The Economic Future of Nuclear Power in Competitive Markets

Abstract

The question to be addressed is whether there is any economic future for nuclear power, especially in more competitive electricity markets and assuming the need for private capital. The answer to this question is yes and maybe. For operating plants, the economic gains can be high - some are money printing machines. Hence, there exists a strong interest in extending the life times of these reactors. For new plants, at least in more competitive electricity markets, the answer under present conditions is rather no unless major changes are made in the capital costs of these plants. This paper explores what the future might be if such changes can be made, what the most important changes are that need to occur, and how such changes might be brought about by a combination of changes in engineering and regulation. For one, a focus on cost-effective safety must be an essential part of the economics of future nuclear power plants. For another, full inclusion of waste disposal and decommissioning costs must be an integral part of nuclear cost analyses, as they generally are today, in order to minimize uncertainties concerning potentially open-ended liabilities. The question then is whether evolutionary improvements of current generation nuclear power plants can do the job or whether new nuclear technologies need to be developed and commercialized.