changes…). Second, studies also differ in their assessment strategies. Physical
consequences can be modelled by dedicated programs (MACCS, COSYMA…
[35]) that rely on level-three probabilistic safety assessments; or assessed by
adapting the figures derived from past catastrophes. Most studies performed in the
early nineties were based on Chernobyl’s figures, and find particularly high values
for the total cost of the accident [19–21]. More recently, another very high cost was
assessed by the German Renewable Energy Foundation which happens to be also
based on Chernobyl’s figures. This observation raises an important question. Can
we assess future accidents solely by using the consequences of past catastrophes? A
preliminary answer is that we cannot. Relying on past figures fails to account for the
learning from past consequences, the enhancement of safety standards, and the
progress in available mitigation technologies.
4.3 Converting Consequences into Costs Requires Various
Hypotheses and Assessment Methodologies
Once the consequences of a nuclear accident have been assessed, they have to be
given a monetary value. Indeed, a cost is the monetary valuation of foregone
welfare. Among the consequences discussed previously, some welfare losses are
easily derived (cost of material losses). For other physical consequences, various
hypotheses are required to bridge the gaps in our limited knowledge. Regarding
health issues, we do not know precisely the effect of exposure to low doses on
cancer or hereditary diseases probabilities. Regarding the environmental impact of
an accident, the size of lost lands depends on the geographical spread of the
radioactive materials and on the acceptable radioactivity threshold that a population
can bear. The consequences on food are also uncertain since the population can
react to food-bans by boycotting healthy products. The harm caused by nuclear
countermeasures, such as psychological distress due to relocations, is also hard to
assess. Some hypotheses substantially differ from one study to another. As an
example, the excess rate of radio-induced cancer varies from 5 to 10% in the
assessments presented in Table 1.
Some of these welfare losses such as reduced tourism, strengthened safety standards for nuclear plants, or higher energy prices, can easily be given a monetary value.
They are assessed through macroeconomic methods such as the IO-table method. Yet,
all welfare losses caused by nuclear accidents are not necessarily monetary.
Therefore, some methodologies have been developed in health and environmental
economics in order to give monetary values to non-monetary losses. Environmental
losses can be assessed by the evaluation of individuals’ willingness to pay (WTP) to
avoid these losses. Two families of methods allow the assessment of this WTP: the
revealed-preference methods and the stated-preference methods. Revealed-preference methods such as the travel cost method or the hedonic pricing method, use past
individual behaviors to infer the value of environmental losses. These are hard to
The Economic Assessment of the Cost of Nuclear Accidents
91
consequences can be modelled by dedicated programs (MACCS, COSYMA…
[35]) that rely on level-three probabilistic safety assessments; or assessed by
adapting the figures derived from past catastrophes. Most studies performed in the
early nineties were based on Chernobyl’s figures, and find particularly high values
for the total cost of the accident [19–21]. More recently, another very high cost was
assessed by the German Renewable Energy Foundation which happens to be also
based on Chernobyl’s figures. This observation raises an important question. Can
we assess future accidents solely by using the consequences of past catastrophes? A
preliminary answer is that we cannot. Relying on past figures fails to account for the
learning from past consequences, the enhancement of safety standards, and the
progress in available mitigation technologies.
4.3 Converting Consequences into Costs Requires Various
Hypotheses and Assessment Methodologies
Once the consequences of a nuclear accident have been assessed, they have to be
given a monetary value. Indeed, a cost is the monetary valuation of foregone
welfare. Among the consequences discussed previously, some welfare losses are
easily derived (cost of material losses). For other physical consequences, various
hypotheses are required to bridge the gaps in our limited knowledge. Regarding
health issues, we do not know precisely the effect of exposure to low doses on
cancer or hereditary diseases probabilities. Regarding the environmental impact of
an accident, the size of lost lands depends on the geographical spread of the
radioactive materials and on the acceptable radioactivity threshold that a population
can bear. The consequences on food are also uncertain since the population can
react to food-bans by boycotting healthy products. The harm caused by nuclear
countermeasures, such as psychological distress due to relocations, is also hard to
assess. Some hypotheses substantially differ from one study to another. As an
example, the excess rate of radio-induced cancer varies from 5 to 10% in the
assessments presented in Table 1.
Some of these welfare losses such as reduced tourism, strengthened safety standards for nuclear plants, or higher energy prices, can easily be given a monetary value.
They are assessed through macroeconomic methods such as the IO-table method. Yet,
all welfare losses caused by nuclear accidents are not necessarily monetary.
Therefore, some methodologies have been developed in health and environmental
economics in order to give monetary values to non-monetary losses. Environmental
losses can be assessed by the evaluation of individuals’ willingness to pay (WTP) to
avoid these losses. Two families of methods allow the assessment of this WTP: the
revealed-preference methods and the stated-preference methods. Revealed-preference methods such as the travel cost method or the hedonic pricing method, use past
individual behaviors to infer the value of environmental losses. These are hard to
The Economic Assessment of the Cost of Nuclear Accidents
91