(Wyoming Business Report, June 6) – The nuclear portion of the Wyoming Energy Summit started off with a bang, or perhaps a controlled reaction, with the showing of the film “Pandora’s Promise.”
The movie begins with anti-nuclear activists passionately protesting, and rapidly evolves to the tale of a group of people who started out against nuclear energy who found themselves coming around just as passionately in favor of it. The rest of the movie explains their changes of heart, and why they now feel that nuclear energy is key to powering the planet.
“I ended up feeling like I was sucker,” explained one of the people profiled in the movie, Ted Nordhaus. “The idea of replacing fossil fuels with wind and solar and nothing else is a hallucinatory delusion.”
All of the people featured in the movie agree that the world needs more fuel, not less, and that renewables will not be able to make up the difference.
Bad press, bad timing
Nuclear power is the victim, the film points out, of incredibly bad press and circumstance. First there is the negative kinship with nuclear weapons. Then there is the painful juxtaposition of the Three Mile Island meltdown in 1979 with the release of the move “China Syndrome” a few days later. “China Syndrome” speculated (wrongly) that a meltdown could burn right through the center of the globe.
Then came the Chernobyl disaster in 1986, which grew to become an urban myth.
Greenpeace, Nordhaus noted, claimed that Chernobyl’s exploding nuclear plant killed a million people and that United Nations reports to the contrary were part of a cover up.
Although the Chernobyl plant was essentially a “Quonset hut” built in an unstable design to incredibly low standards with no containment facility, when it blew it killed just 28 people plus another 19 who died of radiation-linked illnesses. The International Atomic Energy Agency estimates that there will be an estimated total of 3,490 additional deaths from radiation-induced cancer and leukemia from the 600,000 emergency workers, evacuees and residents of the most contaminated areas.
With Chernobyl, British environmentalist Mark Lynas noted, “the tactics and arguments against Chernobyl are the same used by climate skeptics: cherry picking of data, ideological propaganda.”
What most people don’t realize is that radiation isn’t in itself dangerous. Radiation is all around us: it’s in people’s teeth and in their food. Those who live at higher elevations are exposed to more of it than flatlanders are, as are frequent fliers.
As Lynas put it, “I didn’t even know there was such a thing as background radiation, I thought [radiation] was something artificial that man had introduced.”
Another PR knockdown
After the hysteria over Chernobyl had died down and the nuclear industry was again getting back on its feet, the 2011 Fukushima Daiichi nuclear disaster reignited controversy. The meltdown of three reactors was the result of an earthquake and tsunami, compounded by human error. Television viewers were treated to headlines that blurred the triple disasters together: Biggest recorded earthquake to hit Japan! 15,885 dead! Fukushima meltdown!
The number of dead directly attributable to the Fukushima nuclear disaster was zero. The World Health Organization declared that evacuees were exposed to so little radiation that health impacts are likely to be below detectable levels. In fact, Nordhaus noted, nuclear power is the second-safest power source after wind. “It’s safer than solar panels, which are incredibly toxic,” he said.
The impact of the disaster on the nuclear industry was more severe. The meltdown and subsequent shutdown of the Japanese reactors rocked the uranium industry, and flooded the market with the uranium that Japan’s reactors were no longer using, resulting in the lowest spot prices in more than a decade.
Wyoming perspective
After the movie ended and the lights came up, a uranium panel representing all the major players in Wyoming took the stage. In addition to Ken Vaughn, representing Cameco, the sponsor of “Pandora’s Promise;” there was Wayne Heili, president and CEO of UR Energy; Donna Wichers, senior vice president of Uranium One and Paul Goranson, president and COO of Uranerz.
Although the uranium industry is struggling with current spot uranium prices around $28 per pound, all agreed that brighter days are ahead, and that they could be even brighter if Wyoming took over the licensing of radioactive material, a task currently handled by the Nuclear Regulatory Commission.
“If Wyoming can survive this downturn, we’re going to be in a much better place than we were,” Goranson said. “We missed the last peak because the regulatory process is so slow. It took us [Uranerz] seven years to reach commercial operations … What if Uranerz had gotten into operation when the price of uranium was up in the $50s? It would have been a tremendous game-changer.”
Goranson added that part of the delay is “because most of the time the NRC is duplicating work that has already been done by the Wyoming Department of Environmental Quality.”
Agreement state status
Heili suggested that Wyoming could improve its competitive position in the world by enhancing its permitting process.
“We can bring home the radioactive material license through ‘agreement state status’ – rather than rely on the Nuclear Regulatory Commission,” Heili said. “If the state can agree to regulate those aspects, it would reduce redundancies and shorten timelines.”
For example, in Texas, which is an agreement state, Uranium Energy Corporation was able to start production three years faster than companies in Wyoming, Heili said.
Having the NRC fly “all the way from Rockville, Maryland, just to agree to everything the DEQ has already signed off on – it’s not adding one ounce of environmental protection; all it’s doing is slowing things down,” Goranson added. Besides, he added, it’s part of the NRC’s mission statement to allow states to take over.
Thirty-seven states have agreement state status, but Wyoming, which has four of the eight active uranium production sites, does not. In fact, it’s the only producing state that isn’t an agreement state.
Routing licensing through the NRC is also costly. Currently, the state pays the NRC about $280 per hour, plus annual fees and “everything else needed to get a new license,” Wichers said. Uranium One paid $3 million to get their license for Moore Ranch, “plus three years of pain,” she added.
“This is the time for Wyoming to become an agreement state,” Wichers said. “This process will take a couple of years, and we’re looking at three years for the boom to start back. The state needs to be there – be an agreement state – by that time.”
Japan pays the price
In Japan, nuclear power used to supply about one-third of electricity. With no fossil fuels of its own, Japan has to rely on expensive imports of oil and liquefied natural gas since shutting down their nuclear power plants.
According to an article on Bloomberg.com last November, Japan, traditionally a net exporter, recorded 17 straight months of trade deficits, largely due to inflated LNG prices after the Fukushima disaster. The high cost pushed Japan’s trade deficit to a new record high last year and reignited the debate on restarting its nuclear reactors.
It’s not just economics pushing Japan toward the ‘restart’ button. A new nuclear watchdog agency, the Nuclear Regulation Authority was created in September of 2012 to eliminate the cozy setup that allowed utility employees to regulate themselves and ignored operational shortcuts.
Long-term outlook positive
The long-term outlook for uranium is good. China – which already has 20 operating nuclear plants, is building 28 more. Emerging economies, like India’s, are increasingly turning to nuclear power while France, the poster child for nuclear energy, has gone all-nuclear and now has half the carbon footprint of Germany.
With Wyoming being the No. 1 source for uranium in the country, Wichers said a few more years of pain will lead to a bright future for the industry.
“We’re all here to stay,” Wichers said, voicing a common sentiment among the uranium producers.
Heili put it more succinctly.
“We won’t be ‘Fukushima’d’ again!” he vowed.