Nuclear power plants return to the European Union to curb CO2, but is it profitable to build new ones?

For the first time in decades, nuclear technology has become fashionable with the approval of COP26 and the European Union.

Trillo nuclear power plant (Guadalajara)

Nuclear technology is once again in the spotlight. A large part of scientists Intergovernmental Panel on Climate Change (IPCC) and now the European Union, open the door to energy that has been defenestrated for decades due to serious accidents (such as Chernobyl or Fuckushima) and the problem of radioactive waste.

Even so, the European Commission has classified the construction of nuclear power plants as a ‘green investment’ at the same level as renewable parks.

Shortly after, andthe French President, Emmanuel Macron, announced that the country was going to build new nuclear power plants for the first time in decades, to guarantee its energy independence without contributing to the acceleration of climate change. It has not been the only one in Europe. The Prime Minister of the United Kingdom, Boris Johnson, also wants to give more concessions.

Macron has said that they will not be plants like those known up to now, but rather small nuclear reactors of the SMR type, faster and cheaper to build, with an installed power of about 170 MW per unit, but still in incipient technological development. A conventional plant is located between 600 MW and 1,200 MW.

And in the United Kingdom, despite criticism for the high costs and safety problems of the plant currently under construction Hinkley Point C, the Government is studying giving the go-ahead to other two more nuclear plants. At the same time, private companies like Rolls-Royce, con BNF Resources UK y la American Exelon Generation have created a new company to invest a total of 500 million euros in mini-reactors that will produce 470 MW.

Profitability under discussion

According to the report of the International Energy Agency, “Projected Costs of Generating Electricity 2020”, the electricity generated by new nuclear power plants would have lower costs than if compared with the calculations made five years ago. On average, construction costs reflect falls because the learning curve of First of a Kind (FOAK) in several OECD countries.

In his analysis he affirms that nuclear energy continues to be the manageable technology with low CO2 emissions with lowest projected costs based on 2025. Only large hydropower plants can provide a similar contribution at comparable costs, but they remain highly dependent on the natural water capacity of each country.

Electricity produced from nuclear long term operation (LTO) by life extension is highly competitive and remains not only the lowest cost option for low carbon generation, compared to building new plants of energy, but for all energy generation in all areas, adds AIE.

A statement that supports the philanthropist and multimillonario Bill Gates who has said on numerous occasions that nuclear power will be “absolutely” politically acceptable. According to him, new innovations in nuclear technology (founded TerraPower in 2006, a nuclear reactor design company) are making nuclear power safer and more affordable, and countries around the world are beginning to adopt it.

The problem of time

If the costs could be improved, what everyone agrees on is the time it takes to build a nuclear plant. Even the new generation. The time required for most reactors is often in excess of 10 years, and that in the best of cases in which there are no setbacks.

An example can be seen in the nuclear power plant Hinkley Point C. When its construction was approved in 2016, the French company EDF estimated the cost 18,000 million pounds (21,000 million euros). Today, the company puts the bill at about 23,000 million (27,000 million euros) and delays due to regulatory problems will make it difficult to get up and running in 2026.

Also in 2016, the UK government set its profitability price at 108 euros/MWh but with the budget revision it has risen to 124 euros/MWh, although with the escalation of the European electricity markets and the high gas prices (close to 200 euros / MWh and OMIE) could now be profitable. But if it is compared with the average of 28.6 euros/MWh of the renewables that have bid in the last auction in Spain, it makes one think about the competitiveness of these plants.

Another example is also in France. A conglomerate of state-owned companies has been building 2007 a new generation reactor, of the type EPR, with some 1.650 MW of power, in Flamanville (Normandy, northwest), but the project is plagued by technical problems and cost overruns that have caused long delays.

And from the big ones to the small ones. If governments support the new small reactors, there is another major challenge, in addition to their : fuel. Not only is uranium enriched, it needs a new preparation process, as well as being licensed, produced, managed during use, and stored and disposed of when spent.