COST OF NUCLEAR POWER
Nuclear power is capital intensive and costs have escalated since the early days of its development. This is partly a result of higher material costs and high interest rates, but it is also a result of the need to use specialized construction materials and techniques to ensure plant safety. In the United States, in the early
The Taiwan Power Company carried out a study, published in 1991, which examined the cost of building a fourth nuclear power plant in Taiwan. The study found that the cost for the two-unit plant would be U.S. $6.3 billion, a unit cost of around $3150/kWh. The estimate was based on completion dates of 2001 and 2002 for the two units. Orders were actually placed in 1996, with construction scheduled for completion in 2004 and 2005. Construction actually started in 1999 and the plants were still not completed in 2013.
In its 2012 Annual Energy Outlook, the U.S. Energy Information Administration (EIA) estimated that the overnight cost of an advanced nuclear plant based on an order in 2011 for a plant that would enter into service in 2017 was $4619/kW. When contingency factors were taken into account, this rose to $5335/kW.6 Meanwhile, a 2011 U.K. study put the capital cost of nuclear power in the United Kingdom at £3500/kW.7 Nuclear construction costs do not always take into account decommissioning. This can cost from 9% to 15% of the initial capital cost of the plant.
The fuel costs for nuclear power are much lower than for fossil fuel–fired plants, even when the cost of reprocessing or disposal of the spent fuel are taken into account. Thus, levelized costs of electricity provide a more meaningful picture of the economics of nuclear power generation.
In the 2012 Annual Energy Outlook the EIA estimated that the cost of electricity from a new nuclear power plant entering service in 2017 would be $113/ MWh. This was similar to the EIA’s estimated cost of electricity from an advanced coal-fired power plant (without carbon capture and storage) but more expensive than gas-fired combined cycle generation, even with carbon capture and storage. From the U.K. 2011 study the cost of electricity from a nuclear plant was around £97/MWh, cheaper than either coal- or natural gas–fired plants with carbon capture and storage.
While the cost of new nuclear-generating capacity might be considered expensive in some parts of the world, but acceptable in others, the cost of power from existing nuclear power plants is often extremely competitive. This is true even where coal and gas are readily available. In support of this, a number of companies have, in the 21st century, started to make a successful business of running U.S. nuclear power stations sold by utilities when the U.S. industry was deregulated. In France, too, nuclear power is on average the cheapest source of electricity. Here, however, it may be considered a nationalized industry.