Team CANDU gets some support from the Mississauga Times

The July 2, 2006 issue of the Mississauga Times includes an article by Jan Dean titled Our firms Candu anything; Tops in technology: Ontario’s hunger for nuke power helps drive growth; Candu attitude drives Canada’s nuclear industry and creates jobs.

The article includes a number of interesting facts about the impact of a proposal to build two new reactors in Ontario and provides information about the case that is being prepared by Team CANDU to assist them in earning the contract. For example, the two reactor project will require approximately 58,000 man-years of work. This is one aspect of nuclear power projects that I want people to understand a little better.

People that are opposed to nuclear power often point to the huge capital costs and claim that they make the technology uneconomic. They also make rather fact free statements about the labor intensity of solar or wind power. The fact is that a large portion of the capital invested in nuclear power gets distributed into the pockets of a large labor force. Once the plants begin operating, an even larger portion of the Operations and Maintenance (O&M) cost is for labor.

I like the fact that many people share in the project financial turnover; in my mind it is a much more beneficial relationship than a gas plant where up to 90% of the overall cost of producing power is the cost of supplying it with fuel. The oil and gas business certainly has workers, but no where near the number of workers per unit sales as the nuclear industry.

The jobs associated with nuclear power are demanding and require a certain level of skill and training. They also require people that follow rules, have a sense of personal responsibility and a belief that their job is important. In other words, these are good jobs for good people and the pay is not even close to that of a burger flipper.

Perhaps this labor intensity is one reason why “Wall Street” is not yet very enthusiastic about new nuclear power plants. It seems that the analysts in financial companies have a preference for businesses that can outsource their labor needs to developing nations that pay people minimal wages for lengthy work weeks in lousy conditions.

The rest of us do not have to put up with that attitude. It is quite possible to make excellent investment returns even with a strong work force that makes good wages; the numbers work as long as the spreadsheets are done with an understanding of second and third order effects.