This World Nuclear Association Report entitled “The New Economics of Nuclear Power” provides international perspective and definitive analysis of the costs of constructing and operating nuclear power plants in the 21st century.

The Report’s principal conclusion holds fundamental importance for energy planners: In most industrialized countries today, new nuclear power plants offer the most economical way to generate base-load electricity – even without consideration of the geopolitical and environmental advantages that nuclear energy confers.

Factors in Nuclear Power’s Increased Economic Competitiveness
The increased economic competitiveness of 21st century nuclear power arises from cost reductions in construction, financing, and plant operations, and a still further reduction in already low costs for waste management and decommissioning.

Construction costs per kW for nuclear plants have fallen considerably due to standardized design, shorter construction times and more efficient generating technologies. Further gains are expected as nuclear technology becomes even more standardized around a few globally-accepted designs.Meanwhile, recent new-build experience has demonstrated that new plants can be built on time and on budget.

Operating costs of nuclear power plants have fallen steadily over the past twenty years as capacity factors have increased, squeezing far more output from the same generating capacity. (In the USA, operating costs per KWh shrank by 44% between 1990 and 2003.) As marginal costs of generation from nuclear plants have fallen below prices of most other generating modes, owners have found it worthwhile to invest in nuclear plant refurbishment and capacity up-rates. Nuclear power’s low marginal cost and its high degree of price stability and predictability have also encouraged nuclear plant owners to seek operating licence extensions for nearly all reactors.

Waste and decommissioning costs, which are included in the operational costs of nuclear plants, represent a tiny fraction of the lifetime costs of a reactor’s operation. Nuclear plant economics are thus largely insensitive to these costs and will become even less so as fuel efficiency continues to increase and as waste and decommissioning costs are spread over reactor lifetimes that are becoming even longer.

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World Nuclear Association
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www.world-nuclear.org

The World Nuclear Association is the international private-sector organization supporting the people, technology, and enterprises that comprise the global nuclear energy industry.

WNA members include the full range of enterprises involved in producing nuclear power – from uranium miners to equipment suppliers to generators of electricity.

With a secretariat headquartered in London, the WNA serves as a global forum for industry experts and as an authoritative information resource on nuclear energy worldwide.

Introduction by the Director General
Of all factors affecting prospects for the substantial growth of nuclear power in the 21st century, cost is the most fundamental. What are the essential economics associated with the construction and operation of advanced state-of-the-art nuclear power plants?

Certainly other factors will affect the pace of the global nuclear renaissance now under way. The nuclear debate continues to feature expressions of concern about nuclear arms, terrorism, operational and transport safety, and effective waste management and disposal. In addressing all of these concerns, however, the combined efforts of science, diplomacy and industry have achieved substantial advance in ensuring that civil nuclear power can be used without substantial human or environmental risk.

This achievement in meeting legitimate public concerns has provided the foundation for the nuclear renaissance by prompting governments in countries representing the preponderance of world population and economic activity to consider a wider exploitation of the benefits of nuclear energy. These benefits fall into two categories:

• National: price stability and security of energy supply
• Global environmental: near-zero greenhouse gas emissions.

Today, given the urgent environmental imperative of achieving a global clean-energy revolution, public policy has sound and urgent justification for placing a sizeable premium on clean technologies. Such environmentally-driven incentives can come through carbon taxes, emissions trading, or subsidies for non-emitting generators of power.

But the enactment of public policies fully infused with such vision and rationality is a slow process, perhaps too slow. A key question then is whether nuclear energy requires such policy intervention in order to be economically competitive. In short, is nuclear investment warranted in the absence of policy incentives?

This WNA Report addresses the question by providing an authoritative analysis of the economics associated with the construction and operation of nuclear power plants in the 21st century. To achieve this, the report draws upon numerous respected studies published since 2003, describes their premises and parameters, and summarizes the findings. To this synthesis the report adds analysis from member companies of the World Nuclear Association. ...

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