By HARVEY WASSERMAN
Counterpunch
March 19, 2009
The myth of a successful nuclear power industry in France has melted into
financial chaos.
With it dies the corporate-hyped poster child for a "nuclear renaissance" of
new reactor construction that is drowning in red ink and radioactive waste.
Areva, France's nationally-owned corporate atomic façade, has plunged into a
deep financial crisis led by a devastating shortage of cash.
Electricite de France, the French national utility, has been raided by
European Union officials charging that its price-fixing may be undermining
competition throughout the continent.
Delays and cost overruns continue to escalate at Areva's catastrophic
Olkiluoto reactor construction project in Finland. Areva has admitted to a $2.2
billion, or 55%, cost increase in the Finnish building site after three and a
half years. The Flamanville project---the only one now being built in
France---is already over $1 billion more expensive than projected after a
single year under construction.
In 2008, France's nuclear power output dropped 0.1%, while wind generation
rose more than 37%.
Attempts to build new French reactors in the US are meeting stiffened
resistance.
And the definitive failure of America's Yucca Mountain nuke waste dump
mirrors France's parallel inability to deal with its own radioactive trash.
Widely portrayed as the model of corporate success, reactor-builder Areva is
desperately short of money. As it begs a bailout from its dominant owner, the
French government, Areva's mismanagement and overextension in promoting and
building new reactors has wrecked its image in worldwide capital markets.
According to Mycle Schneider, Paris-based author of "Nuclear Power in
France---Beyond the Myth," Areva shares have plunged by over 60% since June
2008, twice as much as the CAC40, the standard indicator of the 40 largest
French companies on the stock market.
Areva's hyper-active public relations department has made much of recent
orders to build two new reactors in China. But it's now begging France's
taxpayers for some $4 billion in short term bailout money, and may need still
another $6 billion more to pay for investments in 
uranium mines, fuel
production and heavy manufacturing ventures.
Areva will also need more than 2 billion Euros (about US$3 billion) to buy
back shares in its nuke reactor unit after Germany's Siemens pulled out of a
joint venture. There have been significant, highly-publicized bumps in the
Chinese transaction. And Areva may now be forced to pony up billions more in
penalties from delays and overruns at its reactor construction fiasco in
Finland.
The Finnish government will also have to meet additional costs from trading
in carbon emissions because it had firmly counted on the new reactor to supply
"green" power as of this year. Olkiluoto is now not expected to deliver
electricity before 2012.
Areva's woes have caused French President Nicolas Sarkozy to face possible
job cuts and asset sales at the government-controlled energy giant, which was
formed in 2001.
China's two-reactor order includes a promise from Areva to supply up to 20
years worth of nuclear fuel. Areva also hopes to sell at least seven reactors
in the US, but these plans are meeting stiff resistance. Complex ownership and
licensing battles have erupted at Constellation Energy, meant to be the conduit
for two new reactors in Maryland. Ratepayer revolts in Florida and Missouri
have arisen over plans to force the public to pay for new reactors as they are
being built. Electric rates in the Sunshine State have already begun to soar
due to proposed nuke construction, prompting an angry grassroots upheaval.
The potential American reactor market has also been bloodied by the
definitive disposal of the proposed high level dump at Yucca Mountain, Nevada.
After decades as the centerpiece of America's "solution" to the nuke waste
problem, with at least $10 billion spent on it, Yucca's failure underscores
France's own waste dilemma.
The French reprocessing center at La Hague has come under widespread attack
for its massive radiation discharges into the English Channel and surrounding
atmosphere. The plant has produced over nine thousand containers of extremely
high level wastes with no safe place to go. Its by-product of plutonium has
complicated global attempts to curb the spread of radioactive materials capable
of being turned into nuclear bombs.
In addition to the reprocessing wastes, without a permanent repository of
its own, France's 58 reactors have also accumulated over ten thousand tons of
spent fuel rods, as the 104 units in the US constantly generate.
Areva says it hopes to raise cash by selling part of a uranium enrichment
plant under construction in southern France to Japan's Kansai Electric. Other
asset sales may be hampered by slumping market values. Areva also hopes to
partner with US weapons builder Northrop Grumman to build heavy reactor
equipment in Virginia.
But on March 11, European Union regulators raided EdF offices because
"suspected illegal conduct may include actions to raise prices on the French
wholesale electricity market." The stunning action against the massive
conglomerate, which is 84.8% owned by the French government, could result in
huge fines.
The EU says EdF may have manipulated prices and redrawn contracts for some
60 key corporate users. Nuke backers constantly tout that close to 80% of
France's electricity comes from reactors whose power flows through EdF. But
Areva's cash shortage and EdF's price-fixing scandal underscore the huge
financial imbalances imposed by building and operating atomic reactors.
According to Schneider, "EDF's shares dropped by over 40% during the last six
months alone. When management in February 2009 announced that larger than
expected charges had corroded profits, share value dropped by 7% overnight and
continued to fall since. The EDF share now stands 12% below the value when it
was first introduced to the stock market in November 2005. Not really a
brilliant investment."
EdF and Areva are at the core of what has been labeled as the global
"nuclear renaissance." Their escalating money problems underscore an epic
failure that has been a significant factor in the current global economic
crisis. After a half- century of massive government subsidies in the US, UK,
France and elsewhere, atomic energy still staggers under an unsustainable load
of high construction costs and uncompetitive prices for the electricity it
generates.
EdF's recent $17.5 billion takeover of nuke utility British Energy came with
a warning from EdF officials that England's commitment to wind turbines could
undermine the future of nuclear power. The statement evoked widespread
astonishment and scorn from the environmental community.
In the financial community, concerns still linger over the
half-trillion-dollar (and still climbing) cost of the 1986 explosion at
Chernobyl. The instant $900 million conversion of the "asset" at Three Mile
Island into an epic liability occurred 30 years ago this month. (The conversion
of Michigan's Fermi I reactor at Monroe into a $100 million molten mess
happened October 5, 1966).
The costs from the earthquake last year that crippled seven reactors at
Japan's Kashiwazaki are still rising. The failure of Yucca Mountain has
converted billions of dollars in utility and taxpayer investments into pure
waste. Growing grassroots movements in Vermont and elsewhere threaten to cut
off license extensions and shut American reactors at which decommissioning
funds have been slashed by the collapse of US investment funds.
The argument that atomic energy provides an answer for global warming turned
to a deep embarrassment in France when reactors were forced to shut during the
summer heat because they were raising river temperatures far beyond legal
limits. In another case, a reactor containment had to be sprayed in order to
cool it back to operational temperatures. Similar shutdowns came at a reactor
in Alabama.
But as massive cost overruns and delays continue to escalate at Areva's
showpiece reactor construction fiasco in Finland, the industry clamors for
unlimited access to taxpayer funds. The surging stream of atomic failure
continues to guarantee that private investors will favor green technologies
like solar, wind and efficiency.
Thus in France, as elsewhere, the "nuclear renaissance" may be still-born.
In 2007, world nuclear electricity generation dropped by an unprecedented 2%.
According to Schneider, in 2008, for the first time in nuclear power history,
no new reactor was connected to the grid anywhere on Earth.
As Schneider's "Nuclear
Power in France---Beyond the Myth" points out, after 35 years of nuclear
power development, the French "nuclear dreamland" gets only 16% of its final
energy from nuclear power. Commissioned by the Greens-EFA Group in the European
Parliament (Brussels, December, 2008) , Schneider's report shows that despite
its huge nuclear commitment, almost half of France's energy consumption still
comes from oil.
In fact, says Schneider, "the wasteful nature of the French economy and
households leads to a higher per capita consumption of oil than in Germany,
Italy, the UK or even the EU on average.
"Those who think that nuclear power would be a cheap and clean way to render
the US less dependent on oil should have a close look at the French
record."
At the French heart of its "renaissance," the nuclear clock is winding down,
not up. Time is running out for a radioactive technology that, after fifty
years, remains unable to muster a sustainable level of private financing, shows
no real promise of ever paying for itself, and has now plunged into deepening
financial chaos.
Harvey Wasserman, a co-founder of Musicians United for Safe
Energy, is editing the nukefree.org web
site. He is the author of SOLARTOPIA!
Our Green-Powered Earth, A.D. 2030, is at www.solartopia.org. He can be reached at:
Windhw@aol.com
Cartoon by Shoji Takagi
