I agree with Ellis that economic forces are the main thing preventing the oft-heralded, but never arriving, "nuclear renaissance" in the US. One minor quibble, John Rowe, the "nuclear guy" who is CEO of Exelon, the top nuclear operator in the US, gave this speech three days BEFORE Fukushima. He said:

> "[Natural gas] is the probable
source of supply for any new

> generation that we might build.natural gas is 50-60%
the price of
new

> nuclear, it's cheaper and much cleaner than new
coal.its cheaper
than

> wind and much cheaper than solar. Natural gas is
queen right now.it

> is going to be the dominant source of energy for
electricity, on
the

> margin, for the next 10 and almost surely for the
next 20 years. It

> simply is more economic than all the alternatives and
is likely to
be

> so for every year within a 20 year period...Up until
2 or 3 years

> ago, I simply could see no alternative to a major
nuclear
resurgence

> at some time, but as we look at a world with
relatively slow growth

> in demand for electricity, wind that actually works,
solar that has

> gone from 40 cents per kilowatt-hour to 20 cents.you
do begin to

> envision that there may be a more complex technology
base out there

> that might be economically competitive with nuclear
and socially

> thought to be preferable."

Nuclear power has never been able to stand on its own in the US market. Like other sources of energy, including oil and gas, it is heavily subsidized. One major form of subsidy is loan guarantees by the federal government; private capital markets simply will not finance new nuke plants without government guarantees.
Secondly, since the 1957 Price-Anderson Act, nuclear utilities have a cap on the amount of compensation they have to pay for any nuclear accident. Anything above that level will be covered by either a hike in utility rates or else federal government spending to pay to compensation. This is because the nukes could not get private insurance coverage without such a cap. BTW, Japan did not authorize any such cap and now it faces a dilemma over TEPCO. Why didn't Japan apply a cap? The reason, I've been told, is that to put in such a cap would be to admit the possibility of accidents; and the nuclear village did not want to admit that possibility.

I suspect that the nuclear subsidy in the US is a lot less than that given to oil and gas, but it still shows that nuclear energy could not make it in the private market. From an economist's standpoint, such subsidies would be justified if there were big gains to society that were not captured in market prices ("positive externalities" in the jargon). For example, lower health costs and fewer premature deaths because of the absence of the kind of pollution produced by oil and gas and coal. But in the post-Fukushima era, that argument, even if true, is not persuasive.

Richard Katz
The Oriental Economist Report