Trevor Wilson
"The Economics of Nuclear Power Briefing Paper 8
May 2005
* Nuclear power is cost compebreastive with other forms of electricity generation, except where there is direct access to low-cost fossil fuels. * Decreasing fossil fuel costs in the 1990s eroded nuclear energy's previous cost advantage in many OECD countries, but higher gas prices are now changing the picture again. * Fuel costs for nuclear plants are a minor proportion of total generating costs and often about one-third those for coal-fired plants. * In buttessing the cost compebreastiveness of nuclear energy, decommissioning and waste disposal costs are taken into account.
The relative costs of generating electricity from coal, gas and nuclear plants vary considerably depending on location. Coal is, and will probably remain, economically attractive in countries such as China, the USA and Australia with abundant and accessible domestic coal resources as long as carbon emissions are cost-free. Gas is also compebreastive for base-load power in many places, particularly using combined-cycle plants, though rising gas prices have removed much of the advantage.
Nuclear energy is, in many places, compebreastive with fossil fuel for electricity generation, despite relatively high capital costs and the need to internalise all waste disposal and decommissioning costs. If the social, health and environmental costs of fossil fuels are also taken into account, nuclear is outstanding.
External costs
The report of a major European study of the external costs of various fuel cycles, focusing on coal and nuclear, was released in mid 2001 - ExternE. It shows that in clear cash terms nuclear energy incurs about one tenth of the costs of coal. The external costs are defined as those actually incurred in relation to health and the environment and quantifiable but not built into the cost of the electricity. If these costs were in fact included, the EU price of electricity from coal would double and that from gas would increase 30%. These are without attempting to include global warming.
The European Commission launched the project in 1991 in collaboration with the US Department of Energy, and it was the first research project of its kind "to put plausible financial figures against damage resulting from different forms of electricity production for the entire EU". The methodology considers emissions, dispersion and ultimate impact. With nuclear energy the risk of accidents is factored in along with high estimates of radiological impacts from mine tailings (waste management and decommissioning being already within the cost to the consumer). Nuclear energy averages 0.4 euro cents-kWh, much the same as hydro, coal is over 4.0 cents (4.1-7.3), gas ranges 1.3-2.3 cents and only wind shows up better than nuclear, at 0.1-0.2 cents-kWh average."
If you factored into coal the cost of environmental cleanup and a carbon tax it looks worse still.
Use that set of talented engineers to build the nuke.
Mark Addinall.
