Why nuclear power plants are so expensive

The cost of a nuclear power plant can exceed €26 billion, as estimated for a new plant in the UK. Here are the reasons for such an exorbitant expense.

In the current economic and climatic context, many consider nuclear power to be the best solution (if not the essential one) to deal with the problems we are experiencing. Although several studies have shown that it is possible to meet the energy needs of entire countries by relying totally on renewable energies, such as wind, solar, geothermal, sea energy, etc. , the costs of completely moving away from fossil fuels are enormous, especially in terms of the disruption of entire infrastructure. For this reason, the transition cannot be immediate, also considering the need for interventions that can take many years. And not to mention the fears for the many workers linked to traditional energy industries. But the most catastrophic consequences of climate change are looming and the costs of natural gas, fuels and related products are exploding, catalyzed (also) by the current and complex geopolitical situation. For this reason, the debate on a possible reopening to nuclear energy has also revived in Italy. Beyond doubts about the potential risks of accidents, one of the problems that should not be underestimated is the exorbitant cost of traditional “light water” power plants, which has increased considerably in recent decades. and whose costs double or even triple during construction. , which can take from 5 to more than 10 years.

Just think of what happened in the United States, with the cancellation of several projects precisely because of the disproportionate increase in costs. As the specialized portal Construction Physics points out, several nuclear power plant projects (to be built in Washington) were closed in the 1980s as costs rose from around $4.1 billion to more than $24 billion ( resulting in default). In Georgia, two nuclear plants with an initial cost of $14 billion have jumped to $28.5 billion and the companies involved are seeking a possible deal, while two plants in South Carolina have been canceled after the initial price of $9 billion. soared to $25 billion. A total cost of €26.20 billion is expected for the traditional 3,300 MW ‘Sizewell C’ nuclear power station to be built in Suffolk, UK. But why are nuclear power plants so expensive?

As Construction Physics explains, several factors come into play. First of all, we must consider the so-called “overnight” costs, that is to say those of the pure and simple construction of the plant without interest and similar, as if the infrastructure were built overnight, which increased almost tenfold. If in the 60s of the last century they were around 1000 dollars per KWe (or one thousand Watts of electrical capacity), it easily reached 8000-9000 dollars/KWe. A new reactor under construction in France is estimated at up to $12,000/KWe. About one-third of overall power plant construction costs come from indirect costs, such as “engineering services, construction management, and administrative overhead,” says Construction Physics. Direct costs, such as reactor, turbine and plant structures have a comparable cost, while another fraction of similar expenses comes from additional plant systems. The engineering project for the construction of the plant alone has a cost that is close to that of the reactor.

Credit: Construction Physics

The construction and maintenance of a power plant also requires a lot of highly skilled labor, which must work for very long years. In the late 1970s and late 1980s, labor costs played an extremely important role in driving up the cost of building a power plant in the United States. Labor costs are estimated to have increased by 18.7% per year during this period, while construction materials have increased by 7.7% per year. Among the costliest are professionals such as engineers, supervisors and quality control inspectors. According to the study “Sources of cost overruns in nuclear power plant construction call for a new approach to engineering design” published in Joule, during this decade, 72% of the cost increase was due precisely to the increase in indirect expenses. Suffice it to say that more than 5,000 workers may be needed to build a factory. Even the new licenses linked to stricter regulations, which influenced the redesign of certain parts of the factories, had an extremely large impact on the increase in costs.

Being so expensive to begin with, much of the expense comes from interest on financing, which can amount to up to 20% of the total cost of the plant. As projects take a long time to finalize, financing costs can reach up to 50% of the total in case of delays, as in the case of Georgian power plants. It should also be borne in mind that a significant part of the cost of electricity produced by a nuclear power plant (60-80%) comes from the investment costs, i.e. the construction costs of the plant itself. This is not the case, for example, of a natural gas power station, where 70% of the cost of the electricity produced comes from fluctuating gas prices. The fact that electricity from a nuclear power plant is paid for a certain amount also influences the expenses, whether the energy is produced or not. Its storage has a cost and there must therefore be a balance between supply and demand, but if it is possible to “shut down” a plant easily, it is not the same for nuclear power plants. Don’t forget also the need to store nuclear waste.

Almost all of these arguments are applicable to traditional nuclear power plants, but fortunately much cheaper next-generation plants are in development. The latest generation microreactors called “Small Modular Reactors” (SMR) have an estimated final cost of around 2 billion euros, compared to more than 26 that the United Kingdom will have to pay for its new plant (hypothetical). Bill Gates with his company TerraPower is also considering new nuclear power plants equipped with “Natrium” reactors, the estimated future cost of which is estimated at around $1 billion. A prototype being built in Wyoming will cost $4 billion, but the cost is expected to be reduced by 75% for the final project.

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Why nuclear power plants are so expensive