Decouple

On May 1st at 11am in a matter of minutes New York State lost more clean energy than all of it’s solar and wind energy fleet combined. This act of climate vandalism occurred in the context of the Climate Leadership and Community Protection Act which mandates 100% carbon free electricity by 2040 and a massive increase in electrification of the heating and transportation sectors. On the sidelines environmental organizations like the National Resource Defense Counsel chearled the closure. The premeditated shutdown of Indian point led to the building of several large methane gas fired plants to fill in the gap of electricity generation. 1000 intergenerational high paying jobs were lost and the Village of Buchanan will be devastated by the loss of work, taxes and revenue. To add insult to injury as it stands up to 50% of the 15 million dollar community fund set aside by the plant operator may be claimed by River Keeper the NGO that was so instrumental in the premature closure of the plant. The volunteer activists of Nuclear New York worked tirelessly to save Indian Point and put nuclear onto the political and media agenda as a keystone climate solution. They were up against environmental NGO’s with budgets of hundreds of millions of dollars. Despite their best efforts the plant has been shuttered, 81% of New York’s downstate clean electricity has been lost and marginalized communities will have to endure the burden of the air pollution resulting from increased methane gas generation. Their struggle was not in vain. Many lessons were learned and new strategies and tactics developed which might yet be employed to save furhter nuclear plants at risk of political closures across the USA. I am joined by Dietmar Detering and Isuru Seneviratne for an in depth discussion.

Heather Hoff is the co-founder of Mothers for Nuclear, and the mother of Zoe. She is a materials scientist, nuclear reactor operator and lifelong environmentalist.    In the words of their website Mothers for Nuclear is an organization of environmentalists, humanitarians, and caring human beings.     "We were initially skeptical of nuclear, but learned through asking a lot of questions. We started Mothers for Nuclear as a way to share our stories and begin a dialogue with others who want to protect nature for future generations."    Heather describes her trajectory as the daughter of an eccentric tinkerer growing up without a flush toilet in the desert in Arizona, to the co-leader of her campus recycling program, to her unexpected employment at Diablo Canyon as a reactor operator and her role as a co-founder of Mothers for Nuclear.

I am joined by Edgardo Sepulveda, a telecoms regulatory economist with an interest in the electricity sector, focused on restructuring and privatization. Edgardo provides a comparative and long-term perspective on the sector. We begin with the first private companies at the dawn of electrification in the 1880’s and the populist push to exert some form of public control to curb abusive pricing, including setting up regulatory commissions to protect the public interest (in the USA, the New York PSC was set up in 1907!). Consolidation from this multi-private operator model to the “traditional” monopoly vertically-integrated firm mostly occurred after World War II (WWII), when the idea that strategic sectors should be publicly-owned via state-owned enterprises (SOEs) drove a series of unifications/nationalizations: Hydro Quebec (1944); ENDESA in Chile (1945); EDF in France (1946); BEA/CEGB in UK (1947), etc. These SOEs expanded the grid and drove electrification. In the US, where public ownership never took off (with a few exceptions (TVA (1933)), the monopoly investor owned utilities (IOUs) also expanded, facilitated by rate-of-return (ROR) economic regulation that guaranteed a stable long-term return on the vast investments needed to meet demand. Starting in the 1980’s, neoliberalism and then environmentalism challenged this structure. Demand, after growing 5% to 6% annually for four decades after WWII, shrank to less than 1% in the last two decades. The neoliberal agenda of competition and privatization was kicked off 1980 in Chile under dictatorship, pushed forward by Thatcher in the UK later in the decade, so that by the California energy crisis in 2000, more than 50% of the USA and 3 out of the 10 provinces in Canada had “restructured”. The idea was that while distribution and transmission remained “natural monopolies” and should continue to be ROR-regulated, generation could be provided competitively and thus “deregulated.” So many vertically-integrated firms were “broken up” (restructured) to allow for a generation market to be created – markets would now set the prices and decide on how much and where to invest. In parallel, many SOE’s were privatized. So what is the verdict? Edgardo and Chris discuss the implications of these two models, for consumers and technologies, in the context of our need to double or triple generation by 2050 to meet decarbonization. Some reports that Edgardo refers to during the podcast, for an even deeper dive: For the USA, Borenstein & Bushnell argue that evidence shows that the restructuring hope was mostly hype in terms of performance: “The U.S. Electricity Industry after 20 Years of Restructuring” (2015) https://energy.ucdavis.edu/wp-content/uploads/2017/03/07-20-2016-DEEP_WP001.pdf Given the above-noted discussion, Edgardo and Chris close of the discussion focusing on nuclear and the available options. A good nuclear-centric analysis of how liberalized markets under-perform from an investment perspective is by Koenig and Kee in “Nuclear New Build - How to Move Forward” (2021) https://nuclear-economics.com/wp-content/uploads/2021/01/2021-01-atw-NECG.pdf, in which they also develop one particular proposed solution (there are many). Edgardo’s Twitter handle is @E_R_Sepulveda Edgardo’s take on the Ontario electricity sector is here https://www.policyalternatives.ca/publications/monitor/power-people and more blogs here: https://www.progressive-economics.ca/author/edgardo-sepulveda/

Environment, Social, Governance investing is a paradigm that is quickly becoming a driving force for global finance. Investors are increasingly paying attention and demanding disclosure of ESG metrics to guide their decisions. At best, nuclear energy sits in an ESG limbo. At worst, it is listed alongside alcohol, tobacco, and pornography as a sin stock. In the EU, the battle over whether to include nuclear in the EU Green Taxonomy still hangs in the balance.     Nuclear checks all of the ESG boxes, providing ultra-low lifecycle emissions electricity without any air pollution, containing all of its waste, providing high-quality intergenerational union jobs, and submitting itself to the most intense regulatory frameworks on earth.    What is the relevance of nuclear achieving ESG status? Would this change the cost of capital and make new builds in the west more economical? How would the Uranium sector be impacted by ESG eligibility?    I am joined by Arthur Hyde, a partner and portfolio manager at Segra Capital Management. In the words of its website, “Segra Capital focuses exclusively on contrarian or underfollowed investment ideas,” and today we dive deep into one such topic.

Russia has been in the nuclear energy game now for over 75 years and its nuclear industry has bounced back to become the leading exporter of reactors around the world. What accounts for this success?    In the context of oligarchs balkanizing and profiteering off of sectors of the USSR's formerly centrally planned economy the Russian nuclear industry managed to re-consolidate itself into Rosatom, a collection of over 360 enterprises.    Rosatom is a vertically integrated state owned enterprise which offers partnering countries around the world the full suite of services and training to bring it nuclear energy generation capacity.    The core of Russia's nuclear program is the VVER design however Russia is also a world leader in SMR and advanced reactor technologies with concepts that have left the computer simulator and are connected to the grid gaining real world engineering and operational experience. What lessons can we learn from its advanced reactor program?    I am joined by Mark Nelson, managing director of the Radiant Energy Fund. Mark is a leading researcher and speaker on the status and prospects of nuclear and alternative energy around the world. He holds degrees in mechanical, aerospace, and nuclear engineering as well as Russian language and literature.

The decision by the Japanese government to begin releasing 1.25 million tonnes of treated water from the Fukushima nuclear plant site over a 10 year period has caused a major stir not only amongst environmental NGO's but also regional countries with historic emnity to Japan.    Greenpeace alleges that radionuclides released into the sea "may damage DNA of humans and other organisms." China states that "the release is extremely irresponsible and will pose serious harm to the health and sagety of people in neighbouring countries and the international community."  So what are the politics and science behind the controversy?    The Fukushima water has been treated and the almost all radio-isotopes have been removed except for tritium. Just how dangerous is it? Tritium is a weak beta emitter with 70x less energy then the the naturally occuring and ubiquitous intracellular radioisotope Potassium 40 which undergoes 4600 radioactive decays per second in our bodies.   The health impacts of a radioisotope are multifactorial. The type of radiation emitted, the energy of that decay, the physical and biologic halflife of the isotope. The amount of tritium that one would need to drink to match a dose from something like a CT scan is simply impossible to ingest.   In response to the Fukushima accident in an effort to gain the trust of the population Japan has already reset its regulatory limits for radiation in drinking water at 1/100th that of the EU. Are these efforts actually counter productive?   Dr. Geraldine Thomas is a senior academic and Chair in Molecular Pathology at the Faculty of Medicine of Imperial College London. She is an active researcher in fields of tissue banking and molecular pathology of thyroid and breast cancer. She is also the director of the Chernobyl Tissue bank.

While hydrogen fuel cells were once hyped for use in personal transportation, hydrogen is now being marketed as an energy panacea and a vital part of a 100% renewables grid. Most of the world's hydrogen is currently produced through steam methane reformation and is used as a very carbon-intensive feedstock for ammonia for fertilizer and other chemical industry applications. Decarbonizing this sector is already a monumental task.  Green hydrogen produced by wind and solar-powered electrolysis is now being proposed as a solution to the problem of renewable intermittency. Is this viable? What are the challenges?  I am joined by James Fleay, an Australian engineer and project manager who has worked in the power and oil and gas sectors. He has also been a solar industry investor and is the founder of DUNE, Down Under Nuclear Energy

We live in a world transformed by big tech and exponential advances in computing. It is no surprise we hope this pattern can be repeated with an energy transition as anxieties mount over the implications of climate change. Unfortunately, magical thinking leaves us far from deep decarbonization and brings with it some staggering implications when it comes to resource extraction and the waste stream of dilute and intermittent energy sources.   Mark P. Mills is a senior fellow at the Manhattan Institute and a faculty fellow at Northwestern University’s McCormick School of Engineering and Applied Science, where he co-directs an Institute on Manufacturing Science and Innovation.

Mark Z Jacobson's roadmap is cited by politicians like AOC, Bernie Sanders, and many others as an article of faith that a 100% renewables system is achievable and desirable. With great power comes great responsibility, and it is essential that those in the political class wrestling with climate change are well-informed about the consequences of their policy decisions.  Enter Michael Conley and Tim Mahoney, who in their book "Roadmap to Nowhere" work through the implications of Mark Jacobson's plan. This includes a massive parallel HVDC transmission system to connect far-flung wind and solar installations to load centres, and a "fuel-less" system that matches supply and demand with very little reserve, predicated on a weather modeling system designed by Mr. Jacobson himself. Lastly, the plan calls for a dramatic increase in hydro involving increasing current capacity by 13x, which would result in discharges that would regularly dwarf historic 100-year floods and wash away population centres on America's major river systems.  Rather than quaint scenes of small-scale, localized, democratically controlled infrastructure, the plan calls for industrialization of America's countrysides with almost 500,000 wind turbines 35 stories high and 14.5 billion square meters of utility solar panels.   When Jacobson's plan was criticized in the academic community, rather than defending his ideas in scientific journals, he responded with a 10 million SLAPP lawsuit alleging defamation. This lawsuit was subsequently thrown out, and Jacobson has been ordered to pay the defendants' costs. It's time for policymakers to devote themselves to energy literacy, understand the studies that they reference, and make informed decisions to guide us through something as consequential as an energy transition.

What happens to our decision-making when we turn nature into God? Humans crave cognitive shortcuts to spare us the metabolically costly mental labour of reasoning through complex decision-making. The heuristic of "Natural Good, Unnatural Bad," has become one such shortcut. But what is natural? Why have we come to deify nature? And does worshipping it help us to make the best decisions for humanity and the environment? Natural is not always what is good for humans or the environment. Nature, for instance, is very good at killing off children under the age of five. Charcoal production, while quite natural, is leading to rapid deforestation throughout Africa. And biomass burning is treated as carbon neutral by many government regulations partially because it feels natural.  Humans are not the first species to radically alter the planet and its atmospheric chemistry. During the Paleoproterozoic era, the first mass extinction was caused by cyanobacteria metabolizing CO2 into O2, turning the oceans and atmosphere from a reducing to an oxidative environment which wiped out most of life on earth. Humans, via our harnessing of technology, have radically altered the carbon, nitrogen, and hydrological cycles of the planet. As a result, standards of living have improved but a deep existential angst and fear of technology is building as we threaten the ecosystem life support services that "nature" provides us with. Can humanity have its cake and save nature too? While some dispute the very notion of nature claiming that everything is natural and made of stardust, traditional environmentalists and ecomodernists both heavily reference nature, though they have radically different conceptions of it and tools for how to preserve and interact with it. Environmentalists favour harmonizing with nature through agroecology and renewable energy, with human populations and energy infrastructure distributed diffusely across the land. Ecomodernists favour "decoupling" from nature by continued urbanization and intensifying agriculture and energy production on the smallest footprint possible to allow rewilding.  We live in strange times where rather than setting clear goals and searching for the best tools to achieve them we make emotional decisions based on deifying nature and what feels natural. We are at risk of relying on simplistic labels and slick marketing in making our most consequential decisions like how to mitigate and adapt to climate change. Alan Levinovitz is a professor of Religion at James Madison University. He works at the intersection of philosophy, religion, and science, focusing especially on how narratives and metaphors shape belief. His most recent book is "Natural: How Faith in Nature's Goodness Leads to Harmful Fads, Unjust Laws, and Flawed Science." Books Referenced:  Sapiens: Noah Yuval Hariri Factfulness: Hans Rosling