Nuclear Power and Market

Energy/War: Breaking the Nuclear Link, by Amory B. Lovins and L. Hunter Lovins. Friends of the Earth, 161 pp., $10.00.

What, one May ask, is Friends of the Earth doing publishing a book on nuclear proliferation? The answer should be obvious. No human activity is as destructive to the environment as a nuclear war would be. Ten years ago environmentalists fought the proposed American supersonic transport as a threat to the earth’s ozone layer; a fleet of SSTs, they argued, would destroy as much as one percent of the ozone, with disastrous ecological effects. By comparison, recent studies by the National Academy of Sciences and others suggest that an all-out nuclear exchange between the U.S. and the Soviet Union would destroy from 30 to 50 percent of the Northern Hemisphere’s ozone, frying half the world with ultraviolet rays. Nor would that be the only effect on the ecosystem; such radiation-resistant species as rats and cockroaches, for example, might multiply, unchecked by more vulnerable predators. Such devastation would swell the human death toll as well. Total deaths could run as high as one billion — a figure to horrify even those mythical “ecofreaks” who prefer snail darters to people. As long as they share a planet with the hydrogen bomb, human beings, too, are an endangered species.

Although it has been deliberately forgotten, the so-called “peaceful atom” is in fact the child of the atom bomb. (See, for example, Milton Mueller, “Nuclear Power and Nuclear Proliferation,” Libertarian Review, July/August 1979.) In this book, Amory and Hunter Lovins argue that this works both ways: “If, as Samuel Butler said, ‘the hen is only an egg’s way of making another egg,’ then perhaps a reactor is a bomb’s way of making another bomb.” One can make a Nagasaki-size bomb with just a few kilograms of plutonium—and a large commercial nuclear reactor produces hundreds of kilograms a year. A fuel-reprocessing plant to get the plutonium is cheap (“tens of millions of dollars”) and relatively easy to build. “Separation of plutonium from spent fuel preceded and facilitated the British, French and Indian decisions to build bombs,” the authors point out, and other countries with reactors could do the same. They could even follow the Israeli (and South African?) precedent and build their bombs secretly. Plutonium is so difficult to measure that the owners of a typical, commercial reactor could divert a few bombs’ worth each year and no one would ever miss it. “World nuclear power over the next two decades could produce over two thousand tons of plutonium. A mere half of one percent of this figure—about half of the ideal or a quarter of the currently typical imprecision of inventory in spent fuel entering a reprocessing plant — would suffice to make thousands of bombs.”

Nuclear power not only proliferates bomb materials, it also proliferates bomb technology. “Such data as the criticality conditions and equations of state of plutonium are secret when applied to bombs,” say the authors, “yet precisely the same data are published in civilian literature which reactor programs make available to proliferators.” The United States government, in its wisdom, has passed this knowledge on to thousands of scientists from 84 countries, including Argentina, Taiwan, South Korea, and India. “Probably half the key staff of the Indian bomb program was U.S.-trained at the expense of U.S. taxpayers.” And “even today,” the authors assert, “disproportionate numbers of

Libyan and Palestinian students are showing disproportionate interest in U.S. nuclear curricula.” These people—like Dr. Bhabha and his colleagues in the Indian nuclear program—can form a constituency for bomb-building and pressure their nominal superiors into a weapons program under some pretext or another (“peaceful nuclear explosions” was the pretext in India). Nuclear bureaucrats are no easier to control than the conventional variety. “In both Britain and France,” it seems, “the formal decision to build a bomb was taken after the apparently unstoppable technologists were nearly through doing so on their own.” As the Lovinses put it: “Politicians come and go, bureaucracies stay and grow.”

With this in mind it’s easy to see that the chief argument of nuclear propagandists—that there are, after all, other ways to make a bomb than with plutonium from a commercial, pressurized light-water reactor—is quite beside the point. “With trivial exceptions... every known civilian route to bombs involves either nuclear power or materials and technologies whose possession, indeed whose existence in commerce, is a direct and essential consequence of nuclear fission power.” Conversely, if nuclear power did not exist, these materials and technologies would be much harder to obtain. Further, “efforts to obtain them... would be unambiguously military in intent”—and therefore far less attractive politically, and easier to prevent.

Here is a cost of nuclear power that far exceeds those usually cited. Suppose, the Lovinses argue, that the probability of a nuclear war in the next 30 years killing one billion people is currently 10 percent. This is probably conservative; former U.S. Ambassador to the Soviet Union Thomas Watson recently predicted nuclear war “in the next two or three decades” unless the U.S. and the U.S.S.R. change their ways. (San Francisco Chronicle, February 9, 1981)

If proliferation caused by nuclear power increased that probability to 11 percent, that works out to 10,000 to 20,000 deaths per quad (one quadrillion BTUs; about 200,000 barrels of oil) of nuclear energy. This is hundreds of thousands of times greater than the expected toll from reactor accidents (tens of thousands, if you still believe the Rasmussen Report). In principle, one could make the nuclear industry bear the full cost of nuclear accidents—though you’d have to repeal the infamous Price-Anderson Act first. But the far greater costs of nuclear proliferation are what the economists call “externalities,” and are borne by the public at large—by everyone.

At first glance this external-costs argument would seem to prove that the marketplace cannot save us from nuclear proliferation, and we must turn to government and (ugh) bureaucrats to “denuclearize” society. But that turns out not to be the case. There are clear indications that the nuclear industry’s woes are due to technical, not regulatory, causes. “Universally—in the United States and in the Soviet Union, in France and in Brazil, under the most diverse conditions of regulation and economic policy—the direct economic costs of nuclear power in real terms (corrected for general inflation) have risen unrelentingly since reactors went commercial.” In the U.S., capital costs of nuclear power plants have been increasing more than twice as fast as those of coal-fired plants (despite the cost of anti-pollution equipment), and now cost 50 percent more per kilowatt of generating capacity. U.S. nuclear plants, however, only operate at about

61 percent of full capacity (plants larger than 800 megawatts can only manage 55 percent). The figures are about the same, or worse, elsewhere in the world; Japanese reactors run at 51 percent of capacity, and French reactors, at 49 percent—even though the French government is perhaps the most rabidly pro-nuclear in the world.

Although nuclear propagandists never tire of scapegoating government regulation, they are less eager to talk about the nuclear industry’s history of massive government subsidies. “A preliminary survey of Federal subsidies to nuclear power,” say the authors, “identified about twenty categories of subsidy, of which several had effectively infinite value (the industry could not exist without them), most were unquantifiable, and three which were quantifiable were together enough to reduce the apparent price of nuclear electricity by more than half.” Nuclear power is collapsing not because of government intervention but in spite of it: “the victim of an incurable attack of market forces.”

But don’t we “need” nuclear power? James Edwards, the ex-dentist whom Reagan appointed Secretary of Energy, claims the country’s energy needs will increase 68 percent by the year 2000 and “there’s no place to turn” but to nukes. The Secretary, however, is considerably behind the times. A prediction of 68 percent growth in energy consumption is equivalent to 125 quads per year in 2000. The Lovinses’ tables show that this prediction, which might have been reasonable five years ago, is the rankest superstition today. Indeed, the DOE’s own Solar

Energy Research Institute recently forecast year-2000 consumption at 55 quads per year, indicating that Edwards’s figure is too extreme to class even as superstition, but belongs in a new category (“The Fever Swamps”?). It is worth pointing out, by the way, that for nuclear power to meet even a quarter of this absurdly large demand we would have to order a new, large reactor every five days and spend “at least three-quarters of all discretionary investment in the entire U.S. economy.” (Those are the figures the Lovinses offer for a 114 quad demand, and are therefore doubly conservative.) Even if we did need that much energy, nuclear power couldn’t give it to us.

Furthermore, nuclear power is the wrong kind of energy. Most energy is used to produce heat—mainly at relatively low temperatures—for space heating and industrial processes, or, in the form of liquid fuels, for transportation. Motors, lights, smelters, and other applications which have to have electricity make up only 7 or 8 percent of all energy needs. “In most industrial countries, therefore, a third to a half of all electricity generated is already being used, uneconomically, for low-temperature heating and cooling—space-conditioning buildings and heating water. Additional electricity could only be so used.” Instead of building nuclear (or coal) power plants, say the authors, it would be cheaper to spend the money on using electricity more efficiently—what used to be called conservation, before we were taught to equate the term with freezing-in-the-dark—and on solar heat. “Indeed, because these measures, intelligently done, generally cost less than the running cost alone for a nuclear plant, a nation that has just built such a plant would probably save money by writing it off and never operating it.” With such expedients as wind power, industrial cogeneration (making electricity as a byproduct of industrial process heat: cogeneration potential is estimated to be the equivalent of two hundred nuclear reactors), small-scale hydroelectricity, and other features of the “soft energy path,” the Lovinses estimate that nuclear power could be phased out within the decade—by free market forces alone.

The authors propose a variety of reforms to cure various “market imperfections” and smooth out the soft path. Most would warm the heart of any libertarian: deregulate energy prices, end price and production subsidies, repeal zoning barriers to wind and solar energy, make utility commissions allow cogenerators to sell their surplus electricity, etc. The authors are scornful of government anti-solar propaganda, such as the claim, found in federal publications until recently, that “passive solar” techniques could not be used to heat existing structures; “some fifty thousand householders who didn’t know that were meanwhile building passive solar greenhouses onto their homes, in which they now bask in February munching fresh tomatoes and reflecting on the infirmities of government.” A few “reforms,” however, miss the point. “Why should a landlord retrofit a building whose tenants pay the utilities, or a cab company fix an inefficient taxi whose driver buys the gasoline?” The Lovinses suggest that some government intervention may be necessary in such cases. But market forces would suffice here as well as if tenants and drivers were free to go elsewhere. The best thing to do for the tenant is not to modify rent control laws (as the authors suggest) but to abolish them and all the other government depredations that restrict the supply of housing and permit landlords to get rich renting energy sieves. Such lapses are minor, and anyway the authors by their own admission are interested in “technical fixes” rather than the tithe of the tithe of free market rectitude. But there are several places where their arguments could have been improved by a dose of 190-proof libertarianism.

One such place is the chapter on nuclear disarmament. The authors score the nuclear powers for piously denouncing proliferation even as they add to their own nuclear stockpiles, and propose the usual disarmament initiatives (mutual force reductions, test bans, etc.). But for “the key missing ingredient...promoting a psychological climate of denu-clearization,” the best they can do is suggest that leaders of the nuclear powers “frequently, publicly, prominently, and sincerely regret their possession of bombs, emphasize the insecurity that bombs bring, and pray for their speedy elimination.” Technical fixes are all very well, but we need more than prayer wheels, even wind-powered ones. What we need is a noninterventionist foreign policy, one which does not depend on nuclear sabre-rattling to counter foreign “threats.” The authors deplore “NATO’s continued emphasis on forward nuclear deployment,” but fail to realize that, as Earl Ravenal pointed out in the April 1981 LR, this is implicit in the very concept of regional defense. It is also worth pointing out, as the Center for Defense Information recently did, that military reactors produce most of this country’s nuclear waste. As long as U.S. policy rests on the nuclear ships and subs of the “blue-water Navy,” it can hardly be otherwise.

Nuclear power and nuclear weapons are branches of a tree with a single root: government intervention, at home and abroad. Our current rulers claim to oppose government intervention but subsidize the breeder reactor (and promote nuclear power in their official statements) and arm to the teeth to defend the American Empire. “To abandon nuclear power and its ancillary technologies,” declare the authors, “does not require any government to embrace anti-nuclear sentiment or rhetoric. It can love nuclear power— provided it loves the market more.” But how much longer must we wait?

Bill Birmingham is a contributing editor of LR.