Economic and Social Research Institute tots up the cost of a nuclear disaster in Europe – €160bn

European nuclear disaster would cost €160bn, Peter O’Dwyer November 22 2016, http://www.thetimes.co.uk/edition/ireland/european-nuclear-disaster-would-cost-160bn-trb3bcrp9

A nuclear disaster in northwest Europe could cost Ireland as much as €161 billion.  A report compiled by the Economic and Social Research Institute found that agricultural production would grind to a halt, with the tourism industry and exports also incurring substantial damage.

The estimated cost of a disaster like that in Chernobyl in 1986 or Fukushima in Japan five years ago could be almost twice the €85 billion bailout Ireland received in 2010.

The UK has 15 active reactors and there are a further 58 in France and eight in Germany, according to the World Nuclear Association. EDF, the French nuclear company, is building an £18 billion (€21.2 billion) plant at Hinkley Point in Somerset, about 150 miles from Rosslare, Co Wexford, on the east coast.

Even under the most benign scenario considered by the ESRI, where no contamination occurs, the total loss is estimated at €4 billion. By comparison, the total value of corporation tax collected in the first nine months of the year was €4.16 billion.

The report focused on the potential impact of a nuclear disaster on tourism, agriculture and food, including both the initial shock and the long-run reputational damage.

The report’s authors said that their analysis was likely to omit several additional losses and could underestimate the true extent of the potential cost to the Irish economy. Concerns over the health risks associated with high levels of contamination could, for example, put a significant strain on the health service.

The total cost of a low-level contamination scenario, which requires the imposition of food controls to reassure the public, and which would cause restrictions on food imports from Ireland, would be about €18 billion.

The third scenario considered would require food controls be put in place for months and steps taken to protect agricultural production. Irish exports would be severely impacted, as in the previous scenario, while Irish consumers would also shun Irish food produce in a further setback for the sector.

The impact on tourism would also be significant, with long-term reputational damage resulting in an economic cost of €80 billion.

The most severe economic shock would arise where the contamination warrants the imposition of food controls for years. Under this scenario, the impact could persist for 60 years, though the most substantial economic impacts would arise in the first 30 years.

It is assumed that Irish agricultural production would cease entirely for three years, costing about €5 billion, and that EU member states would begin importing Irish produce after this period. Trade with international partners would take another 12 years to restart.

Culling and disposing of contaminated livestock could cost more than €5 billion.

Not only would exports be decimated but the need to import much of the country’s food would lead to far higher domestic costs. There could also be significant emigration.

Under this worst-case scenario, the estimated economic loss was €161 billion.

A spokesman for the Department of Communications, Climate Action and Environment was not available for comment.

November 23, 2016 Posted by Christina Macpherson | business and costs, EUROPE | Leave a comment