Green Energy, Rent Seeking, Corporatism, and Unintended Consequences

English: Vogtle nuclear power station Cooling ...

English: Vogtle nuclear power station Cooling Towers (Photo credit: Wikipedia)

Georgia Power is building a nuclear power plant. That would be good if they foresaw making a legitimate profit from it. It doesn’t sound like it.

Georgia Power says the Vogtle project creates lots of jobs and buys lot of building materials.  The same could be said about the construction of a large pyramid. The question should be about the value of the costly project verses other things that might have used the labor and materials.

So how does a society choose between alternative uses of resources? Under market conditions with unhampered price signals, consumers decide with their spending what uses should be made of resources.

That’s not how the decision to build the Vogtle nuclear plant was made. Instead, the drivers were lobbying on the state and federal level for special government favors that would never be granted voluntarily by consumers. The academic term for this is rent-seeking; the more everyday term is cronyism.

Given all the special treatment from government for nuclear plants, it is doubtful they could be built under market conditions. Natural gas and coal, with far less up-front costs and competitive variable costs, are the capacity-of-choice for competitive markets.

Georgia Cronyism: DSM, Nuclear Plague Public Service Commission – Master Resource.

That’s pretty much what always seems to happen when things are built for political purposes.


history-image5In a somewhat different case, I note that there is a proposal for developing an entire straw pellet power plant and a surrounding roughly 50 acres site in Norwich, UK.

It has some good features, I think, such as the use of heated water from the plant for domestic heating, which works well in an urban area. I think they are going to have difficulty finding enough pelletized straw to burn, although the fact that the UK has prohibited burning straw in the field (last I knew that was the most efficacious way to release nitrogen back into the soil, not that the greenies ever cared about that) but pelletizing on that scale is not an inconsiderable process.

From the website it sounds reasonably OK to me but £325 million  without a detailed plan (they haven’t sited their generating station yet, or completed detailed environmental surveys). So there is still a lot of room for the price tag to grow, and unintended consequences to strike.

In addition, it looks to me like they are relying heavily on academics, and rent-seeking government contractors and politically connected people generally. I saw no mention anywhere on the website that they thought anybody, anywhere would make a profit, not even the wheat farmers (switchgrass, anyone?).

Here’s their website.

My best guess at the moment (I haven’t even close to enough information for an opinion) is that it’s not a bad idea but they’ll not get it done in 30 years and the budget will treble (at least).

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About NEO
Lineman, Electrician, Industrial Control technician, Staking Engineer, Inspector, Quality Assurance Manager, Chief Operations Officer

6 Responses to Green Energy, Rent Seeking, Corporatism, and Unintended Consequences

  1. the unit says:

    I’m not sure of all the details about how things go forward now, was told by CIC not by yourself you didn’t.
    A Southern Company member, Gulf Power, had purchased some 2700 acres locally for a new power plant by 2013. It was pretty well understood to be nuclear. Been stalled now since then as Commission would not allow rate increase. Now I don’t like a rate increase, particularly now on fixed income, but the guy this endeavor is named for would have handled it. I don’t think the rent-seeking memo went from his inbox to his outbox, just waste can.
    Need more like him, although likely none around, instead of “Looking for Mr. Goodbar.”
    http://www.southerncompany.com/about-us/our-business/southern-nuclear/alvin-vogtle.cshtml

    Liked by 1 person

    • NEO says:

      Yep, there are some good ones about, and I’ll bet they’re even more frustrated than the rest of us. Nukes are expensive, not for engineering reasons but because of over-regulation. It’s been like that all my life, that’s why they’re uncommon. Operationally and for the environment-they’re simply outstanding, their major wast product is hot water, although we do need a used fuel depository.

      In fact, if we were tp combine the two, a nuke plant would be even better for what the want to do in Norwich, they have a market for the hot water as well.

      Liked by 1 person

      • the unit says:

        Too bad used fuel depository can’t buy it’s own “ticked to Hell.” 🙂

        Liked by 1 person

        • NEO says:

          Yucca Flats would have been fine, except for politics (OF COURSE)

          Like

        • the unit says:

          From Wiki…Yucca Flat, the craters or subsidences give Yucca Flat a look similar to the surface of the moon.
          Yep, the nuclear testing there at Yucca Flats gave us Harry Reid.
          Lack of testing gave Attila the Hun and Muhammad prior. No easy solution. 🙂

          Liked by 1 person

        • NEO says:

          Well said.

          Liked by 1 person

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