Clean Power solar energy costs nuclear energy costs

Published on August 1st, 2010 | by Zachary Shahan


Historic Report: Solar Energy Costs Now Lower than Nuclear Energy

August 1st, 2010 by  

solar energy costs nuclear energy costs


For ages, people have been saying: “Solar is a great, clean, renewable energy source, but it is just too expensive. Other energy sources, like nuclear, may have some (or serious) environmental risks, but they are cheaper.”

Now, a new report out of Duke University says that solar energy and nuclear energy have passed a “historic crossover,” where decreasing solar energy costs and increasing nuclear energy costs have met, and then parted. Solar energy is now cheaper than nuclear energy and is getting increasingly cheaper every day.

Solar Energy–Nuclear Energy Crossover

John O. Blackburn, a professor of economics at Duke University in North Carolina, and Sam Cunningham, a graduate student at Duke, wrote the paper, “Solar and Nuclear Costs — The Historic Crossover.” They wrote: “Solar photovoltaics have joined the ranks of lower-cost alternatives to new nuclear plants.”

The crossover occurred at 16 cents per kilowatt hour.

Of nuclear energy construction costs, Mark Cooper, senior fellow for economic analysis at Vermont Law School’s Institute for Energy and Environment, says that the estimates have been going up significantly for years (i.e. from $3 billion/reactor in 2002 to about $10 billion/reactor now) and they are expected to continue rising.

In a report Cooper published last November, he found that the costs for U.S. taxpayers and utility users could end up being hundreds of billions or even trillions of dollars more than needed to achieve our low-carbon goals if the federal government goes for a nuclear energy intensive approach. The name of the report: “All Risk, No Reward for Taxpayers and Ratepayers.”

Nuclear Industry Push for More Help Could Result in Financial Disaster, & Already Has

The ambitious nuclear energy approach is continuously and heavily being pushed by the nuclear industry, of course. On their wish list are subsidies, tax credits, loan guarantees, procedural simplifications and more. Unfortunately (and the route of this word really stands out to me writing this), the federal government has been giving in.

The nuclear industry is also pushing for help on the state level.

Diana Powers of the NYTimes writes:

At the state level, the industry has also pressed the case for “construction work in progress,” a financing system that requires electricity users to pay for the cost of new reactors during their construction and sometimes before construction starts. With long construction periods and frequent delays, this can mean that electricity users start to pay higher prices as much as 12 years before the plants produce electricity.

Think the environmental risks and disasters of building nuclear power plants are the only problem? Think again.

As far back as 1985, Forbes magazine called construction of the first generation of U.S. nuclear plants “the largest managerial disaster in business history.”

More from the NYTimes:

The first round of plants resulted in write-offs through bankruptcies and “stranded costs” — investments in existing power plants made uncompetitive by deregulation — which essentially transferred nearly $100 billion in liabilities to electricity users, said Doug Koplow, an economist and founder of Earth Track, based in Cambridge, Massachusetts, which campaigns against subsidies it considers environmentally harmful.

And, even more astounding than that, take a look at this info:

From 1943 to 1999 the U.S. government paid nearly $151 billion, in 1999 dollars, in subsidies for wind, solar and nuclear power, Marshall Goldberg of the Renewable Energy Policy Project, a research organization in Washington, wrote in a July 2000 report. Of this total, 96.3 percent went to nuclear power, the report said.

And these costs and risks are nothing compared to what is expected if a new wave of nuclear reactors gets the government backing the industry is looking for.

Why does the industry continue to push forward? Because they aren’t at risk with the government’s support.

“With such financing the utility is making a one-way bet, allowing it to make a profit even when the project fails,” Cooper said. “The people bear the risks and costs; the nuclear utilities take the profits. Without loan guarantees and guaranteed construction work in progress, these reactors will simply not be built, because the capital markets will not finance them.”

For more on the topic, read the NYTimes lengthy 3-page piece. I think I will write more on nuclear energy in the coming days as well.

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About the Author

is tryin' to help society help itself (and other species) with the power of the typed word. He spends most of his time here on CleanTechnica as its director and chief editor, but he's also the president of Important Media and the director/founder of EV Obsession, Solar Love, and Bikocity. Zach is recognized globally as a solar energy, electric car, and energy storage expert. Zach has long-term investments in TSLA, FSLR, SPWR, SEDG, & ABB — after years of covering solar and EVs, he simply has a lot of faith in these particular companies and feels like they are good cleantech companies to invest in.

  • archaios pteryx

    Hey… how about a study carried out by an accounting firm, or an investment bank, on behalf of a Business or an Engineering school? Otherwise, I can assign a mouse health study to Sylvester cat and he shall prove that mice are good for you (after taking into account that backup power is free).

    • Anonymous

      Backup power is irrelevant to the price of solar. No one is talking about building a grid fed mainly by solar which would need to be backed up by storage or another form of generation.

      Solar stands alone, just as every other source of electricity. If it is one of the lower priced providers within a buying block then it will crowd out more expensive sources.

      It’s like you being willing to pay $1.50 a pound for tomatoes at the grocery store, but buying from your neighborhood fruit stand when they are selling for $1. They might not have $1 tomatoes twelve months of the year, but when they’ve got ’em you buy ’em.

      That is exactly what is happening with wind. In places where there is a lot of wind on the grid (Texas, for example) cheap wind causes more expensive generation to either shut down or sell their power at a loss (in the case of coal and nuclear). Dispatchable sources such as hydro just shut down and sell their power when there is market demand.

      And this creates major problems for coal and nuclear, especially nuclear. The price of electricity from coal and nuclear depend on them being utilized 24/7. If they lose part of their hourly incomes, have to sell at a loss, because of cheap renewables available on the grid then they have to jack up their selling price for the rest of the day in order to stay in business. It’s a bigger problem for nuclear because nuclear is even less dispatchable than coal.

      Then as coal and nuclear are required to raise their prices due to being crowded out of part of the day they face an additional threat from stored cheaper wind and solar and that curtailed hydro.

      It is not time to invest in coal and nuclear. Lunches are being eaten and it’s their lunches….

  • It’s good news that the cost of PV solar is competitive (or cheaper than) nuclear power. The true costs of small-scale modular nukes are essentially unknown in this country, and the economic history is not kind to nuclear power. Further, the question of nuclear waste remains, to understate, rather thorny.

  • Michael Boyter

    Zachary, I support what your said. Bill Woods seems to be aligned with the nuclear power industry and he obviously like most of them refuses to look at the facts and the truth. If the nuclear power systems are so wonderful, why will the insurance industry not insure them? They basically want to keep hosing the tax payers. I have yet to see a nuclear power plant come in on time and budget. I don’t know what he’s pushing but it’s not the facts. We should make sure that all nuclear subsidies are stopped until they find a way to deal with the storage of their waste. The issues of terrorism and nuclear proliferation in a world with as many tin dictators as we have is just plain insane. Look at Russia scrambling to put out the wild fires for fear the widespread radiation from their worst nuclear Accident will be spread into Moscow and get into the jet stream. Nuclear power is a looser, any way you look at it. It will destroy the already battered economies of the world and make things worse.

    Zachary, I commend your excellent work. The technology exists today that will make nuclear obsolete before the end of the decade. This is not a dream, its a reality. Keep up the good work Zack, Your providing a good service by exposing their lies and showing the truth to an uninformed and greatly misguided Corporate News Media owned by the Reactor Makers such as G E and others.

    • Michael, thank you much. Rare to get such positive comments and definitely a nice relief. Thank you for your opinion and kind words of support. Of course, the subject matter is the issue.

  • OIL = Money. In the 70’s there was a period time when American many people could only obtain gas on odd or even days depending on matching the last digit of their license plate. There was outrage and concern then and proponents of replacement vitality sources spoke out. Their warnings were unheeded. Fast forward 40 many years. We are paying the value for greedy oil companies and lawmakers who profit from major oil. The bp disaster is what happens when corporations are greedy and will stop at nothing to make that funds! An investment in Natural Energy is mostly a necessity. Americans have been completely told it seriously isn’t achievable to make a wonderful car or truck that won’t run on gas. We are already told you can get limitations to Green Electric. We have been told that we will need oil to survive. We are actually told, “No, You Cannot.” This is known as a nation of inventors, brilliant most people who CAN make Natural Electric and green vigour work for us. We have to break the strangle hold that substantial oil has on our government and our lives. IF we survive the bp oil disaster, we Need to Modify.

  • Daniel Jacobson

    The argument that solar panels take too much space is dramatically lessened if we figure out how to have more solar roofs and walls on all kinds of buildings.

  • Anthony

    Since you opened yourself up to it Zach, the New York times article, that you now admit to basically plagiarizing right here, has a credibility demolishing editor’s note…good job on your fact checking.

    • “plagiarizing”? you have to be kidding. i put the NYTimes as the site where i saw the news & quoted from in the article more than once. do you know what plagiarizing is? i didn’t copy and paste the article in here but used parts of it.

  • Bill Woods

    In the US, every nuclear plant that’s started construction in the last 20 years has come in on schedule and under budget.

    Seriously, Japan and Korea have excellent track records, which is an existence proof that it can be done. China seems to be doing well, though it’d be prudent to take their cost estimates with a grain of salt.

    Anyway, the whole basis of this nuclear vs. solar comparison is misconceived. Nuclear competes with coal to supply baseload power, while PV competes with gas to provide (the front side of) peak load.

  • Bill Woods

    “16 cents per kilowatt hour.” This figure for solar PV is wildly misleading on the part of the authors. In Appendix A they show how they reached it: a solar system costing

    10,000 / 3000 / 0.85 / 0.18 = 39.2 $/W(average).

    Multiply that by 0.078227 / 8760 = 35.0 ¢/kW·h.

    State and federal taxpayers cover 65% of the cost, leaving the ratepayers with 15.9 ¢/kW·h.

    But the subsidized cost isn’t the real cost, and subsidy levels like that don’t scale; if PV grows beyond a trivial fraction of total supply they’ll be cut. See the experience of Germany and Spain.

    … Meanwhile, the most expensive nuclear plant listed in Appendix B is estimated to cost $11.25 billion and generate 1.105 GW. At a conservative 85% capacity factor, that’s 12.0 $/W(average). Using the same amortization factor, that’s 10.7 ¢/kW·h.

    • @ Bill Woods: again, what ridiculous subsidies do nuclear plants get? (and when was the last time one was built and the cost estimates didn’t skyrocket?)

  • Hasse

    EgadsNo, 10000 cubic feet is not a cubic mile. Its a cube around 21feet on each side.

  • Pitt

    >>> Pebble bed reactors can operate

    >>> at half that cost

    Pebble bed reactors are still in the prototype stage, meaning any estimates about their operating cost in a commercial setting are (a) uncertain, and (b) referring to a time years in the future.

    It is misleading to compare the estimated future costs of a speculative technology with the current actual costs of an existing technology.

    >>> industrial is the backbone of

    >>> the economy and its power

    >>> supply right now is what is

    >>> crippling it

    Industrial electricity costs in Germany are much higher than in the USA, yet Germany has a strong manufacturing and export sector. Based on that evidence, it is unlikely that electricity costs are the main problem currently facing the US economy.

    >>> 10,000 cubic feet…a cubic

    >>> mile of refined silicon

    If your calculations come to absurd conclusions, it’s usually wiser to re-examine the correctness of those calculations rather than assume the absurdity is true.

    5,000 cubic feet is 3.4 × 10^-8 cubic miles.

  • John Farmer

    The new nuclear facilities that will be built have an expected life of over 70 years. Solar panels might have a life span of 20 years. If you took the entire life span of a nuclear plant into consideration you would see there is no other power source that can compare to nuclear power. Also Solar produces more volume of waste than any other power source. Let us remember that solar is an intermittent power source. If one takes the cost of storing power via solar for a 24/7 day operation or the cost of a carbon producing natural gas plant to back up solar the price per kilowatt climbs significantly.

    It is funny how people like Zachary Shahan conveniently forget these obvious facts when writing about nuclear power. However, Zachary as a long history of not telling the truth. To him it is more important to push his political agenda of renewable energy than to tell the truth. This can be illustrated in the fact that Zachary does not use peer reviewed science to make his points. Instead, he relies on studies that are fudged by his pro renewable cohorts. To me it shows how desperate renewable energy advocates are becoming in protecting their large government subsidies.


    • @ John Farmer: thank you for all the compliments. yes, me and the NYTimes are ignorant of all the benefits of nuclear power & the downsides of solar in covering this story and are just greedy renewable energy supporters trying to steal some of the 96.3% of clean energy subsidies that go to nuclear power.

  • It is exciting to see how much is being done with solar power. It is becoming more affordable, more accessible and easier for consumers. It is also bringing us that much closer in this country to energy independence.

  • Sven

    While I didn’t follow EgadsNo completely, I get the gist of what he’s saying. And he’s absolutely right. The market will always prefer energy dense fuel and it’s not even close between nuclear and solar.

    I also love solar for residential areas. Putting them on any roof is good, but using huge amounts of land to build a “solar power plant” is just silly.

  • John

    I question the assumptions that went into the calculations for this report. The reason I think Dr. Blackburn’s and his co-researcher’s finding are suspect is because the group that funded their research is actively opposing the construction of new nuclear power plants as well as fighting to shut down current plants. Changes in assumptions such as the Weighted Cost of Capital (WACC) used calculate future nuclear costs can make a big difference. I don’t know what what Dr. Blackburn used for a WACC, but a report put out by CitiBank used a WACC of 14% even though the industry averages 7% and with government backed loans, new US reactors are expected to have a WACC of 5-6%.

    I also did some digging and found that the DOE EIA projects levelized costs for nuclear power to be at 11.9 cents/kWh whereas solar PV is expected to be above 30 cents/kWh.

    The other factor that needs to be considered is the costs of utility wide electric storage or extra capacity for night time periods or prolonged periods of cloudy days. When a nuclear power plant has an unscheduled outage, they have to pay rate payers for the lost electricity. Somehow I don’t see solar power generating stations have to pay for unscheduled clouds passing over head or in the event there’s a powerful thunderstorm with large hail destroying miles of PV panels?

  • rick jones

    Litigate and delay anything enough and it will become prohibitively expensive. It is neither solar nor nuclear, but how much has Cape Wind had to spend fighting the NIMBY litigation it has faced?

  • Jim S

    Solar power developers are notorious for lying about the true cost of their technology. I wouldn’t believe this study for a nanosecond.

    • @ Jim S: Nuclear industry folks aren’t? Costs skyrocket as soon as (or even starting before) projects start to get built… and the increases continue on all the way through the process

  • Erico

    First, pebble bed reactors haven’t been built yet, so the half cost is a guess. Second, to produce nuclear fuel you spent almost as much energy as you get from the fuel. It doesn’t make sense.

  • This is a great win for the solar industry and I hope it makes more people take notice. I’d like to disagree with EgadsNo’s comments. Solar is a viable option for commercial projects. With most having large, unshaded flat roofs, they would be an optimal site.

  • Adam F.

    The previous poster, I feel, is on to something. We need to look a lot closer at the Duke report’s mathematics. It just doesn’t add up in my mind. Furthermore, one also needs to take into account space requirements of solar and other renewables. Overall, nuclear is much more space efficient, which, if solar takes off, will become much more of an issue.

    • @Adam F.: Solar energy, in many cases, is put on the tops of roofs. Whether they be houses or warehouses. Not space efficient?

  • EgadsNo

    “The crossover occurred at 16 cents per kilowatt hour.”

    Pebble bed reactors can operate at half that cost and obviously those inflated costs are from clueless regulators, because the power density of a plant cannot be matched and there is where the majority of costs will based on- solar cells use mono crystalline silicon which is only reliably produced by melting polycrystalline silicon at around 3000 which is as costly as producing steel in terms of energy consumed. Any idea how many solar cells you need to replicate a 200MW reactor that is putting out energy 24/7 without concern of failures- and far less maintenance costs. Well the largest solar project right now is 300MW and 2/3rd of the space of that used is 3.3 square miles. At 350 micron thickness that is just under 10,000 cubic feet of mono crystalline silicon required + maintenance costs vs a building that could fit in a high school and be operated by under a dozen people. Even if only half of the space used is covered by photo voltaics that is still almost a cubic mile of refined silicon. Which do you really think costs more to make and produce electricity from?

    Do not get me wrong I am a big fan of solar for residential purposes- but residential only uses about 20% of the total electrical demands compared to commercial and industrial. To use solar cells to cover industrial demand alone would be catastrophic to ecology vs pebble bed reactors. Do not fool yourself either, industrial is the backbone of the economy and its power supply right now is what is crippling it- don’t think it is wages.

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