Posted by Big Gav in nuclear power
Technology Review has an article on the poor economics of nuclear power - Nuclear Power Renaissance?.
Whether new nuclear plants are a good bet economically depends on three factors, all now in flux. First is the cost of a new reactor. In 2005, a few would-be reactor builders said they could construct a facility generating 1.2 to 1.6 gigawatts for $2,000 per kilowatt of capacity. Now, they put the cost at $4,000 per kilowatt. Neither price includes interest charges accrued during construction, which could be substantial if the job takes more than the five years or so that the builders predict--or if interest rates rise, as they are expected to. The Electric Power Research Institute, a utility consortium based in Palo Alto, CA, recently put the capital cost of a new coal plant at under $3,000 per kilowatt and that of a natural-gas plant at $800 per kilowatt.
The second factor is uncertainty about possible future competitors. If 10 years from now wind or solar plants, or coal plants that capture their carbon emissions, are able to deliver vast amounts of cheap power, the market price of electricity will fall, and plant owners may never see enough revenue to meet their costs.
The third factor is uncertainty about the price of fossil fuels, particularly natural gas. In the last year, the fuel cost for a kilowatt-hour generated from natural gas has varied from about 2.3 cents to about 9 cents. If a federal cap-and-trade system or a tax on carbon dioxide emissions is instituted, that is likely to add 0.5 to 1.5 cents per kilowatt-hour. Add in 2 cents or more to recover the cost of building the plant, and the price of gas-fired power could make nuclear power look very attractive--or really overpriced.