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All risk, no reward for taxpayers and ratepayers: The Economics of subsidizing the ‘Nuclear Renaissance’ with loan guarantees and construction work in progress (2009)

AuteurMark Cooper, IEER
6-01-0-10-83.pdf
Datumnovember 2009
Classificatie 6.01.0.10/83 (KOSTEN)
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Uit de publicatie:

ALL RISK, NO REWARD FOR TAXPAYERS AND RATEPAYERS

THE ECONOMICS OF SUBSIDIZING THE ‘NUCLEAR RENAISSANCE’ WITH
   LOAN GUARANTEES AND CONSTRUCTION WORK IN PROGRESS


                       Mark Cooper
          Senior Fellow for Economic Analysis
        Institute for Energy and the Environment
                   Vermont Law School

                    November 2009
                                  TABLE OF CONTENTS

ISSUE BRIEF                                                                              1
      The Nuclear Industry’s Demands for Direct Subsidies
      Nuclear Reactors are Uneconomic and Highly Risky
      Subsidies for Nuclear Reactor Construction Harm Taxpayers and Ratepayers
      The Bottom Line on Nuclear Reactors

I. INTRODUCTION                                                                          8
      A. Shifting Risks and Costs to Taxpayers and Ratepayers
      B. Outline

II. ASSESSING THE ECONOMIC RISK OF NUCLEAR REACTORS                                     10
      A. The Importance of Properly Allocating Risk
      B. The Risk of Nuclear Reactors Imposed on Taxpayers and Ratepayers
      C. The Risks Facing Nuclear Reactors
      D. The Bottom Line for Taxpayers And Ratepayers
         Nuclear Reactors are High Risk, High Cost Ventures
         Subsidies will Impose Severe Financial Harm on Taxpayers and Ratepayers
         Environmental Externality Arguments Do Not Justify Subsidies
      E. Conclusion

III. THE RISK OF NUCLEAR REACTORS IN THE EYES OF INDUSTRY                               20
     ANALYSTS
       A. Moody’s
       B. Standard & Poor’s
       C. Consulting Firms

IV. EMPIRICAL EVIDENCE OF THE INCREASING RISK OF NUCLEAR                                29
    REACTORS AT THE NATIONAL LEVEL
      A. Technology Risk
      B. Policy Risk
      C. Regulatory Risk
      D. Execution Risks
      E. Marketplace Risks
             Demand
             Natural Gas Prices
      F. Financial Risk
      G. The Bottom Line on D