Thoughts on New Zealand's 'energy crisis'

Why we oppose nuclear power►10th December 2006

Nuclear power. Could it be the answer, to what growing numbers seem to believe, is an energy supply and greenhouse gas production crisis that both darkens New Zealand's horizon and threatens our 'clean, green image'? At NZ Gold we are not so sure, yet our views emerge from a slightly different perspective to many in the traditional 'green movements'.

At NZ Gold we confess to being, what we tend to believe, is an almost extinct species. We are 'old-fashioned capitalists'. As such we struggle with what appears to be the contemporary wisdom and morality. To us this is a 'fundamentally redistributive thinking' which suggests - nay contemptuously declares - that it is entirely acceptable to confiscate the income of one group (normally the 'middle class') and to use the plundered booty for all manner of purposes designed to benefit 'vote grabbing' politicians and the vested interests that support them. Ordinary people, working hard to get ahead and do the best for themselves and their families - in both New Zealand and Britain - will need no reminding of the astonishing proportion of their income that is now taken by the state.

In connection with the above, we understand that Britain is a little ahead of New Zealand in the overall 'plunder stakes' with a 'tax freedom day' (that hallowed moment when on average your income is actually yours instead of the government's) falling on June 3rd this year. So that our readers can compare we note that 'tax freedom day' this year for New Zealand is cited as June 1st.

Much is made of the amount spent on 'welfare' and a 'finger of condemnation' is frequently pointed at those individuals and families who are recipients of all manner of 'benefits' and other transfer payments/allowances. Certainly, the extent to which welfare payments have grown in both New Zealand and Britain is literally astonishing and in subsequent writings we shall explain why we believe this will ultimately prove unsustainable. Yet there is another form - of what we at NZ Gold consider to be 'welfare' - that receives rather less coverage. This is the money, again taken in vast quantities from the 'middle class' via such impositions as taxes and rates, that winds up benefiting business. Now as 'capitalists' you might expect NZ Gold to support such arrangements - but we do not! What we believe in is transparency. That is why we support honest money, as opposed to the endless generation of un-backed fiat money, and it is why we argue against, what we perceive, is a growing culture of 'corporate welfare'.

Our philosophical difficulty, with simply 'taking' the income of one group and effectively handing it over to big business, irrespective of the usual claims about 'national interest' and 'job creation' etc, makes it very difficult for us to support nuclear power at NZ Gold - and that is before we even consider the other 'negatives' that are particularly relevant to New Zealand. At NZ Gold we reflect that the British people were being told in the nineteen fifties that nuclear power would ultimately be so cheap to produce that it would not require metering. Manifestly, such claims have proved ridiculous and it is our understanding that nuclear generation of electricity has historically proved consistently price uncompetitive when considered against the available alternatives. We thus perceive an industry that has effectively required massive subsidies from the taxpayer and we find this reality at odds with the increasingly repeated mantra that nuclear power will deliver cheap and abundant energy going forward. Perhaps all the problems have been solved, but we would suggest that if so then the industry should deliver a cast-iron and transparent economic case for nuclear power and then - presumably - private capital (as opposed to confiscated taxes) will rush to invest!

We also recoil, with some amusement, at those who suggest we embrace nuclear power generation as though it can be achieved with the same nonchalance one might use when hailing a black cab at Piccadilly Circus. If, as appears to be the case, nuclear power generation is set to proliferate worldwide then how high 'up the reactor delivery pecking order' do nuclear advocates - writing enthusiastically in the letters section of New Zealand newspapers - think this country is going to be? At NZ Gold we would suggest that the planning process, construction, delivery, and commissioning of a New Zealand nuclear power facility would be so protracted that 'the lights would have gone off' long before any atomic energy was being delivered to the consumer. Although, when it comes to local communities having a legitimate input into what happens in their areas via the planning process, we should not be too complacent. The British government, having changed its mind about nuclear power, in contrast to the renewable and conservation preferences it reached in its energy white paper in 2003, looks set to simply 'impose' new nuclear facilities whether they are wanted or not. This, of course, is entirely consistent with Britain's emergence as a 'quasi fascist corporate state'. Going forward, we would expect to see the 'need' for new nuclear power generation employed as a pretext for altering Britain's planning laws so that, in the future, communities can be subject to 'Soviet style' central planning in a whole raft of areas. Don't believe us - well try looking at what is proposed for the 'concreting over' of the South East of England to provide housing - most of which is needed to accommodate levels of immigration that beggar comprehension! How confident are you that the political/big business 'cabal' that appears to run New Zealand these days will not simply deliver a 'British' style solution to the planning of your community in future?

Indeed, the role of immigration in creating burgeoning demand for electricity is something that we seldom see referred to. Particularly interesting for us at N.Z. Gold is the fact that the traditional 'green' movement seems strangely reluctant to connect overwhelming immigration with - what we would have thought is a rather obvious consequence - exponentially increasing demand for resources in the new country of domicile. Forgive us, but we find ourselves asking if this might have something to do with the fact that most post-war immigration into countries such as Britain and New Zealand has been from foreign lands with very different historic and cultural perspectives. Could it be that more important to the traditional 'green movements' than saving the environment is assuaging the 'socialist and liberal intellectual within' for whom 'Anglo Saxon hegemony' and not environmental degradation is the real 'enemy'? At NZ Gold we take a simple and honest view - if both Britain and New Zealand are facing serious problems with adequacy of electricity supplies going forward then why are both countries dashing to exponentially increase their populations. The answer, of course, is because it suits the political/big business 'cabal' and if massive new electricity generation infrastructure is needed - at least in part because of immigration driven demand - then hey 'no problem' because the existing population can be forced to pay via the tax system.

At NZ Gold we are not anti-immigration. On the contrary, we would far sooner live next door to a sultry and sophisticated East European beauty - than a belching 'ladette' from Essex! Yet this is not the point. An arrangement in which vested interests enjoy the benefits of mass immigration, whether it be businesses in the form of artificially cheap labour or politicians 'trading' the right of abode for votes, requires massive 'cross-subsidy' from the established base of taxpayers. Small wonder then that the British Treasury has recently signalled rising taxes for the next five decades!

In reflecting on the need to subsidise any new British nuclear generating capacity, former environment minister Michael Meacher (Returning to nuclear power could prove a deadly u-turn - Guardian Wednesday February 1st 2006) offered his lamentation for the cost of decommissioning existing plants and managing the vast quantities of waste that have progressively accumulated. At NZ Gold we have seen some figures in the mid fifty billions, Mr Meacher suggests seventy billion! (approximately $NZ 200 billion). A visiting alien from outer space might think us mad! Firstly, we spend billions subsidising a wholly uneconomic way to generate electricity - and then we spend more billions trying to clean up the mess afterwards. This brings us to another key objection that we have to nuclear power at N.Z. Gold - the concern that it will require us to pass on costs for decommissioning and waste disposal to as yet unborn generations. In the same way that we object to governments incurring debts, that they arrogantly pass on to the unborn after 'purchasing office' with the monies raised - in our book intergenerational theft - we find offensive the ongoing transfer of the costs of defunct nuclear generating capacity decades and centuries hence. Again, we are told that more contemporary reactor technology will eliminate many of the historic 'waste problems' with which a country like Britain must now contend, but we wait to be convinced. In New Zealand nuclear waste derived from electricity generation is one problem - despite numerous other environmental challenges - that we do not have to face. At NZ Gold we would suggest maintaining the status quo, unless an overwhelming case for nuclear power generation arises and the issue of waste can be satisfactorily addressed. This would require, in our view, a great deal more than advocacy by politicians and other related interests. Indeed, we would suggest that the recent embrace of the nuclear option by Britain's 'ruling' Labour government should have alarm bells ringing - irrespective of any other shortcomings in the nuclear argument. At NZ Gold we are always minded to the view that when leading politicians pursue a course of action then there is much merit in considering doing precisely the opposite. It was just this contrarian view that caused us to take an interest in the merits of precious metal investment when Britain's Chancellor of the Exchequer, Gordon Brown, sold a large chunk of the nation's gold reserves - at a miserable price - in 1999!

Yet what about global warming some will say? Isn't nuclear power the perfect way to produce electricity, without the generation of greenhouse gas emissions, and hasn't our prime minister committed us to environmental sustainability and carbon neutrality etc etc? Well perhaps, but at NZ Gold we suspect that the 'greenhouse gas' argument is much more complex than the nuclear 'disciples' would have us believe. For a start the 'nuclear devotees' seem to conveniently forget that uranium doesn't just appear out of thin air. Like gold, it has to be mined from ore and our understanding is that this requires large amounts of hydrocarbon energy. Moreover, if nuclear power generation proliferates as is being suggested, the more abundant ore grades of uranium will inevitably give way to less generously endowed resources at rapid speed - and it will then presumably require much more hydrocarbon input to extract the diminishing fissile material. Thus ironically, as nuclear power expands with great fanfare about its 'eco-credentials', the much vaunted greenhouse gas advantage over fossil based alternatives could diminish to the ludicrous situation where more hydrocarbon energy is needed to mine poor grade ores than is finally available from the painstakingly recovered uranium. At NZ Gold we have seen some alarming figures about how long known uranium resources will last if exponential growth in nuclear power generation develops. Another negative, would we really want to see New Zealand incur the massive costs associated with building a nuclear facility - only to discover ourselves competing with much wealthier and more influential countries for the necessary fuel some years hence? As to the suggestion of 'fast breeder reactors' - employing plutonium derived from the reprocessing of spent nuclear fuel - we cannot imagine an option more likely to heap terminal ridicule upon 'clean green nuclear free New Zealand'.

Perhaps thorium, which is some three times more abundant than uranium, will ultimately offer a more enduring source of nuclear reactor fuel for the future. Perhaps it will be possible with thorium to deliver an unequivocally safe, advantageous, financially transparent and reliable breeding cycle using particle accelerators. Then, on the other hand, perhaps someone will 'crack' how to deliver nuclear fusion and fission based technologies will be rendered obsolete (with the taxpayer - of course - picking up the bill for 'cleaning up').

At NZ Gold we have little doubt that fission-based nuclear power generation will expand greatly overseas. Yet, as we have mentioned previously, the fact that politicians seem to be in the vanguard of advocating for such proliferation leaves us intensely skeptical. In the same way that their advocacy of 'fiat currency expansion' ultimately suggests a huge financial mess, we wonder if a politically driven dash to nuclear power wont ultimately portend something rather worse? Indeed, in a sense we find that the debate over nuclear power eloquently articulates the general decent into absurdity and duplicity that now characterises politics - especially in Britain! Politicians, the people who will tell you - with their 'first face' - about how the sea levels are going to rise because of fossil fuel driven global warming. Politicians, the people who will then tell you - with their 'second face' - that the only answer is to build nuclear power stations. Yet correct us. Won't these new nuclear power stations invariably be built - on the very coastlines that politicians claim are going to disappear? If what they are telling us is correct then even a total cessation of fossil fuel burning by Britain and New Zealand would surely make little difference to rising sea levels - as China and India industrialize at breathtaking speed! How long before we see the first combined nuclear reactor/aquarium?

At NZ Gold we believe that our pro-nuclear credentials were once impeccable. We lived close to an early British Magnox nuclear power station - and at one stage even held shares in an Australian exploration company with a large uranium resource! Yet we were never entirely comfortable when that power station came into view, as we drove back towards the low lying coastal Essex town of Maldon, after spending the day working in London. Somehow things seemed more 'convivial' when the frequent fogs rolled in and the vast structure was obscured from view - 'out of sight, out of mind'. It was that enduring recollection, and some research that we chanced upon regarding depleted uranium munitions, that caused us to more closely investigate the case for nuclear power. Weighed in the balance we simply find ourselves at NZ Gold coming to the same conclusion as Michael Meacher "Britain needs nuclear like a hole in the head". If so, then we ask ourselves how much less does New Zealand need nuclear power - especially when such vast potential exists for both energy conservation and the return to a more holistic and responsible approach to 'electricity hungry' immigration.

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