There is a curious shift in the world. Everything old is new again… and everything new is aging badly.
Not too long ago, the USA was a center of growth and innovation in the world. Leaders in manufacturing, creation of new designs, research to find ever newer technologies to explore and exploit. Now not so much…
China and India were old. Stagnant. Or worse, having a ‘great leap backward’…
Europe was chock full of young folk ‘yearning to breath free’, rushing to America.
But now fortunes wheel has turned.
Demographics in Southern Europe
I’ve talked about demographics before. And about the “demographic bomb” of the baby boomers in the USA expecting to retire, but not enough workers to support them, pay their pensions, medical care, change the bed pans, etc. There’s a similar issue brewing in Europe. But this article has an interesting point of view on it all.
Who will pay the bonds?
While the USA debt maturity (so far) is not too bad, that is, it is fairly short average maturity, the different countries in Europe each have their own maturity profile. Many government bonds (from all countries) are in longer maturities. Such as 30 year bonds. (Some up to 50 or more in the past.) So who will pay a 30 year bond? Not the 70 year old of today. Most likely not even the 35 year old of today (as they will be retired in 30 years… at least, they expect to be if in Europe).
Southern Europe: Beyond a Demographic Point of No Return
July 7, 2011
The absence of the devaluation option within the Euro mechanism requires a great deal more theater on the part of feckless and incompetent politicians who made their careers by dispensing borrowed money to their voters.
That is true for the moment, when the elder dependent ratio for Southern Europe stands at around 25%. Between 2020 and 2045, however, the infertility of Southern Europe will catch up with it, and the elder dependent ratio will rise to over 60%–an impossible, unmanageable number.
2020 is not that far away. 7 years? From 25% elder dependents ramping up to 60%? 2045 is only 32 years away. So 30 year bonds issued now will be repaid by whom in 2043 ? Hmmmm? The 50% to 60% who are trying to support the other half of the population while trying to get on with their own lives too?
That puts a whole different “spin” on the problems with Spain and Greece right now. Greece can’t do enough “austerity” over the next decade or two to in any way ‘fix’ that as the demographics are a ‘done deal’. Their excess promises of ‘retirement’ can not be paid. So they are hoping to borrow the money. But for the next 30 years? Or more? And they to whom will the bill be handed?
I ought to get population profiles for each of the countries of Europe to see just what each one is staring at. I’m just too far behind to do that right now.
Normally these are presented as an ‘Age Pyramid’ with men on one side and women on the other. At a glance you can see where the population stands. You can instead pick them up at this link:
which will bring up Greece, but you can then choose other countries.
The graphs look like this:
A very fast growing country will have a fat bottom to the pyramid. Few old folks on top, lots of grandkids a the bottom. A “mature” country is supposed to become more strait sided. This one looks like a fat snake with a big rat in it. That’s not good. That “bolus” of 30 to 50 somethings is expecting to retire and be supported by that skinny stem of kids below them. They can’ support their present (narrowing) retired population as it is.
Note that they COULD have more children if they got busy Right Now as they still have a modest number of 20 somethings. But wait a few years and even they can only increase the burden of ‘carrying’ infants and too many retirees. They may be already past the functional “point of no return”. Those two small white squares are on the 20-24 age bracket and say they have 2.7% women in that group. Another 3.3% up to age 30. That’s 6% in the most likely child bearing years. Not a whole lot (and they likely already account for some of the existing children below them).
At that point the character of these countries will change radically; they will be overwhelmed with immigrants from North Africa as well as sub-Saharan Africa, who will not have the skills or the habits of civil society to maintain economic life. And their economies will slide into a degree of ruin comparable only to that of classical antiquity. Perhaps the Chinese will operate Greece as a theme park. Spain, which can draw on Latin American immigrants, is likely to be the least badly off.
So will Greece choose to just become a new district of Turkey? A suburb of Libya? Somehow I don’t think they want that. But will they have a choice? Ireland and Spain could have “back migration” from The New World, if it got bad enough. Perhaps even Italy (though with some language issues). But Greece is looking at either ceasing to exist as a dominant culture inside their own borders, or suffering a significant economic trauma that makes the present troubles look like nothing.
The United States is nearly ‘strait sided’ in comparison. The UK in between. Germany, to me, looks even worse off demographically. While Turkey is a regular (if a bit narrow) pyramid and Egypt a very wide bottomed pyramid. Iraq is “scary wide” at the bottom. The world has a major “Muslim Winter” coming in just a decade or two.
In short, Europe may not be able to choose who just walks in and takes over. Will ’60 somethings’ drive the tanks to stop them?
I suggest spending a while at that site looking at various countries. Some, like Rwanda, are scary wide bottomed. Others, like France, quite reasonable. They tell you who will be running things, who will be having ‘retirement riots’, and who will be desperate for food and education aid.
It looks to me very much like Greece is on their way to cultural extinction, one way or the other, and with Germany not far behind. (WHEN Greece defaults on those German bonds, who will then pay for the old Germans retirement funds?) Germany has a wide block of 30-50 year olds working hard now, making extra cash. But in 20 years, they are 50 to 70 and starting to cash in those bonds. Who will be paying those Greek bonds for those “70 something” German retired folks then? Frankly, both those countries make the USA “Demographic Bomb” look like a firecracker at most.
Europe is in trouble, and it will get worse.
“Demographics is Destiny.”
Why would anyone buy a 30-year bond from any of these countries? By 2041, there won’t be enough taxpayers left to pay the coupons. And that raises a related question: what is time horizon of an equity investment in those countries? Although Standard and Poor’s calculates the duration of equities at somewhere between 20 and 30 years, that is a somewhat dubious estimation of interest sensitivity, not a measure of the horizon of expectations. Markets are notoriously short-sighted. But at some point markets must recognize that companies that have a rapidly-shrinking pool of workers as well as customers are in no position to earn profits. The real demographic crunch will start to hit in the mid-2020s, and it is possible that markets will ignore the inevitable demographic doom until then.
There’s little reason to expect European contagion to blow up the financial system today. But there’s also no reason to invest in those countries, except on a very opportunistic basis.
I think that kind of sums it all up.
But the interesting bit comes out of India and China. China does not show up as nearly as ‘skewed’ as I’d expected, and India is growing nicely, but not too much, in population. Still, China has a ‘narrower stem’. Over time, India will displace China as the large cheap labor market and both China and Russia will start shrinking with more retired than working. (Though for Russia it is only short of ages below about 15, so might still have a resurgence of kids.)
I think, though, that there is another more interesting marker of difference. Who is advancing new technologies, and in particular, new energy technologies, the fastest? Who is PLANNING for growth and making it happen?
So India, in particular, has a growing population (but not as crazy as Iraq where a click on 2065 on the population size graph to the right says it breaks 100 Million then… Not going to happen, you say? That’s just a bit over 50 years away. Many are already born and they expect to have a regular life too. Including families. So “something has got to give”… And their oil will be getting low by then.) But back at India. Are they doing interesting things to prepare?
Well, yes. They are building roads and infrastructure like crazy. (Almost as fast as the Chinese…)
All that takes energy to drive it. China is buying all the coal in can find. But India doesn’t have a lot of resources developed internally. It does have a big pile of Thorium, though. (As does China). Thorium can be used in many kinds of nuclear reactors.
This link has a wealth of interesting information:
India’s plans for thorium cycle
With huge resources of easily-accessible thorium and relatively little uranium, India has made utilization of thorium for large-scale energy production a major goal in its nuclear power programme, utilising a three-stage concept:
Pressurised heavy water reactors (PHWRs) fuelled by natural uranium, plus light water reactors, producing plutonium.
Fast breeder reactors (FBRs) using plutonium-based fuel to breed U-233 from thorium. The blanket around the core will have uranium as well as thorium, so that further plutonium (particularly Pu-239) is produced as well as the U-233.
Advanced heavy water reactors (AHWRs) burn the U-233 and this plutonium with thorium, getting about 75% of their power from the thorium. The used fuel will then be reprocessed to recover fissile materials for recycling.
This Indian programme has moved from aiming to be sustained simply with thorium to one ‘driven’ with the addition of further fissile plutonium from the FBR fleet, to give greater efficiency. In 2009, despite the relaxation of trade restrictions on uranium, India reaffirmed its intention to proceed with developing the thorium cycle.
A 500 MWe prototype FBR under construction in Kalpakkam is designed to produce plutonium to enable AHWRs to breed U-233 from thorium. India is focusing and prioritizing the construction and commissioning of its sodium-cooled fast reactor fleet in which it will breed the required plutonium. This will take another 15 – 20 years and so it will still be some time before India is using thorium energy to a significant extent.
A well thought out, very large, Thorium fuel cycle. It includes the use of breeders and well proven reactor designs. The PHWR is the CANDU design. Originally from Canada, the Indians made a ‘knock off’ when folks started trying to tell them what they could, and could not, do or have. So much for “embargo” as a preventative of nuclear expansion…
We also see here a couple of ‘clues’ about why the USA and EU didn’t want Thorium to be common during prior decades. It takes a ‘breeder blanket’ of some kind to make Th into U233 to keep the process running. Essentially, making a reprocessing / breeding cycle mandatory and having folks skilled at making and extracting Pu and U233, along with concentrating them. Everything needed to make bombs. Which India did.
(Even a U233 bomb. Folks try to make it sound like the stuff can’t be used, but it about the same as Pu in ‘boom ability’, just more ‘hot’ to work with it. The USA made such a bomb too, though with a more mixed core.)
A key finding from thorium fuel studies to date is that it is not economically viable to use low-enriched uranium (LEU – with a U-235 content of up to 20%) as a fissile driver with thorium fuels, unless the fuel burn-up can be taken to very high levels – well beyond those currently attainable in LWRs with zirconium cladding.
With regard to proliferation significance, thorium-based power reactor fuels would be very poor source for fissile material usable in the illicit manufacture of an explosive device. U-233 contained in spent thorium fuel contains U-232 which decays to produce very radioactive daughter nuclides and these create a strong gamma radiation field. This confers proliferation resistance by creating significant handling problems and by greatly boosting the detectability (traceability) and ability to safeguard this material.
Then after a whole lot of other stuff, down near the bottom:
Weapons and non-proliferation
The thorium fuel cycle is sometimes promoted as having excellent non-proliferation credentials. This is true, but some history and physics bears noting.
The USA produced about 2 tonnes of U-233 from thorium during the ‘Cold War’, at various levels of chemical and isotopic purity, in plutonium production reactors. It is possible to use U-233 in a nuclear weapon, and in 1955 the USA detonated a device with a plutonium-U-233 composite pit, in Operation Teapot. Yield was less than anticipated, at 22 kilotons. In 1998 India detonated a very small device based on U-233 called Shakti V. However, the production of U-233 inevitably also yields U-232 which is a strong gamma-emitter, as are some decay products, making the material extremely difficult to handle and also easy to detect.
So it’s very bad for making bombs and nobody would ever want to do that… except the USA with 1950s technology and the Indians just because they could… Th breeds to U233 that can be chemically separated, much easier than enriching… Notice we made it by the ton? About 19 lbs makes a dandy bomb…
OK, that aside.
What is china doing?
China Announces Thorium Energy Project
1 February, 2011
The Chinese Academy of Sciences announced that it will finance the development of a programme to develop a Thorium Fuelled Molten Salt Reactor (TFMSR). This is first of four “strategic leader in science and technology projects” that the Chinese Academy of Science will be supporting.
The Head of the Chinese TFMSR programme is Dr Jiang Mianheng, Graduate of Drexel University, with a PhD in electrical engineering. His father Jiang Zemin, was the former President of the People’s Republic of China from 1993 to 2003. This gives an indication of the importance the Chinese Leadership attach to the TFMSR programme.
Well, at least he’s a graduate of one of OUR schools. In a way, we can say the USA is still important to the future of nuclear power…
High level backing. New design. Strategic Leader.
I wonder if it is too late for me learn Chinese.
But at least we built one first!
Molten Salt Reactors: The Oak Ridge National Laboratory (USA) designed and built a thorium-based demonstration MSR using U-233 as the main fissile driver. The reactor ran over 1965-69 and operated at powers up to 7.4 MWt. The lithium-beryllium-thorium salt worked at 600-700oC and ambient pressure. The R&D program demonstrated the feasibility of this system and highlighted some unique corrosion and operational issues that need to be addressed if constructing a larger pilot MSR.
There is significant renewed interest in developing thorium-fuelled MSRs. Projects are (or have recently been) underway in China, Japan, Russia, France and the USA.
With 1960s technology…
Per Japan, we have the Fuji effort. But Japan is presently thinking about maybe not doing nukes so much, so that effort is looking for funding before it does any more.
The fuel self-sustaining small Molten-Salt Reactor (MSR): FUJI-series MSR concept evolved from the Molten-Salt Breeder Reactor (MSBR)X-1,-2 based on “single-fluid molten fluoride fuel”, which was developed in the Molten-Salt Reactor Program(MSRP), Oak Ridge National Laboratory (ORNL), USA among 1950-1976.
Note that it is a ‘concept’… But based on USA Tech! From the 1970s…
And those Russian and French plans?
A rational practical international developmental program has been proposed based on Japan-USA-Russian trilateral cooperation. During 1980s we had several cooperations with not only ORNL […]but also EdF […], Euratom […] Kurchatov Inst. […] etc.. The pilot-plant: miniFUJI X-11(about 7MWe) is suggested to be constructed at Russian Federal Institute of Technical Physics (ITP), Snezhinsk, Russia
So they’ve been talking around there “proposal> for a while and trying to find who can cough up some money.
But loads of tech info down in that rest of that paper.
What looks like a newer and neater bite at the apple here:
December 19, 2007
Fuji molten Salt Reactor
The Fuji Molten salt reactor is a japanese design that can run on thorium or a mix of thorium and Uranium or Plutonium. The project plan is to take 8 or 9 years to develop a miniFuji reactor and 12-15 years to develop a Fuji reactor. The R & D is mostly related to the details of the structural material and components.
Oddly, the page is festooned with ads to “Go Solar!”… It has other interesting reactors mentioned on the page to, so worth a look.
Several of the Fuji designs fit the IAEA definition of a small reactor that generates less than 300Mwe. There is interest in small reactors due partly to the high capital cost of large nuclear power reactors generating electricity via the steam cycle and partly to consideration of public perception, there is a move to develop smaller units. These may be built independently or as modules in a larger complex, with capacity added incrementally as required. Economies of scale are provided by the numbers produced. There are also moves to develop small units for remote sites.
The most prominent modular project is the South African-led consortium developing the Pebble Bed Modular Reactor (PBMR) of 170 MWe. In China, Chinergy is preparing to build a similar unit, the 195 MWe HTR-PM. A US-led group is developing another design with 285 MWe modules.
But at least the USA got third billing this time. Hey, we are “on the page!”… with “developing another design”… There follows a nice list of 11 folks / organizations with reactors “development claimed to be well advanced”. Has pictures and everything.
So overall, it looks like China is in the lead. From that earlier China story, what kind of timing?
The Academy stated that “The scientific goal is to develop a new generation of nuclear energy systems [and to achieve commercial] use [in] 20 years or so. We intend to complete the technological research needed for this system and to assert intellectual property rights to this technology”.
Whist the announcement refers to a 20 year programme, rapid progress can be expected in the next 5 years towards a demonstration plant.
This programme will place China at the forefront of development of truly competitive nuclear power suitable for large scale power production as well as supporting desalination, hydrogen production, and other high temperature chemical processing, due to the characteristics’ of TFMSR’s. The TFMSR programme will see China leading the world in the development and application of high temperature materials, and quite probably the use of the Brayton power generating cycle.
About 20 years. 2030+
About the time Greece is learning to speak Turkish and Italy is a Libyan colony. Got it.
Odds & Ends
Mulls the question over and links to:
Where we have the claim:
At anywhere from 10 to 300 megawatts, small modular reactors, like the Babcock & Wilcox design pictured above, are being touted by some as safer, cheaper and more scalable alternatives to large-scale nuclear power plants. And a whole litany of companies have unveiled designs and are lining up in the U.S. to apply for approval from the Nuclear Regulatory Commission. But that process could take a while. one company, NuScale Power, of Corvalis, Oregon, says in this energyNOW! segment, the earliest their reactor will be available is 2018.
Nuclear power from Oregon? Really? And in only 5 years. Now why do I think that is made from Unobtanium for Durability…
Been around since 2000… http://www.nuscalepower.com/an-About-Company-History.php
But their history page says they have NRC lined up to do an approval process and have designs and everything, including funding.
NuScale has completed four pre-application meetings with the NRC to familiarize staff with the features of a multi-module plant. It was determined that the plant falls within the existing regulatory framework for light water reactors.
Fluor Corporation commits to making an investment exceeding $30 million in NuScale Power LLC., enabling NuScale to move forward with the backing of a major player in the global nuclear energy industry.
So maybe we’ll do something after all. On that “silicon valley venture cap starup” kind of path we do. Throw away past designs, start over, do something different and Rad, and all. Maybe even with 1990s technology (as it looks similar in concept to the Toshiba design). Tall cylinder stuck in the ground.
I can’t help but project national character onto these efforts. The USA is doing lots of paperwork shuffles and maybe some kind of unexpected direction out of it.
We have “petition drives” http://thoriumpetition.com/
Thorium, converted into energy in a Liquid Fluoride Thorium Reactor (LFTR pronounced “Lifter”), has the potential to completely eliminate our dependence on fossil fuel based electricity generation… All the while releasing orders of magnitude less radioactive material into the atmosphere than coal and natural gas! No greenhouse gasses are emitted. And operating costs are projected to easily compete with coal.
Hey, easy peasy and done next week too! /sarc>;
If it’s trendy, launch a bunch of companies and look for funding. Like the one above, or this one (or a couple of others):
Kirk Sorensen believes firmly that safe nuclear power can contribute significantly to the world’s energy future – provided that reactors run on liquid thorium fuel rather than on solid uranium as they do today.
Showing the courage of his convictions, Sorensen has quietly launched his own thorium reactor company, called Flibe Energy, in Huntsville, Ala. He aims to have liquid thorium reactors operating within 5 to 8 years.
Sorensen says he wants to “redefine” nuclear, so that it deservedly takes on a clean and safe association, contrary to its long running negative place in popular opinion, as swaths of the public fear the hazards of nuclear waste and nuclear power accidents. The industry is fighting harder than ever to improve nuclear’s image after the meltdown earlier this year at Japan’s Fukushima Daiichi plant.
Yeah, man, and change the world… in less than 5 years. (Can the NRC even do paperwork review that fast?)
The Chinese are setting up a major plan, well staffed, a bit of over-complicated organizationally, but likely to work. A long time horizon, but well thought out and likely correct.
The Indians are being careful with their limited resources, taking a known-good path, and getting it done. Nothing too exotic, but improving where needed. (Though Pakistan has a demographic pyramid shaped like a ‘Hershey’s Kiss’, so likely to have some issues with the neighbor…)
Russians, French, EU, Japan all milling around looking for who has a money pot to dip into. Old people not wanting to risk much, but not wanting to be out of the game entirely.
But at least we know that in 15 or 20 years there will be a Chinese Thorium MSR running and that India will be set for electricity at low cost for the next 1000 years. Maybe they can even buy Greece and Italy. One each. Just supply enough young workers to pay into the retirement fund and we’ll put it on a “Reverse Mortgage” for you…