Change we can invest in

By ###########

As witnessed by a recent meeting between Steven Chu (the soon to be energy secretary) and the Illinois Congressional Delegation, the coal and nuclear states could become a huge crimp in the nation’s desire to shift investment away and from coal and nuclear power plants in favor of less financially risky, cleaner energy efficiency and renewable energy technology investments.

Short term thinking is what got us into the concurrent economic and energy crises. If the Obama Administration continues the same tradition of bailing out entrenched interests and obsolete technologies, we will be in big trouble.

Coal and nuclear plants are on parallel courses with respect to up front costs, legacy costs, severe liability issues, inefficiencies from both an energy and economic perspective, and lack of infrastructure to support these industries. Indeed, the only way to save the new coal or nuclear industries is to shift the financial risks of constructing new plants or keeping existing plants in place onto ratepayers and/or taxpayers.

With respect to up front costs, both technologies are uneconomic investments. They are not cost-effective by any stretch of the imagination. Nuclear power appears to be ranging in the $10 to $12 billion range for 1,000 megawatts (a megawatt can power 700 homes). New coal gasification plants are probably in the range of $2.5 to $3 billion, at the low end, for 630 megawatts. If one were to sequester 80% to 90% of the carbon dioxide, the cost of the plants would increase 60% to 80%. However, carbon capture and sequestration at the scale envisioned is completely theoretical and the technology, if possible, will not be available for 15 or more years. Class five wind capacity is roughly half the cost of coal gasification plants and energy efficiency much less than that.

Secondly, both harbor significant legacy costs. High-level nuclear waste will remain toxic for hundreds of thousands of years. We have yet to figure out what to do with it. Yucca Mountain, the proposed repository in Nevada, so far has cost $11 billion just to study so far and the site won’t open until something in the 2020s, if at all. Studying the feasibility of carbon capture and sequestration, building out thousands of miles of pipeline to transport carbon dioxide to places where it can be sequestered, and installing the technology itself on existing power plants will cost, at least, hundreds of billions of dollars and keep in place dirty, technologically obsolete power generation.

Third, both harbor significant liability issues that scare investors away and set the public up for a new round of Wall Street-like bailouts. The only reason nuclear power plants were built was because of the Price Anderson Act which shifted the majority of costs of a potential nuclear accident to the taxpayer. Carbon sequestration will face similar liability issues with respect to property damage, potential ground water contamination, or catastrophic failure. You can bet that we’ll see legislation similar to Price Anderson to “encourage” investment in carbon capture and sequestration.

Fourth, both technologies are highly inefficient. Large, centralized power plants range in efficiency from 32% to 38%. Their distance from population centers, sometimes hundreds of miles, makes them even more inefficient. They are also capital intensive projects, not labor intensive projects like energy efficiency and renewable energy investments. Capturing and sequestering carbon (if possible at all) will make coal plants even less efficient, cutting efficiency 25% to 30%.

Fifth, as indicated, maintaining coal-fired power will necessitate the build-out of a massive carbon sector in the economy. Building more nuclear plants will necessitate the rekindling of the nuclear infrastructure that has melted away over the last 20 years.

So, the choices are: 1) use public policy to strengthen and expand the financially less-risky, economically superior energy efficiency and renewable energy sectors; or, 2) continue to squander public and private financial resources by going down the same high-cost, high-stakes path of keeping the coal and nuclear industries propped up.

We can now easily meet 50% of our electricity demand with energy efficiency alone and eliminate the need for any new coal or nuclear plants. Energy efficiency coupled with renewable energy technologies will allow us to phase out both coal and nuclear plants over the next 40 years.

XXXXX is the YYYYY of ***** organization. **** is a participant of CLEAN (www.theClean.org) a collaboration of over 100 grassroots organizations working nationwide to secure a clean energy future for the United States. CLEAN is initiating the Clean Energy Economy Investment Act to promote timely and smart investment of public funds for a new, clean energy economy.