Nuclear power will be the featured energy source in the International Energy Agency’s 2014 World Energy Outlook (WEO).¹ To gather input, the IEA convened 100 experts in Paris on 31 March for an informal meeting—“The Future of Nuclear Power”—to help shape the three chapters of the upcoming WEO, which is standard reading for all in the energy policy field. The IEA’s Chief Economist, Fatih Birol, introduced the session noting that the WEO was always objective and does not lobby for any energy source or technology.²

Nuclear plans and prospects vary widely across regions and countries. In recent years, it is the emerging economies—China, Russia, Korea and India—which have started construction of the most new plants. In countries where electricity markets are more competitive and where electricity demand is growing more slowly—for example the United States and countries of the European Union—there is little or no construction activity. The delegates heard that over 75 per cent of world nuclear plants are more than 25 years old:³ countries with these plants are considering what to replace these plants with when they reach the end of their working lives.

Part of the challenge for these countries is that the financial costs of nuclear remain highly uncertain. The group heard of huge variability in the reported completion costs for US and European plants built during nuclear power’s boom years (1970-1990), and that costs have increased over time. Longer ‘lead’ (construction and commissioning) times were identified as a key reason.  Information on costs in other parts of the world, notably the key emerging markets, remains unavailable. The group did not conclude whether the major time and cost overruns experienced at projects in Flamanville (France)⁴ and Olkiluoto (Finland)⁵ were due to new designs, project management or other reasons.

Financing new plants is another challenge. It was noted at the meeting that private finance finds it very challenging to invest in nuclear: there would be no revenue for at least a decade, investments may then take another 25 years to pay back and projects are subject to significant political and regulatory risk. The sheer scale of investment—around US$ 8 billion for a typical nuclear plant—makes governments unwilling to take the debt on their books, but the private sector needs a wide range of terms and assurances to offer an alternative. The need for wide public acceptance, covering multiple electoral cycles, complicates the issue. Conversely, the workshop heard that nuclear power’s high up-front capital costs made it attractive for countries like the United Arab Emirates which are running high budget surpluses and wish to turn such surpluses into long-term assets.

The WEO chapters on nuclear will be an important reference in the ongoing nuclear power debate. Delegates were asked for their advice on what the IEA should analyze. The International Institute for Sustainable Development (IISD) noted that transparency of basic information is of key importance because it is the essential foundation of an informed public debate. The need for information on the costs of constructing and running nuclear power plants—most usefully from recent or ongoing build—is paramount; without it, citizens cannot sensibly compare nuclear power’s costs relative to renewable and fossil fuel alternatives. Understanding how prices for nuclear fuel—uranium—may change over time is also a key factor, as is an assessment of the financial value of nuclear power in being a ‘base-load’ technology (one which operates continuously) against the intermittent generation that solar PV and wind turbines produce. The costs associated with the decommissioning and permanent disposal of nuclear wastes remain unclear, and the relative costs and benefits of nuclear power in terms of pollution and accident risks should, in the view of IISD, also be considered in the WEO.

Generating a consensus on the pros and cons of nuclear relative to alternatives such as renewable energy is a long-term process. The IEA’s WEO chapters have the opportunity to make a very useful start in generating the shared understanding essential for full public engagement in the debate on nuclear power, itself a subset of the discussions on what mixes of energy and technology countries should employ for their future electricity supply. These mixes have major implications for whether development is sustainable.

1. The 2014 version will be published on 12 November 2014 and launched in London on that date. See http://www.worldenergyoutlook.org/ for further details.

2. The IEA notes with respect to the WEO 2014 chapters: “Nuclear power: Uncertainties continue to cloud the future for nuclear—government policy, public confidence, financing in liberalized markets, competitiveness versus other sources of generation and the looming retirement of a large fleet of older plants. The study will assess the outlook for nuclear power and its implications.” See: http://www.worldenergyoutlook.org/

3. The International Atomic Energy Agency’s “PRIS” database contains full details on all world nuclear power plant construction dates, sizes, etc. and is publicly accessible. See http://www.iaea.org/pris/Home.aspx

4. See http://en.wikipedia.org/wiki/Flamanville_Nuclear_Power_Plant

5. See http://en.wikipedia.org/wiki/Olkiluoto_Nuclear_Power_Plant