Is private money ready to go nuclear?

[jpak]

http://www.theglobeandmail.com/servlet/story/LAC.20080213.RCANDU13/TPStory/Business

OTTAWA -- Global makers of nuclear reactors are looking to add some high-octane fuel to the much-touted nuclear renaissance by tapping private capital pools to finance their multibillion-dollar projects.

But it's not yet clear that hedge funds and investment banks are willing to take on the financial risks long associated with the capital-intensive projects that are prone to cost overruns.

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In Canada and the United States, private companies are proposing to finance and own nuclear power plants, and sell the power to utilities. To do the deals, they need utilities to sign long-term power purchase agreements that essentially shift much of the risk from the firms themselves to ratepayers.

But Mark Winfield, a York University environmental studies professor, said private sector players will only finance nuclear projects if they can shift the risk to the public. He said the power purchase agreements provide the developer with an assured market on an uncompetitive basis.

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[GliderGuider]

1. Given what's about to happen to large pools of capital around the world

This pipe dream isn't going to last long.

[Dogmudgeon]

2. That might not be the case

And it has nothing to do with the "flavor" of energy.

I would think that in an economy crashing due to energy issues, that energy might be one of the few advisable investments left, whether it's for building a nuclear reactor, a wind farm, or getting the neighbors together to craft-produce a few kiloliters of biodiesel.

I may have overlooked something here. In an end-of-civilization scenario, of course, there are no public investments worth making. But short of that, I would expect energy, food, and "defense" (cops, soldiers, prisons, and guns) to be holdouts. And possibly some rudimentary medical system.

Does this make sense?

--p!

[GliderGuider]

3. I was thinking more about the current global financial situation

I'm more immediately concerned about what's going to happen as a result of the financial shenanigans that are going on rather than about an economic decline due to energy loss. Nuclear energy requires large, concentrated amounts of capital, more than wind farms or other small-scale efforts. That kind of money may not be available for much longer if the global derivative/hedge fund/sub-prime/credit card/SIV/CDO/CDS clusterfuck unwinds completely.