Is nuclear energy an option for the new millennium?

In the global market-oriented world of the next millennium, economic competitiveness will be a cornerstone for the viability of nuclear energy. On the other hand, sustainable development goals are calling for environmental and social protection as well as economic efficiency. In this context, governments have a key role to play in order to reconcile market mechanisms with environmental and social concerns.

Nuclear energy is highly regulated and controlled owing to the early recognition of the potential impacts on human health of radiation. Therefore, external costs associated with residual impacts of nuclear power are low compared with those of alternatives for electricity generation, including most renewables.

Getting the prices right through internalisation of external costs would reinforce the competitiveness of nuclear power versus fossil fuels. However, uncertainties on assessing the impacts and the valuation of external costs may delay policy decisions in this regard. For investors and managers in the power sector, external costs will not be reflected in decision making as long as social and environmental impacts are not recognised by government policies through prices or regulation. Therefore, in the short term nuclear energy may have to compete with alternatives on the basis of direct costs only.

Concluding remarks

The outlook for nuclear energy varies from region to region and from time to time. In the short term, nuclear power plants in operation likely will increase their outputs and it may be expected that while installed nuclear capacity will remain more or less stable, nuclear electricity generation will increase. Plant lifetime extension and performance improvements are expected in most OECD countries already operating nuclear units; a few countries may initiate or pursue nuclear power programmes and a few others may reduce their installed nuclear capacity by plant retirements.

In the long term, beyond 2020, nuclear energy could regain and eventually increase its share in energy supply in particular in countries where concerns about greenhouse gas emissions leading to global climate change and security of supply will be driving factors in energy policies. In those countries, carbon-free domestically based energy sources such as nuclear and renewables, will have opportunities to substitute fossil fuels.

©, OECD, July 2000, Is Nuclear Energy an Option for the New Millenium? Reproduced by permission of the OECD.