nuclear-news

Corporate investors asking hard questions about economics of nuclear power

hard questions have to be put about new nuclear units.

Challenging Ontario’s new nuclear plants By Staff Torstar News Service, 20 Nov 12,  A new nuclear debate is starting to percolate in Ontario. At industry conferences and in the corridors of Queen’s Park, energy activists are questioning whether Ontario should invest billions in new nuclear energy units.

But these activists aren’t the long-time foes of the nuclear industry, who based their arguments on moral and environmental grounds.

They’re working for corporate clients, and asking hard questions about the economics of nuclear power, given the alternatives like plentiful natural gas.

They’re suggesting that producing electricity with gas may be cheaper,
faster and less risky than building new nuclear units.

“In our view it’s going to be extremely challenging for any government
in the future in this province to do new nuclear,” Jason Chee-Aloy of
the consulting firm Power Advisory LLC said in a recent presentation.

“From a pure dollars and cents cost point of view, there are real
issues with it,” he told the Association of Power Producers of
Ontario. (APPrO)

Chee-Aloy is not a fringe player. He’s an economist and former senior
energy bureaucrat with the Ontario Power Authority.

The skepticism is a direct challenge to Ontario Power Generation’s
proposal to build two new reactors, each capable of producing 1,000
megawatts, at its Darlington nuclear station……
The capital cost of a nuclear plant is five times that of a gas plant,
he says, citing figures from the Energy Information Administration in
the U.S.

New nuclear units will need to charge 15.5 cents to 19 cents a
kilowatt hour for their output, he told APPrO, while gas plants can
operate for 8.5 cents to 12 cents a kwh

Chee-Aloy and his partner John Dalton argue that the economics of the
alternatives need to be more fully explored – specifically, the flood
of natural gas from shale deposits that is now flooding onto North
American markets and lowering prices.

“Where you have gas prices where they are, it makes the economics of
new nuclear more of a challenge,” said Dalton……
Chee-Aloy is not the only skeptic.

Adam White, who heads the Association of Major Power Consumers of
Ontario (AMPCO) also says hard questions have to be put about new
nuclear units.

“The common wisdom always has been that we need to build to
accommodate economic growth,” White said in an interview.

“We see now that the economy grows and electricity consumption falls.
That’s been happening consistently over the last decade. Who are we
building it for?”

White argues that the risk of new nuclear plants is high in part
because of the long lead time needed to get regulatory approval, then
build the plant.

“With gas, you’re up and running in 18 months,” he said. http://metronews.ca/news/toronto/448858/challenging-ontarios-new-nuclear-plants/

November 22, 2012 - Posted by Christina Macpherson | business and costs, Canada