Archive for category Myth Busting & Analysis
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My first reaction was “Wow! Did I just read that correctly?!”
It was one of those “ah-ha moments” when a seemingly mundane statement leapt out of the page and whacked me on the forehead. This time the catalyst was a twitter reply from Chris Pragman (@ChrisPragman) who describes himself as an “Avid Podcast listener, Engineer, Nuclear Power, Fire Protection, and beer geek with a long commute!”
You see, I had posted a tweet earlier in the day about the cost to taxpayers of some “green energy” jobs. There’s a new wind farm in Oregon called Shepherds Flat that received federal cash grants totaling $490 million under the guise of job creation. For that grand sum the Shepherds Flat project will create 35 new jobs. The math is easy; $14 million per “green energy” job. Our tax dollars at work!
This tidbit about Shepherds Flat was part of a larger report by the Energy Tribune that among other things compared the relative size of US government subsidies to various energy industries. The report by Robert Bryce calculated subsidy dollars per unit energy produced and concluded the renewable energy industry receives 6.5 times more federal government subsidies than the nuclear industry, and 12 times more than the oil and gas industry. That fact really didn’t surprise me considering the billions of dollars in grants, production tax credits, and favorable depreciation rules the government lavishes upon anything branded with the “renewable” label. Then Chris asked a great question, “What do they consider nuclear subsidies?”
When I dug into that question I learned the Congressional Budget Office is tasked with tracking the amount the government spends subsidizing various industries, and they publish their findings periodically. There it was on page 3: $900 million in “subsidies” for the “favorable tax treatment of nuclear decommissioning funds.” Hmmm. What could that be?
You see, every nuclear plant owner is required by federal law to set aside funds to ensure there’ll be enough money to pay for decommissioning the plant when the time comes. Typically plant operators add to the fund each year and over time the fund grows until it’s used. The NRC monitors each fund and will require plant owners to make additional payments if they think they’re behind. These funds are essentially forced savings accounts that add to each nuclear plants annual operating expenses.
So what’s the “favorable tax treatment?” It turns out Title 26 of the United States Internal Revenue Code requires interest or other investment earnings of nuclear plant decommissioning funds to be taxed at “only” 20%. Maybe I’m alone in this, but being required by law to set up a fund, then being taxed on that fund’s growth hardly fits the definition of a “subsidy!” Other sources of energy are not required to set up such funds – they carry the potential future costs of dismantling equipment as liabilities on their balance sheets. In the case of nuclear plants they’re forced to set aside capitol in government mandated and monitored funds, then the government takes 20% of the fund’s earnings.
Anyway, in 2009 the CBO calculated this “favorable tax treatment” to be worth $900 million, and they called that a “subsidy.” That’s quite a different kind of subsidy from the cash grants, tax credits, and accelerated depreciation enjoyed by the renewable energy industry. Personally, I have a tough time viewing this as a subsidy at all.
Chris, thanks for asking the question! I learned something new today, and maybe some of you out there did too.
Happy Birthday to This Week in Nuclear!
On Dec 27 This Week in Nuclear will turn seven years old. I would like to express my heartfelt “thanks” to all of you who have supported and continue to support the blog and podcast!
Activists, medical practitioners and politicians who have demanded moratoriums [on uranium mining] may have various reasons for doing so, but their claims that the public and environment are at risk are fundamentally wrong.
That about sums up the facts on the safety of uranium mining and the validity of motives of those who oppose it. What’s particularly noteworthy about this statement is its source: Michael Binder, the President of the Canadian Nuclear Safety Commission. It’s impressive to see this level of leadership from the Canadian equivalent of the US Nuclear Regulatory Commission.
Note: this post also appears at the ANS Nuclear Cafe
What better way to celebrate National Nuclear Science Week than to acknowledge amazing career opportunities that exist for people interested in joiningthe nuclear renaissance. If you are a middle or high school student (or are the parent of one) considering college alternatives, you would be hard pressed to find a better investment than earning an associates or bachelors degree in nuclear-related science, engineering, or technology.
Opportunities for entry level positions have not been this rich at any time during the past three decades, and the nuclear industry is partnering with many schools to ensure graduates have the knowledge and skill for success as power plant engineers, operators, and technicians. Because of a combination of national and international trends, there have never been more opportunities for young people to begin careers in the nuclear industry. Read the rest of this entry »
or “Why I’m Still A Climate Change Skeptic”
It must be great to be a climate change believer.You get to boldly declare your alignment with the “A” team, the smartest minds and greatest strategic thinkers of our time, or so we’ve been told.You get praise from big government (at least under the current US administration) and get to hang out with old hippies who sail up and down the Hudson River playing folk music and singing songs about Mother Earth and fighting the good fight.
Unfortunately, I can’t count myself in, but I’m not exactly out either.I’m on the fence and that’s a problem for me.My science and engineering education taught me enough about pv=nrt and the partial pressure law of gasses to know you can’t just keep dumping airborne crud and gasses into a fixed volume of anything without changing it’s composition.I’ve also been around long enough to see changes in the planet, but are those being caused by progressive man-made climate change or a normal natural cycle? Read the rest of this entry »
On September 8, 2011 the electrical grid in and around San Diego, California experienced a blackout that lasted for more than 12 hours. By some accounts more than 5 million people were effected. The initiating event was a human error that caused a large transmission line from Arizona to turn off unexpectedly. I recently discussed why a single failure as occurred that day should not have caused such a widespread grid failure, and how New York City will be much more susceptible to similar events if Indian Point Nuclear Plant is shutdown prematurely.
As it was designed to do, the San Onofre nuclear plant automatically disconnected itself from the grid and shut down then the blackout occurred. This was done as part of the plant’s protective scheme to shield the plant from unintended consequences from the falling grid voltage and frequency. A similar thing happened to nine nuclear plants in the eastern USA during the blackout of 2003.
Why do nuclear plants trip off line when a blackout happens? Read the rest of this entry »
There was a horrible accident in Kenya this week. More than 100 people were burned to death, and hundreds more were injured when a gasoline pipeline began leaking and then exploded. My heart goes out to the victims, and their families, and to all the people of Kenya who are dealing with the worst industrial disaster in their history. Eyewitnesses reported seeing burning people leaping into a nearby river trying to extinguish the flames that engulfed them. Rescue workers had to place a net across the river to catch the charred bodies of the dead so they would not wash down stream. The death toll continues to grow, and most of the 100+ injured including many children are not expected to survive.
The pipeline runs through Sinai, a Nairobi ghetto of corrugated tin and cardboard huts. When the pipe began leaking hundreds of people gathered around to scoop up the spilled gasoline. As the crowd grew a spark from a cigarette butt or some other heat source ignited the fuel. The blast incinerated scores of people nearby. Flames cascaded down on nearby huts then raced through the crowded slum. Read the rest of this entry »
There is a good deal of misinformation being circulated about the potential harm to people in Japan from plutonium present in mixed oxide (MOX) fuel in the unit 3 reactor at Fukushima Daiichi. The real story comes from an independent group of scientists who make up the American Nuclear Society Special Committee on Nuclear Non-Proliferation . Their conclusion?
Mixed Oxide (MOX) fuel has been used safely in nuclear power reactors for decades. The presence of a limited number of MOX fuel assemblies at Fukushima Daiichi Unit 3 has not had a significant impact on the ability to cool the reactor or on any radioactive releases from the site due to damage from the earthquake and tsunami.
The US Department of Energy issued a press release today announcing a new $102 Million loan guarantee for a 50.6 MW wind farm near Roxbury, Maine and an 8 mile transmission line to connect it to the grid. Before we join hands in carbon-free jubilation let’s do the math:
$102 Million for 50.6 MW that will operate (best case) at 30% capacity = $6.72 million per megawatt (MW) of delivered electricity
During a recent conversation over the Deepwater Horizon oil spill, a friend asked if anyone in the group was boycotting BP. This led to a lively discussion about the effectiveness of boycotts and the inevitable question,
“Who do you boycott?” Read the rest of this entry »
Ever thought about how many zeros there are there in a “pico” something?
Remember back in grade school when we learned the metric system of measures? We started out with units that are easy to visualize: meters get 1000 times bigger and become kilometers; meters get 1000 times smaller and become millimeters. We understand these intuitively because we have a frame of reference and can visualize each of those unites of length and distance. Units of mass are the same way; we know a gram is a small unit of mass – we can hold a gram of almost any material in the palm of our hand. For example, a penny weighs 2.5 grams. Stack up 400 pennies and you have a kilogram, or 1000 grams. Cut a thin copper shaving off a penny and you have a milligram, or one 1,000th of a gram. Again, these are things we can see, and that makes it easier to understand. Read the rest of this entry »