Skip to content

Fracked off via The Economist

Thanks to cheap natural gas, America’s nuclear renaissance is on hold


The culprit is the price of natural gas, which fell from over $13 per million British thermal units in 2008, when many of the applications to build new nuclear plants were lodged, to just $2 last year. Although it has since recovered to over $4, America’s huge reserves of shale gas should stop it from rising much for years to come. That makes some old nuclear plants costlier to run than gas-fired ones. Factoring in the massive expense of building new reactors—the pair at Vogtle will cost around $15 billion—makes nuclear power even less competitive. David Crane, the boss of NRG Energy, which scrapped plans to build two reactors in Texas in 2011 after sinking $331m into the project, estimates that new gas-fired generation costs $0.04 per kilowatt-hour, against at least $0.10 for nuclear.

It was not supposed to be this way. In 2005 Congress approved subsidies to bolster the nuclear industry and encourage the construction of new plants. It extended a law limiting owner liability in case of accidents and, for the first few new reactors, offered $18 billion in loan guarantees, $2 billion in indemnification against cost overruns and $1 billion in tax breaks. The NRC streamlined its licensing procedures, hoping to avoid the years of delays that inflated costs for earlier nuclear plants. (Southern ended up paying $8.7 billion for the existing reactors at Vogtle, a far cry from the $660m originally projected.)

Posted in *English.

Tagged with , , , , , .

0 Responses

Stay in touch with the conversation, subscribe to the RSS feed for comments on this post.

Some HTML is OK

or, reply to this post via trackback.