OK

This is what is suggested in a recent article of the Times of London:



French demand high price for `rescuing' nuclear industry with two new reactors (behind pay wall, but accessible here)

According to well-placed industry sources, EDF Energy has told officials that it needs about £165 per megawatt hour, almost four times the existing wholesale price of electricity, if it is to go ahead with Hinkley Point.

(...)

The Government has warned EDF Energy, and its junior partner Centrica, that nuclear power subsidies must be lower than offshore wind power to ensure public acceptance. The company argues that the total costs of the giant new offshore wind projects planned for the North Sea will be £180 per mw/h [sic], making nuclear slightly cheaper.

That this is even in discussion shows how difficult it is to know the price of new nukes. Proponents of nuclear have long argued that nuclear power was really cheap, in the 3-4c/kWh (i.e. 30-40 EUR/MWh) range, and the recent report by the Cour des Comptes in France noted that the actual price of nuclear power in France over the past 30 years had been close to 50 EUR/MWh (see a summary of the report in English here (pdf)). But that was in the good old days when the country could - and knew how to - do industrial policy, and could fund nuclear power plants using sovereign discount rates (5-8% over 30-40 years) rather than private investor discount rates (10-15% over 15-20 years).

The Cour des Comptes notes that future nuclear power was unlikely to be cheaper than 80 EUR/MWh, and massive delays on the Olkiluoto and Flamanville plants being built by Areva in Finland and France (the former now pushed back again to a cumulative 5 year delay at the minimum) have made the calculation even more complicated.

I had heard rumors that EDF could be asking the British government for a 115 GBP/MWh tariff, in itself a stunning admission that nuclear was not so cheap (and making it barely cheaper than offshore wind, which currently benefits from tariffs in the 120-130 GBP/MWh range in the UK, and can be expected to go down significantly over time, as the sector industrializes and gains scale). But 165 GBP/MWh is definitely more expensive than offshore wind (the whole offshore wind industry would jump with joy if offered a flat tariff at that level) and massively more expensive than onshore wind (which costs 60 GBP/MWh or so and could be deployed on a large scale in the UK if it were not for NIMBY obstacles).

Beyond showing the UK government desperation to get some nukes built, this story suggests, more than anything else, that Germany's decision to stop nuclear altogether actually makes economic sense. Of course, it's not going to be easy, and there are serious engineering and technical problems to be solved, but they can be resolved if sufficient commitment is put towards that goal. In Germany, that commitment is there. In the UK, I think it's there as well (offshore wind will not be sacrificed to do nukes), but it's still not seen as the core priority - unless the push for nukes is actually a devious plot to make offshore wind look comparatively cheap...

Originally posted to Jerome a Paris on Wed Jul 18, 2012 at 09:33 AM PDT.

Also republished by Climate Hawks and Nuclear Free DK.

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