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Episode 102. The Economic Feasibility of Nuclear Power

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The economic feasibility of Nuclear Power is under an unprecedented microscope, with evolving energy solutions and changing market dynamics, the mathematical foundation that once supported the nuclear industry's robustness is now slipping.


While traditional energy giants like the US, France, and Russia grapple with the shifting sands of economic viability, emergent green energy leaders are questioning the place of nuclear power in tomorrow's energy mosaic. Is nuclear energy a mere bridging solution in our transition to a carbon-neutral future, or is it an unsustainable relic of the past? We ask our panel of experts:

 

Episode Overview:


Part 1: Atoms and Accountants (5:32)

  • Paul Dorfman begins our episode with some perspectives around the timeframes involved in building nuclear power stations and the economic burden these lengthy timeframes imposes on an investor. He points to the experience of France's ageing infrastructure and the economic timebomb they may represent.

  • We discuss the requirements for a nuclear power plant, including the impact on climate change on potential sites.

  • We examine the notion of nuclear power plants becoming a highly profitable enterprise after maturing around the 15 year mark, in theory being able to run for decades after that.

  • Dorfman counters that these plants have a much more finite life and the costs of decommissioning may bankrupt companies and become a burden for the state, both financially and environmentally. In addition, the technical expertise required in decommissioning a nuclear plant is often vastly underestimated.

  • We discuss the changing nature of electricity demand across societies and how that change is causing a re-evaluation of how energy grids are being designed and which technologies should be used to create the smart grids of the future.

Part 2: The Price of Particles (22:30)

  • David Schlissel gives us an overview of the cost and time estimate blow outs of nuclear power plants in the United States, and how that has impacted the appetite for nuclear power projects moving forward.

  • The costs of running ageing nuclear power plants has increased above the expected growth, as well as the dramatic fall in energy prices through low LNG and renewables prices.

  • This situation creates a dangerous situation for nuclear power plants that have not yet paid off its loans and investors, where bankruptcy may be the better option for the owners, instead of continuing operations or paying for the expensive decommissioning process.

Part 3: Elemental Economics (33:56)

  • James Acton takes us through the different dynamics from country to country, with several western nation's turning away post-Fukushima as public sentiment soured on the use of nuclear power.

  • However, across the world there are several counter-examples. Acton points towards plants under construction in India and Turkey, several of which are being financed by Russian loans.

  • We discuss the evolving technology used in plant creation today, the majority of which are still using 'light water' reactors, which gained prominence from the US Navy's investment in the technology for its nuclear submarines.

  • We turn towards the concept of small modular reactors (SMRs) and the potential benefits of this technology, as well as the likelihood of these SMRs coming online in a timely fashion, given the plurality of research and designs being investigated separately by different firms.

  • We discuss the safety concerns around nuclear power and the regulatory approach required to answer those concerns, particularly with the diversity of technologies currently in place and under construction.

 

Episode Guests:

Paul Dorfman

  • Chair of the Nuclear Consulting Group and Associate Fellow, Science Policy Research Unit at the University of Sussex

  • Honorary Senior Research Associate at the Energy Institute at University College London

  • Senior Member of the European Nuclear Energy Forum (ENEF)

  • Served as Secretary to the UK government scientific advisory Committee Examining Radiation Risks from Internal Emitters, as well as an Advisory Group Member to the UK Ministry of Defence (MoD) nuclear Submarine Dismantling Project

David Schlissel

  • Director of Resource Planning Analysis at the Institute of Energy Economics and Financial Analysis

  • He has over 30 years of experience as a regulatory attorney and consultant on energy and utility issues and has testified as an expert witness before regulatory commissions in more than 35 states and before the U.S. Federal Energy Regulatory Commission and the Nuclear Regulatory Commission

  • His work has included researching, writing and testifying about the U.S. nuclear industry and the cost overruns, construction delays and other challenges associated with many nuclear projects.

James Acton

  • Holds the Jessica T. Mathews Chair and is co-director of the Nuclear Policy Program at the Carnegie Endowment for International Peace.

  • A physicist by training, he has testified to the U.S. House of Representatives Appropriations Committee on nuclear modernisation

  • Acton’s publications on nuclear policy include Why Fukushima Was Preventable, a groundbreaking study into the root causes of the accident

  • He is a member of the International Advisory Council for the Luxembourg Forum on Preventing Nuclear Catastrophe.

 

The Red Line's Nuclear Power Reading List:

We’ve compiled a list of further reading to better understand the geopolitics of nuclear power generation.

Books:

Global Energy Fundamentals

Simone Tagliapietra


The Economics of Nuclear Power

Geoff Rothwell


A Bright Future

Joshua S. Goldstein and Staffan A. Qvist

 

For episode transcripts, monthly geopolitics Q&A’s, member-only videos and to support the show, check out our Patreon here: https://www.patreon.com/theredlinepodcast


This episode is dedicated to our Patreon member Shane Seremet, Jaap Kramer, Stuart Shroff, and An Si.

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