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Nuclear Energy Institute
FOR IMMEDIATE RELEASE: February 20, 2007
Contact:, 202.739.8000 or 703.644.8805 (after hours and weekends)

Record-Low Production Costs, Near-Record Output Mark Stellar Year for U.S. Nuclear Power Plants

WASHINGTON—U.S. nuclear power plants in 2006 supplied the second-highest amount of electricity in the industry’s history while achieving record-low production costs, according to preliminary figures released today by the Nuclear Energy Institute. The 103 commercial nuclear plants operating in 31 states generated 787.6 billion kilowatt-hours (kwh) of electricity last year, second only to the record-high of 788.5 billion kwh of electricity produced in 2004.

Nuclear energy supplies electricity to one of every five homes and businesses. It also supplies nearly 75 percent of the electricity that comes from sources, including renewable technologies and hydroelectric power plants, that do not emit controlled pollutants or greenhouse gases into the atmosphere.

The industry’s average production costs—encompassing expenses for uranium fuel and operations and maintenance—were an all-time low of 1.66 cents/kwh in 2006, according to preliminary figures. Average production costs have been below 2 cents/kwh for the past eight years, making nuclear power plants highly cost competitive with other electricity sources, particularly those that are capable of reliably producing large amounts of electricity.

“The consistent safe, high performance and efficient operation of the nation’s nuclear plants provides overwhelming evidence that our business model is working and buttresses the case for building a new generation of advanced-design plants to help America meet its energy needs,” said Frank L. (Skip) Bowman, NEI president and chief executive officer.

Electricity production at nuclear power plants has increased 36 percent since 1990, adding the equivalent of more than 26 large power plants to the electrical grid and preventing the emission of massive amounts of controlled air pollutants and greenhouse gases if that increase in baseload, or around-the-clock, electricity production instead had been met by fossil-fired power plants.

Amid concerns about future energy security and the threat of global climate change, and with the nation’s electricity needs projected to increase 40 percent over the next 25 years, a growing chorus of supporters—spanning policymakers, leading environmentalists, business leaders and the public at large—is advocating the construction of new nuclear power plants. The Energy Policy Act of 2005 included incentives for a limited number of advanced-design nuclear plants among its provisions encouraging improved energy efficiency and the construction of renewable energy sources and cleaner fossil-fired power plants.

The average production cost dropped to a record-low even though prices for uranium fuel have increased considerably over the past three years. Production costs are a key measure of an electricity source’s competitiveness in the market because generating companies typically dispatch their low-cost electricity to the grid first.

Even when expenses for taxes, decommissioning and yearly capital additions are added to production costs to yield a total electricity cost, nuclear-generated electricity typically clears the market for less than 2.5 cents/kwh. By comparison, production costs alone for natural gas-fired power plants averaged 7.5 cents/kwh in 2005, according to Global Energy Decisions data.

The industry’s average capacity factor—a measure of efficiency—was 89.9 percent last year, according to preliminary figures. That is slightly higher than 2005’s 89.3 percent; the industry’s record-high of 90.3 percent was set in 2002.

“It’s going to take a collaborative effort of all forms of electricity generation, as well as much-improved efficiency, to meet the sizable energy needs that our nation faces,” Bowman said. “Still, the exceptional performance achieved at U.S. nuclear power plants in 2006 shows that the nation’s future energy security hinges in part upon increased reliance on clean, safe and affordable nuclear energy.”

Final figures on the industry’s 2006 performance are expected within about two months.


The Nuclear Energy Institute is the nuclear energy industry’s policy organization. This news release and additional information about nuclear energy are available on NEI’s Internet site at