Build nuclear capacity in the United States

I open with a common theme in the energy debate at this time. To build nuclear or to not build nuclear? I answer the question in my title, alternately "Build Nukes!".

First point, let's say the overnight cost of nuclear and the overnight cost of combined cycle natural gas are $10,000 (probably high, includes financing) and $1,000 (probably low, at least for greenfield, doesn't include financing...). Also, let's look at a 35 year term. Let's assume a 35 year average price of natural gas at $6 and NG plant nominal heat rate of 7,000 btu/kW. Let's assume nuclear fuel and O&M (variable and fixed) are $20/MWh and gas O&M is $10/MWh. That gets you to just above $56/MWh for Nuclear and just below $56/MWh for Natural Gas. You can quibble with all of those assumptions, but is my order of magnitude really very wrong?

Second point, to my friends on the right, just because you have never priced an externality before doesn't mean it is free. Maybe you can bury your head in the sand and ignore the ratio of serious climate scientists being about 10,000 to 1 in favor of climate change being due to anthropogenic greenhouse gas emissions and pretend that the 10,000 is all a scientific cabal. Is there any serious and credible opposition to the theory that anthropogenic carbon dioxide emissions are acidifying the oceans? Do we really let the reefs die off en masse?

Third point, with the major exception of Chernobyl, and with no known and established exception in the west, all pollution generated from commercial nuclear plants has a known location. It may be in pools at the plant site, it may be in the South Pacific somewhere, it probably won't ever be at Yucca Mountain, but it is all contained where you could conceivably see it if you desired to look.

The specific policy that the United States needs is simple.

First, create an entity like the original new deal Fannie Mae to securitize loans for nuclear plants to match the original term of the COL, which I see on research is actually 40 years and not 35 as above. The point there is that home mortgages would never have been standardized at a 30 year fixed rate in the United States without Fannie Mae. Nuclear are one of the few infrastructure investments that demand such a term. The problem financing Nuclear may not be that Wall Street doesn't want to, just that nobody but the government can establish securities of the initial term.

Second, figure out what to do with the waste for the term of the loan. Two facts of nuclear waste is that it becomes less hazardous over time and that the real answer for what to do with it long term is probably to shoot it off into the sun. We do not have reliable transport to shoot it into the sun at this time, but the idea that we have to come up with an absolutely safe repository that will hold the stuff for the next million years is ludicrous. The energy secretary is a Nobel Laureate. I am a random business guy. He can spend a few hours and figure it out just fine.

Third, even though it is 16 years out, congress probably needs to fix the long term structure of the Price-Anderson Act. Given the long lead to actually build a nuke, we may be getting close enough that uncertainty about the act is a justified concern weighing against a utility that wants to build Nuclear.