Externalities and Internalisation of Radioactive Waste Producing Activities: The Analogy With Environmental Practices

All human activities generate negative externalities, in particular the use of radioactive material for electricity production and radioisotope applications. Both activities produce radioactive waste, which can, therefore, be considered as being specific externalities. The purpose of the paper is to investigate these externalities and to identify appropriate internalisation instruments. Analogue cases in environmental management are discussed. In general the nuclear externalities are not internalised in the management costs charged by Radioactive Waste agencies (RAWA). The paper explores the possibility of having an internalisation of all costs as requested by the strict application of the Polluter Pays Principle. In the case of electricity production a comparison is made between the externalities attributed to nuclear waste and those in relation with CO2-emissions from the combustion of fossil fuel. A brief overview is given on the evaluation approach in ExternE (“Externalities of Energy”). The evaluations are the basis for the design of a carbon tax applicable to fossil fuels for reducing CO2-emissions. A similar tax could be charged on radioactive waste management. Beyond the internalisation objective, the tax proceeds could finance the technological R&D for improving the conditions of storage and disposal, and provide compensations to local residents in the vicinity of nuclear waste management facilities. The management of spent radioisotope equipment in medicine, research, or industry is shown to have similar features to the management of packages, spent electrical appliances, and the disposal of batteries. In general the price of management of the spent material is not included in the purchase price. In case of spent radioisotope equipment, the externality mainly represents the risk of this material becoming a hazard for the public health. It is recommended to internalise the full costs of management to eliminate this risk. Moreover spent material should be registered and RAWA should maintain detailed inventories on their national territories. In order to induce the free return of spent material to the RAWA, deposit refund systems could be set in place as in the package or battery market. A surcharge is paid by purchase, which is refunded to the buyers when they return the product for recycling or proper disposal. The paper concludes by describing lessons and possible implications of the previously discussed environmental tax or surcharge systems on the way the Polluter-Pays Principle is applied in radioactive waste management.