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And I'd add that nuclear power is worse here than even standard capitalism. In the US, the federal government provides a massive subsidy in the form of free ins

And I'd add that nuclear power is worse here than even standard capitalism. In the US, the federal government provides a massive subsidy in the form of free insurance: https://en.wikipedia.org/wiki/Price%E2%80%93Anderson_Nuclear_Industries_Indemnity_Act https://en.wikipedia.org/wiki/Price%E2%80%93Anderson_Nuclear... And that's before we get to all of the other subsidies, cataloged here: https://www.ucsusa.org/resources/nuclear-power-still-not-viable-without-subsidies https://www.ucsusa.org/resources/nuclear-power-still-not-via... I'm a big fan of free and fair markets, and think that they have been woefully underapplied in recent decades. Happily there's an uptick in antitrust regulation, so maybe we're moving in the right direction.

whatshisface 3y ago
All regulated industries receive liability breaks as "compensation" for being regulated. For example, many classes of product approved by the FDA are considered immune from liabilities related to dangers discovered in application[0], in particular, medical devices[1]. I agree that it is likely to distort the markets and incentivize regulatory capture. [0] https://en.wikipedia.org/wiki/FDA_preemption https://en.wikipedia.org/wiki/FDA_preemption [1] https://en.wikipedia.org/wiki/Riegel_v._Medtronic,_Inc https://en.wikipedia.org/wiki/Riegel_v._Medtronic,_Inc.
- wpietri 3y ago
  Do you have more examples for this "all"? There are a lot of regulated industries out there, and I haven't heard of liability exemptions for them. E.g., food is highly regulated, but there are plenty of lawsuits over that. Ditto cars. Or banks. Or airplanes. From what I've seen, I think things like the Price-Anderson Act are less about universal liability protections for regulated activities, and more about special pleading by people with money. It seems to me that the correct response for "this is so dangerous nobody will insure it" is not "well fuck it, go ahead and the government will cover your losses."
pdonis 3y ago
> In the US, the federal government provides a massive subsidy in the form of free insurance While I'm no fan of this act on general principles and would be fine with seeing it repealed, to call it a "massive subsidy" ignores the fact that, as the Wikipedia article you link to notes, the secondary insurance provided under it has never been used. Every claim has been within the amount of primary insurance coverage, which is bought on the open insurance market at normal rates. This is strong evidence that nuclear power is in fact an ordinary insurable risk and the government does not need to take measures like this act.
- wpietri 3y ago
  No, insurance doesn't work like that. The cost of the Fukushima disaster is something like $200 billion. An insurer isn't going to say, "Well gosh, no US plant has ever had a problem, so we're happy to write a $250 billion policy for the same price as a $15 billion policy." ($15 billion being the liability cap beyond which taxpayers are on the hook.) The subsidy here is the price difference between having full insurance and price of only having to insure to the cap, cumulatively since 1957, for every nuclear plant in the US. It's hard to put a number on that, but it's wildly larger than zero.
  - pdonis 3y ago
    > The cost of the Fukushima disaster is something like $200 billion. Yes, and the root cause is well known and easily avoidable, so any insurer can simply require that it is not present in an insured system--in this case, that backup generators and switchgear for decay heat removal are sited where they can't be inundated by a tsunami. Exactly as the backup generators and switchgear for all other reactors at the same site were. In fact, that very observation highlights a problem with the absence of insurance: nobody was independently checking for exposure to risk. An insurer would have asked why the backup generators and switchgear for that one reactor were sited differently from all the others at the site before agreeing to provide coverage. Also, insurance is not necessarily blanket coverage for everything at a single price. An insurer of a reactor might not include tsunami inundation in the policy--or might require a separate rider, priced separately, for that particular risk, which will have a different risk profile than other risks associated with the reactor. > The subsidy here is the price difference between having full insurance and price of only having to insure to the cap While this was true back in 1957, when there was no real data on commercial nuclear reactor operational risks, that is not the case now and has not been the case for quite some time. I would expect the fact that no claims have gone over the cap for decades to be reflected in pricing for insurance up to the cap being basically the same as it would be for insurance to a higher maximum liability. OTOH, if insurance for this particular risk is not a very competitive market--which it might well not be precisely because of government interference in this area--then the "subsidy" the government is providing is just canceling out what would otherwise be an unwarranted increase in premiums by insurers who effectively have monopoly pricing power. All that said, I'll reiterate that I would be fine with having this law repealed and letting nuclear compete in a free market with other energy sources--of course provided that we treat all those other energy sources the same and the government does not favor or penalize any of them. I just think that nuclear would do better in such a regime than many others appear to think.

whatshisface 3y ago

All regulated industries receive liability breaks as "compensation" for being regulated. For example, many classes of product approved by the FDA are considered immune from liabilities related to dangers discovered in application[0], in particular, medical devices[1]. I agree that it is likely to distort the markets and incentivize regulatory capture. [0] https://en.wikipedia.org/wiki/FDA_preemption https://en.wikipedia.org/wiki/FDA_preemption [1] https://en.wikipedia.org/wiki/Riegel_v._Medtronic,_Inc https://en.wikipedia.org/wiki/Riegel_v._Medtronic,_Inc.

wpietri 3y ago
Do you have more examples for this "all"? There are a lot of regulated industries out there, and I haven't heard of liability exemptions for them. E.g., food is highly regulated, but there are plenty of lawsuits over that. Ditto cars. Or banks. Or airplanes. From what I've seen, I think things like the Price-Anderson Act are less about universal liability protections for regulated activities, and more about special pleading by people with money. It seems to me that the correct response for "this is so dangerous nobody will insure it" is not "well fuck it, go ahead and the government will cover your losses."

pdonis 3y ago

> In the US, the federal government provides a massive subsidy in the form of free insurance While I'm no fan of this act on general principles and would be fine with seeing it repealed, to call it a "massive subsidy" ignores the fact that, as the Wikipedia article you link to notes, the secondary insurance provided under it has never been used. Every claim has been within the amount of primary insurance coverage, which is bought on the open insurance market at normal rates. This is strong evidence that nuclear power is in fact an ordinary insurable risk and the government does not need to take measures like this act.

wpietri 3y ago
No, insurance doesn't work like that. The cost of the Fukushima disaster is something like $200 billion. An insurer isn't going to say, "Well gosh, no US plant has ever had a problem, so we're happy to write a $250 billion policy for the same price as a $15 billion policy." ($15 billion being the liability cap beyond which taxpayers are on the hook.) The subsidy here is the price difference between having full insurance and price of only having to insure to the cap, cumulatively since 1957, for every nuclear plant in the US. It's hard to put a number on that, but it's wildly larger than zero.
- pdonis 3y ago
  > The cost of the Fukushima disaster is something like $200 billion. Yes, and the root cause is well known and easily avoidable, so any insurer can simply require that it is not present in an insured system--in this case, that backup generators and switchgear for decay heat removal are sited where they can't be inundated by a tsunami. Exactly as the backup generators and switchgear for all other reactors at the same site were. In fact, that very observation highlights a problem with the absence of insurance: nobody was independently checking for exposure to risk. An insurer would have asked why the backup generators and switchgear for that one reactor were sited differently from all the others at the site before agreeing to provide coverage. Also, insurance is not necessarily blanket coverage for everything at a single price. An insurer of a reactor might not include tsunami inundation in the policy--or might require a separate rider, priced separately, for that particular risk, which will have a different risk profile than other risks associated with the reactor. > The subsidy here is the price difference between having full insurance and price of only having to insure to the cap While this was true back in 1957, when there was no real data on commercial nuclear reactor operational risks, that is not the case now and has not been the case for quite some time. I would expect the fact that no claims have gone over the cap for decades to be reflected in pricing for insurance up to the cap being basically the same as it would be for insurance to a higher maximum liability. OTOH, if insurance for this particular risk is not a very competitive market--which it might well not be precisely because of government interference in this area--then the "subsidy" the government is providing is just canceling out what would otherwise be an unwarranted increase in premiums by insurers who effectively have monopoly pricing power. All that said, I'll reiterate that I would be fine with having this law repealed and letting nuclear compete in a free market with other energy sources--of course provided that we treat all those other energy sources the same and the government does not favor or penalize any of them. I just think that nuclear would do better in such a regime than many others appear to think.