For those who are unfamiliar with the Price-Anderson Act (click here for more explanation), utilities are required to buy the maximum amount of commercially available insurance. As of 2011, that is only $375 million - repeat MILLION - per reactor.
If there is a claim larger than the insurance coverage limits, every utility in the country is required to contribute up to $111.9 million for each reactor that they own. Since there are 104 reactors in the USA, the maximum amount of the fund, then, is approximately $12.6 billion. Any claims above this would have to be covered by the taxpayer.
Given that BP has taken a charge to earnings of $40 billion to cover its losses from the Deepwater Horizon oil spill, it is unlikely that a mere $12.6 billion would be sufficient to cover a really bad incident. The current problems in Japan indicates that massive costs will be incurred for many months - perhaps years.
Admittedly, payments made under the Price-Anderson Act, since its first passage, only amount to $151 million. That, however, should not be extrapolated into the future. A 'Black Swan' (apologies to Nassim Taleb) event can reasonably be expected - somewhere, sometime - and the costs of such an event can be anticipated to overwhelm the fund.
The score, in yet another game rigged against the citizens of the USA, is:
Corporate Welfare 104 Taxpayers 0
That we continue to put up with this sort of giveaway is a headscratcher indeed!
Full Disclosure: Your correspondent worked on issues (including the Price-Anderson Act) relating to nuclear power as a political and economic analyst in 1973.
He was also a management consultant on assignment at Westinghouse Nuclear Fuels Division in 1979 during the melt down of Reactor #2 at Three Mile Island where he learned much from some who had survived, and cleaned up after, some quite ugly incidents that were successfully contained but could easily have become uncontrollable.
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