Nuclear power: just not economic

Meltdown: A Gloomy Look at the Economics of Nuclear Power

The WALL STREET JOURNAL

By Keith Johnson 16 Sept 09

There’s a new paper out from Spanish researchers at Universidad Pontificia Comillas exploring nuclear economics. Spain, you may recall, has its own debate about the future viability of nuclear energy.

The paper poses a simple question: Does nuclear energy add up to a rational investment in a liberalized energy market? Rather than trying to compare the costs of generating electricity, the paper focuses on the costs of building new nuclear reactors.

The answer: New nuclear plants might just make economic sense, but probably won’t in the real world………………

The problem, the paper says, is that so many things can break against the economics of nuclear energy.

Cheaper natural gas (it recently was at seven-year lows); cheap carbon permits (they’ve been falling in Europe and in U.S. greenhouse-gas auctions); high interest rates (the nuclear industry still faces a “risk premium” from lenders); or longer-than-expected construction times all make nuclear power look less attractive: “Then, even without cost overruns, nuclear would not be competitive, sometimes by a large margin.”

Given all the things that can dent nuclear economics, the paper concludes on a pessimistic note: “Looking at the past history of nuclear would then result in concluding that nuclear will probably not be competitive on a purely economic basis. Therefore, cost will not be a plus for nuclear, but will still be one of its problems.”

http://blogs.wsj.com/environmentalcapital/2009/09/16/meltdown-a-gloomy-look-at-the-economics-of-nuclear-power/

September 18, 2009 - Posted by Christina Macpherson | 2 WORLD, business and costs | antinuclear, nuclear, nuclear costs, radioactive