Remembering the Stern Review of Climate Change: An Unfriendly Note

Posted on October 25, 2013
Posted By: Ferdinand E. Banks

In preparing my new economics textbook (2013), several widely publicized topics were deliberately omitted. Perhaps the most notable was the Stern Review on the Economics of Climate Change. On several occasions I heard this document mentioned when I was visiting professor at the Asian Institute of Technology (Bangkok), and since I had encountered some information about it earlier, I took the liberty of informing my students that it was not to be discussed in my classroom in the course of what might be described as normal business, and under no circumstances was I prepared to regard it as a suitable topic of conversation during my precious leisure hours.

Several years ago Lord (Nicolas) Stern (of Brentford) appeared in Stockholm in order to clarify for a large audience at the Royal Institute of Technology the conclusions reached in his widely advertised analysis of the cost of preventing various environmental calamities. I was not invited to attend this 'gig', because it was probably believed by its arrangers that had I been present, there might have been what is sometimes called an 'incident'. This was definitely not certain, because I would have been willing to exercise a maximum of self-restraint to avoid informing Lord Stern that many leading economic theorists regard his work on this topic as scientifically meaningless.
"Meaningless", and in the light of the finished product known as the 'Stern Review', pedagogically insignificant. To my way of thinking, that document - or at least the very small portion that I forced myself to examine - is an insult to economics teachers like myself, as well as the students who require our guidance where their reading materials are concerned, but who unfortunately may have been informed by advisors, supervisors, mentors and itinerant charlatans that the Stern Review is state-of-the-art knowledge.

There is also this matter of innocent bystanders who pay taxes in order for - among other things - systematic and professional attempts to be made to ascertain the extent and mechanics of e.g. atmospheric pollution, and if necessary to suggest or devise efficient programs for reducing the dangers it may pose to their health and/or their standard of living. I also want to emphasize that the few analytical fragments I perused of the Stern Review reminded me of the esoteric contributions that once filled a journal called 'The Review of Economic Studies', which played an important part in my graduate education at the University of Stockholm, and contained articles which later appeared on my reading list when I taught mathematical economics in Uppsala and Australia. Eventually I smartened up however, and I can proudly state that I haven't read nor taught anything specifically from that or similar journals for more than 20 years, nor do I intend to read or teach anything in the near or distant future, regardless of what close or distant colleagues feel is pedagogically appropriate.

Something else should be pointed out before we proceed to the main theme of this note. The team working on the Stern Report came to 23 men and women, as well as many consultants. In other words, it may have been true that anyone who had anything positive to say about Lord Stern's approach to this topic - regardless of how inappropriate or loony-tune it might have been - was welcome to contribute.


After scrutinizing a few pages of the Stern Review, the first conclusion I formed was that if it is true that we are now living in the most dishonest period in modern times, as a Canadian billionaire once claimed, then the so-called research done by Stern and his team might best be described as an outrageous waste of money. Money that should have been used to provide young students of economics with a portion of the education they both need and deserve, This is perhaps a reason for Professor Richard Tol saying that if the Stern Review had been presented to him as a 'Master's' thesis, he would have graded it F (for failure).

But please take note that I am not criticizing nor denigrating climate scientists. economists, journalists, break dancers or anybody else who take the position that global warming may be a clear and present - or nearly-present - danger. For instance, I am completely uninterested in the fact that in a poll taken by the Pew Research Center in the United States, climate warming turned out to be in 20th place among 20 anxieties that persons who responded to the poll were asked to rank. As far as I am concerned, more can and should be done by the governments of many countries to improve the environment. And why not? When President Franklin D. Roosevelt was mobilizing the American people for the most brilliant war effort in human history, he made it clear that everyone had to participate: women, men, and perhaps some children. The same is true here, and more important, investments in environmental improvements that are financed by tax-payers, with or without their approval, make more economic sense than investing in stupid wars on the other side of the world.

There are no surprises in the Stern report, at least for my good self. Given the limitations of economic theory, as well as the publications and other career achievements of Professor Stern, there was only one logical approach to the project bearing his name, which was to assemble or borrow from an analytical model that would permit an overblown and rambling discussion of cost-benefit analysis to take place over 700 pages. The implicit or explicit model apparently chosen by Professor Stern, and which might have been chosen by myself, or for that matter by party animals posturing themselves and courting attention at the bar of an Uppsala University student club, could only be the one published by Frank Ramsey in his famous article 'A Mathematical Theory of Saving' (1928).
What is the reasoning behind this choice? I don't know how much of the Ramsey model Lord Stern has borrowed, nor do I want to know, but I am aware that a key result from Ramsey's article appears in the Stern 'review'. Moreover, the basic focus of such a model can be easily explained to a majority of economics undergraduates, and especially those pursuing their education in the kind of university or institution where environmental studies have almost the same status as theology.

Equally as important, a Ramsey-type model can be summarily enriched in case someone visiting a lecture on this topic decides to play ego games with the lecturer by impugning the logic of Ramsey's construction. For instance, a skilful economics lecturer with a modest amount of integral calculus at his or her disposal should be able to convince a drowsy audience of environmental 'tag-alongs' that this approach contains a useful insight into whether benefits from investments undertaken to avoid future environmental deterioration outweigh the present cost of these investments.

This kind of model often reduces to determining the discount rate (or rates) that should be used to evaluate future benefits. (A discount rate says something about substitution between present and future benefits and costs. For instance, in an article by Kenneth Arrow and a squad of his collaborators (2013), it was recommended that consideration should be given to "whether the benefits of climate policies, which can last for centuries, outweigh the costs, many of which are borne today". Arrow and his associates stress that dealing with this matter involves the rate at which future benefits are discounted, and the thing that caught my attention was his mentioning that an analysis of this sort might be useful for considering the disposal of nuclear waste.

I had a short talk with Professor Arrow when he was in Sweden to receive his Nobel Prize in economics, and he gave me some invaluable advice on the book I should use to teach mathematical economics, but even so I feel it necessary to say that marginal adjustments of discount rates of the kind discussed in the Arrow article have little or no relevance when dealing with any major issue having to do with nuclear energy!

I still remember teaching - without much enthusiasm - the theory and use of discount rates, but where nuclear energy is concerned, the important answers are in the nuclear past and present, and not fantasies and estimates about the future. They are e.g. in the economic and political history of nuclear and other energy investments in Sweden, and what has happened and will happen in China. Evaluating benefits from nuclear energy primarily involves a thorough understanding of the likely evolution of nuclear technology, although it seems that obtaining this understanding is as difficult as making sense of the Stern project and the crank belief that it was worth launching.

The Swedish Energy Minister has proposed altering Sweden's energy architecture in such a way as to obtain enough renewables - e.g. wind and solar - to replace all of Sweden's nuclear assets. Fortunately we know something about how this absurd strategy would play out without bringing discount rates into the discussion, because the cost of electricity in Denmark - which is generally considered the promised land of wind-based energy - is the highest in Europe, while the cost of electricity in Sweden - which has a large nuclear commitment - is among the lowest, and would be the lowest if Swedish governments avoided the advice of quacks. It is also very likely that the nuclear waste problem will be solved in a decade or less by the design and production of integral fast reactors that reprocess all waste within the nuclear cycle. Apparently. The multi-billionaire Bill Gates is financing the construction of one of these devices.


Occasionally I find it necessary to engage in impromptu debates about nuclear energy, which in order to dominate I sometimes find myself saying that nuclear energy might be capable of playing an important role in any program designed to reduce emissions of Carbon Dioxide (CO2). In addition, because of its reliability, I like to claim that the use of nuclear energy increases the value of renewable facilities.

My argument in this matter usually turns on my knowledge of the situation with greenhouse gases in Sweden and France, which unfortunately means that this hypothesis may not be of interest to half-baked energy experts in many other countries. Frankly I don't care, because the teaching of energy economics is so pathetic in most countries - to include Sweden - that I lack the patience to provide the necessary explanations. I do however make a point of repeating as often as possible that when Sweden rushed into a nuclear commitment, it was possible to assemble in just under 14 years an inventory of 12 reactors. Furthermore, this was done by a work force with only a modest background in nuclear matters. It is the presence of these reactors and the large hydroelectric sector that explains why - until the curse of electric deregulation came about - Sweden had one of the lowest electric prices in the world where the supply to households was concerned, and probably the lowest price to the industrial sector.

As to be expected, it is always possible to find ladies and gentlemen who are thrilled to the marrow in their bones with the waffle presented in the Stern Review, Take for example Joan Ruddock, Parliamentary Under-Secretary of State for Energy and Climate Change in the UK. She dismissed the criticisms of Stern by distinguished economists like Professors Richard Tol, Partha Dasgupta and Martin Weitzman because - according to her - these economists suffer from "a fundamental misunderstanding of the role of formal, highly aggregated economic modelling in evaluating a policy issue."

I'm terribly afraid that I must reject that point of view my excellent Ms Ruddock: they do not misunderstand! You and I are guilty of that shortcoming! You because your education in economic theory is worse than inadequate, much worse, and me because although I am a humble teacher and academic energy economist, the only interest I have or need in what you mistakenly call "aggregated" economic modelling is the slender amount necessary for me to write and publish items like this short note and my forthcoming energy economics textbook (2013).


Arrow, Kenneth and 13 collaborators (2013). 'Determining benefits and costs for future
generations'. Science (26 July).
Banks, Ferdinand E. (2013). Energy and Economic Theory (2013). London, New York
and Singapore: World Scientific.
____ . (1977). Scarcity, Energy and Economic Progress. Lexington Massachusetts:
Lexington Books.
Dales, H.H.(1968). Pollution, Property and Prices. Toronto: Toronto University Press.
Harlinger, Hildegard (1975). 'Neue modelle für die zukunft der menshheit'
IFO Institut für Wirtschaftsforschung (Munich).
Hilsenrath, Jon (2009). 'Cap-and-trade's unlikely critics: its creators'. Wall Street Journal
Martin, J-M. (1992). Economie et Politique de L'energie. Paris:Armand Colin.
Michel, Jeffrey H. (2013). Squaring off with CCS: German abandonments prompts
EU policy revisions (Conference paper).
Ramsey, Frank (1928). 'A mathematical theory of saving'. Economic Journal.
Stern, Nicholas (2007). Stern Review on the Economics of Climate Change. London:
H.M. Treasury.
Yohe, Gary W. (1997). 'First principles and the economic comparison of regulatory
alternatives in global climate change'. OPEC Review (21.2:75-83).

Authored By:
Ferdinand E. Banks (Uppsala University, Sweden), performed his undergraduate studies at Illinois Institute of Technology (electrical engineering) and Roosevelt University (Chicago), graduating with honors in economics. He also attended the University of Maryland and UCLA. He has the MSc from Stockholm University and the PhD from Uppsala University. He has been visiting professor at 5 universities in Australia, 2 universities in France, The Czech University (Prague), Stockholm University, Nanyang Technical

Other Posts by: Ferdinand E. Banks

Climate change: A short note - December 16, 2015
A Nuclear Energy Update - March 13, 2015
Helpful Thoughts About Coal - December 10, 2014

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October, 25 2013

Len Gould says

Agreed professor. One can make a model based on future discount rates say anything one wants when the future of interest is a long way away and just a minor increase in estimated discount rate can entirely overwhelm any possible present value.

I noticed two interesting items in our local Toronto liberal newspaper this morning. 1) A demonstration wind turbine installed several years ago in this city, which was originally costed based on it's certainty of provining >90,000 kwhr / yr of energy, has in its life only produced on average 9,000 kwhr of energy. 2) Our august Liberal provincial premier (e.g. governor etc.) is being roundly criticised by said liberal paper for having cancelled the construction of two new nuclear reactors in favour of instead re-furbishing two of our older reactors, after a somewhat smelly Liberal fundraising event sponsored by the operators of the 8-unit reactor plant where the refurbishing is happening. All this from a paper (Toronto Star) with an editorial viewpoint which in the US would be called radically socialist at least, but which is instead, of course, merely supportive of smaller and medium businesses rather than large fortune 50 businesses.

October, 26 2013

Ferdinand E. Banks says

Thanks Len. You see, I am not saying anything about climate change, although I suspect that some bad climate change news might be up ahead. I dont know.

I am talking about a silly discussion of climate change by a brilliant Economist (Lord Stern) and a platoon of helpers who probably dont know anything - or at least dont know what they should know,

October, 26 2013

Michael Keller says

Seems to me touting renewable energy as a cure to "Climate Change" is a fools errand, at best. There is virtually no chance of having any meaningful impact on the climate, as any practical mathematical analysis quickly demonstrates.

More likely, the whole effort is a simply a clever means to transfer more power and wealth to the elitist left.

If renewable energy can reduce energy costs, then by all means pursue the "green" technologies. However, that is generally not the case. I would apply the same criteria to nuclear (or any other energy technology) as well.

As to economic analysis of climate change, the more apt approach would be examining the sapping of economic vitality that occurs when pursuing needless and grossly inefficient activities.

October, 26 2013

Malcolm Rawlingson says

It should be no surprise to anyone that the Toronto turbine only produced 9000 kwhr/year. 90,000kWhr/yr is based on the most ideal and perfect wind conditions occurring on a routine basis. Wind patterns in Toronto are hardly ever in this ideal range. The wind is often not blowing hard enough or it is blowing too hard. Electricity can only be produced when the wind is blowing in the ideal range - which or course does not happen that often.

The economics of wind turbines or any other renewable" device will never make any sense because of the simple fact that you are not able to control the energy input to the device. We can not control when the wind blows any more than we can control when the Sun shines.

It is quite obvious to me as it should be to everybody that (for example) if the Sun does not shine for 12 hours on average a day that in order to build power capability to last 24 hour a day you need to install TWICE the capacity. If you need 1 kW for 24 hours a day then you must produce 2 kW for the 12 hours a day that the Sun is shining AND be able to store the spare kW. That means you need to spend twice the capital to install 2 kW instead of 1 kW of solar panels and spend more capital on the construction of some sort of storage device that as yet has not been invented.

How can that possibly make any economic sense?

By comparison if you install 1 kW of nuclear capacity it is available 24 hours a day 7 days a week independent of whether the Sun is shining or not. That means you need to invest in 1 kW of capacity and NO storage. Of course nuclear capacity factors are not quite 100% but they are very very close to that. What really compounds the stupidity is that is takes the production of MORE carbon dioxide per kW of installed solar capacity than it does to make the same kW of installed nuclear capacity. So society loses both ways.

But no doubt the Toronto windmill sales pitch was full of crappy economic arguments like the Stern report - which was a laugh a minute to read. Perhaps like Professor Banks I should have had the wisdom not to waste my time reading it.


October, 26 2013

Malcolm Rawlingson says

I agree Michael. If one really believes that Carbon Dioxide in the atmosphere is causing changes to the climate then in order to make any real difference a large expansion of nuclear production would be required to make any sort of a dent in it.

Strangely nuclear is opposed by every left wing politician around the planet. So while they want massive reductions in CO2 they decry the only large scale power option capable of doing it. Therefore one must come to the inescapable conclusion that there is another motive here and it is not "saving the planet". It is indeed about giving power and money to the left wing elitists that always know what is best for us.

Low cost electricity is what is best for the planet and that comes from nuclear power plants on the scale necessary The French know it, the Chinese know it, it is starting to dawn on the British at long last, the United Arab Emirates knows it, Russia knows it. Obama does not....but then how does one expect a lawyer to know anything.


October, 28 2013

Richard Vesel says

I am going to take a moment here to engage in a bit of personal recall, as our author is fond of doing.

When I first got out of school with my masters in Electrical Engineering & Applied Physics, (1978), I joined a group in a well known industrial controls company that dealt specifically with the nuclear industry. Our parent company was the manufacturer of many of the reactors located here in the US, and around the world. I was extraordinarily pleased to be a small part of the industry which I believed would lead us into the 21st century with a clean energy future. I

As often has happened in my life, fate, or Edsel Murphy, interfered with my dreams, on a rather grand scale, by causing the Three Mile Island incident less than a year after I joined the industry. This effectively killed the US nuclear industry from the standpoint of proliferating this remarkably good solution, and it hasn't yet recovered. I was also a member of the American Nuclear Society for several years, and sat as a member of one of their standards committees, working on equipment qualification envelopes and standards. All this while still in my 20's. In my early 30's, I moved to within three miles of the largest commercial nuclear facility in Ohio ... well, yes, upstream and upwind of it, but frequently visiting parks and beaches only a mile downstream and downwind of it. I do not glow in the dark...

Here we are, 30+ years later. The Chernobyl and Fukishima events have only served to increase the global angst about using nuclear power, as well as the US creating a crisis-in-waiting by not politically addressing the storage and reprocessing of spent fuel sitting in dozens of locations around the country. We here are all technologists, and can recognize the inherent value of the nuclear solution. However, we can only lead, and pontificate, to the societal horses (to rhyme with forces), yet we cannot force them to drink. At least not in a Western-style democracy we can't.

PEOPLE are AFRAID of the technology. Yes, that fear has some small legitimacy, but for the most part, it is founded in ignorance of reality. A 2GW coal-fired plant releases more unregulated/uncontrolled radiation into the environment daily, than a well-regulated nuclear plant of equivalent size does in a year. Right down the road, at a nuclear site where I did some consulting work a couple of decades ago, the onsite radiation detectors would go off if the wind changed direction, and the effluent from the 2.8GW coal plant across the street bathed the site. (Radon)

So, while we can agree that nuclear would be a large portion of the ideal generation mix for most of the globe, I can sadly offer only the following insight: It ain't gonna happen. Maybe on the Moon, or on Mars, but not here. Too many people are too afraid of it, and no amount of education or benign experiences are going to change that. If fusion ever makes it out of the laboratory, sometime this century, it MIGHT stand a chance, but I feel that it is going to be horridly expensive, and the kooks out there will evoke images of even larger H-bomb mushroom clouds, thereby causing limitless debate on the topic.

Just as my vegetarian friends would wish us all to stop eating meat because it comes at the expense of killing animals, I reply with this. People will not change their belief systems, even when presented with strong ethical (or technical) arguments. The only things that will work on a grand scale are palatable and affordable alternatives. People have spent years developing "Beyond Meat", to the point where it is good enough to fool refined palates, and for it to be available at prices competitive with real meat, even cheaper. We are doing the same with the creation of "Beyond Coal" ... gas is cleaner and more palatable, for now. Renewables can be argued forever, but hydro and geothermal are most DEFINITELY economically viable and reliable, and solar and wind, when combined with more esoteric grid management and (soon to be) utility scale storage, will be palatable, and at the very least, not-too-harmful economically. So I believe the path forward is pretty clearly defined by mass human behaviors and beliefs, and we can either lead, follow, or get out of the way...

Regards, RWV

October, 28 2013

Michael Keller says

As the scope of the misleading claims and outright fabrications of "man-caused-global-warming-catastrophe" become more evident, renewable energy will be forced to compete on economic merits alone. On such a level playing field, renewable is not particularly economically viable in the majority of locations in the US. However, more locations will be viable if renewable energy costs continue to drop dramatically.

Hydro power is more or less maxed out in the US, with environmental opposition to new dams a nearly insurmountable obstacle. Hydro power from Canada makes a lot of sense, if the pin-heads in New England ever get their heads screwed on properly.

Geothermal has but very limited practical potential. Ditto for storage of renewable energy.

I think the more likely future lies with continued reliance on fossil fuels as well as energy efficiency and conservation. Nuclear, not so much because it costs too much, at least here in the US where we are blessed with a number of competing fuels.

As far as the public's fear of nuclear, I believe that will more or less evaporate if nuclear costs can be brought down significantly. That is, however, a very tall order.

October, 28 2013

Malcolm Rawlingson says

In Ontario nuclear power is the least cost option next to hydroelectric plants. The existing fleet on nuclear plants in the US are making lots of money for their owners since the capital cost is paid off and they are operating many years beyond their amortized life span. Fuel is insignificant so all the rest is gravy.

Wind and solar can never ever compete without the back up of large power plants on the grid. because something has to be there when wind and the Sun is not. Running a modern grids with only wind and solar is not possible. Wind and solar can ONLY be accommodated because there are already other power plants operating. Otherwise the capital costs would be double plus you\will need some means of storage and that is not free.

If wind only operates 25% of the time something needs to be operating the other 75% of the time. Not only that but you ALSO need to build many more wind plants than you actually need so that there is spare energy to be stored when they are not operating.

Like I said the ONLY reason they work now is because coal, gas and nuclear fill the gaps. Otherwise dead in the water.


October, 30 2013

Fred Linn says

So, to make a long story short----climate change does not exist, unless you want to use it to make an argument in favor of nuclear power.

October, 30 2013

Bob Amorosi says

Climate change, if you believe it exists, is already beyond a tipping point last I heard recently. If all man-made emissions of gases around the globe that are cited as the root causes were to stop now, it won't stop the warming trend of the earth's climate. So gents, like it or not, we will be faced with severe challenges over the next few decades to preserve our modern way of lifestyles.

I agree completely that omitting new nuclear plants from our electricity generation fleet has been short-sighted. Ontario's decision lately to refuse to fund new plants is mostly due to the bitterly huge up-front investment cost (to the public purse) in building them, at a time when the public purse is deeply in debt. The widespread public fear of nuclear that Richard describes just makes it easier for the public to accept their decision without much backlash.

Natural gas for transportation will probably save our economic backsides from steadily rising oil prices over time. It may even become a great alternative to on-site electricity generation if the technology Malcolm has described in past posts here becomes viable commercially. As for solar and wind generation, it is just a matter of time as their percentage penetration on the grid grows, their added higher costs will trickle down to consumers' and industry's pocket books, making us less competitive in global markets for goods and services. The steadily rising electricity rates will hurt everyone.

The political decisions being made today about nuclear builds, renewable energy sources added to the grid, and the lack of climate change actions, means that we can look forward to massive changes, but these changes will take years to unfold. Some of the brighter politicians know this already, and given the changes will happen gradually over many years, they are counting on the public to be able to adjust to them.

The most visible impact on consumers and industry will be gradually increased efforts for higher energy efficiency in every facet of life. One of the arguments against adding more nuclear plants in Ontario lately is that our demand growth has slowed tremendously over the last decade such that we now have a comfortable surplus in total grid capacity today. A large part of this surplus is a result of increasing energy efficiencies, particularly in industry, and also to a great extent due to the massive decline in manufacturing over the same period.

The age of wasteful consumption of energy and of consumption of consumer goods is slowly morphing into the old days when everyone counted their pennies at every turn. Efficiency gains have been going on for decades admittedly, but there is much more that is possible ….this is where the biggest commercial opportunities will be for our future industries in my humble opinion.

- Bob

October, 30 2013

Michael Keller says

Bob, You really need to pay closer attention to actual science, as opposed to "consensus" science. There is no particular evidence that we are past a "tipping" point. Fact of the matter is, the planet is simply ignoring the dire climate models, which are clearly in error. Global climate catastrophe is unlikely as a result of man's feeble efforts.

There is a good reason to to save energy, but it has nothing to do with "global warming" and everything to do with saving money.

October, 31 2013

Ferdinand E. Banks says

The story about excessive nuclear COSTS is incredible. INCREDIBLY STUPID. Sweden constructed 12 reactors in just under 14 years because they believed that they HAD TO DO IT. The US did the same thing in WW2 with the navy and air force, AND THEY COULD HAVE DONE THAT WITH THE ARMY if they hadn't listened to the wrong people.

Once the present president of the US has returned to some other branch of show business, maybe the next president will tell sombody to find out how to construct nuclear facilities at the same cost that they can be constructed in China, Maybe...that is. They dont have to be constructed now, The whole Point is to prepare the economy for the bad news up ahead.

October, 31 2013

Bob Amorosi says


I agree the prospect of saving money when saving energy is a much stronger motivation for consumers and industry. Climate change is being used as another reason though, and unfortunately the public tends to believe "consensus science" instead of actual science.

I personally believe our climate is changing and has passed a tipping point, and is not likely to go back to what we once knew as "normal", at least not in our lifetime. Maybe I and all of the consensus science believers are wrong on this, but when the mountain glaciers start to return and the ice pack in the arctic stops melting back to record low levels, then maybe I can relax. My point is, can we afford to do absolutely nothing about climate change? i.e. what if the consensus science turns out to be right? I don't think so...

October, 31 2013

Bob Amorosi says

In the name of doing something to deal with climate change, among other good reasons, we should be building at least some new nuclear plants. Building none at all is stupid, I agree with Fred.

If the up-front cost to build them is too high, then the politicians should learn how to negotiate cost reductions with nuclear suppliers. Nuclear engineering is probably similar to other fields of design engineering where there are always multiple design methods of achieving the same thing, some lower costs than others.

October, 31 2013

Michael Keller says

Bob & Professor Banks,

Nuclear power plants in their current form are expensive because lots of "stuff" is required to build & operate them. That is an inherent characteristics that cannot be overcome, although some cost reductions are possible.

In my view, nuclear power has to move beyond the current form (water cooled reactors and a steam cycle for power generation) in order to successfully compete. The hybrid-nuclear technology my firm has developed is one possible path. There are other advanced nuclear concepts in various stages of development, although it is unclear whether any of these approaches can be both competitive and fail-safe. While we believe the hybrid-nuclear technology does meet these objectives, only time will tell.

November, 01 2013

Ferdinand E. Banks says

Fred Linn, the worst climate change scenario is uncertain, although I am not really certain of what the Word WORST means here.

Nuclear is certain. Some of the most neurotic human beings on the face of the Earth are against it, although I can't figure out why. It doesn't have anything to do with safety however, because it is clear that technology can give us safe reactors. Of course, the last two presidents of the U.S. are dumber than stupid, and so you could not convince them to forget about becoming involved in stupid wars thousands of miles away, and instead concentrate on the future energy requirements of their own country..

As for this business of cost, it is no longer up to private industry to give an example of what can be done. In the US, for example, the government should assume that responsibility. It is for the government to mobilize the people who can construct one state of the art nuclear plant, and then say LIKE IT OR NOT FRED, HERE IT IS!

November, 01 2013

Michael Keller says

With all due respect, the government could not organize their way out of a paper bag.

Who do you think is a major reason for the high cost of nuclear plants in the US? None other than the US Nuclear Regulatory Commission, who represents the zenith of the government bureaucratic approach to massive over regulation.

Please note, some regulation is reasonable. But the reality is massive amounts of time, energy and money are devoted to pretty meaningless considerations. Instead, efforts should be directed at the truly important.

From a practical standpoint, the only way to effectively deal with the existing bureaucratic tangle is to deploy nuclear plants that are essentially passively safe, thereby eliminating most of the intense oversight. Better yet, make the plants truly passively fail-safe and life will be better for all, including the regulators.

While the costs associated with safety regulation are a key consideration, the nuclear power plant must also be able to compete. In other words, the plants must not cost too much to build and operate. In my view, therein lies a fundamental problem for conventional nuclear technologies.

November, 02 2013

Ferdinand E. Banks says

Michael, you say that the government is responsible for the high cost of nuclear plants in the US. You probably are right, though not in the way you think.

Since the election of George W. Bush the US has had an incompetent government. First a war based on a lie about weapons of mass destruction, and now a hopelessly ignorant president. But as Another president said, this energy thing is the "moral equivalent of war". Actually he should have just said that it was the equivalent of war, and when the country has to deal with a war, they don't turn the fighting of it over to The National Association of Manufacturers (if that organization still exists.

Anyway, what I am after is the Construction of a 'state of the art' nuclear plant, or plants, or Components of plants, or whatever. A symbol of American excellence. Bill Gates might be financing something like that now - might - in which case you can join the Chorus telling our government to keep its geasy hands off. As for me, I will extend congradulations.

November, 09 2013

Malcolm Rawlingson says


I am in general agreement with your views on nuclear new build in Ontario. Not building them is an easy sell to the public and - as you rightly say - the demand growth has not been there to support these large additions of capacity. However I do not think that the reason is entirely due to conservation although certainly some credit is deserved. What has REALLY happened in Ontario is that the large power consumers in Ontario have either departed the Province or simply shutdown their operations. Two major industries have all but gone in Ontario. The steel industry has pretty much gone (a huge electricity consumer) and the pulp and paper industry in Northern Ontario is down to a few mills.

Taking these large volume 24 hour a day consumers off the grid leads to just one result....massive surplus base load generation and is exactly what we are seeing. Add to that the near decimation of the car industry in Ontario - also a 24 hour a day large volume consumer and it is as clear as day why we have so much surplus power.

So of course when the Government embarks on a deliberate de-industrialization of heavy industry SBG is the inevitable result because the power supply industry was designed and built around providing steel and paper with power.

The economic consequences of course are equally devastating. Ontario has been running massive deficits for years now with no sign of meaningful abatement. In many respects - despite the smoke and mirror politics of Governments of all stripes - Ontario is in worse economic shape than Greece.

We have gone from the powerhouse of the Canadian economy to the have not Province in Canada. Of course there is no need to build more nuclear plants...soon we will not need an electricity industry.


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