In this paper, Geoff Rothwell analyzes cost, waste and safety issues that surround the further use of nuclear power in the U.S. After many years without nuclear power plant construction, five nuclear power plants are being built in the U.S. While there are 10 other applications for construction and operating permits, the construction cost for advanced nuclear power presents a barrier to finishing these units. These costs reflect a redesign of nuclear power plants to rely on natural safety systems, also known as passive safety.
In deregulated markets, the electric utilities must shoulder the entire risk of building and operating them. This makes Wall Street edgy, increasing the risk premium on anything nuclear. While the up-front costs of nuclear power are large, the operating costs are relatively low, exactly the opposite of combined-cycle natural gas generation with low upfront costs, but very volatile operating costs. Combining them minimizes the weighted risk-adjusted levelized cost of electricity. However, building nuclear plants hinges on the cost of capital available to nuclear investors.
One way to lower that cost is by completing the plants under construction on time and on budget. Another way to lower the cost of capital is to reduce the size of upfront costs required to add a nuclear plant to a portfolio of generating assets. Small Modular Reactors, SMRs, can provide nuclear power at a lower initial investment. All SMRs being considered for near-term development in the U.S. (but not in other countries) are passively safe, e.g., after the Babcock & Wilcox mPower reactor shuts itself off, because of its underground design, the reactor’s heat dissipates into the earth surrounding it. The U.S. nuclear navy has been safely using small Light Water Reactors for almost 60 years.
Deploying a new technology also allows the formation of a new system for handling used nuclear fuel. If Congress is able to remove the requirement that licensing interim used nuclear fuel facilities depends on licensing a geologic repository, electric utility-owned interim storage facilities can provide storage to the year 2222 for less than electric utilities’ contributions to the Nuclear Waste Trust Fund.