Is nuclear energy the answer?
probably not
Nuclear power is one of the most polarizing topics in any discussion of our energy future. As someone who appreciates the potential of nuclear energy, I am torn about its prospects. On one hand, nuclear energy offers an always-on, low-carbon alternative to fossil fuels. On the other, its cost remains a significant hurdle, deterring new developments in this sector.
The central issue with nuclear power is its cost. Constructing nuclear power costs approximately $10,000 per kilowatt of capacity. This is ten times as expensive as solar and wind, which cost around $1,000 per kW. See this plot, from Lazard:
Critics of renewable energy often point to solar and wind’s intermittency — the fact that the sun doesn’t always shine and the wind doesn’t always blow. You can, of course, add storage to solar, which increases the cost to $1,600 per kW, still much cheaper than nuclear.
To the power plant operator, though, intermittency is completely irrelevant. They don’t care if they only get power 6 hours one day, zero the next, and 12 the next. What they care about is how they get on average, which determines their annual revenue. From the operators perspective, solar and wind and wind get the W, which is why the market is building so much solar and wind.
Why is nuclear power so expensive? A significant factor is the lack of scale. In most industries, costs decrease as production increases, benefiting from what experts call “learning by doing”: the more of a product you build, the cheaper and higher quality the products are.
The very first flat-screen TVs were very expensive. But, as we made gazillions of them, the price plummeted, so now you can get a ridiculous 86″ TV with WiFi and built-in Netflix for under $1,000 with which to watch important and educational shows like this.
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