The German government is seriously considering imposing a significant tax on nuclear fuel rods that is expected to provide the government with approximately 9.2 billion euros of additional revenue over a four year period. This new tax might initially make nuclear reactors less economically competitive compared to fossil fuel alternatives, but it could very well open the door for additional operating life and perhaps even new reactor construction.
Some of my fiscally conservative friends think this is a terrible idea that should not be emulated by any government – their theory is that if a government actually wants to encourage a beneficial technology, it should ease the tax burden and perhaps even offer subsidies to make the investment more attractive.
I have a rather convoluted thought to offer. If the tax is approved and the revenues start flowing into government coffers, much of the official opposition to nuclear energy will be silenced by the cash flow. When representatives stand up in future sessions to offer legislation that would force reactors to shut down before their end of life or that would severely restrict new development, other representatives will remind them that they will need to replace the revenues coming from the fuel tax. They will also mention all of the wonderful things that they are accomplishing for their people as the fuel tax revenues increase because more fuel rods are being sold to more and more nuclear power plants.
If nuclear energy is destined to grow its market share, everyone outside of the industry will want to know – “what’s in it for me?” They will want a clear benefit to them from the act of changing from active opposition to support for nuclear energy.
A significant source of the success of the opposition to nuclear energy in the US was that every time a new nuclear plant came on line, the local utility applied for an immediate rate increase. The general population complained bitterly to their elected officials for allowing companies to build facilities that produced more expensive electricity. If there is a well understood tax being collected on the output of the new facilities, perhaps the elected officials will help the population understand why their bills will go up a little as the clean new power sources are added to the grid.
Please understand that I am not advocating the imposition of a tax burden so high that nuclear no longer makes any economic sense, but just think – here in the US a tiny 0.1 cent per kilowatt hour fee collected on the output of reactors that were mostly completed 20-30 years ago raises nearly $800 million per year. A rapidly expanding nuclear industry could provide a substantial increase in revenues that might help to balance the very out of balance federal, state and local government budgets.
Standing by for the blasts of opposition.