Thursday, February 21, 2008

Nuclear Subsidies- $60 Billion a Year?

Those of you who read the post last fall on Shakespeare's Sister about nuclear power may recall that the author promised a follow up demonstrating how nuclear power is simply unnecessary for our energy needs. Well, it's finally here!

There's too much here for me to delve in all at once, but I'd like to call attention to one point that jumped out at me- the most outrageous estimate of U.S. nuclear subsidies I've ever seen:

And then there are the nuclear subsidies. One estimate is twenty billion in subsidies in 2005. However, Koplow, the grand old man of government energy support estimates, calculates that nuclear receives between 4-8 cents per kWh in subsidies in the US alone (not including the one extorted from our grandkids who'll be paying for dealing with the waste). Compare that to the average, you-see-it-on-your-bill residential cost for electricity of 10c/kWh. Just the subsidy is more than half that. It adds up to $30-60 billion per year, since nukes are said to produce about 85.6GW per year.

Of course something is horribly wrong here. As it turns out, it's that the author failed to actually read what his source said. From Doug Koplow's "Subsidies in the US Energy Sector: Magnitude, Causes, and Options for Reform," regarding the provisions of the 2005 energy bill:
Federal subsidies to new nuclear power plants are likely between 4 and 8 cents per kWh (levelized), and could well be the determining factor driving the construction of new nuclear power plants. (Koplow, 2005a).
As for the other half of the author's math, I don't know where the 85.6GW figure came from. The page he linked to states that the annual production of nuclear energy in the US is 750 TW-hr per year. But a $0.04 subsidy per kW-hr for this amount of generation is equal to $30 Billion, so the math is "right," as it were. But the reading comprehension sure isn't. The subsidies referred to here are for plants that are still on the drawing board, not those currently in operation. More important, Koplow himself calculates the figure at $9 Billion- still far too high, but nowhere near $30 Billion, and much less $60 Billion.


Ashutosh said...

Why do I get the gut feeling that corn subsidies obscenely outnumber nuclear subsidies?

Sovietologist said...

Probably because they actually do? ;)