Module B1 Study Book - the Graduate School of the Environment

) The economics of nuclear have been difficult to support, and the costs are
increased by the extra safety measures are required to satisfy the political
objections.
The main problem is not so much the cost of the fuel [though reprocessing,
if it relied on, adds to the cost substantially] but the cost of the plant. LWR
plants cost in the range $1700 - 3100 / kW, (WEA 2000) around three times
that of fossil fuel plants, and cost problems are exacerbated by construction
delays and budget overruns.
Newer generations of plants, it is claimed, will be cheaper [a recent US govt
study put them at a little over $2000 / kW], but we can build coal plants for a
little over $1000, and gas for $500 (EIA, 2000). Operational costs have risen
fast - largely because of safety fears - and stand at around three times those
of fossil fuel plants (WEA, 2000). Meanwhile, the cost of fossil fuel electricity
- coal to an extent, and much more so gas - has fallen substantially.
In 1990, when the Thatcher government began the process of privatising
the power industry, the City reacted badly. Under the old CEGB [Central
Electricity Generating Board], there had been massive subsidies, protection
from competition and some extremely dodgy accounting. This latter had
understated the costs, especially in insuring against accidents, in providing
for decommissioning and waste disposal, and in pricing new investment.
Another fundamental problem was that the government applied a ‘test
discount rate’ of 5%: this in effect meant that a much lower rate of return
was acceptable, and so prices notionally ‘charged’ [it was all internal trading]
could be lower. Lord Marshall, a nuclear enthusiast, warned that costs per
kWh from PWRs would virtually double, from an already high 3.22p.
The result of exposing the industry to the market was that, while nuclear had
been made to look quite cheap [though in fact governments for some time,
knowing something of the truth, had cooled a lot on new build of nuclear
plant], it became clear that no company was going to invest in building
nuclear with entirely its own shareholders’ money. Subsidies to the [now
partly privatised] industry have continued at many hundreds of millions per
year, and extremely large one-off payments have also been necessary to
keep the main players afloat.
5. The arguments over nuclear power
a) Can it be a big help in cutting CO2 emissions?
Part of the anti-nuclear case is that it is not true that generating electricity
from nuclear produces no CO2. The energy for plant construction, for mining,
processing and fabrication of materials, and for reprocessing, are all energyintensive
activities, and to the extent that this comes from fossil fuels, it is a
source of CO2.
Estimates of the life-cycle output of CO2 per kWh from any power station,
and especially nuclear, are fraught with problems arising from the sensitivity
of the calculation to assumptions about operational life and about the CO2
Lecture: Nuclear Power 53