shown as a liability on the books. In 2007 British Energy’s undiscounted liabilities were given as £14.5 billion – more than double the amount in the liabilities fund.

The is designed to pay for all decommissioning costs when they arise. The money is invested in a supposedly ring-fenced fund – like a pension fund for nuclear facilities. But in the past (see time

Credit: The Guardian The Credit: line) these funds have been raided Sizewell B, in Suffolk, Britain’s newest nuclear station, and the UK’s only by the nuclear industry to build new pressurised water reactor. It was built with the levy on electricity bills which nuclear facilities, such as Sizewell was supposed to be spent on nuclear clean-up. B, and the money has evaporated.

2007, JUNE: 2007, JUNE: 2007, AUGUST: Nuclear Decommissioning The original idea of Thorp was to Finland’s Olkiluoto 1,600 Authority (NDA) reveals there are reprocess foreign spent fuel so the megawatt third generation 30,000 tonnes of uranium and plutonium and uranium it contained reactor is revealed to be two 100 tonnes of plutonium in store, could be returned to its country of years late and over budget. but no policy for managing this origin for re-use as fuel. The shutdown It was originally due to be material in the long term. of the plant means no plutonium is completed in 2009; now being produced to make into MOX estimated to be completed fuel for foreign contracts. A condition 2011 at a cost of 4 billion 2007, JUNE: of the MOX plant licence was that Euros (£1 billion over budget). Government sells £2.3 billion only plutonium from foreign fuel could The project was supposed to worth of shares in British Energy. be used. To avoid having to shut the require no public subsidies but Money goes to the Nuclear MOX plant as well as Thorp, the NDA is supported by export credit Liabilities Fund to pay for spent proposes changing the licence so guarantees from French and fuel reprocessing. allowing the use of British plutonium Swedish Governments. from stores to make up foreign fuel until Thorp can restart. There is a short public consultation on the issue.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 27 The Government has pledged current AGR power stations’ profits limiting problems. The closure this will not happen again and the marginal. For example, the cost of of Thorp could add billions of pounds discount rate of 3 per cent is based uranium is rising, and although the to the liabilities. Both British Energy on the assumption that the liabilities Government is confident this will and Sellafield Limited refuse to fund will grow at the rate of 3 per not substantially alter the long-term disclose the company’s liabilities for cent. The theory is that by the time cost figures for nuclear generation, Thorp; but about 40 per cent of the decommissioning is necessary the some mining experts say good throughput at Thorp has been from fund will neatly pay for everything. quality supplies of uranium are finite. the AGR stations owned by British This is the view of British Energy Over the planned life of existing and Energy. The clean-up cost and BERR. new nuclear reactors, a shortage of of Sellafield is more than £31 billion, suitable uranium could do to nuclear but only a small part of that is While the Government is happy fuel prices what the has for Thorp. with this arrangement the National done to the cost of running the Audit Office (see above) and the family car. British Energy said that in So far the company and the House of Commons Committee on January 2008 the uranium price had Government are avoiding both these Public accounts in its 2006/07 report gone up to US$95 a pound. This eventualities by extending the life concluded “the taxpayer is was compared with $85 in March of Thorp to at least 2015, along still exposed”. 2007. This would drive up nuclear with extensions for the three AGRs fuel costs by £146 million a year if which were due to be closed soon. The exposure will become critical British Energy had not advance- Despite boiler cracks, Hinkley Point when liabilities exceed assets. This purchased uranium at the old price. in Somerset and Hunterston on the may happen as in 2001 when the Ayrshire coast, due to close in 2011, price of electricity dropped below A more likely immediate danger to had their lives extended to 2016 the cost of producing it from nuclear British Energy arises if any of the in December. Because of safety power – although this seems unlikely ageing AGR power stations have fears they were operating at an in the foreseeable future because to close because of safety faults, uneconomic 60 per cent of capacity the price for wholesale electricity has for example distortion of at the beginning of 2008 but the more than doubled. Yet costs could blocks or corrosion, both of which company hoped to raise this to 70 rise sufficiently to make some of the have already been identified as life- per cent and get them back in the

2007, SEPTEMBER: 2007, OCTOBER: 2007, NOVEMBER: Royal Society reveals that the Cost of nuclear clean-up rises Because of breakdowns and poor Sellafield MOX Plant will never to £73 billion according to the performance at Sellafield the work to design capacity of 120 NDA – 16 per cent more than NDA abandons plans to close tonnes of MOX fuel a year and 40 estimated only a year before. the Magnox reprocessing plant tonnes is maximum production in 2012 and puts it back to 2016 target. at least. Thorp closure is also left 2007, NOVEMBER: open ended. Government approves swapping 2007, SEPTEMBER: British plutonium for foreign , Friends of the plutonium so MOX production Earth, WWF, and Green Alliance can continue while Thorp remains pull out of latest Government closed. consultation on nuclear power describing it as “a sham”.

28 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE Credit: GuardianCredit: Newspapers black. Dungeness B in Kent, due to close in 2008, has already had its life extended to 2018. Next in line for extensions are Hartlepool on Teeside, and Heysham 1 in Lancashire, both due to close in 2014.

It is only the lifetime extensions to these stations and Thorp that are preventing British Energy having to turn to the taxpayer to underwrite its liabilities, which would exceed the assets in the liability fund. In response to detailed questions both British Energy and BERR express confidence that the fund will always manage to keep ahead of liabilities. On the figures available, with the size of the known undiscounted liabilities rising, it may need a remarkable The first advanced gas cooled nuclear power station at Dungeness Nuclear juggling act and a great deal of the in Kent which took 18 years to construct and has never worked as designed. nuclear industry’s voodoo economics to keep the company afloat while a new generation of nuclear power to acquire a BE station on closure GET-OUTS AND PERKS plants is built. But British Energy to either decommission or continue To avoid the new nuclear building notes that if the juggling act fails to operate it.” In other words, if programme being too closely “There is provision within the bankruptcy looms the industry or any associated with existing costs at restructuring agreements for the failing part of it will be nationalised. Sellafield and future problems for Government to exercise an option British Energy it is probable that the

2007, NOVEMBER: 2007, DECEMBER: 2007: British Energy says it has signed British Energy to spend £90 Builders of Olkiluoto 3, the new agreements for grid connections million extending the life of nuclear power station in Finland, for four nuclear sites at Sizewell Hinkley Point B and Hunterston still hope to open the plant in in Suffolk and Bradwell in Essex, B Power stations by five years summer 2011. Dungeness, Kent, and Hinkley to 2016 although they will only Point, Somerset. It has also be able to run at 70 per cent received a report about sea of original output. There is no 2007: defences on all four sites having formal closure date for any of the First poured for France’s to be strengthened to cope with company’s stations. Provided third generation nuclear power climate change. they are safe and the company plant, similar but modified design decides they are economically to Olkiluoto 3. Expected to be viable they can stay open commissioned in 2012. indefinitely. This means new nuclear build is not needed to replace existing stations because they are unlikely to close when the Government claims they will.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 29 ©Steve Bell 2008 – All Rights Reserved. First published in in published First Reserved. Rights – All 2008 Bell ©Steve The Guardian .

When the Government recently decided to back a revival of the nuclear industry, two favourite characters from political cartoonist Steve Bell returned. The two-headed radioactive sheep, first seen after the reappeared, alongside a new herd of white elephants.

2008, JANUARY: 2008, JANUARY: 2008, MARCH: Government announces it Hopes of restarting Thorp dashed Independent think tank the is favourable towards new when lift carrying spent fuel into Economic Research Council nuclear building porgramme plant fails and sinks back into releases a report saying that a but pledges that there will be storage pond. nuclear build programme is not no public subsidy. Details on possible in the UK without the how this is to be achieved to be Government speeding up the published later. Tim Jackson, 2008, MARCH: planning process and giving economics commissioner at the Energy Minister Malcolm Wicks financial guarantees so the UK’s Sustainable Development admits MOX plant produced only taxpayer covers the risk of cost Commission denounces the 2.6 tonnes of fuel in 2007 and overruns. It says the Government Government’s endorsement of less than 6 tonnes since opening would have to guarantee to nuclear power as “disingenuous in 2001. Wicks describes it as a buy all the electricity output of nonsense and a blatant failure of “largely unproven technology”. nuclear stations and the taxpayer moral vision”. underwrite any consortium’s exposure to cost of spent fuel and waste disposal.

30 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE Government and the nuclear industry Another public subsidy is insurance There is one other issue that is would like to float another company against accident and the increasing not addressed in the figures the to own the sites and new stations. In bill for security. Unlimited insurance Government has put forward this way the taxpayer would be made underwritten by the state is already and on which they rely to make to shoulder all the costs and private enshrined in international treaty so nuclear power appear competitive: industry would take all the profits of the UK taxpayer has no alternative transmission costs. The new breed a new programme. One of the key but to foot the bill for these. It is, of nuclear power stations are going components of a new programme however, an economic advantage to be among the biggest power would be that all the spent fuel that other forms of electricity plants in Britain and distant from would be stored on site – effectively generation do not enjoy. The special where most of their electricity will postponing the disposal problem armed nuclear police are also a be used. This will require a large for future to deal with. public expense. investment in the National Grid, This is contrary to the Government’s clearly something British Energy is stated aim of only encouraging Hard to quantify as a financial perk aware of because of the deal it has sustainable development. is the need for nuclear power to already struck for four proposed be given priority as a baseload sites. Lack of grid connection Some of the subsidies the provider, that is to say the power that has long held back development Government will give to the nuclear is needed 24 hours a day outside of renewables in Britain mainly power industry will become apparent the times of peak demand. Much is because the Government has failed as terms and conditions are made of the intermittency of wind- to force progress. This is one of negotiated with potential builders. generated power but nuclear has the the many problems that has kept The need for sea defences for the opposite problem: stations cannot Britain’s renewables programme new stations as climate change be readily turned on and off and behind the rest of Europe. Only takes a hold have been mentioned they only operate economically at Malta and Luxembourg have a but it is not clear who will pay for full power, so they have to be given smaller percentage of renewables in them. All the proposed sites are on priority to sell their electricity to the their energy supply. vulnerable coasts. Will the nuclear grid to the exclusion of other power industry pay the cost or the taxpayer- sources that may be cheaper. But the transmission problem hides funded Environment Agency? another statistic that makes nuclear

2008, MARCH: 2008, MARCH: 2008, MARCH: Business Secretary, John Hutton, British Energy shares rise 20 per The Government says it will be says he wants the nuclear cent after announcement that happy if British Energy is owned component of Britain’s electricity company is in talks with potential by a foreign company. Concern production to rise beyond 19 per partners or might be the subject is expressed that any successful cent with new build and says he of a takeover bid. RWE and E.ON bidder would have control of all wants to sell the Government’s in Germany, EDF France and the suitable sites for new nuclear remaining 35 per cent stake in , owner of British Gas stations in England. British Energy. and Scottish and Southern all said to be interested.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 31 power look less financially attractive. of the reasons for the delay. This and time delays. This would add The standard loss of power through nuclear station was to be built at a dramatically to the cost of borrowing long distance transmission from fixed price so has had to be heavily capital in the open market. Without big generating plants is quoted as subsidised. This is being done by a government guarantees to hold 9 per cent by the industry. Losses guarantee by heavy industry to buy down interest rates for new nuclear are much smaller for locally based the electricity output, and by export build, which amounts to a substantial renewables because the energy is credit guarantees by the French and subsidy, it seems impossible used close to source. Swedish Governments. The extra to finance the programme. The costs will therefore fall on French Government is already committed THE FRENCH CONNECTION and Swedish taxpayers. to bailing out British Energy if it fails The March 2008 Anglo-French financially. Because British Energy summit agreement of cooperation on No nuclear station has ever been owns all the best nuclear sites it is nuclear matters was interpreted by built in Europe without government almost certain to be a partner in any Downing Street officials as meaning subsidy. In France the public pays new nuclear venture. Because of its that the UK would rely heavily on for the nuclear industry twice, guarantees to the company to take French expertise to help build its first through its electricity bills and again on any liabilities the Government new nuclear stations. through its taxes. The true cost will be in a position of having to foot of nuclear energy in France is a the bill for any shortfall in funds. This makes it more likely that the first state secret and has never been It is hard to avoid the conclusion choice for Britain’s nuclear new build disclosed. that, whatever the Government’s will be the French 1,600 megawatt assurances to the contrary, nuclear Evolutionary Power Reactor, the first The biggest problem for potential new build will involve heavy of which is being built in Finland. nuclear investors in Britain is the government subsidies and unlimited It was due to be producing power capital costs of nuclear stations, liability for the British taxpayer. in 2009 but has been delayed to especially with the credit crunch summer 2011, and is estimated to and high interest rates. It is a virtual cost at least double its original 3 certainty, going on past and current billion Euro budget. Lack of skill in experience of nuclear construction, the workforce was given as one that there will be cost overruns

2008, MARCH: 2008, MARCH: 2008, MARCH: John Hutton, Energy Secretary, Energy Minister Malcolm Wicks, Prime Minister Gordon Brown says new nuclear build in the UK claims there will be “no subsidies and French President Nicolas will create 100,000 jobs, provide for new nuclear build” and says Sarkozy issue a communiqué £20 billion in new business for he is convinced that the UK promising to jointly “improve the UK and likens it to the North Sea cannot reduce its carbon dioxide efficiency and effectiveness of Oil bonanza of the 1980s. He emissions by 60 per cent by 2050 nuclear developments”. Officials wants the UK to be the number without new nuclear stations. say it means the UK will lean one place in the world to do heavily on French nuclear energy nuclear business, and says there skills “at least in the initial stages is a critical two year window to of expansion”. achieve this. Promises nuclear waste White Paper for spring 2008 so problem of waste from new stations is solved.

32 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE NEW SITES: THE UK’S PROBABLE, EXISTING AND NON-OPERATIONAL NUCLEAR POWER STATIONS

Dounreay [1994]

Probable sites of new ‘super-sized’ 3.3GW nuclear power stations Hunterston A Torness [2023] [1989] Existing nuclear Hunterston B power stations [2016] [Decommissioning starts] Non-operational Chapelcross power stations [2004] [Decommissioning started] Hartlepool Calder Hall [2014] [2003]

Heysham 1 [2014]

Heysham 2 [2023] Wylfa [2010]

Sizewell B Trawsfynydd [2035] [1991]

Sizewell Sizewell A [2006] Oldbury [2008] Berkeley Bradwell [2002] [1989] Bradwell Hinkley Point Hinkley Point B Dungeness [2016] Hinkley Point A [2002] Dungeness A Dungeness B [2006] [2018]

[1990] Source: NDA, DTI, British Energy

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 33 There has been an enormous Privatisation and Financial Collapse Paper 4: The Economics of Nuclear number of reports, books and in the Nuclear Industry, Simon Power, Sustainable Development papers on the nuclear industry in Taylor, Routledge, November 2007. Commission, 2006. the past five years, and many more in the decades before. Below are The Future of Nuclear Power, DTI A Cautionary Note, Pete Wilkinson, the major ones I have read and Consultation Document, May 2007. 2006. drawn on. I have been writing about the industry and talking to and Broken Promises: Why the Nuclear AGR Fuel Storage Plan, British interviewing people interested in it Industry Wont Deliver, Corporate Nuclear Group, July 2006. since mid-1980s. Watch report 2007. Nuclear Renaissance, W.J. Nuttall, The list is arranged with the most The Economics of Nuclear Power, 2005. up-to-date books and papers first. Greenpeace International, 2007. However at the end of the list are The Economics of Nuclear Power: details of some of the other sources, Friends of the Earth consultation Analysis of Recent Studies, Steve including some of those interviewed response to Managing Radioactive Thomas, 2005. in 2007 and 2008 during the course Waste Safely, 2007. of my press fellowship at Wolfson Mirage and Oasis: Energy choices College, Cambridge. Uranium and Plutonium: Macro- in an age of global warming, New Economic Study, Final Report, Economics Foundation, 2005. Taking forward decommissioning, Nuclear Decommissioning Authority, National Audit Office, 2008. June 2007. The Decommissioning of The UK Nuclear Industry’s Facilities, Nuclear Consultation: Public Trust in British Energy Accounts, 2006, Department of Trade and Industry, Government, Nuclear Consultation 2007, third quarter accounts 2008 – 2004. Working Group, editor Paul plus various press releases. Dorfman, 2008. Examination of BNFL’s reports and The Economics of Nuclear Power, accounts, MJ Sadnicki, 2002. Decoding Nuclear Nonsense II, UK Government briefing paper 8, Tom Burke, Third Generation June 2007. The economics of new nuclear Environmentalism Ltd., 2008. power plants and electricity Report on Delays at Olkiluoto 3, liberalization: Lessons for Finland Nuclear Decommissioning Authority, Finland’s new nuclear plant, STUK, from British experience, Steve annual reports and business plan Finland’s Radiation and Nuclear Thomas, presented in Helsinki, 2008/11. Safety Authority, 2006. 2002.

Nuclear Power Generation Cost Managing Our Radioactive Waste Thorp: The Case for Contract Benefit Analysis, Department of Safely, Committee on Radioactive Renegotiation, Friends of the Earth, Business Enterprise and Regulatory Waste Management, final report, 1999. Reform – updated April 2007. November 2006. 60 Years of Nuclear History: Britain’s Strategy Options for the UK’s The New Economics of Nuclear Hidden Agenda, Fred Roberts, 1999. Separated Plutonium, Royal Society, Power, World Nuclear Association, September 2007. 2005. The Economic and Commercial Justification for Thorp, BNFL, 1993. British Energy – Impact of The Restructuring of British Energy, Government Announcement re National Audit Office 2006. Thorp and the , Disposal of Interest in British Energy, Research paper 93/20, House of May 31, 2007. Commons Library 1993.

34 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE The Thermal Oxide Reprocessing Nuclear Debates, Hansard, March Nuclear Power, Walter C Patterson, Plant, British Nuclear Fuels, 1992. and May 1978, June 1993. 1980.

The cost of nuclear power, House Britain’s Nuclear Nightmare, James Windscale: The evidence and the of Commons Select Committee on Cutler and Rob Edwards, 1988. argument: The Guardian, 1977. Energy, HMSO, 1990. Cabinet Papers, The , decision to suppress report, 1957, released by Public Record Office under 30 year rule.

Briefing Papers (1990-2008 series) Martin Forwood, Cumbrians Opposed to Radioactive Environment.

Briefing Papers: Nuclear Installations Inspectorate: (1990 – 2007).

World Nuclear News Press Releases, 2007.

British Nuclear Fuels: Press Releases, Annual Reports: Sellafield News 1985-2007.

Guardian cuttings, Paul Brown 1983- 2007, Terry Macalister 1997-2008, plus other Guardian, Times and Financial Times reports.

Personal interviews: Nuclear Decommissioning Authority, 2007 and 2008, Sellafield Ltd, Department of Business Enterprise and Regulatory Reform, British Energy and Nuclear Installations Inspectorate in 2008.

Olkiluoto 3 1600MW , Finland Official web site, 2008. Credit: Reuters

The Chernobyl reactor in 1986 shortly after the world’s worst nuclear accident devastated the area.

VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE 35 VOODOO ECONOMICS AND THE DOOMED NUCLEAR RENAISSANCE

This paper exposes how badly the nuclear industry in Britain has performed throughout its entire history.

Fifty years of unfulfilled promises, technical failures and an escalating bill to the taxpayer raise huge questions over the viability of a new nuclear power programme in the UK.

Making life better for people by inspiring solutions to environmental problems Friends of the Earth, England Wales and Northern Ireland 26-28 Underwood Street, N1 7JQ, Tel 020 7490 1555 Fax 020 7490 0881 Website www.foe.co.uk Trust company number 1533942, charity number 281681

Printed in the UK on paper made from 100 per cent post-consumer waste May 2008