Atomic Show #235 - Energy and Empire by George Gonzales 1


  1. I’ve seen waste storage systems, done financial analysis, and recognized the vast gap between the public perception of what nuclear energy can and cannot do and reality.

    @Rod Adams

    How does your “financial analysis” square with recent news of significant financial challenges, long in the making, faced by Areva and EDF in France (where nuclear gets a major boost from State policy and support, consumer subsidy and infrastructure development, and State leverage in international and trade of energy, equipment, professional development, and global markets)?

    Areva’s stock collapsed 55% over last 12 months, it’s bonds were downgraded to junk status last November, and it’s loss for the year is larger than its market capitalization. To say nothing of rising future liabilities (uncertain at the moment) of extensive plant upgrades, waste management (geological isolation at Bure), and decommissioning costs.

    Gonzolas may be correct that monopoly control over fossil fuels and their extraction presents a certain national competitive advantage over other technologies and energy resources that are less easy to “own” and “control” on a monopoly basis (solar and nuclear being two examples). The experience of Areva (and the significant levels of state support that are needed at all levels to keep the industry afloat) appears to provide good evidence for such a thing. Gonzolas, it appears to me, isn’t making an argument that some kind of subversion took place in 1973, rather efforts were made to advance the interest of nuclear at the time and they simply fell out of favor vis a vis more compelling and dramatic performance of alternatives (with respect to national interests, political economy, public acceptance, utility and finance elites, etc.). The question going forward is not what happened with nuclear losing the competitive race for market share over fossil fuels, but can it compete in the future and in a newer marketplace (and one less dominated by monopoly control over resources, technologies and fuels).

    Does nuclear just wish to pick up where fossil fuels left off (and become the new monopoly provider of technology equipment, services, and fuels), or is there a more radical and fundamental shift that is taking place (more along the lines of what Friedman calls a “flatter earth” and the challenge presented by a disruptive technologies, a global space for technology sharing, finance, intellectual property, and a condition of increasing energy availability for consumers and developers alike). Nuclear appears to be doing quite well in places were monopoly interests pertain (and it receives strong state support and command and control decision making). In a less unilateral setting, it appears to be having a more difficult time (and can’t seem to find the capital, publicly accountable regulatory environment, policy and public support needed to break out of it’s niche). If monopoly advancement of nuclear comes with a very high and unsustainable price tag, I’m not sure this approach will be a successful one in the long run (and it may be 1973 all over again). The nations pursuing this costly and very high public debt strategy may be at a competitive disadvantage (as appears to be the case with France, Japan as well). Time will tell.

    1. @EL

      How does your “financial analysis” square with recent news of significant financial challenges, long in the making, faced by Areva and EDF in France (where nuclear gets a major boost from State policy and support, consumer subsidy and infrastructure development, and State leverage in international and trade of energy, equipment, professional development, and global markets)?

      Areva made a huge mistake by partnering with the Germans in the design of the 1600-1700 MWe European Pressurized Reactor (EPR) and then stubbornly attempting to sell a reactor that does not meet customer needs for an economical power source. They have also stubbornly refused to listen to the NRC’s objections regarding the control system and lack of physical separation for redundant channels.

      Areva’s troubles are not indicative of basic nuclear technology weaknesses any more than Rolls Royce or Jaguar challenges are indicative of general weakness in automobiles.

      Actually a better analogy might be pointing to difficulties at Mac Truck as proof that there are fundamental issues with all forms of motorized transportation.

    2. Areva’s stock collapsed … To say nothing of rising future liabilities (uncertain at the moment) of extensive plant upgrades, …

      When nuclear plants get upgraded, AREVA makes money, since it sells the engineering, parts, and services to do the upgrades.

      … waste management (geological isolation at Bure), …

      AREVA has been making money off of “waste” management for decades. It owns and operates the used fuel reprocessing facility at La Hague, don’t you know?

      … and decommissioning costs.

      Again, that would be the “Back End” division of ARVEA. Decommissioning is good business.

      If you think that AREVA’s nuclear business is in trouble, you should take a hard look at how AREVA’s renewable division is doing. I think that their bio-mass business (i.e., building cheap plants to burn trash and rubbish) is doing OK. The solar and wind parts are surviving.

      Welcome back, EL! I hope that you enjoyed your brief vacation, but I suppose that it’s time to punch the clock again, eh?

      Disclaimer: I work for AREVA; however, what I say in this forum is my own opinion and does not represent the opinion or policy of my employer in any way. Wouldn’t it be nice if everyone was as forthcoming about who they work for? 🙂

      1. @Brian Mays

        Warning – If you persist in accusing EL of being a professional commenter, you may find your comments being deleted. I came very close to deleting the second to last paragraph regarding “punching the clock” in your comment, but decided against it.

        1. @No Labels

          My experience with wind energy could be considered professional – I spent four summers during my naval career teaching off-shore sailing and taking lengthy voyages powered by the wind, with several thousand ocean miles accumulated. Sailing was my job, so that sort of counts as “professional” experience with wind power.

          My solar energy experience is mostly observational and modeling.

          Big difference between describing someone as “tiresome” and accusing them of being a paid commenter. One is purely a judgement based on personal perception, the other is a label that can be either proven or disproven with evidence.

      2. Decommissioning is good business.

        @Brian Mays.

        You don’t seem very well informed about position of company, and prospects for dissolution and closer tie ups with EDF and CEA? Talk of Hinkley Point getting cancelled and inability to raise funds (certainly at a cost that fails to improve massive debt picture) isn’t troubling to you. How do you propose EDF fund it’s long standing and highly uncertain legacy costs (which ratepayers and the federal government are on the hook for … not fully independent and private companies)? Is it good for business for EDF and CEA (and for French Government) to also take downgrades in credit and write-downs by taking on closer finance and business ties with Areva (a troubled asset)?

        You seem to be overlooking a lot that is quite worrisome in this situation (and with the dismissive comment that uncertain legacy costs are somehow good for business for Areva). This is very far from the case, especially for a company in the business of selling very expensive equipment (and to clients who wish to have a bit more certainty about long term legacy costs than what Areva is able to provide). We’ll see if they can straighten it out with a great deal of outside help, but I don’t find these issues at all unique to Areva (especially with all that is typically said here on the topic of regulatory uncertainty, imperfect waste management approaches, non-competitive plants decommissioned early, expensive and uncertain decommissioning costs, global security concerns, and impediments on many levels beyond engineering to advanced reactors, particularly on a private sector basis). If you’re wondering why many private utilities are on the fence about nuclear (yes, State directed efforts at new construction are doing OK), uncertain long term costs and uncertainties (displayed very well by Areva) have a lot to do with it.

        So sure, Areva can continue to generate red ink by patching up old plants (quite a business strategy and vision for the future you are proposing)?

        1. @EL

          You don’t seem very well informed about position of company, and prospects for dissolution and closer tie ups with EDF and CEA?

          You and Brian may disagree about the way one should interpret various pieces of information about Areva, but you are being a bit illogical by claiming that he is not well-informed about his own employer. Brian has made no secret of the fact that he has first-hand knowledge of Areva.

          Ex: Brian: “Disclaimer: I work for AREVA; however, what I say in this forum is my own opinion and does not represent the opinion or policy of my employer in any way.”

          1. @Rod Adams

            Stock has been cut in half over 12 months, lending to company is currently below investment grade, and Areva faces poor prospects for new capital and possible buy out threats. It needs a great deal of State help. Ignoring these threats, and saying decommissioning is “good business,” is not particularly far sighted or well informed (and it doesn’t seem illogical to me to say so). Especially when additional bailouts from the taxpayer and ratepayer (and new tariffs) are the next likely bumb in the road.

            Any of this sound familiar?


            Returning to the original topic, disruptive challenges abound … and is nuclear’s only response raising the cost of electricity, tapping into decommissioning funds, standing watch over nuclear waste, and a slate of botched repairs and upgrades (Crystal River and SONGS). That’s not a future, that’s a checkered past (and troubled asset). Some serious work, development effort, creative public and private sector financing, and much more needs to take place before any of this changes. Defending the status quo isn’t going to get us there (that is what sounds illogical and short sighted to me).

            Are folks here up to the task, because it’s rather hard to tell sometimes … it feels like “wait and watch” has become the new normal (as investment funds flow elsewhere, just as in 1973, and France and others plan for a future with less nuclear, less uncertainty in long-term costs, and less debt).

            1. @EL

              Have you listened to either Atomic Show #233 or #234?

              You are talking to the wrong audience if you think “nuclear’s only response” is defending the status quo. There are many new ideas being developed, even if the established companies are not the ones developing them. Will all succeed?

              Heck no, but innovation requires a willingness to tackle hard challenges with the understanding that failure is an option. I personally like the tech entrepreneur mantra – fail fast. That allows rapid learning and moving on to more productive endeavors quickly.

              Brian was correct when he described specific aspects of Areva’s product and service line as good businesses. He did not claim that the company has no troubled products or is in terrific shape over all. Areva is a large conglomerate; some of its businesses are doing reasonably well while some of them are in serious trouble.

    3. Devil in the details EL. Losses from lower revenues, renewable losses and new reactor in Finland setbacks:

      Areva suffered a €373m net loss from discontinued renewables activities including offshore wind and concentrated solar in the first half of 2014. ( )

      Revenues last year also shrank by 4.0 percent to 9.2 billion euros, and its renewable energies activities took a hit because of lack of orders.

      In a results statement late on Wednesday, Areva revealed that it had taken heavy charges for its deeply troubled contract to build a new-generation EPR nuclear reactor in Finland. ( )

      Big LOL.

        1. I wouldn’t call one time charges and very short term, nuanced and politically connected instances and influences “trends” regardless.

          Beyond that your original comment is difficult to read and decipher. What was the point and motive there? Are you questing the opinions here related to the theorized emotional response to a possible ethical dilemma encountered by totally fabricated whole, completely inanimate object?

          But Im sure I just need to do more reading.

  2. “They [Areva] have also stubbornly refused to listen to the NRC’s objections regarding the control system and lack of physical separation for redundant channels.”

    100% freaking correct.

    This applies to any nuclear company – SMR, non-LWR, Generation III+ LWR, etc. Follow BTP 7-14 (DSRS for LWR SMRs) and RG-1.152, 1.168 through 1.173, 1.180, 1.209 and 5.71 for digital I&C. Don’t argue with the NRC. Just stop your complaining, and stop saying you got a unique system or you’re passively safe or your molten salt can’t boil or whatever, so the NRC rules don’t apply. The NRC is paranoid about common cause / common mode failure propagation in and through digital I&C, and is even more paranoid about CyS (especially hidden latent defects in logic or code that V&V of requirements or hazards analysis or software unit testing don’t reveal). So just follow the Reg Guides and stop saying that they are simply guidance and you can invent your own way, because by the time the NRC decides to get around to looking at your own way for approval, Christ will have returned and this will all be a moot point.

    Now I could be wrong, but I will guess digital I&C SQA and CyS might take up half the cost and half the schedule for a new advanced reactor big or small. And doing it wrong (or worse, defying the NRC) is more expensive than either concrete and rebar or conduit and cable.

    By the way, this applies equally to FPGA / CPLD configurable logic because the NRC regards that as much software as it does PLM, Pascal, Ada and all the rest (yeah, I am an old Fortran-77 and Latin and Koine Greek guy – I only know English and dead languages). FPGA chips, CPLD chips, UVPROMs, EEPROMs, etc, are NOT merely hardware, and don’t let any nit-wit tell you otherwise. But don’t be like me – be nice.

    And one other thing: no stinking prioritization modules. That’s what screwed Areva up. Stop with that nonsense.

    Sorry. This is a source of frustration for me, NOT because I worked for Areva (never did) NOR because of my current employer (it’s a Byzantine maze of regs and standards!) – I am simply thinking of what I saw happen in the past and how the NRC simply held things up with RAIs because what they explicitly required in the Reg Guides wasn’t done. 🙁

    BTW, the regs and standards are no easier for Candus in Canada. Read CE-0100-STD and CE-1001-STD through CE-1004-STD and CSA-N290.14 and CSA-N286.7 (I could go on but you get the idea).

    1. I hope that NuScale is following all of those Reg Guides, Ioannes. Rod, you might consider pointing Mike McGough to Ioannes’s comment.

      1. Please do NOT single out NuScale. B&W mPower got its DSRS, but the NRC has yet to provide the NuScale DSRS, chapter 7 of which will simplify the BTP 7-14 stuff for NuScale. And that’s all under Advanced Reactors on the US NRC web site in the very public domain. NuScale should NOT be penalized because the NRC is slow to issue the DSRS. My comment applies to any company big or small doing this. It could be Leslie Dewan’s company, or Bill Gates’ company, both of which are doing advanced reactors. The intent of my comment is to help and NOT criticize any specific company. I have seen engineers go through sleepless nights because of this stuff that mangers usually don’t understand, and I would just as soon see a successful enterprise.

        1. I sympathize with your frustration, however some of your frustrations are mis-characterized. mPower got its DSRS because they paid the NRC enough $ in meetings to tell the NRC how & why the NRC had to stamp the mPower document telling NRC how to write the mPower DSRS. NuScale is still at the “pay the NRC in meetings stage” on how & why to write the NuScale DSRS (wink, wink). So you see NuScale is really the hold-up, still paying the ransom, just not fast enough.
          You said in an above comment “…by the time the NRC decides …”; NRC doesn’t “decide” anything, they work through a procedural checklist for approval of everything, which includes verifying the answers from a computer code run, which the NRC has also verified with its own verification run of a verified computer code run (I know, it’s complicated, but computer runs are really reality, everything else is fake). So if you can’t get a digital control system approved, take a hint, sit in ransom money meetings and explain it to them, write the standard for them, and maybe even develop a computer code that can find common cause/mode failures. If it ain’t code it ain’t real. You are probably still under the misconception that engineering judgement, after decades of experience, has a place in nuke power regulation; that’s just silly.

          1. MJD,

            I really hope you are wrong but I suspect otherwise. Kyrie Eleison, Christe Eleison, Kyrie Eleison.


      2. Here is an example of delay to which I referred: RIS 2014-XX, “Embedded Digital Devices in Safety-Related Systems”

        It was supposed to have been issued in mid-last year. March 2015 is now upon us in a few days and it still isn’t issued, and it promises to help clear up some of this confusion regarding digital I&C. So part of the problem is this: NSSS organizations (NuScale, B&W mPower, Holtec, Westinghouse, etc.) are trying to hit a moving target. 🙁

        1. Exactly. But when I look at the examples given in your reference, I see they use a common cause failure of EDGs using a digital control device with a software (or firmware) problem. I agree it is possible. But at the end of the day, you have an equipment failure, and yes it can be all trains of a safety system. But here’s where NRC gets off in left field with loss of engineering judgement. And they seem to shift to zero risk (to the NRC by acceptance) rather than “acceptable risk”, which is what they claim to use. The Station Blackout Rule forced a hypothetical (non mechanistic) loss of all AC power sources assumption, which means loss of both EDGs, and then dictated a coping time (for PWRs it’s RCP seal integrity). If you couldn’t meet it, buy an SBO diesel. So that one is covered under “acceptable risk” already. Same goes for ATWS, same for total loss of all Feedwater, and HPI, etc. I think everything has been looked at & plants have coping guidelines. And they are constantly expanding beyond DBA coping strategy. If NRC can find a specific area beyond DBA where digital can cause a problem, that hasn’t already been considered, OK deal with that specific equipment problem. But their wholesale rejection of digital control for “what if” just does not make sense.
          But then utilities have not always done them self any favors in this area either, as the 2003 slammer worm intrusion at Davis Besse proved. A totally self inflicted digital problem, caused by loss of control of the station network firewall.

      3. @EntrepreNuke

        I’m confident that NuScale knows what it’s doing. Several former NRC regulators in decision-making positions there, including the CTO/co-founder.

        1. To Rod,

          This is NOT a reflection on any company or particular individual, and certainly not a reflection on Dr. Reyes, but there are cases – and not insignificant in either number or consequence – of some (not all) former NRC people having gone to work in private industry (otherwise known as free enterprise) and having acted with an arrogance and hubris unbecoming in any nuclear professional. Somehow, having once been a regulator (or a member of a regulatory body), certain of these individuals (not all and definitely not a reflection on any specific company) regard themselves as above the regulation, and act towards their new co-workers or direct reports within private enterprise in a condescending or patronizing manner at best, or as is more often the case, in a derogatory or demeaning way. Sometimes (not all the time) extensive years in government service seems to result in a “holy than thou” attitude. Therefore, while individual cases within NuScale or B&W mPower or Holtec or Westinghouse or whatever may be different, I would not place blanket confidence in the decision-making process of former regulators any more than I would place blanket confidence in the decision-making process of an entrepenuer (otherwise known as a businessman or capitalist). These are imperfect and fallible human beings given equally to error and concupiscence. If one doesn’t trust a capitalist to make a right decision, then why would one trust a regulator when both are the same kinds of human beings?

          As for me, I am more inclined to trust a capitalist because I know what his or her interests are – to make a profit. As for some (not all) former regulators once in the most pristine of regulatory agencies in all the planet, theirs often (not always) isn’t the honest motivation of profit, but the concupiscence of the most mortal of the seven deadly sins, pride followed closely by greed (yes, a greed worse than any of that seen in the likes of monopolists – NOT capitalists – like Carnegie or Rockefeller). What MJD wrote only serves to confirm my worst fears. 🙁

  3. In regards to Chernobyl there is a big difference in regards to living in an environment with humans or without humans. For one thing animals who live around humans often befit from bigger brains.

    There is a lot of genetic variation in most species. When their environment changes the different natural selection pressures lead to changes in which genes are predominant. Proving some variation is because of mutations (radiation induced or otherwise) or because of genetic drift and/or selection pressures would require genetic information from many different animal to know with any certainty. Anything else is just speculation.

  4. Show a country how to make good enough solar panels and batteries for individuals to make their own power, and they will be independent forever.

    Sell a country oil, nukes, or gas turbines on credit, and they will bow down to you forever, pay you interest, and buy necessities for security apparatus. That is, until they throw off your yoke.

    On History Channel’s The Men Who Built America, did you notice how the first power plant was in a house basement, making that house independent. Later power plants were centralized, making the entire city more dependent on things outside their control.

    On this “radio broadcast” it was enjoyable to hear the guest’s different, believable, and maybe even better, interpretations of history.

    1. @Tax Payer

      On History Channel’s The Men Who Built America, did you notice how the first power plant was in a house basement, making that house independent. Later power plants were centralized, making the entire city more dependent on things outside their control.

      Sure, I noticed that the first power plant was installed in the basement of a personal residence. However, I also noticed that particular residence was owned by one of the richest and most powerful bankers in history – J. P. Morgan. Another detail that you seem to have overlooked is that even Morgan’s house was not independent; that power plant required regular fuel deliveries from somewhere else and discharged its waste into the shared environment of all of Morgan’s neighbors.

      Distributed electricity generated from efficient, centrally-located, reliable, weather-independent facilities that obtained economy of scale by serving a variety of customers who needed power at different times over a 24 hour period is one of the greatest inventions of the Industrial Age. It has been a source of incredible human freedom and has helped to raise billions of people from bare subsistence living to a situation where Americans command the equivalent of between 100 and 200 “servants” all day, every day.

      Feel free to have a different opinion, but the facts disagree with your perceptions.

    2. Solar requires backup and a very closely supervised and regulated grid/market. Its another layer of oversight and complexity. It requires extensive predictive input as well. Its the opposite of transparency and independence. Or its colossal waste. Thats the nature of intermittent power systems.

      Why do people keep bringing up that ridiculous argument? Where did that even come from??

  5. This guys does not even know the difference between radioactivity and poisoning by metals, when he mentioned Iraq and the birth defects which, I presume, he believes have been caused by radioactive depleted uranium…

    Seems to me he’s quite clueless about quite a few things nuclear, unfortunately, including a lot of myths on Chernobyl.

    Will most likely not read his book, but might consider Rod’s suggestion for “A Century of War: Anglo-American Oil Politics and the New World Order”

    Ciao, Luca

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