Much has been written on the costs of nuclear power, with a large body of the academic literature focusing on the existence of learning by doing, standardisation benefits and economies of scale as means for reducing the construction costs of nuclear reactors. Over the last few years, the construction of first-of-a-kind Generation III reactors has resulted in important initial costs overrun and delays, especially in Europe. However, the comparison between the 2005, 2010 and 2015 Projected Costs of Generating Electricity seem to indicate that this initial phase of construction costs increase may be behind us and that construction costs reduction may be achievable over the next decade or two.
Nuclear power stands at a critical juncture in NEA countries with the completion of several first-of-a-kind (FOAK) projects. These projects have served to rebuild industrial capabilities after a long nuclear construction hiatus creating a window opportunity to capitalise on the experience accumulated to improve the economic performance of future nuclear projects. At the same time, significant cost overruns and delays in several parts of the world have challenged the competitiveness of nuclear power and are driving the risk perception of future projects.
In other parts of the world, however, the nuclear industry is currently performing quite well in with new nuclear capacity being built in a more predictable and cost-effective manner (i.e. China, Russia and the UAE). In addition to these recent success stories, there is extensive historical data from past nuclear programmes (France, Japan, Korea) showing that nuclear power can be delivered with lower cost and risks if the appropriate governing frameworks are put in place.
The NEA Ad hoc Expert Group on Reducing the Costs of Nuclear Power Generation was established in 2018 to evaluate the construction cost reduction opportunities arising at different levels and timeframes. In particular, it assesses the policy and governance frameworks needed to drive positive learning and continuous industrial performance for nuclear new build. The study also explores the risk allocation and mitigation priorities needed to define adequate financing schemes for these projects. Longer-term cost reduction opportunities related to the harmonisation of licensing regimes and industrial codes and more innovative designs (i.e. SMRs and advanced reactors) are also analysed.