Quantifying the social costs of nuclear energy: Perceived risk of accident at nuclear power plants

Anni Huhtala and Piia Remes (née Aatola) ()

Energy Policy, 2017, vol. 105, issue C, 320-331

Abstract: The preferences expressed in voting on nuclear reactor licenses and the risk perceptions of citizens provide insights into social costs of nuclear power and decision making in energy policy. We show analytically that these costs consist of disutility caused by unnecessary anxiety - due to misperceived risks relating to existing reactors - and where licenses for new nuclear reactors are not granted, delayed or totally lost energy production. Empirical evidence is derived from Finnish surveys eliciting explicitly the importance of risk perceptions on preferences regarding nuclear power and its environmental and economic impacts. We show that the estimated marginal impact of a high perceived risk of nuclear accident is statistically significant and that such a perception considerably decreases the probability of a person supporting nuclear power. This result holds across a number of robustness checks including an instrumental variable estimation and a model validation by observed voting behavior of the members of Parliament. The public's risk perceptions translate into a significant social cost, and are likely to affect the revenues, costs and financing conditions in the nuclear power sector in the future.

Keywords: Economics; Vote; Nuclear accident; Subjective risks; Probabilities; Instrumental variable (search for similar items in EconPapers)
JEL-codes: C25 C26 C83 D62 Q48 Q58 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:105:y:2017:i:c:p:320-331

DOI: 10.1016/j.enpol.2017.02.052

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