Can nuclear power make a comeback after 20 years, during which time hardly a single new plant has been commissioned among the developed world's countries?
In the absence of any government action, the answer depends on the costs of nuclear compared with its alternatives. Because nuclear plants involve high capital costs, they must be run almost continuously to be economical. This puts them into direct competition with coal-based power plants.
Gas-based generation plants, on the other hand, are less capital intensive, but their fuel is dearer and therefore the electricity produced is generally more costly. Despite that, they do play an important role as a provider of peak supply. Gas turbines can also be engineered to respond quickly to changing market conditions, backing off when demand and prices fall and rapidly firing up to take advantage of demand and price surges.
Hydro plants also involve high capital costs, and they can only store enough water in their dams to run one quarter of the time. Again, they operate to take advantage of peak demand periods.
Other power sources: wind, solar panels, etc., are uncompetitive except in very remote locations or at very low energy share levels. Their reliance on the Sun and the wind makes them intrinsically unreliable.
The costs of different power plants are shown in Table 1. These include three different estimates for nuclear power, with costs varying from the low $50s to the upper $60s per MWh. Coal in Eastern Australia comes in at under $40 per MWh and natural gas at about $44. The costs in Table 1 exclude taxes, subsidies and other regulations designed to alter choice of power generating technologies or mitigate greenhouse gas emissions.
As it is 30-60 per cent more expensive than coal-based generation, and somewhat more costly than gas, in the absence of government intervention, nuclear power does not have a future in Australia in the medium-to-long term. Nuclear is, on the other hand, significantly more cost effective than wind and all other exotic alternatives.
Compared with coal, natural gas and hydro generators have greater value because they are more flexible and can start and stop much more easily. Wind is the opposite-its unreliability is a detriment per se and, in addition, it imposes costs elsewhere on the system because other plant must be made available as a back-up.
