The European Wind Energy Association (EWEA) has published a blog titled Nuclear Decommissioning Costs Amount to €66 Billion in UK alone that is a direct response to a post on Foratom titled To subsidise or not to subsidise: that is the question. There seems to be a conflict brewing over energy-related actions that is worth following.
Foratom’s post provides some details about the amount of money European government have spent in recent years to encourage renewable (aka unreliable) power systems and the considerable amount that they have forced electricity consumers to spend by mandating renewable energy feed in tariffs.
Many countries in the EU are subsidising heavily renewables and the figures are striking. EU states invested around €35 billion in renewable energy infrastructures in 2009. Subsidies in the form of feed-in tariffs (FIT) that oblige energy retailers to buy power from renewables at a fixed price (usually above the market price), over a fixed period of years are widespread. 23 out of 27 member states use that kind of subsidies. In the UK, subsidies for renewables and notably the so-called Renewable Obligation increased consumers’ electricity bills in total by €1.34 billion in 2008 and 2009. In Germany, total subsidies amount to €5 billion per year for only 7% of electricity production from wind and solar. In Slovakia, the cost of subsidies for solar panels jumped from €10 million in 2010 to €117 million in 2011, etc…
It seems that the EWEA is offended that the nuclear industry would have the gall to point out that purveyors of unreliable energy systems are the recipient of massive, continuing subsidies while nuclear energy receives little to no financial encouragement from European governments. In fact, the situation is quite the opposite in many European Union member states, which impose special, nuclear-only taxes.
Furthermore, in some countries the so-called windfall profits of nuclear power are taxed in order to finance renewables. Germany had introduced a nuclear fuel tax in 2010 as part of a deal to extend the operational duration of nuclear power plants. The tax has been abandoned following the decision of the German government to accelerate nuclear phase-out. Sweden taxes nuclear power at about €0.67 cents/kWh, which makes up about one third of the operating costs for nuclear plants. In Belgium, the government proposed to increase the nuclear tax to €550 million per year despite its decision to close two of the country’s oldest reactors by 2015.
The Foratom blog correctly points out that nuclear plant decommissioning costs are accounted for in the initial capital cost budget because funds are set aside when the plants are built. Those decommissioning funds grow with time and are available when the plant reaches its end of life. In addition, Foratom correctly points out that research and development funds for nuclear fission are quite modest.
The budget for nuclear fission in the EU’s 7th programme for research and development (FP7) is €280 million over the 5-year period 2007-11. It is only 0.5% of the overall FP7 budget.
The EWEA claims that in the UK alone, nuclear decommissioning costs may run as high as €66 billion. The blog also claims that nuclear research and development expenditures are several orders of magnitude higher than reported by Foratom.
They might not seem much for Foratom but they are a lot more than renewables get! According to the OECD/IEA Clean Energy Progress Report 2011 governments in 23 leading nations (including 8 EU members) spent $56 billion on nuclear R&D 2000-2010 compared to just $16 billion on all renewables (and ‘renewables’ are many technologies: wind, solar, tidal, wave, geothermal etc).
I suspect that the EWEA accounting method includes the cost of decommissioning weapons material production facility and that their “nuclear” R&D figure includes all of the silly expenditures that have been aimed at chasing the fusion chimera. It is not honest accounting to attribute those costs to nuclear energy; every once in a while even the proponents of fusion will have an honest moment and reveal the fact that they are not really an energy technology program after all.
I offered the following comment on the EWEA blog. Perhaps others will join in and mention how the cost of nuclear R&D has been outrageously inflated by including fusion expenditures.
I am not as familiar with provisions for decommissioning in the UK as I am with the provisions in the US. Here, every nuclear electricity production facility is required by law to put aside sufficient funds for decommissioning out of the revenues generated by the facility. These funds are subject to regulatory review every few years and the companies are required to make adjustments depending on market conditions. No public funds are used at all.
We do, however, spend several billion dollars every year on “nuclear decommissioning” and clean up costs at national weapons production facilities that have nothing at all to do with electricity production. Is it possible that the EWEA figures above include government expenditures for similar weapons related activities?
Publisher, Atomic Insights