Nuclear Power: Unsafe in Any Hands?(A)
Since we began managing socially responsible portfolios two decades ago, we have avoided investment in companies that own nuclear power facilities. Today, this is an increasingly controversial stance. We are often asked: Given the risks global warming poses to the planet, isn’t nuclear power an important alternative to burning fossil fuels?
The question is made more pressing because those inquiring include some of our clients, staff, and board members, who believe that nuclear power may be necessary for both greenhouse gas reductions and energy independence. As a firm, we’ve dedicated significant time and research to grappling with such energy-related issues. After careful consideration, we still believe the benefits nuclear power might provide in reducing climate change and air pollution do not outweigh the risks associated with commercial nuclear reactors.
There are 103 nuclear power plants operating in the U.S. today; they provide 21% of the country’s electricity, while coal provides roughly 51%. Unlike coal, nuclear reactors emit virtually no carbon dioxide and very little routine air pollution. But the risks of nuclear power are potentially devastating, and become more likely as the Bush administration advocates huge expansion of nuclear power, without demonstrating much interest in enforcing non-proliferation and safety commitments.
U.S. Fuel Sources for Electricity (U.S. DOE 2001)Coal51.1%Nuclear20.6%Natural gas16.9%Hydropower5.6%Petroleum3.4%Solar, wind & other renewables2.1%
In the U.S. today, there are 72 commercial reactor sites housing radioactive spent fuel. This waste will remain radioactive — and must be monitored — for hundreds of thousands of years. To date, no viable long-term solution for the storage of spent fuel has been developed. And as long as nuclear power plants operate, highly radioactive spent fuel must be stored underwater in huge pools at the plant site. The spent fuel is vulnerable to both terrorist attacks and potentially catastrophic meltdown accidents caused by failure of the cooling process.Many believe a single geologic repository, namely the proposed Yucca Mountain in Nevada, is the safest solution to the nuclear waste storage conundrum. However, Yucca Mountain seems far from an ideal solution. Located 90 miles from Las Vegas, Yucca Mountain sits near 35 active fault lines in an area that’s had more than 600 earthquakes over the last 20 years. Transporting spent fuel to Yucca Mountain by truck and train over proposed routes would require travel through 43 states, passing within a half mile of 50 million people, carrying highly radioactive waste vulnerable to routine traffic accidents with potentially disastrous results. Federal environmental and safety standards have been lowered five times to accommodate Yucca Mountain’s acceptance as the potential burial site for the nation’s nuclear waste. And Yucca Mountain is unlikely to solve the nuclear waste problem: spent fuel already in storage at reactors around the country today already exceeds Yucca Mountain’s 70,000 ton capacity.
The spent fuel from commercial reactors also poses risks linked to nuclear weapons. Spent fuel contains about one percent plutonium. If separated through chemical reprocessing, this commercial plutonium can be used to make nuclear weapons. U.S. policy has prohibited commercial use of plutonium to date. But North Korea’s plutonium is from commercial sources, and Japanese officials have proposed using their separated commercial plutonium to make bombs, should they consider it necessary.
According to the Department of Energy, “Reactor-grade plutonium is weapons-usable, whether by unsophisticated proliferators or by advanced nuclear weapon states. Theft of separated plutonium, whether weapons-grade or reactor-grade, would pose a grave security risk.” Global supply of separated civilian plutonium is now about 200 tons – approximately the same amount of plutonium in military stockpiles. A few kilograms of stolen or purchased plutonium would suffice to make a nuclear weapon.
Unfortunately, accessing weapons-usable material may not be that difficult. The recently aired TV series “Avoiding Armageddon” tells the story of Leonid Smirnov, who as a mid-level foreman at the Podolsk Chemical Research Institute in Moscow in the 1990s, pilfered tiny pieces of enriched uranium over four months, thinking he could eventually profit from sale of the material. He stole a total of 1,538 grams (about 3 pounds) of enriched uranium before being caught – and before the uranium reached the black market. No one at the plant noticed the material missing. The International Atomic Energy Agency reports 17 similar thefts of nuclear material, all discovered after the fact.
Since 9/11, we’ve been painfully aware of nuclear power plants themselves as possible terrorist targets. Spent fuel storage pools are vulnerable to a variety of attacks, not just from airplanes, and current security measures appear insufficient. Paul Leventhal, former head of the Nuclear Control Institute, reports, “Half the nuclear power plants in the U.S. have failed to repel mock attacks – so-called force-on-force exercises supervised by the Nuclear Regulatory Commission. The NRC refuses to take enforcement action in response to the failures, and is in the process of weakening the rules of the game in response to industry complaints.”
Even when nuclear power is handled with the best of intentions, there is the not-insignificant risk of human error. With the routine operation of nuclear reactors comes the risk of leaks and accidents, potentially on a catastrophic level. Three Mile Island and Chernobyl demonstrated that large-scale nuclear power accidents can happen. There have been more recent incidents. Last year, the Davis-Besse nuclear plant in Ohio, owned by FirstEnergy, was closed when potentially catastrophic corrosion that nearly made a hole right through the reactor lid was discovered. Just last month, a reactor at the South Texas Project, co-owned by AEP Industries and Texas Genco, was shut for a smaller but similar problem. These incidents and others have exacerbated concerns about the aging stock of nuclear power plants, industry cost-cutting measures, and reductions in safety inspections.
Largely because of public fears and high capital costs, no new U.S. commercial nuclear power plants have been ordered in the past 25 years. Moreover, as policy the U.S. has refrained from plutonium reprocessing for either nuclear power or nuclear explosive purposes. However, U.S. nuclear policy may be changing.
The Bush energy plan, issued in May 2001, proposes, “the expansion of nuclear energy in the U.S. as a major component of our national energy policy.” Such expansion would include building new plants at existing sites, easier relicensing procedures, industry subsidies, and the development of new reactor types and forms of reprocessing, likely using plutonium as fuel. Says Dr. Arjun Makhijani, president of the Institute for Energy and Environmental Research, “Reprocessing and plutonium-fueled reactors would throw overboard, without serious national debate, non-proliferation policy that has been sustained on a bipartisan basis through five presidents.”
In keeping with the Bush strategy, the Department of Energy has launched a 30 to 50 year international research effort to develop “Generation IV” advanced nuclear fuel reprocessing technologies. As Dr. Thomas Cochran, director of the Natural Resource Defense Council’s nuclear program, describes, “This research effort will likely expand the availability of weapon-usable materials in other countries in the near-term, result in the training and employment of new cadres of scientist and engineers with expertise in actinide (including plutonium) chemistry and metallurgy, but not result in the deployment of new commercially viable nuclear power technologies.”
The risks of nuclear power are exceptional, and call for exceptional vigilance. History has demonstrated the potential for human error even when vigilance is paramount, making it impossible to say nuclear power can be made safe.
We believe there are better energy solutions than expansion of either fossil fuel production or nuclear power. Indeed, one of the strongest arguments against expanding nuclear power may be the opportunity cost. A dollar invested in nuclear power is a dollar that might otherwise be spent developing economically and environmentally superior energy resources, such as wind, solar and hydrogen-powered fuel cells, as well as investments in improved energy efficiency.
At Trillium Asset Management, we continue screening client portfolios for both nuclear power and nuclear weapons. We are advocating for better solutions to nuclear waste disposal, filing a recent shareholder resolution with Ameren asking for measures to reduce risks of irradiated fuel rods stored at its Callaway Plant. And we continue to advocate for research and development of energy efficiency measures and renewable sources, with the belief that ample energy can be provided at a reasonable cost, without contributing to climate change and without putting the world at risk of nuclear harm.