It’s not nuclear power that’s unsafe…
It’s greed and arrogance.
In a new movie called Pandora’s Promise, director Robert Stone makes the case that nuclear power is an effective form of power generation that should be embraced by environmentalists, as it offers the promise of carbon emissions reduction.
While I agree with this is theory, in practice it’s still a bit of a slippery slope. After all, Chernobyl and Fukushima were not nuclear crises because the process of nuclear power generation is inherently unsafe. They were crises because of human error. Lax policies, sub-par safety procedures, and poor logistical planning were to blame in both of those instances, not the splitting of isotopes.
And this is why, as I’ve said on numerous occasions, the nuclear industry has a public relations problem. It’s very hard to convince folks that nuclear power is an environmentally-friendly option while the Fukushima power plant is still leaking radioactive water — and it will likely take 40 years for the plant to be decommissioned.
So last week, I was not surprised to read that Southern California Edison announced it was closing the San Onofre nuclear power plant in California.
Seeds of Distrust
After a half billion dollars’ worth of repairs and replacement power, Southern California Edison decided to retire a set of reactors due to continued failures of tubes that transport radioactive water.
Critics say that Mitsubishi Heavy Industries is to blame, as the company had allegedly hidden the risks of a new steam generator that was installed in 2009.
You see, it’s stuff like this that makes it hard for most folks to get behind the nuclear industry: manufacturers hiding safety issues, government officials looking the other way while substandard designs and planning are put in place, and flat-out lying about the dangers of meltdowns.
This is how the seeds of distrust are planted.
And it’s unfortunate, because if governments weren’t bought and sold by special interests, and honesty — not spin — was the goal of press releases, perhaps the nuclear industry, particularly in the United States, would be less of a target for environmentalists.
Of course, even with the public often skeptical on nuclear industry promises, ultimately it’s not the environmentalists that are hindering domestic growth…
A Credible Case
It’s interesting, but while nuclear power advocates speak glowingly about the carbon-free benefits of nuclear power, carbon emissions in the United States actually fell by more than 200 million metric tons in 2012 — without an increase in nuclear.
Bottom line: You can thank both an increase in demand reduction and a transition from coal to natural gas for that. Sure an increase in solar and wind also helped, but nearly 75% of CO2 emissions declines in 2012 can be traced back to economy-wide energy efficiency and conservation measures.
So perhaps the most logical near-term solution for environmentalists is not increasing or saving the nuclear power industry in the United States, but instead pursuing a more aggressive approach to energy efficiency and conservation along with the continued transition from coal to natural gas.
Now, understand I don’t say this to discredit the contribution of nuclear. Truth is I do believe nuclear offers a great deal of benefits, but those benefits cannot be fully realized until we kick special interests to the curb, retire and decommission about 30% of the nuclear power plants that are now operating past their intended life spans, and come up with real solutions to our nuclear waste problems.
Only then will the domestic nuclear industry be able to make a credible economic and environmental case for nuclear power expansion.
Until then, from an investment perspective, I see no indication of a nuclear power bull market in the United States anytime soon.
And in California, where the San Onofre power plant is fading into the sunset, something’s going to have to make up for the 19% shortfall in power production.
With San Onofre out of the picture…
Coal’s a no-go in California, and they wont’ be building any new nuclear power plants anytime soon, either.
In fact, it is illegal to build new nuclear power plants in the state until the industry can find a way to permanently dispose of radioactive waste. And I wouldn’t hold my breath on that one.
So, how will residents keep the lights on with San Onofre out of the picture?
Today about 25% of California’s power is imported. That figure is now expected to rise, and most of this will be coming from natural gas.
Of course, it should also be noted that wind and solar developers are further strengthened by the demise of San Onofre, although those were already guaranteed continued growth anyway, as the state has held firm on its 33% renewable energy portfolio by 2030.
So if you’re looking to score big on the next U.S. nuclear casualty, your best bet is to focus on California’s rush on renewables, like solar, and of course natural gas. Both should serve you well as California nuclear goes gently into that good night.
To a new way of life and a new generation of wealth…
Jeff is the founder and managing editor of Green Chip Stocks. For more on Jeff, go to his editor’s page.
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