Economy Sandbags Plans for Nuclear Reactors The selected article by Matthew L. Wald, printed in the October 11, 2010 edition of The New York Times is a fact based article, which at the same time, attempts an analysis of the stated facts, relying on the principles of demand and supply. Wald’s analysis could be taken to be credible, as it is based on the time tested fundamentals of economics. Besides, the writer is a regular contributor to the New York Times, and has written more than 5000 stories and articles for the chosen newspaper.
This article is pertaining to the glitches hampering the construction of the proposed nuclear reactors in the US, owing to the fall in the demand of nuclear power (Wald B1). The government is reluctant to back the construction of new nuclear reactors because of a fall in the demand of nuclear power. While on the one side, there has been a fall in the demand of electricity in general, owing to the economic meltdown, on the other side, nuclear power has become more costly, because of a fall in the price of natural gas over the last two years.
Under such circumstances, when the demand for power is already low, power distribution companies are less likely to increase their demand for nuclear power, when they could purchase cheaper power from the generation companies who rely on natural gas. Besides, nuclear reactor owners don’t afford to boost demand by lowering their prices, as the fixed costs associated with nuclear power are quiet high.
So, in the near future, going by the unsatisfactory available prices and low demand, the supply of nuclear power is less likely to rise. This is expected to push the equilibrium price of nuclear power, below the price expected by the already functional nuclear power generators, leading to stagnation in the supply of nuclear power. The failure of the Congress to pass the climate legislation, which could have increased the price of power produced by fossil fuel dependent substitutes, has further worsened the situation.
The situation is expected to remain so for some time. Even if one tries to be positive on the economic recovery front, as per the facts extended by this article, the price of fossil fuels is less likely to rise to 2008 levels. Word Count: 380 Works Cited Wald, Matthew L.
“Economy Sandbags Plans for Nuclear Reactors”. The New York Times 11 October 2010: B1.