Managing Nuclear Waste from Power Plants

National strategies to manage nuclear waste from commercial nuclear power plants are analyzed and compared. The current strategy is to try to operate a repository at Yucca Mountain, Nevada, to dispose of high-level nuclear waste underground. The main alternatives involve temporary above-ground storage at a centralized facility or next to nuclear power plants. If either of these is pursued now, the analysis assumes that a repository will be built in 2100 for waste not subsequently put to use. The analysis treats various uncertainties: whether a repository at Yucca Mountain would be licensed, possible theft and misuse of the waste, innovations in repository design and waste management, the potential availability of a cancer cure by 2100, and possible future uses of nuclear waste. The objectives used to compare alternatives include concerns for health and safety, environmental and socioeconomic impacts, and direct economic costs, as well as equity concerns (geographical, intergenerational, and procedural), indirect economic costs to electricity ratepayers, federal government responsibility to manage nuclear waste, and implications of theft and misuse of nuclear waste. The analysis shows that currently building an underground repository at Yucca Mountain is inferior to other available strategies by the equivalent of $10,000 million to $50,000 million. This strongly suggests that this policy should be reconsidered. A more detailed analysis using the framework presented would help to define a new national policy to manage nuclear waste.     

A Multiattribute Utility Analysis of Alternative Sites for the Disposal of Nuclear Waste

Five potential sites nominated for the Nation's first geologic repository for disposing of nuclear waste are evaluated using multiattribute utility analysis. The analysis was designed to aid the Department of Energy in its selection of 3 sites for characterization, a detailed data-gathering process that will involve the construction of exploratory shafts for underground testing and that may cost as much as $1 billion per site. The analysis produced insights into the relative advantages and disadvantages of the nominated sites and clarified current uncertainties regarding repository performance.     

Probabilistic Risk Analysis for a High-Level Radioactive Waste Repository

A probabilistic risk analysis (PRA) for a high-level radioactive waste repository is very important since it gives an estimate of its health impacts, allowing comparisons to be made with the health impacts of competing technologies. However, it is extremely difficult to develop a credible PRA for a specific repository site because of large uncertainties in future climate, hydrology, geological processes, etc. At best, such a PRA would not be understandable to the public. An alternative proposed here is to develop a PRA for an average U.S. site, taking all properties of the site to be the U.S. average. The results are equivalent to the average results for numerous randomly selected sites. Such a PRA is presented here; it is easy to understand, and it is not susceptible to substantial uncertainty. Applying the results to a specific repository site then requires only a simple, intuitively acceptable "leap of faith" in assuming that with large expenditures of effort and money, experts can select a site that would be at least as secure as a randomly selected site.     

Public Attitudes Toward Siting a High-Level Nuclear Waste Repository in Nevada

This paper examines the sources of public opposition to a high-level nuclear waste repository among samples of 1001 residents of Nevada and a national sample of 1201 residents. Two models of choice are contrasted: A benefit-cost model and a risk-perception model of individual choice. The data suggest that the willingness of Nevada residents to accept a repository at Yucca Mountain depends upon subjective risk factors, especially the perceived seriousness of risk to future generations. Perceived risk depends in part on level of trust placed in the Department of Energy to manage a repository safely. Opposition to a local repository did not decrease significantly if compensation in the form of annual rebates, either ($1000, $3000, or $5000 per year for 20 years) were offered to residents. The public needs to be convinced before compensation is considered, that the repository will possess minimal risks to themselves as well as to future generations, and that the site currently targeted is suitable. One way to do this is through adoption of mitigation and control procedures such as strict federal standards and local control over the operation of the repository. The federal government should also consider returning to the fair procedure for selection between candidate sites specified in the initial Nuclear Waste Policy Act of 1982.     

Fraud and abuse: the payer's perspective

As the health care sector consumes an ever-increasing portion of our nation's gross national product (GNP)), forecast to represent 15 percent of the GNP by the year 2000, increasingly intensive efforts are being used to control the growth rate of these costs. Medicare fraud alone is estimated to represent $2 billion yearly. Abusive billing of private health insurers represents a far larger amount. This article discusses the concept of fraudulent and abusive physician billing practices.     

AN ANALYSIS OF PORTFOLIO REVISION STRATEGIES UTILIZING VARIABLE REVISION INTERVALS*

This paper investigates portfolio revision with an emphasis on the decision of when to revise. A statistical technique based on the sequential analysis of the time series of portfolio return relatives determines when revision is to occur. The technique detects changes in the time series which are an indication that the underlying generating process of the time series has changed and that the portfolio should be, if necessary, revised. Thus, the length of the revision interval is variable and a function of the data. The statistical technique is utilized in conjunction with three portfolio revision strategies. These three revision strategies are compared to a buy and hold policy over three nonoverlapping, 12-year investment horizons. The basis of comparison is the net terminal values which include adjustments for transaction costs and taxes. The sensitivity of the statistical technique to its parameters is also analyzed.     

An Adaptive Regional Input-Output Model and its Application to the Assessment of the Economic Cost of Katrina

This article proposes a new modeling framework to investigate the consequences of natural disasters and the following reconstruction phase. Based on input-output tables, its originalities are (1) the taking into account of sector production capacities and of both forward and backward propagations within the economic system; and (2) the introduction of adaptive behaviors. The model is used to simulate the response of the economy of Louisiana to the landfall of Katrina. The model is found consistent with available data, and provides two important insights. First, economic processes exacerbate direct losses, and total costs are estimated at $149 billion, for direct losses equal to $107 billion. When exploring the impacts of other possible disasters, it is found that total losses due to a disaster affecting Louisiana increase nonlinearly with respect to direct losses when the latter exceed $50 billion. When direct losses exceed $200 billion, for instance, total losses are twice as large as direct losses. For risk management, therefore, direct losses are insufficient measures of disaster consequences. Second, positive and negative backward propagation mechanisms are essential for the assessment of disaster consequences, and the taking into account of production capacities is necessary to avoid overestimating the positive effects of reconstruction. A systematic sensitivity analysis shows that, among all parameters, the overproduction capacity in the construction sector and the adaptation characteristic time are the most important.     

Public Opposition to a Proposed Nuclear Waste Repository in Canada: An Investigation of Cultural and Economic Effects

Residents of four northern communities were surveyed about Atomic Energy of Canada Limited's proposal to site an underground repository for high-level nuclear waste somewhere in the Canadian Shield. Opposition to the repository was relatively strong in all communities, but was strongest among aboriginal respondents. Path analysis revealed that trust in nuclear regulators, faith in science and technology, and anticipated net costs were important mediators of this effect. Aboriginals were less trusting, exhibited less faith in science and technology, and perceived the costs associated with the repository to be higher than their nonaboriginal counterparts. No support was found for the hypothesis that, after controlling for aboriginal status, financially insecure individuals would display greater support for the nuclear waste repository than financially secure individuals. Policy implications for balancing perceived risks and siting needs are discussed.     

A Bayesian Benefit-Risk Model Applied to the South Florida Building Code

A Bayesian compound Poisson benefit-risk model is described in this paper, and used to evaluate recent revisions to the South Florida Building Code (SFBC). The model accounts for natural variability in hurricane frequency and severity, and uncertainty in the effectiveness of the revised code. Ranges of residential growth rate, code effectiveness, construction cost increase, and planning period length are assumed, to show the ranges of cost-to-performance ratio within which the code will make sense economically. The expected cost of residential hurricane damage over 50 years for ten South Florida counties assuming continuation of previous building practices was $93 billion, equivalent to the residential damage of 5.2 Andrews. Assuming a reduction in the growth of damageable housing in South Florida from 5.5% to 2% as a result of code revision, estimated damages under the new code were $45 billion. At a per-house construction cost increase of 5%, the probability of at least recovering the estimated $40 billion cost of the specified wind-resistant construction was estimated to be 47%. Expected return on investment was estimated at $7 billion over 50 years. The expected return lies between a $44 billion loss and a $47 billion gain, when growth in damageable housing is allowed to range from 1% to 4% and construction cost increases are assumed to lie between 3% and 8%. Actual monetary return for a 5% cost increase and 2% growth in damageable housing ranges from a $20 billion loss to a $100 billion gain with 95% probability, as a result of weather variability alone. Results support SFBC revisions on solely economic grounds, a conclusion strengthened considerably in light of potentially avoided deaths and hurricane traumas. The model represents one approach to evaluating economic aspects of the sustainability of new technological measures on the basis of available information.     

Reinhardt on reform. Interview by Donna Vavala

Almost since the federal government took its giant step into health care delivery and financing in 1965 with Medicare and Medicaid, the emphasis in Washington has been on reducing the costs of health care. Almost all federal health law subsequent to those two programs has been aimed at cost control, even when the titles of the bills promised a more noble purpose. The most notable exception is the law establishing end-stage renal disease coverage, but it has become a prime exacerbator of rising costs. Not even the designers of the federal programs envisioned how quickly health care costs would rise and how substantial the increases would be. The federal tab in 1993 was $280.6 billion. In 1960, it was $3 billion and in 1970 it was $17.8 billion. And overall health care costs have followed a similar curve, growing from 5.3 percent of the U.S. GDP in 1960 and 7.4 percent in 1970 to 13.8 percent in 1993. The end is not in sight. Economists are predicting growth to 18 percent of GDP by the next century. Uwe E. Reinhardt, PhD, James Madison Professor of Political Economics in the Woodrow Wilson School at Princeton University, does not believe that the "bite" will become that large, but he does expect increases to continue into the near future. In the interview recorded in this article, Professor Reinhardt assesses both the current and his predicted financial scenario for the health care field.     

Reassessing the human health benefits from cleaner air

Recent proposals to further reduce permitted levels of air pollution emissions are supported by high projected values of resulting public health benefits. For example, the Environmental Protection Agency recently estimated that the 1990 Clean Air Act Amendment (CAAA) will produce human health benefits in 2020, from reduced mortality rates, valued at nearly $2 trillion per year, compared to compliance costs of $65 billion ($0.065 trillion). However, while compliance costs can be measured, health benefits are unproved: they depend on a series of uncertain assumptions. Among these are that additional life expectancy gained by a beneficiary (with median age of about 80 years) should be valued at about $80,000 per month; that there is a 100% probability that a positive, linear, no-threshold, causal relation exists between PM(2.5) concentration and mortality risk; and that progress in medicine and disease prevention will not greatly diminish this relationship. We present an alternative uncertainty analysis that assigns a positive probability of error to each assumption. This discrete uncertainty analysis suggests (with probability >90% under plausible alternative assumptions) that the costs of CAAA exceed its benefits. Thus, instead of suggesting to policymakers that CAAA benefits are almost certainly far larger than its costs, we believe that accuracy requires acknowledging that the costs purchase a relatively uncertain, possibly much smaller, benefit. The difference between these contrasting conclusions is driven by different approaches to uncertainty analysis, that is, excluding or including discrete uncertainties about the main assumptions required for nonzero health benefits to exist at all.     

Using Integrated Geospatial Mapping and Conceptual Site Models to Guide Risk-Based Environmental Clean-Up Decisions

Government and private sector organizations are increasingly turning to the use of maps and other visual models to provide a depiction of environmental hazards and the potential risks they represent to humans and ecosystems. Frequently, the graphic presentation is tailored to address a specific contaminant, its location and possible exposure pathways, and potential receptors. Its format is usually driven by the data available, choice of graphics technology, and the audience being served. A format that is effective for displaying one contaminant at one scale at one site, however, may be ineffective in accurately portraying the circumstances surrounding a different contaminant at the same site, or the same contaminant at a different site, because of limitations in available data or the graphics technology being used. This is the daunting challenge facing the U.S. Department of Energy (DOE), which is responsible for the nation's legacy wastes from nuclear weapons research, testing, and production at over 100 sites in the United States. In this article, we discuss the development and use of integrated geospatial mapping and conceptual site models to identify hazards and evaluate alternative long-term environmental clean-up strategies at DOE sites located across the United States. While the DOE probably has the greatest need for such information, the Department of Defense and other public and private responsible parties for many large and controversial National Priority List or Superfund sites would benefit from a similar approach.     

The Cost of Compensating Asbestos Victims Under the Occupational Disease Compensation Act of 1983

The potentially huge financial liability due to asbestos product suits and the resulting filings for reorganization in bankruptcy by Manville, UNR Industries, Inc., and Amatex, has become a major public policy concern. In response to the problem several bills have been introduced in the Congress to provide compensation for asbestos (and other occupational disease) victims. This paper estimates the cost of compensating asbestos victims under the provisions of the "Occupational Disease Compensation Act of 1983," introduced by Congressman George Miller. Utilizing fatality projections from studies by Enterline, Selikoff, and Walker, and assumptions regarding likely claims filing and success rates, duration and degree of disability, and medical expenses, first year costs for this legislation are estimated to range from a low of $131 million to a high of $ billion. Present value cost estimates at a 2% real discount rate range from $3 billion to $56 billion. The paper also estimates the impact of possible modifications to the compensation provisions of the legislation. Reducing medical payments by the amount received from medicare would lower costs by 3-4%. Providing survivors with a 3-year lump sum benefit rather than a 5-year lump sum payment would save 20-25% as would offsetting the 5-year lump sum by expected social security old age and disability benefits. Combining all of these changes would reduce costs by almost 50%.     

Total Economic Consequences of an Influenza Outbreak in the United States

Pandemic influenza represents a serious threat not only to the population of the United States, but also to its economy. In this study, we analyze the total economic consequences of potential influenza outbreaks in the United States for four cases based on the distinctions between disease severity and the presence/absence of vaccinations. The analysis is based on data and parameters on influenza obtained from the Centers for Disease Control and the general literature. A state‐of‐the‐art economic impact modeling approach, computable general equilibrium, is applied to analyze a wide range of potential impacts stemming from the outbreaks. This study examines the economic impacts from changes in medical expenditures and workforce participation, and also takes into consideration different types of avoidance behavior and resilience actions not previously fully studied. Our results indicate that, in the absence of avoidance and resilience effects, a pandemic influenza outbreak could result in a loss in U.S. GDP of $25.4 billion, but that vaccination could reduce the losses to $19.9 billion. When behavioral and resilience factors are taken into account, a pandemic influenza outbreak could result in GDP losses of $45.3 billion without vaccination and $34.4 billion with vaccination. These results indicate the importance of including a broader set of causal factors to achieve more accurate estimates of the total economic impacts of not just pandemic influenza but biothreats in general. The results also highlight a number of actionable items that government policymakers and public health officials can use to help reduce potential economic losses from the outbreaks.     

The Vulnerability of the Nevada Visitor Economy to a Repository at Yucca Mountain

This article reviews the studies commissioned by the Nevada Nuclear Waste Project Office to estimate the economic impact of a high-level nuclear waste repository at Yucca Mountain. Case studies found that visitor impacts occur for some analogous facilities, but not for others. Assessments of behavioral intent indicate that at least some economic agents would avoid visiting Nevada under repository scenarios. A third set of studies tested the risk-aversion and negative-imagery models of visitor decision making; people avoid visiting places associated with either a significant health risk or negative imagery, but it has yet to be shown that a repository would induce these perceptions in nearby places. In sum, the NWPO-sponsored studies suggest the potential for visitor impacts, but do confirm that these effects will occur.     

Corporate compliance programs: risk management for the future

The Department of Justice has estimated that the government loses $100 billion annually in health care fraud. Consequently, the government's health care fraud enforcement activities with respect to all health care providers and suppliers continue to grow. Last year alone, the government collected more than $8 billion in settlements, fines, and penalties involving health care fraud. Recent settlements with the government have begun to include corporate compliance programs that require continued government oversight of the health care organization as an essential part of the settlement. The first section of this article describes the legal significance of health care companies' having corporate compliance programs. The second section provides a sample list of topics that should be included in any corporate compliance program. Finally, we describe various issues related to the creation and implementation of corporate compliance programs.     

Inventory cost saving benefits from the standardization of computer modular instruments

This article investigates the savings in inventory costs from the standardization of two computer modular instrument interface standards: NIM, an analog standard and CAMAC, a digital standard, at US nuclear laboratory installations. The major benefit from the standardization effort springs from the fact that the modular instruments are interchangeable, providing opportunities for reducing inventory costs. To that effect, the safety stock levels of instrument modules required for computer system configurations were estimated by an iterative procedure derived from a continuous Markov chain process with a one-to-one replacement policy. Since on the average, there are only two instruments of the same type per CAMAC or NIM crate, the opportunities for reducing inventory costs are a function of the number of crates and thus appear present only in medium and large systems. Large amounts of benefits of $206m (in 1981 dollars) were estimated from this successful standardization effort.     

Health care costs tied to many issues

Although, in 1990, the United States spent about $750 billion (12.2 percent of the Gross National Product) on health care, 31-37 million people in this country are uninsured. Another 4 million people are thought to be underinsured. We have one of the highest infant mortality rates among developed industrialized nations and rank 19th in health care and well-being among those nations. Our life expectancy is lower than those of some third-world countries. The United States and South Africa are the only two industrialized nations without a national health care policy. In spite of these statistics, U.S. health care costs continue to rise and, by the year 2000, are expected to reach $1.5 trillion (15 to 17.5 percent of the GNP. Per capita spending on health care will reach $5,515 by the year 2000, compared with $2,425 in 1990 and $1,016 in 1980.     

Risks of Hazardous Waste Sites versus Asteroid and Comet Impacts: Accounting for the Discrepancies in U.S. Resource Allocation

Approximately $6 billion is spent annually in the United States on the cleanup of sites regulated under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA, or Superfund). The current health risks posed by such sites are thought to be quite small; the expenditures are justified primarily as protecting hypothetical future residents of these sites. Approximately 0.05% of this amount, or $3 million, is spent annually by the U.S. government on the detection of asteroids or comets that could strike the earth. Such damaging impacts do occur from time to time--most recently in 1908 in an unpopulated region of Siberia--but no person is confirmed ever to have died as a result. Anticipated impacts over the course of 1 million years would yield deaths that, when annualized, total approximately 4,000 per year. The risk reduction goal for CERCLA is 15 orders of magnitude greater than that for asteroid/comet detection. A modest increase in resources devoted to asteroid detection would greatly increase the chances of early detection of a threatening object, allowing an effective defense to be attempted. This article argues that the much lower risk-to-resources ratio for CERCLA cleanups than for asteroid and comet detection can be explained by four primary factors: (1) the regard for future generations, since CERCLA benefits mainly the unborn; (2) concrete fears, since toxics are much more feared than asteroids or comets; (3) the source of the threat, since toxic contamination is caused by human beings, unlike impacts from space objects; and (4) the greater political constituencies for hazardous waste cleanup than for space object detection.     

A Review of the High-Level Nuclear Waste Repository Siting Analysis

We critique two 1986 Department of Energy reports concerning the selection of sites for characterization as the nation's first high-level nuclear waste repository. We find that the multiattribute utility analysis of the five nominated sites was well done, although we express concern about the assessed probabilities, question the construction of two important attribute scales, and disagree with some of the value tradeoffs that were used. In contrast, we find the logic of the recommendations report to be weak and unconvincing.