Antinuclear

The ‘pie in the sky’ financials of the South Australian Nuclear Royal Commission’s Report

What happens when the private public partnership goes wrong, the private company can just declare bankruptcy and go back to whatever tax haven they more than are likely based in?

David Richards,  Commenting  on the specific recommendations in the Royal Commission’s Report, 12 June 16  http://yoursay.sa.gov.au/discussions/nuclear-community-conversation-comment-on-the-specific-recommendations-in-the-final-report

The real weakness for this report is the ‘pie in the sky’ financials: The numbers may add up, however their basis in fact is largely illusory… Completion of the construction of the underground storage facility is by use of the money collected after many thousands of tonnes of waste has been collected and stored on the S.A surface. The proposal’s model is supposed to be simple: we start collecting the used fuel for which we will be paid $1.2 million a tonne, we store it on the surface for 10 plus years while the repository is prepared under the surface, and then inter it permanently underground. The weakness of this financial model is that it relies upon our potential customers providing a constant supply of waste at a premium price that we nominate for a sustained period.

What happens if not all of our customers is prepared to continue to pay the $1.2 million a tonne? They might send, 100 tonne, say, at the nominated price to get things started, and then ask for a discount. The potential suppliers will know the score, once the canisters are on the surface; the clock in S.A is ticking: success will rest upon this timeline for permanent storage below the surface, achieved by the sustainability of the cash flow generated by maintenance of the waste stream at the nominated price. The overseas suppliers will have done their sums, some of them have held on to this waste for the last 50 years, holding back for a little while longer to get a cheaper price is good business sense. Paying our initial asking price may free up enough space in their local repositories to allow them to absorb new waste until we offer them disposal at a reduced rate. They will have a good idea of the breakeven point of disposing of this waste, and will if they are feeling generous offer this price. Once the waste is accumulating on the South Australian surface, who will be the most desperate, those getting rid of the stuff, them that have been stock piling it for years, or us with a partially built facility and waste in temporary storage on the surface? Continue reading →

June 13, 2016 Posted by Christina Macpherson | NUCLEAR ROYAL COMMISSION 2016 | Leave a comment