Some of the earliest documented instances of opposition to the development of commercial nuclear power in the United States originated from designated representatives of the coal industry. They were the first people to mount sustained opposition to the use of taxpayer money to support the development of nuclear power stations.
They testified against the implied subsidy associated with nuclear fuel leasing and complained about the value credited to commercial plant operators for the plutonium produced during operation, even though that material was locked up inside used fuel rods. They were the first people to label the Price-Anderson nuclear liability limitations as a subsidy.
The coal industry, frequently referred to as “King Coal” in the era up to the end of World War II, had legitimate commercial reasons for striving to convince the Government to stop pushing atomic power into the electricity market. The industry had experienced a 30% slide in sales by weight during the fifteen year period between the end of the war and 1960. It nearly completely lost both the home heating market and the railroad locomotive market to diesel fuel and natural gas. The utility power market was the coal industry’s only real growth area.
However, by the early 1970s, the coal industry quietly backed away from the political struggle against atomic energy, apparently recognizing that more effective recruits had arrived to continue the fight.
After 1971, it appears that the coal industry decided to focus its internal efforts on continuing to improve mine productivity and reduce transportation costs while allowing others to take the visible lead on the political part of their battle to maintain sales growth by slowing the atomic competition.
After that introduction, it is incumbent on me to provide evidence that support the claims. First, however, I’d like to let you know how I happened to come across a new, rather rich seam of material that backs up a theory I have been developing for many years.
After I published a recent post titled Smoking gun: AEC told President Kennedy why coal industry was opposed to nuclear energy, Kirk Sorensen sent me an email that included a clipping from the Knoxville News-Sentinel that he had discovered while going through papers in the basement of an Oak Ridge National Laboratory retiree.
That October 2, 1966 News-Sentinel article, titled Coal Industry Overwhelmed, contained a number of key passages, but it also contained several useful search terms that led to additional evidence. One specific clue that the article provided was the name of an organization I’d never before encountered, the National Coal Policy Conference (NCPC) and the name of one of its early leaders, Joseph Moody.
That group was established in 1959 and dissolved in 1971. While it lasted, it was a unique grouping of mining companies, railroads, the United Mine Workers of America, electric power utilities and mining equipment manufacturers. The issue that brought these often contentious groups together was a focused effort to promote the increased use of coal in competition with residual oil, natural gas and atomic energy.
Reading books and articles about epic battles over energy markets that date back to several years before I was born has been an interesting way to spend the past couple of days. I know – I’m an odd bird.
On February 10, 1958, the New York Times published an article titled ATOM POWER ASSAILED: Southern Coal Producers Ask U. S. to End Program that described how a coal lobby group engaged in a specific political action to stop the Atomic Energy Commission from funding commercial power development. That opening gambit did not succeed and it did not win the coal industry lobbyists any friends on the Joint Committee for Atomic Energy. Here are some key quotes:
The Southern Coal Producers Association called on Congress today to end the civilian atomic power development program of the Atomic Energy Commission.
Joseph S. Moody, head of the group, said the commission’s power development program had been a “dismal failure,” “completely unnecessary,” a dissipation of the nation’s scientific and technical manpower and a heavy tax burden on the American people.
[Chet Holifield] “predicted that coal interests would be ‘no more successful in stemming the progress toward the development of an economic atomic power than they have been in trying to stop the use of natural gas.'”
Several years later, Mr. Moody, now the president of a larger organization dedicated to increasing coal sales, was involved in another political action to reduce subsidies. Here is a quote from a UPI article titled Atom-Power Delay Urged On Congress:
Washington, July 13 (UPI) — The National Coal Policy Conference asked Congress today to delay approval of three proposed civilian nuclear power plants on the grounds that Government subsidization of them was against the public interest.
More than $42,400,000 has been appropriated for the plants, Joseph Moody, the conference president said. But no one has “clearly established” the need or justification for the subsidies, he said.
Mr. Moody also questioned what effect subsidization would have on the coal industry.
In a book by Brian Balogh titled Chain Reaction: Expert debate and public participation in American commercial nuclear power, 1945-1975 (Cambridge University Press, 1991) there is a passage indicating even earlier interest.
At its inception, the program to develop commercial nuclear power did not fit the iron-triangle model, even as adjusted for the contingencies of the New Deal. Interest groups were more of an afterthought than a crucial catalyst. A massive wartime effort inadvertently created a technology that might prove to be of great social and economic value. Owing to its sudden introduction and the uncertainty that clouded its potential uses, support for — or, for that matter, opposition to — its development remained poorly defined.
Coal interests were perhaps the only group that was not ambivalent. The “coal boys” saw no possible good coming their way and opposed the development of nuclear power from the start. [pp 64-65]
(Note: The above passage contains a footnote mentioning a paper titled “The Coal Boys Attempt to Split the Atomic Lobby: A Tale of Two Technologies and Government Policy in the 1960s,” which was presented to the annual meeting of the History of Science Society in October 1987. I have been unable to locate that document, if anyone can help me find it, I would be grateful.)
The coal interests effort to slow or halt the subsidized power reactor program continued throughout the 1960s. A New York Times article dated June 17, 1964, titled Coal-State Senator Opposes Subsidies For Atomic Power leads with the following paragraph:
Senator Robert C. Byrd, asserting that nuclear fuel now threatened coal as an energy source, urged an end yesterday to the Government subsidy for atomic power plants.
In the keynote address of the annual convention of the National Coal Association being held here, the West Virginia Democrat said the subsidies were not necessary or desirable because there had been drastic reductions in the cost of constructing nuclear generating stations.
Senator Byrd, who represents the largest bituminous coal producing state, called for other Government moves to shield coal from what he termed unfair competition.
In a letter to the editor of the New York Times dated September 25, 1964, NCPC’s Joseph Moody made the following statement:
The Government should stabilize residual oil imports at or near present levels, stop subsidizing civilian nuclear power which, as now subsidized, competes in coal’s major growth market — electric utilities — and negotiate aggressively to remove barriers which prevent coal from achieving its full potential in the export market.
Coal is Appalachia’s largest resource and industry. It can become even larger, if given the opportunity, and be a source of many thousands of urgently needed new jobs.
The effort to stop favorable fuel leasing arrangements and backdoor subsidies provided by generously valuing the plutonium produced while operating a commercial reactor was part of a push to convince the Atomic Energy Commission to declare that light water reactors were sufficiently well-proven to be declared to be of “practical value.” If the AEC made that determination, it would force utilities to apply for licenses under section 103, which applies to commercial reactors rather than under section 104, which only applies to demonstration reactors.
While the Atomic Energy Commission had the authority under section 104 to waive fuel lease charges, provide direct subsidies, and provide other research and development services for free, it did not have that authority for commercial nuclear power plants licensed under section 103. Before finding Balogh’s Chain Reaction, I was not aware that all of the reactors ordered before 1970 were licensed under section 104(b) as demonstration reactors because the AEC believed that there were too many cost and operational uncertainties to declare them to be of “practical value.”
Nuclear power projects that were licensed as demonstration reactors received one more benefit that helped to speed the process of getting them approved, but also created a whole new class of opponents. The process for obtaining a section 104 license did not pass through the office of the Attorney General for a review to ensure that it did not violate provisions of the antitrust laws. That facet of the “practical value” controversy raised the ire of small companies, the public power cooperatives, and their political allies.
Balogh devotes a considerable amount of space to the long-running discussion within the AEC about the determination of “practical value”. He describes how there was an entire series of memos (the AEC 152 series) that provided detailed arguments justifying the Commission’s reluctance to declare a whole class of reactors to be commercial; the staff position was that each project needed to be judged on a case-by-case basis. Professional staff members also recommended that the Commission wait to obtain operational data over a sufficient period of time before making the determination that reactors were practical.
Aside: That suggestion was eminently sensible. If it had been more publicly discussed and taken on board by the utilities and manufacturers, perhaps nuclear technology would have been developed on a more sustainable trajectory. End Aside.
Coal industry representatives, including Stephen Dunn, president of the National Coal Association (NCA), Brice O’Brien, the NCA’s general counsel, Joseph Moody, president of NCPC, and Philip Sporn, the chairman System Development Committee of American Electric Power, play a prominent role in Balogh’s analysis of the issue and the way it was finally resolved. Here is a sample quote:
Moody [president of NCPC] demanded an immediate halt to the subsidies. He called on the Atomic Energy Commission to declare that reactors were of “practical value.” “There can be no question that they are of ‘practical value’ — or else they would not be built to supply commercial power,” Moody fumed. He also demanded that the AEC charge the market rate for the commercial use of fuel, increase charges for other AEC-subsidized services, and eliminate government-guaranteed indemnification under the Price-Anderson Act. As the National Coal Association’s general counsel, Brice O’Brien, put it, “Thermal reactors have reached the point where they should be placed in the mainstream of commerce to stand on their own feet without the artificial stimulation and artificial distortion of taxpayer-financed subsidies.”
(Balogh, Chain Reaction, p. 208)
(Note: The context places this demand in early 1964.)
Here is another quote that demonstrates that coal interests continued to press the issue.
Rebuffed in 1965, the coal boys were back again in 1966. They cited another flurry of reactor announcements, and continued AEC statements citing the competitive advantages of nuclear power.
The “practical value” issue was finally resolved in December 1970, with legislation that prevented nuclear plants licensed under section 104 from generating more than 50% of their annual operating expenses from the sale of commercial electricity. That provision convinced utilities to use the section 103 process for commercial power plants.
A book by J. Samuel Walker titled Containing the Atom: Nuclear Regulation in a Changing Environment, 1963-1971 (University of California Press, 1992) (available for a bargain price of $1,981.46 per copy), adds a discussion about the coal industry’s efforts to prevent the renewal of the Price-Anderson Act, which was passed in 1957 as a temporary measure with a ten year sunset provision. That effort was part of “what Nucleonics Week called ‘no-holds-barred opposition to [the] AEC’s civilian nuclear power program.'” (p. 116)
As the dispute escalated, the coal lobby added Price-Anderson to its list of complaints about nuclear power. After the AEC proposed its amendment to resolve Jersey Central’s concerns about the expiration of the indemnity law, coal interests seized the opportunity to voice their objections. They argued not only that Price-Anderson was an unwarranted and improper subsidy for the nuclear industry, but also tweaked nuclear proponents by questioning why it was necessary. In March 1964, Congressman John P. Saylor, who represented bituminous coal regions in western Pennsylvania, introduced his own amendment to Price-Anderson. In contrast to the AEC’s measure, his bill provided that a nuclear plant would not be covered by the indemnity law unless it received an operating license by 1 August 1967. “The atomic energy industry insists that atomic powerplants are safe and…the Atomic Energy Commission supports this claim,” he declared. “Under the circumstances, there is no reason for the tax-paying public…to be forced to underwrite insurance for a commercial venture.”
(Walker, Containing the Atom, p. 117)
John W. Johnson’s Insuring Against Disaster: The Nuclear Industry on Trial (Mercer University Press, 1986) contains a similar discussion about the coal industry’s successful efforts to label Price-Anderson as an unfair subsidy while being unsuccessful in stopping its passage and renewal. Here’s a sample quote:
…the most visible elements of controversy in the nuclear indemnity-insurance debate were injected by the National Coal Association (NCA) and allied pro-coal forces. In the congressional hearings and debates over the original Price-Anderson bill in 1956 and 1957, the coal interests presented only weak resistance to indemnity and limitation-of-liability legislation. In the 1960s, however, the “coal dust” swirled around the Price-Anderson extension deliberations at nearly every stage. In essence, the coal interests used this debate as an occasion for a multifront attack on nuclear power.
The NCA’s main criticisms of Price-Anderson were twofold: 1) that the amount of liability insurance provided by the act and its proposed extension was too low, particularly given the $7 billion upper-limit damage figure noted in WASH-740 in 1957 and probably exceeded in 1964-1965 because of the larger size of the new nuclear plants; and 2) that the freedom from liability suits in the nuclear industry provided no incentive to improve the safety engineering of reactors. The second criticism is one version of the argument — often heard in the 1960s — that the Price-Anderson Act was a subsidy for the nuclear industry.
(Johnson, Insuring Against Disaster, pp. 62-63)
I want to again emphasize that all of the above noted efforts were a part of a broad industry campaign, led by designated trade association representatives engaged in a legitimate and open effort to halt government practices seen as unfairly influencing a competitive and lucrative commodity market. It was widely reported within the trade and general business press and fully understood by both private industry and government officals.
A June 20, 1966 New York Times article titled Coal Vs. The Atom: Battle Is Joined includes the following passages:
Washington, June 19 — Coal vs. the atom — a slowly developing battle that has suddenly intensified — will draw the attention of the coal industry’s top strategists here this week.
They are the leaders of the 5,000 coal producing companies, gathering for the National Coal Association’s annual meeting, which began today.
The battle is sure to mean cheaper electricity for the consumer.
Coal lost the most important single skirmish in its battle last Friday when the Tennessee Valley Authority chose the atom to provide power for what will be the world’s largest nuclear powered electrical plant.
Coal still fires the plants that produce 52 per cent of the nation’s electricity. The demand for electrical power will more than triple from 1960 to 1980, according to the Federal Power Commission.
But the inroads beginning to be made by nuclear power have set off what Joseph E. Moody, president of the National Coal Policy Conference, Inc. called, “the most strenuous competitive struggle of this generation.”
Coal is down to its fighting trim, having just spent more than a decade automating and streamlining its production and transportation methods to recover losses in the railroad industry and home heating markets to diesel oil and natural gas.
By the end of the 1960s, however, the coal industry groups arrayed to slow down the growth of nuclear energy began backing out of the fight. My interpretation is that they recognized that their efforts to publicize concerns about rapid nuclear energy growth had attracted other recruits to the battle. In the spirit of the times, they recognized that their efforts could be readily dismissed as special interest pleadings, while the new recruits could bring more energy and persuasive arguments to the battle.
The coal industry ended the Sixties in a cheering mood as it watched nuclear plant orders fall far behind the previous two years. It also grew optimistic as conservationists began probing into possible thermal effects of nuclear plants and youth groups started to single out nuclear power as a target akin to napalm.
A March 1, 1971 article by Ben A. Franklin titled Union-Management Conference in Coal Industry Is Dissolved documents the demise of the National Coal Policy Conference. It lists three separate pressures that pulled the organization apart, but it also includes what might be considered a “mission accomplished” passage.
The conference spent its first years battling the well-advertized advent of atomic electrical power, a threat to coal that some power economists here believe did not materialize on schedule in part because of the conference’s opposition.
Though the organized and open efforts by coal interests to slow the development of nuclear energy faded away more than forty years ago, the arguments that they introduced continue to appear on the lists of talking points against the technology. That remains the case even in relation to policies and programs that were substantially modified decades ago so that they no longer provide the unfair benefits that they once did.
I wonder how many of the people who repeat the antinuclear talking points about nuclear power subsidies and Price-Anderson liability limits know that they are supporting corporations in the business of extracting and moving massive quantities of coal?
Nuclear Power Economics–Analysis and Comments–1964 Prepared for the Joint Committee on Atomic Energy by Philip Sporn, chairman, System Development Committee, American Electric Power Co.
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