In the recent film “Sully,” based on a real event, an Airbus 320 loses both of its engines to bird strikes in just five minutes. With all power gone, the pilot has seconds to act. Can he make it back to La Guardia airport in New York? Or should he attempt a water landing in the Hudson river?
Captain Sully chooses the latter. He tersely announces, “Brace for impact,” at which point the flight attendants in unison begin a kind of creepy, hypnotic chant: “Brace! Brace! Heads down! Stay down! Brace! Brace!…”
The passengers comply. They are frightened, and some scream, but they stay seated. They tuck their heads and some put hands on the seat in front of them. In other words, they shelter in place.
And everyone survives.
How to Save Nuclear
1. Consolidate or Die
Only two companies make large-bodied jet planes: Boeing and Airbus.
Large, complicated projects like building a jet plane or a nuclear plant require very large, upfront investments that only large, well-capitalized entities can back — like an electric utility, or Boeing, which invested $32 billion making the Dreamliner.
If nuclear is going to survive in the West, it needs a single, large firm — the equivalent of a Boeing or Airbus — to compete against the Koreans, Chinese and Russians.
There will never be as many nuclear plants as jet planes, especially not during a time of low overall demand for electricity. As such, economies of scale must be achieved more rapidly.
One of the keys is making both construction and operation as efficient as possible.
Many of the big global nuclear players offer to build and operate the plants. That’s what the Korean company, KEPCO, has done in the United Arab Emirates (UAE).
The four-reactor nuclear plant KEPCO is building is in UAE on-time and appears to be on-budget. In January, the UAE awarded KEPCIO with a 60-year, near-$50 billion contract to operate and maintain the plants it built.
I was told by someone in the industry that KEPCO treated the construction part of the work as a loss-leader in order to get the more lucrative operation, maintenance and refueling contract — and perhaps to advertise its construction prowess to other nations.
The Airbus of nuclear should be run by someone with significant experience in nuclear plant construction — since that’s where the cost savings (and overruns) come from — not engineering.
To some extent, consolidation is already happening. In 2006, Toshiba bought Westinghouse and Mitsubishi partnered with Areva, while in 2007, Hitachi partnered with the GE nuclear division.
Toshiba recently bought the construction firm hired to build the AP-1000 Vogtle plant, but with the latter deal, the consolidation came too late. It was done in response to, not in anticipation of, future construction and manufacturing delays.
Of course, consolidation on its own is not enough, as Areva learned. There must also be standardization, scaling and social acceptance. Consolidation is essential to achieve the repetitions required for cost reductions. And a planned scaling-up of nuclear is the key to achieving those repetitions.
2. Standardize or Die
First, the new Boeing or Airbus of nuclear should build a single design. Standard-setting is a traditional role of government, and in the past has been a huge aid in helping industries consolidate, grow and achieve continuous improvement.
The UK has key role to play here. The heterogeneity of its planned reactors is astonishing:
- AP1000 x 3 for Moorside
- EPR x 2 for Hinkley Point C, EPR x 2 for Sizewell C
- Hitachi ABWR x 2 for Wylfa Newydd, ABWR x 2 for Oldbury B
- Hualong-1 x 2 for Bradwell
The UK should scrap all existing plans and start from a blank piece of paper. All new UK nuclear plants should be of the same design.
Second, the criteria for choosing the design should emphasize experience in construction and operation, since that is the key factor for lowering costs.
Reprocessing waste should be off the table. It is unnecessary and adds to the costs.
Some emphasis should also be on mass-manufacturing modules, something the Koreans are also pursuing.
But what both Toshiba and Areva failures underscore is that all new nuclear plants, however much they are going to be manufactured, are going to require construction according to the exacting standards of strict regulators, and it was that kind of construction that helped destroy not just one but two of the world’s largest nuclear companies.
Third, the plants should be constructed sequentially so that managers and workers in Airbus Nuclear can learn from experience.
Fourth, the firm should have strong financial incentives for reducing costs.
Fifth, the program should include a significant increase in funding to test alternative reactors.
The record here is clear: governments only invest significantly in demonstrating new nuclear reactor types when their nations are building new nuclear plants. And with good reason: people believe there is a future for nuclear.
It works the same way in reverse. Long before they had achieved their goal of shutting down existing plants, anti-nuclear activists avidly sought to cut funding for nuclear innovation. They won a big victory in 1982 when Congress cut funding for the Clinch River fuel processing project. And they won another in 1993 when Congress cut funding for the integral fast reactor.
Funding for the experimental molten salt reactor developed at Oak Ridge in the late 1960s was cut before it could ever become a test reactor. The U.S. Atomic Energy Commission estimated that building one would cost $10 billion (in 2016 dollars), and noted that past tests usually cost twice what had been estimated.
A long-term, global build-out of standardized nuclear plants is the only way in which states will invest the billions needed to test radically different designs.
3. Scale or Die
What’s behind the crisis facing nuclear generally and Toshiba in particular is the utter lack of certainty about any future nuclear plant builds — including those under construction.
Nations must work together to develop a long-term plan for new nuclear plant construction to achieve economies of scale. Such a plan would allow for certainty, learning-by-doing, cost declines and lower financing costs.
Risk and rewards should be pooled. Cost savings achieved through experience should be shared along with the cost overruns of the first few plants.
Governments should invest directly or provide low-cost loans. While this will inevitably be decried by anti-nuclear groups, the truth is that the U.S. and Europe have been subsidizing wind and solar for decades. In Illinois and California, subsidies for wind and solar have played a key role in threatening nuclear plants with premature closure, undermining clean air and climate goals.
Some basic fairness is in order. This starts with investment and financing as well as support for nuclear plants at risk of premature closure due to our discriminatory subsidy regime.
Others might wonder why nuclear energy should be supported when Boeing and Airbus flourished without government help. But the truth is that they didn’t: last year the World Trade Organization says Boeing and Airbus received billions in government subsidies — up to $22 billion worth for Airbus alone.
UK Labor leaders have already called for direct government investment to save the plants:
“The delay we’re seeing under the Tories is leaving thousands of nuclear workers uncertain about their future,” the shadow Labor secretary said on Wednesday. “Public investment in nuclear energy would bring huge benefits through the nuclear supply chain and energy security.”
Plus, financing is the key to opening up the global market — something that is in the entire industry’s interest.
Vietnam recently cancelled plans to build nuclear plants and is now planning to build coal plants instead. Someone close to the situation told me that had foreign nations financed the nuclear plants, they would have gone forward.
And the quantities of financing — not development aid — are trivial considering the potential benefits to nuclear supplier nations, especially when the financing is spread out over 30 years and is shared by UK, Japan, France and the United States.
And such financing would offer a decisive advantage to the Airbus of nuclear over its competitors, allowing it to win contracts and provide the certainty everyone in the industry needs.
For such an effort to work, it would need widespread support that lasts for many decades. That will require that national governments work together to increase public demand and social acceptance of nuclear. Toshiba and Areva show that declining social acceptance drives demand for unnecessary regulations, as well as the industry’s constant changing of designs.
Japan’s nuclear industry cannot survive so long as public opposition is preventing the restarting of shuttered nuclear plants.
The Japanese government and industry leaders must overcome their shame and seek help from allied nations in overcoming the public’s continuing radiophobia in response to Fukushima.
What’s needed is an independent, serious and sustained effort by health and medical professionals to help Japanese and other publics to overcome fears based on grossly unscientific information.
France, Canada and most recently Vietnam all show that this can be done.
And as an analogy, there is much more to be learned from efforts to increase support for vaccinations among skittish parents. There is an aggressive and effective effort to educate the public about vaccines that, for the most part, still works. In response to a recent measles outbreaks, for example, California started requiring students be vaccinated to attend public schools.
If millions of parents will inject their children with the polio virus because they understand that it is a weakened version of the one that cripples and kills, they are capable of understanding that nuclear plants are the safest and cleanest way to make electricity.
The truth is that human beings around the world have been victimized by fake news about nuclear power since the late 1960s. When most people learn the basic facts about nuclear they become far more supportive of it.
And yet neither governments nor industry have ever, in the 50 years of nuclear energy, made a serious effort to provide those facts.
What that means is that there is enormous potential to touch hearts and change minds, just as many of ours were upon learning why nuclear is essential to mitigating climate change.
The crisis that threatens the death of nuclear energy in the West also offers an opportunity for a new life.
When you consider that the nuclear industry has for 40 years often done the exact opposite of what’s known to work, it’s a small miracle that nuclear is still 11 percent of global electricity, instead of zero.
Everything that’s wrong — the proliferation of designs, the delay in project starts, efficient Korean competitors, low demand, low social acceptance — is something that can be made right.
We can learn from the Koreans. We can standardize design. We can finance the necessary scale. We can go back to Vietnam with a better deal. And we can increase public acceptance.
Policymakers have a special role to play. They must seek out reformers and change agents within an industry that is dominated by the same kind of thinking that led to today’s crisis. They must reach out to their counterparts in other nations. And they must stand up to ideologues peddling pseudo-science on the Left and pseudo-economics on the Right.
Ultimately new leadership with a new vision and plan must emerge from within the nuclear industry. Toshiba has seen a succession of leaders pitching what is fundamentally the same approach. It’s not clear that Areva has yet learned the lessons from its EPR debacle, or whether anyone has really started to clean house.
But, happily, Toshiba and Areva are not the only two companies capable of exercising the leadership required to save the world’s most important environmental technology from being consigned to the long-term waste repository of history.