Too Cheap to Meter?

Updated February 20, 2009
"Our children will enjoy in their homes electrical energy too cheap to meter," he declared.   ...    "It is not too much to expect that our children will know of great periodic regional famines in the world only as matters of history, will travel effortlessly over the seas and under them and through the air with a minimum of danger and at great speeds, and will experience a lifespan far longer than ours, as disease yields and man comes to understand what causes him to age."

  Lewis L. Strauss
  Speech to the National Association of Science Writers, New York City, September 16th, 1954
  [New York Times, September 17, 1954]

Lewis L. Strauss, chairman of the Atomic Energy Commission, recently said:

"It is not too much to expect that our children will enjoy in their homes electrical energy too cheap to meter; will know of great periodic regional famines in the world only as matters of history; will travel effortlessly over the seas and under them and through the air with a minimum of danger and at great speeds, and will experience a lifespan far longer than ours, as disease yields and man comes to understand what causes him to age. This is the forecast of an age of peace.

  [New York Times, August 7, 1955]

Amazingly, over fifty years later one still hears the phrase "too cheap to meter" repeated by the media and the antinuclear movement, construed as a proof that nuclear science and technology promised some Utopian future but never delivered.   But did the nuclear industry really expect to generate electricity "too cheap to meter"?   Or is it just an easy, catchy and tired phrase taken out of context?

Lewis Lichtenstein Strauss was the chairman of the US Atomic Energy Commission (forerunner of the US Nuclear Regulatory Commission and the US Department of Energy nuclear program) from 1953 to 1958.    The New York Times reported, on September 17, 1954, that Strauss "predicted ... that industry would have electrical power from atomic furnaces in five to fifteen years."   Strauss was right - this came true in 1957, with the start-up of America's first civilian power reactor at Shippingport, Pennsylvania.

In his speech to the science writers, Strauss waxed eloquent about the great future of science and technology generally, not just the fledgling nuclear power industry.   And well he might - the post-war era heralded great advances in all manner of scientific and technical endeavour: medicine, aviation, physics, agriculture, electronics, mechanization, biology, geology, rocketry, etc.   There seemed to be no bounds to human ingenuity, despite the development of weapons of mass destruction.   So it was no wonder that, talking to an assembly of science writers caught up in an increasingly technical world, Lewis dreamed of a Utopia courtesy of American science and industry.

Some have suggested Strauss was talking of fusion energy rather than fission.   Others said that Strauss meant that electricity would one day be so inexpensive that it would be billed at a fixed rate regardless of consumption, because reading meters would be uneconomical.   Decades earlier, Charles Proteus Steinmetz (1865 - 1923), the great American electrical engineer, said electricity would become "so cheap that it is not going to pay to meter it" [Spencer R. Weart, "Nuclear Fear: A History of Images", Harvard University Press, 1988].   Still others have noted that Lewis did not even state a connection between nuclear energy and "electrical energy too cheap to meter" in his speech.   Even the New York Times managed to write two somewhat different quotes attributed to Strauss, which invites the question "What exactly did Strauss say"?

Regardless of his exact meaning, Strauss was but one voice, a voice removed from the laboratories and development workshops.   There were many contrary opinions.   As C. G. Suits, Director of Research at General Electric, said in 1951:
    "It is safe to say ... that atomic power is not the means by which man will for the first time emancipate himself economically, whatever that may mean; or forever throw off his mantle of toil, whatever that may mean.   Loud guffaws could be heard from some of the laboratories working on this problem if anyone should in an unfortunate moment refer to the atom as the means of throwing off man's mantle of toil.   It certainly is not that!"

Strauss' predecessor Gordon Dean, Chairman of the US Atomic Energy Commission from 1950 - 1953, wrote an introductory book "Report on the Atom: What You Should Know About Atomic Energy" (Eyre & Spottiswoode, London, 1954).   Dean wrote two chapters on "Power: the peaceful goal", in which he described the present (1953) progress towards power-producing reactors, and the factors influencing their design, including economics:
    "What, then, is really meant by the phrase 'economically feasible power'?   If we were to take the Arctic as an example, it might mean something that was terribly expensive by New York or Pittsburgh standards, and yet, for the Arctic, much cheaper than the cost of hauling in heavy shipments of coal or oil to fuel an orthodox power plant.   In short, therefore, when we speak of economic feasibility, we are speaking of relative, and not absolute, costs."
(pp. 145-146)

    "Among all the questions hanging over the future of atomic power, perhaps the most fundamental is this: 'Is it all really worth the effort?'   I have heard many people express shock and surprise when they learned that about all they can expect from atomic power, at least at first, is a new source of electricity that will only take a few pennies a month, if that, off their monthly light bill.
    This is, however, the case, and here is why: to produce electricity an atomic power plant needs all of the electrical generating and distribution equipment that a coal-burning plant needs.    The only difference is that in the atomic plant the coal hopper and steam boiler would be replaced by a nuclear reactor and a different kind of steam boiler.   There is no chance, therefore, of reducing the cost of the plant by going to the atom for fuel.   As a matter of fact, it seems quite possible that atomic power plants will always cost more to build than coal plants - they certainly do now - because a nuclear reactor is, by its very nature, vastly more expensive than a coal furnace.
    The place, then, where you can save money by going over to atomic power is in the cost of the fuel.   And here you do save money, because the atom packs so much energy into such a small space.   This means that your fuel, per unit of heat, not only comes more cheaply in the first place; it also means that you save money all along the line on transportation, handling, and storage charges.   So great is this saving that some economists, when calculating the cost of atomic power, put the cost of the nuclear fuel down as virtually zero.   But it is important to remember that, even if coal were mined and distributed free to electric generating plants today, the reduction in your monthly electricity bill would amount to but twenty per cent, so great is the cost of the plant itself and the distribution system.
    To express it in the simplest terms: you can save a lot of money on fuel if you have an atomic power plant, but it will cost a great deal more to build than a coal-burning plant."


The January 1954 National Geographic magazine reiterated Dean's comments in an article by Assistant Editor F. Barrows Colton, entitled "Man's New Servant, the Friendly Atom":
    "Today's big question about peacetime atomic energy is when it will be used for producing industrial power.   One authority has predicted economical atomic power 'in a very few years, certainly less than ten.'   Other estimates run up to 30 years.   . . .   Electric power produced by atomic energy cannot be much cheaper than present-day power, however.   Fuel represents only about 20 percent of the cost of electric power to the consumer today.   Even if atomic energy eventually proves cheaper than coal, the remainder of the process of making electricity will be the same as now, so that the other 80 percent of the cost will not be reduced." [pp 86 - 87]

Even earlier, the November 1948 National Geographic stated this same point in "The Fire of Heaven; Electricity Revolutionizes the Modern World" by Albert W. Atwood:
    "But atomic power waits upon the solution of many scientific and engineering problems.   Even then, so far as we know, we would have only a substitute fuel to be used in generating electricity; the far more costly business of getting the current to consumers would remain as now." [pp 655-656]

In 1955, the year of Strauss' speech, Babcock and Wilcox released the 37th edition of Steam: Its Generation and Use, an encyclopedia of steam generation history, application and equipment.   B&W is still a major supplier of steam generation equipment, for fossil and nuclear generation, and B&W Canada is world-renowned for its steam generators for nuclear plants.   In 1955, however, nuclear generation was still in its infancy; in Chapter 27 "Nuclear Power", the section on "Economics of Nuclear Power" states:
    "The dominant factor in the development of nuclear power is its cost.   Studies by the AEC and its associated groups have indicated that the cost of power from the first few nuclear plants will be fairly high - several mills above the cost of conventional plants of the same size.   With improvements in design, fabrication methods and operating procedures, however, the cost of power from succeeding plants will be reduced considerably.   Many experts predict that the reduction will be sufficient to make nuclear power competitive with conventional power throughout most of the United States within the next 10 years.   In any event, it is worth while to exploit immediately the use of nuclear power in the high-power-cost areas of the world.   In some of these areas, nuclear power is undoubtedly already competitive.
    The chief reason for the prevailing optimism concerning the ultimate cost of nuclear power is that the cost of the nuclear fuel consumed to create a given amount of heat is much smaller than the cost of equivalent gas, oil or coal fuels.   Other nuclear plant costs, particularly equipment fabrication and fuel investment, may be higher than for conventional plants.   Since coal and oil costs are rising due to the utilization of poorer and poorer sources, it is apparent that the relative cost of nuclear fuel will be still less as time goes on.   This saving should compensate for the higher plant costs.   Another factor which must be considered is that development of nuclear power will help to conserve the world's hydrocarbon resources for manufacture into propulsion fuels and for use in the synthetic chemical industry.
[pp 27-7 to 27-8]

Less than four years after Strauss' speech, the United States Atomic Energy Commission produced a large-format pictorial survey of the nuclear industry, entitled "Atoms for Peace: U.S.A. 1958".   Strauss was still chairman of the USAEC, and wrote the preface.   The section "U.S. Power Economics" reads:
    "It is a hard economic fact that before nuclear power can begin to be commercially competitive in the United States, its cost must be brought down to levels well below those acceptable in Western Europe and other areas where conventional fuels are in short supply.
    Depending on location, it costs from $100 to $200 per kilowatt of installed capacity to build a conventional power generating station in the United States.   If the fixed charges on this investment are reckoned at 14.5% per annum, which is representative of accounting practice in the U. S. utilities industry, and if the plant runs at an average of 80% of rated capacity, which is typical of base-load operation, the fixed cost of power generation then comes to two to four mills per kilowatt hour.   To this must be added the cost of running the plant, which amounts to about one mill per kilowatt hour, and the cost of fuel, which might be as low as one mill or as high as four mills per kilowatt hour, depending, again, upon location.   The total cost thus ranges from four to nine mills per kilowatt hour.   The national average is seven, while that for Western Europe, if computed on the same basis, is about ten to twelve.
    At present it costs $300 to $400 per kilowatt of installed capacity to build a commercial-scale nuclear power plant in the United States.   It is considered unlikely that this cost can be brought down much below $200 to $250 in the foreseeable future.   At the lower figure, the fixed cost of nuclear power generation will be between four and five mills per kilowatt hour.   The cost of running nuclear power plants is not known with any degree of reliability at the present time but can be expected to be in the range of one to two mills per kilowatt hour, allowing for greater maintenance expense than is encountered in conventional power plant practice.   On this basis, if nine-mill nuclear power is to be achieved in the United States, it will be necessary to hold fuel costs within the range of two to four mills per kilowatt hour; and for costs that would be more generally competitive, one must think in terms of minimal fixed and operating costs in combination with fuel costs in the neighborhood of only one mill per kilowatt hour.
    There is confidence that these targets can be reached, but it is clear that a highly developed technology will be required.   That, of course, is the reason for the massive development effort outlined above.   It is also the reason for the U. S. emphasis on building up industrial strength in this field.

In the UK, Sir John Cockcroft said of UK reactor development: "we do not expect to produce a cheaper source of power than that derived from coal - it is likely, in fact, to be somewhat more expensive. What we are aiming at is to increase the total power available" [Joule Memorial Lecture, 1951].   He concluded by saying: "The essential thing is now to get on and build some power reactors".   Cockroft was the director of the UK nuclear research program, and had been the first director of Canada's Chalk River nuclear laboratories, from 1944 - 1946.

Thinking of Canada, opinions expressed here were also more pragmatic:

In conclusion, the nuclear industry in many countries foresaw a promising future in the 1950s, along with many other scientific and technical fields.   But the industry, confronted with the practicalities of converting fission heat into useable electricity, did not expect a Utopian world with energy "too cheap to meter".   That was simply one phrase in one man's litany of futuristic visions.