Next Generation Energy is managed and written entirely by Seed editors and expert guest bloggers. Read more about them No -- I'm not talking about the radioactive hazard in the news from France last week that "In less than 15 days, the CRIIRAD [Independent Commission on Research and Information on Radiocactivity] has been informed of four malfunctions in four nuclear plants, leading to the accidental contamination of 126 workers."
I'm talking about how new nukes have become an economic hazard -- the 45 plants John McCain wants to shove down the throat of the American public by 2030 might cost half a trillion dollars (not counting transmission) and would raise electricity rates across the nation.
Once touted as "too cheap to meter," power from new nuclear plants simply became "too costly to matter," as the Economist put it back in May 2001. And prices have tripled since then.
Over time, energy efficiency programs deliver more and more energy at prices of two to three cents per kilowatt hour. If the entire nation pushed efficiency as aggressively as California, we would never build another polluting power plant.
While wind and solar PV do occasionally experience modest price rises as commodity prices rise, their prices have tended to drop over time, thanks to the manufacturing learning curve and economies of scale.
New nuclear plants, however, have been getting more and more expensive over time, thanks to manufacturing unlearning and diseconomies of scale from production bottlenecks, as discussed in this June report I wrote for the Center for American Progress, "The Self-Limiting Future of Nuclear Power." A shorter version is here.
In October 2007, Florida Power and Light (FPL), "a leader in nuclear power generation," presented its detailed cost estimate for new nukes to the Florida Public Service Commission. It concluded that two units totaling 2,200 megawatts would cost from $5,500 to $8,100 per kilowatt -- $12 billion to $18 billion total!
Earlier this year, Progress Energy informed state regulators that the twin 1,100-megawatt plants it intends to build in Florida would cost $14 billion, which "triples estimates the utility offered little more than a year ago." That would be more than $6,400 a kilowatt. But wait, that's not all. As reported by the St. Petersburg Times, "The utility said its 200 mile, 10-county transmission project will cost $3-billion more." If we factor that cost in, the price would be $7,700 a kilowatt.
The utility won't even stand behind the exorbitant tripled cost for the plant. In its filing with state regulators, Progress Energy warned that its new $17 billion estimate for its planned nuclear facility is "nonbinding" and "subject to change over time."
Worse, Florida passed a law that allows utilities to recoup some costs while a nuclear plant is under construction. How much? About $9 a month starting as early as next year! Yes, the lucky customers of Progress Energy get to each pay more than $100 a year for years and years and years before they even get one kilowatt-hour from these plants.
If energy efficiency could be forward priced on ratepayer bills, we could stop electricity demand growth in its tracks at a price five times cheaper than new nukes.
Indeed, Jim Harding, who was responsible for the the economic analysis in a mid-2007 Keystone report on nuclear power, e-mailed me in May that his current "reasonable estimate for levelized cost range ... is 12 to 17 cents per kilowatt hour lifetime, and 1.7 times that number [20 to 29 cents per kilowatt-hour] in first year of commercial operation."
Recent modeling work done for the California Public Utility Commission puts the cost of power from new nuclear plants at more than 15 cents per kWh before transmission and delivery costs.
The great challenge for nuclear power in this country over the next four decades will be to cost-effectively maintain even its 20% market share as most current reactors reach the end of their lifetime. But for those who want affordable and timely strategies for deep greenhouse gas emissions reductions in the utility sector, the primary answer for the foreseeable future is going to be energy efficiency, wind power, solar PV, and solar baseload.
Comments
what's ironic is that Nuclear is very much the centralized, top-down big government solution that any real economic conservative should abhor, whereas negawatts, wind & solar are entrepenurial, bottom up and market-driven solutions.
But McCain has repeatedly shown no respect or knowledge of markets such as with his moronic battery prize idea
Posted by: bwv | July 31, 2008 1:24 PM
So lets see... Contamination scare? Check. Lots of scary numbers? Check. Unsubstantiated claims? Check.
This seems like just another hatchet job on nuclear and not a rational comparison. Radiation contamination is very scary, right up there with terrorists. But what are the real risks and how do they compare to the job risks employees in other energy sectors face? Yes, nuclear is expensive. But how do the numbers compare with coal, solar, wind, etc?
Posted by: df | July 31, 2008 1:38 PM
Nuclear power has always had some hidden subsidies in how it's linked to the weapons industry. On the other end of things, costs can be modified fairly significantly based on the safety margins you assume.
Posted by: Anthony | July 31, 2008 1:40 PM
There are additional costs that are usually ignored with nuclear power and that have to be covered by the taxpayer:
- exploration of waste disposal facilities
- security measures for the plant as well as fissile material transport
- cost of clean-up after a large-scale disaster (in a realistic scenario every plant would have to be covered by a multi-billion dollar insurance policy to cover the risks of their technology)
And like with oil/gas nuclear has significant geo-political implications that solar and wind power don't have. Monitoring worldwide uranium mining to avoid proliferation doesn't come for free and includes not only the costs for the official agencies but also lots of intelligence operations.
Posted by: Michael | July 31, 2008 2:00 PM
Nucular seems like a needlessly complex recipe for the boiling of water.
Posted by: Matt Hussein Platte | July 31, 2008 3:20 PM
I'm very disappointed on this blog's articles on nuclear energy.
While this blog happily talks about pie-in-the-sky bioenergy/solar/windpower systems, there was not a single article yet about possible improvements in nuclear technologies which can potentially solve (or already do it!) a lot of current problems. Or at least about nuclear success stories like France.
Instead, you're running a "Nucular contamination!ZOMG!!!" scare.
Posted by: Alex Besogonov | July 31, 2008 5:36 PM
The real question has to be, why are these estimated costs escalating out of all reason? Is it because some standards have been set impossibly high? I have no doubt, that some activists would push standards beyond anything reasonable in order to kill Nuclear, but I don't know if that is in fact what has happened. In any case we need to understand the source of the high costs. Perhaps some good faith bargaining can change this dismal picture?
I have no doubts, that negawatts are the cheapest power. But, as you know negawatts are a tough political sell, and require cooperation of a large number of consumers to make much progress. If we don't get enough negawatts (you and I would agree that this would be a human not a technological failing), and we get into a severe energy crisis, the attitude of full-speed ahead damn the torpedoes could prevail. A little bit of compromise ahead of time in order to avert that possibility might be worth the price.
Posted by: bigTom | July 31, 2008 5:44 PM
First off will you please stop using the 'too cheap to meter' phrase. It was said by some politico; the industry NEVER EVER said that and you are invited to show me different.
Secondly, why is it that nobody else has an issue about their nuclear waste except the U.S.
Posted by: DV82XL | July 31, 2008 9:32 PM
I can assure you that nuclear waste is regarded as a big problem here in the UK too.
Those of you complaining that this blog is doing a hatchet job on nuclear because of waste concerns are posting on the wrong thread - the waste thread was yesterday. This post is about economics.
No, it's because the costs of steel and concrete (which nuclear power plants use huge amounts of) have tripled in the last couple of years.
And we haven't even mentioned decommissioning costs yet.
Posted by: Dunc | August 1, 2008 4:53 AM
Basically, this article says that wind and solar power are more economical "if energy efficiency programs" work. With no indication that any "energy efficiency programs" now work or can work in the future. IF efficient power storage can be accomplished, IF solar panels can be made that are ten times more efficient than the current ones, IF the wind would just keep blowing all the time.......
Well, IF the moratorium on nuclear power plants had not been put into place by Carter and then maintained by every President and Congress since, the cost of Nuclear Power would not be so excessive, would it? And all those nasty, dirty radiation spewing coal plants would have been retired by now.
Posted by: Oldfart | August 1, 2008 8:18 AM
"I'm very disappointed on this blog's articles on nuclear energy."
I agree. So far, it's been all knee-jerk anti-nuclear. I certainly don't support John McCain, but we need to be realistic here. And while I absolutely agree on the need for conservation, that won't eliminate our need for energy,... and nuclear power can actually provide it. Frankly, there seems to be a LOT of wishful-thinking in solar and wind generation, and little or no critical thinking about them. But while we blithely expect technological magic in these areas, we're determined that nothing can solve the scary nuclear issue.
The big problem with nuclear power is social (or political, which amounts to the same thing). Costs of nuclear plants have skyrocketed because of the anti-nuclear lobby and the NIMBY syndrome. In most places, it would be easier to propose electrical generation by burning babies! These knee-jerk reactions will probably mean that nuclear stays off the table in America. But hey, if we were smart, we wouldn't be in this mess in the first place, would we?
If we really expect to accomplish anything - instead of just proposing lovely, faith-based scenarios - then nuclear needs to be a PART of our energy plans. How much of a part is certainly debatable. But so far, this energy blog has been a big disappointment.
Posted by: WCG | August 1, 2008 9:31 AM
I concur - this blog's treatment of nuclear power has been pretty inflammatory and abysmal, repeating a bunch of 1970s-era talking points that have been fairly well debunked over the past quarter-century.
If we wanted to read climateprogress.org, we would - I see no reason to uncritically echo their posts here.
Conservation, wind, solar, geothermal, and tidal power are great but they are no substitute for a large base-load generating station. They simply cannot do the job. For that you need either fossil or nuclear generation and we've established that the carbon footprint of fossil fuels makes current fossil technology a non-starter. Dismissing nuclear power based on specious Nixon-era arguments is not helping matters.
Every means of generating power has economic, political, social, and ecological consequences, every single one of them. If you want to discuss energy technology and policy, you need to be informed of the character and salient costs, risks, and benefits of each technology including conservation, storage, and transmission technologies. The only way we as a society can make rational decisions about the risks and costs we wish to bear is to leave dogma and propaganda at the door and treat the issues honestly. Sadly, that's not happening here; I expect better from Scienceblogs.
Out of curiosity, how many people here have had any first-hand experience with commercial nuclear power, either as a contractor, utility employee, or regulator? I'm talking about people who've actually worked at a power plant or otherwise been on-site, not just those walking through the Visitors Center.
Posted by: Bob | August 1, 2008 1:33 PM
This recent spate of anti-nuclear posts ihave been strong on hype and weak on facts and context. I might not be so critical if [redacted] weren't heavily investing in solar. They were also investing heavily in wind but have recently backed out of a high profile project. Their only interest in nuclear seems to be to use nuclear power to extract fossil fuels. But they aren't building it or investing in it. They just want to buy the power from it if it's built.
@Micheal:
There are additional costs with all forms of power generation that are usually ignored and have to be covered by the taxpayer, not just for nuclear. The cost to the environment of mining and burning coal is a good example. The hidden costs for wind and solar power aren't readily apparent to me yet but I am confident that they are there. Especially if they are developed by companies like [redacted].
Posted by: df | August 1, 2008 6:31 PM
The trend in blog posts seem to be related to whether or not somebody has a horse in the race or not.
Posted by: df | August 1, 2008 6:33 PM
This recent spate of anti-nuclear posts ihave been strong on hype and weak on facts and context. I might not be so critical if [redacted] weren't heavily investing in solar. They were also investing heavily in wind but have recently backed out of a high profile project. Their only interest in nuclear seems to be to use nuclear power to extract fossil fuels. But they aren't building it or investing in it. They just want to buy the power from it if it's built.
[NOTE: You can Google the facts on all these claims. My comments keep getting rejected if I mention [redacted] by name or include URLs to back up any of my statements.]
@Micheal:
There are additional costs with all forms of power generation that are usually ignored and have to be covered by the taxpayer, not just for nuclear. The cost to the environment of mining and burning coal is a good example. The hidden costs for wind and solar power aren't readily apparent to me yet but I am confident that they are there. Especially if they are developed by companies like [redacted].
Posted by: df | August 1, 2008 6:36 PM
df raises the question of hidden costs. It's one that bothers me as well.
So far as I can see on the evidence so far Wind generation has been supported almost everywhere by generous subsidies, tax breaks on long term investment and, marginally, sales of dedicated green electricity (via income investment promises) at a marginally higher unit rate.
It may be that the currently increasing costs of fuel for traditional sources means that premium rates for Wind generation are no longer so appropriate but I have not checked and compared recently. Of course the sudden increases would be highly convenient for the more expensive technologies.
But assuming that nearly all energy platforms could be presented as getting subsidies, real or 'in kind' via taxation adjustments, what are the less obvious hidden costs?
For wind one of the things that I have not so far seem mentioned is responsibility for remedial costs. Is anyone responsible for the remedial costs of returning a windfarm location to its original state (more specifically removing the plant and groundworks) should a site be be abandoned for any reason? Cleanup costs are a large overhead for traditional generation sites, especially nuclear. Does wind escape?
Even if the site is not abandoned the planned investment life is, to the best of my knowledge, about 20 to 25 years. Maybe less if the are huge advances in technology and an enforced need to optimise many existing locations since they were originally selected on the basis of optimum efficiency anyway. This represents a much shorter life than might be expected for other generation installations. It seems unlikely that replacement technology at the end of life would find the existing infrastructure 100% reusable. Positioning, spacing and concrete base sizes would all likely change. Access and maintenance roads and grid connectivity as well.
How many of those costs are projected in the plans?
I would guess that there would be similar considerations for solar but perhaps more related to disposal of obsolete and worn out panels.
In a 30 year proposal for renewable implementation and deployment there might be an overlap of up to 50% of the time where both new and replacement installations would need to be funded. Indeed if one was very conservative and concluded that a typical installation might be superseded for various reasons after just 15 years, shortfall of originally planned life expectancy being not uncommon in technical projects, you would end up with a scenario whereby all the renewable infrastructure needed replacement within 15 years of completing the planned 30 year development.
If such things are not factored into the equation they should be. Does anyone have any links that demonstrate how these things are covered?
Posted by: Grant | August 2, 2008 6:21 AM
Joe, first off, I know it has been pointed out to you several times before that the phrase "Once touted as "too cheap to meter" is taken out of context. The quote that the phrase is derived from came from Lewis L. Strauss (chair of the Atomic Energy Commission, then focused primarily on military and uses of nuclear energy - not a member of the nuclear industry), addressing the National Association of Science Writers in 1954. He said:
He was talking about the future of science and technology generally, not just nuclear power. You really need to stop parroting this ridiculous phrase as if it meant something.
Second, let's compare your $0.5T cost of nuclear with an alternative - solar thermal. David Rutledge of CalTech writes, using the Nevada Solar One plant as a reference point: "US annual electricity consumption is 12.5EJ,or 3,500TWh, production from Nevada Solar One is taken to be 0.130TWh/y. By my rough calculation, that means we would need 27,000 Nevada One type plants to equal current electricity consumption. Since NS1 cost $260 million to build, that would be $7.0 T - 14 times the nuclear figure you claim would "raise electricity rates across the nation".
Oh, and in the 2030 timeframe you mention, starting say in 2010, that would mean between three and four Nevada solar Ones being completed every day for 20 years.
Funnily enough, I never see these figures addressed by opponents of nuclear.
Posted by: Skeptico | August 2, 2008 12:51 PM
I'm not sure what happened to my last post (I'll charitably assume it's rotting in a moderation queue) but I concur, this blog has been a wellspring of debunked Nixon-era antinuclear propaganda. Say something new, preferably something relevant to the past five years, and please stop rehashing the articles on climateprogress.org; if we wanted to read them, we would - there.
Conservation ("negawatts" - nice catchphrase) is great and should be promoted, but it does not deliver energy. It reduces demand, allowing expensive peaking units like gas turbines to be left idle or obviating the purchase of electricity by utilities to handle peak demands, but it does not generate a milliwatt of power. Conservation is not a long-term substitute for generation capacity and to treat it as a means of producing power is simply dishonest.
Again, I fully support conservation and I practice what I preach in terms of insulating my home, upgrading my refrigerator and A/C unit, taking my local utility up on its offer of a free programmable thermostat that cuts out my A/C for 30 minutes to help the utility deal with high demand days, and converting the bulk of my bulbs to compact fluorescents. I've put a few thousand dollars into these upgrades, partly to reduce my bills over the long haul but primarily because reducing my energy footprint is the right thing to do.
None of that generates a bit of energy - peak capacity is unchanged because of it and it's a lie to suggest that it does.
Now to address the costs associate with the proposed expansion of the Turkey Point station with two Westinghouse AP1000s or General Electric SBRWs: did you actually read the actual response to the petition to determine need for Turkey Point Nuclear Units 6 and 7?
Seriously.
Did you read the FPSC assessment agreeing that there's a need for TP 6 & 7, considering environmental impact, fuel diversity, water requirements, and the inadequacy of demand-side management (aka conservation and load-shaping) and solar/wind/thermal/tidal generation to meet the expected demand?
As for $/kW, the spectrum of scenarios comparing nuclear to natural gas combined-cycle plants gave a breakeven capital cost from $3,206/kW to $7,281/kW; for coal the range was $5,921/kW to $9,450/kW.
Note that those are capital costs - the other two legs of the financial triangle of energy generation are fuel costs and operation and maintenance costs. Fuel costs are assumed to be low, not out of any wishful thinking but out of the reality that per-megawatt, nuclear fuel is cheap. There's plenty of documentation on this; IIRC it was $250k/bundle or so 15 years ago and I don't expect that's changed much. Google is your friend or ring up the nice people at GE, Siemens, BNFL, or Studsvik and ask for a price quote.
This leaves O&M costs. This is somewhat of a crapshoot since there's no operational record for the AP1000 or SBWR but the big lesson the nuclear industry has learned since TMI is that less is more. The more hardware and piping you have, the more that needs inspection, testing, maintenance, surveillance, spares, equipment qualification, licensing, QA, documentation so it's in the vendor and the operator's best interest to minimize it. Hence, the design of modern plants makes use of passive safety features to a far greater extent both to decrease the already low risk to the public but to also decrease capital and O&M costs. We won't know until there's some operational history, but I'd put money on decreased O&M costs for newer units.
Care to put those quotes in context? I suspect that every estimated cost comes with boilerplate "subject to change over time" because it's simple financial reality. Estimates are made at a point in time and cannot account for fluctuating commodity prices (such as steel.) Without context, we can't tell if the utility is, as you say, not standing behind their estimate. Without a specific source document, I'm provisionally calling bullshit on this quote mine.
Look, nuclear is often not the most attractive option in capacity planning due to risk perception, the loss of domestic production skill and facilities (consider the national security implications of relying solely on Japan Steel Works for heavy forgings like reactor vessels and turbine casings), debt service, lead time, large facility project management, fickleness and pique of regulatory agencies, and the general uncertainty associated with such large projects. There are serious issues that need to be addressed whenever a large project like this is undertaken, nuclear or not, and none of what you've written is particularly novel or significant. Worse, the cloying bias and quote-mining don't help matters. The 4/11/2008 FPSC document I referenced tells a very different tale than the one you've presented so my challenge to you is to show where the FPSC has changed their mind. No seven-year-old graphs from The Economist, no retread articles from climateprogress.org, no content-free articles from the St. Petersburg Times - I want reviewed numbers and assessments from the FPSC. After all, the FPSC is responsible for balancing the cost and reliability of power for their state, they have more expertise and information than any advocacy group, and they don't have a financial interests in the plant other than to keep Floridians' rates low.
Oh, my horse in the race is that it's vitally important to me to prevent ignorance, irrational fear, misguided advocacy groups, and corporate shills from keeping from us a reliable supply of clean, safe, affordable energy no matter the technology used to generate it. It is not helpful to use junk science, junk economics, and irresponsible scaremongering to cloud the facts. It's dishonest and as long as I'm able, I'm going to fight it.
If you care about my employment history and financial holdings, just ask. I'm pretty good about full disclosure.
Posted by: Bob | August 3, 2008 2:02 AM
What's the original source and context for the IHS/CERA graph? It looks suspiciously like a normalized aggregate cost graph comparing ... what, exactly? What is the "portfolio" referenced?
It's already well known that nuclear units have a higher capital cost than fossil units and it is equally well known that, in aggregate, the higher capital and O&M costs are offset by very low fuel costs, making nuclear as or more attractive than fossil plants in the long term.
I don't want to impugn IHS or CERA because I don't know the context of their source article, but to cherry-pick a graph that a) doesn't show a spectrum of generation technologies (coal, gas, oil, nuclear, wind, solar), and b) doesn't show capital, fuel, and O&M costs makes this article a case study for How to Lie With Statistics.
Remember, the premise of this article is that electricity from nuclear units is more expensive than other sources and thus a bad value proposition to the consumer/public. To adequately establish that, you must consider all significant contributors to busbar cost (total cost of electricity leaving the power station) - this is Utility Economics 101. Second, you cannot show the costs in isolation to support your premise, you must show how nuclear busbar costs compare to those of other generation technologies. Third, you need to choose a consistent method of aggregating data - are you making the claim that nuclear generation cost is non-competitive everywhere? Just in the US, the Southeast, Florida? Some energy technologies are cheaper or work better in specific regions; compare solar in Seattle vs Tuscon, natural gas in East Texas vs Boston. If you're going to take the Turkey Point proposal as representative of the cost of new nuclear generation, you must show those costs are representative of the region you're analyzing and compare them to the region-biased costs of other generation schemes.
Finally, one more niggling detail: you add in a proposed $3bn transmission project. The transmission and distribution (T&D) infrastructure would have to be expanded if the proposed capacity was added at Turkey Point independent of the power generation technology used. While the cost of the T&D expansion is relevant to this particular project, it's not relevant to the busbar cost of generation and can't be used this way to make a blanket statement about the economics of a particular generation technology. The whole reason for using busbar cost for comparison is to separate T&D costs from station costs for performing exactly this sort of analysis. If you're going to include T&D costs, you need to do a lot more work to prove your point.
The data presented in this post does not support its conclusion. Several forms of bias are clear. In short, it's a trainwreck and science-wise it really casts Scienceblogs in a poor light. Joe, I'm more than happy scare up my old environmental and economic analysis notes and see if I can find you a concise reference on power generation pricing. You're obviously enthusiastic and care about the environment, but frankly you need some help with analysis and presentation. You don't do yourself or anyone else any favors knocking out articles like this.
Posted by: Bob | August 3, 2008 8:31 AM