Nuclear Energy Insight March 2007
—America’s nuclear power plants last year supplied the second-highest amount of electricity in the industry’s history while achieving record-low production costs, according to preliminary figures released last month by the Nuclear Energy Institute.
The 103 nuclear power plants in 31 states generated 787.6 billion kilowatt-hours of electricity last year, second only to the 788.5 billion kilowatt-hours of electricity produced in 2004.
Nuclear energy supplies electricity to one in every five U.S. homes and businesses. It also supplies nearly 75 percent of the electricity that comes from sources 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 1.65 cents per kilowatt-hour in 2006, according to preliminary figures. Average production costs have been below 2 cents per kilowatt-hour for the past eight years, making nuclear power plants among the lowest-cost electricity sources.
“The industry’s commitment to safety and efficiency is clear in last year’s performance, and it buttresses the case for building a new generation of nuclear plants to help meet customers’ electricity needs,” said Skip Bowman, the Institute’s 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.
The average production cost for electricity generated at nuclear power plants 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 low-cost electricity to the grid first.
Even when adding expenses for taxes, decommissioning and yearly capital additions to production costs to yield a total electricity cost, nuclear-generated electricity typically clears the market for less than 2.5 cents per kilowatt-hour—three times less than natural gas-fired power plants, 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.”
The industry expects to release final figures on 2006 plant performance in April. —Read more articles in Nuclear Energy Insight and Insight Web Extra.