Risky Business: Generation of Nuclear Power & Off-shore Oil Risk Management Development

Hope Babcock, Professor of Law, Georgetown University Law Center

By Nicole Benincasa

Hope Babcock, Professor of Law spoke this afternoon on the generation of nuclear power and off-shore oil risk management development.

Ms. Babcock spoke about how two industries have responded to risky accidents that have occurred in the past several years: the 1979 Three Mile Island nuclear power plant accident in Harrisburg, Pennsylvania and the 2010 Deepwater Horizon oil spill. She explained that licensing of industrial activities reflect a political value judgment that these activities provide a social benefit that is greater than the social cost that occurs. However, that value judgment should be rethought. Based on what happened at the Deepwater Horizon oil drilling rig, it seems clear that no one took the likelihood of a catastrophic accident happening seriously enough, even though it was the third similar accident of its kind.

It took one major nuclear accident, Three Mile Island, to jolt the industry to take immediate steps to dissuade the industry from re-thinking nuclear power plant operations. Ms. Babcock explored the question of why the same type of internal correction did not happen after the first oil rig blowout in 1969.

There is a critical difference in how the public perceives the two activities; the public is not afraid of the deep-water drilling of oil, though it is afraid of nuclear radiation. This fear made it very likely that unless the nuclear power industry took steps to regain the public’s confidence in nuclear power, the industry was as good as dead. Collectively, this defining difference has contributed to a higher standard in the nuclear power industry than in the oil drilling industry.

Over 50,000 wells have been drilled, and more than 70 percent of all offshore oil and gas comes from these types of platforms. In the 1980s, the United States Secretary of Interior attempted to reinvigorate the offshore drilling process. This encountered enormous political resistance, and Congress responded with a series of annual moratoriums in offshore drilling. Today, 80 percent of the outer continental shelf is closed to drilling oil. The April 2010 blowout and resulting fire is, to date, the worst oil drilling accident in the United States.

In 1979, a blowout in the Gulf of Mexico affected 162 miles of the Gulf’s beaches. Well blowouts are not rare events; in 37 years, blowouts occur at a frequency of 1 every 3.7 years. Indeed, an accident of the April 2010′s magnitude was inevitable. In little more than two years, BP found itself paying millions of dollars to contain and mitigate the damages and to compensate the hundreds of thousands of people who were affected by the 2010 oil spill. The accident lasted for 152 days, before it was finally plugged in September. The oil spread to the eastern coast in Florida and as far west as Texas. The spill’s immediate impact on the marine environment has been devastating; many of the wetlands remain heavily oiled to this day. The release of toxic chemicals may have an adverse effect on the ecosystem. Even today, when little surface evidence of the spill is apparent, the economic and social impacts are equally devastating. The impact of the oil spill will continue long after its visible reminders are present.

The nuclear industry got its start at almost the same time as the offshore drilling industry. Today,  nuclear power makes up about 20 percent of the base load electrical power. Since 1979, there have been 47 incidents that required nuclear plants to be shut down, but none compare to what happened with the nuclear disaster which occurred in Harrisburg. The economic impact of the accident was devastating. In approximately two hours, conditions turned the power plant into a multi-billion dollar liability.  The Nuclear Regulatory Commission (NRC) issued the last permit for the commission of a nuclear plant the year before this disaster.

Alternatively, some of what happened on the Deepwater Horizon drilling rig is unknown, because some of the people on the rig tragically died. The mistakes that occurred on the rig severely compromised the ability of containing or avoiding the accident. The desires of both companies to keep business running created atmospheres where the risks of danger were under-appreciated. The drilling rig and the nuclear power plant were both extremely unsafe. The drilling rig was in poor shape, because it was not properly maintained. There were at least 26 components and systems on the rig that were in bad shape. These technical and mechanical problems led some experts to say that this was not a freak accident, but the result of the rig’s unsafe conditions. The rig’s malfunction rate was significantly worse than others. In addition, the companies responsible for key components of the well did not share information about the system’s integrity with their owners and operators. The same thing happened with Three-Mile Island Unit Two in Harrisburg. Amazingly, almost the entire chain of events that occurred at Unit Two happened at another reactor; again, this information was not shared with owners and operators. Facility operators failed to recognize what was happening as a result of inadequate training.

An alarm system on the Deepwater Horizon drilling rig designed to alert workers had been disabled, because it woke up workers on the drilling rig. The drilling crew made a decision to replace the well plug, precipitating the flow of gas up the pipe. Two minutes into the accident, the plan’s emergency core cooling system activated automatically, but it was turned off twice. The crews of both the nuclear power plant and the oil rig ignored or misinterpreted critical information that would have ensured that workers knew a disaster was about to occur. The drilling crew refused to believe what they were seeing, coming up with various explanations for the tell-tale signs of an impending blowout. The crew also inexplicably did not do a flow check when they realized that there was a discrepancy between pipes. The crew thought monitors were malfunctioning, and critical monitors were not visible to operators attempting to ensure that an accident would not occur.

Poor and non-existent communication in both accidents made matters worse. Some have suggested that the lack of pre-accident coordination contributed to the oil-rig blowout. Post-accident reports indicate that there was chaos, with no one on the rig clearly in charge. Similarly, there was minimum communication between Three Mile Island’s control room and company management. The nearest town was not told what was happening on the site until days later.

There were problems within the oil rig company that may have been indirect causes of the accident, as well. Many workers were concerned about safety practices, and feared reprisals if they were to report such practices. BP had a history of bypassing safety systems. BP always chose the least-expensive option, though it often elevated the risk of disaster. Time and money were a major concern to BP. Although BP denied that safety had been compromised, the results show otherwise.

Blind faith in engineering can lead people involved in such industries to forget to be afraid. The offshore oil and gas industry was and still is in total denial of what happened on the offshore oil rig. The immediate negative effect of this attitude was that a crew was not prepared or able to deal with the situation.

What the offshore oil and gas industry has done today is largely cosmetic. A short-term moratorium on offshore drilling, when compared to the nuclear power industry’s immediate upgrade to the power plant system and addition of stringent new requirements for the emergency response plan, are grossly insufficient.

Why the different responses to these accidents? Ms. Babcock believes that because the public is afraid of radiation, and it is not afraid of oil and gas, the fear of nuclear power has propelled the industry into a self-corrective path. The ramifications of human error and negligence are so great that another catastrophic event at a nuclear power plant would likely shut down the nuclear power industry forever. No such threat exists with offshore oil rigging. Nuclear power occupies an extreme position on the scale of risk. This fear-factor simply does not affect the off-shore oil drilling industry. There is minimal psychological pressure on this industry to exercise extreme caution. As a result, Ms. Babcock believes that the oil industry will not change its practices. Thus, it seems unlikely that any type of social rethinking will occur.