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What Role Does Nuclear Energy Play in a Net-Zero Future?
October 26, 2022 | Report
The outlook for nuclear energy to provide much of the economy’s baseline energy needs is challenged by an aging portfolio of reactors and a shallow pipeline of applications to build and operate new plants in the future. Over the next three decades, most of the US’ 93 nuclear reactors are approaching the end of their respective Nuclear Regulatory Commission (NRC) license terms. While it is possible to extend operating licenses for some of these facilities, in many cases these extensions have already been granted, and decommissioning may be the likely next step for these aging energy infrastructure assets. That leaves the economy woefully short in meeting future energy demand from zero-carbon nuclear sources.
Insights for What’s Ahead
- The amount of electricity generated by nuclear reactors is likely to fall significantly over the next few decades. Investor-owned utilities and other facility operators may face increasing cost pressures to add nuclear capacity at a time when many plant licenses are approaching their expiration dates. The resulting investment needs may raise electricity rates and require large inflows of investor capital in the form of equity and debt investments.
- Electricity markets in the US may experience greater volatility if electricity from nuclear sources constitutes a smaller share of the total load profile. Nuclear power operates with efficiency exceeding 90 percent in most cases, providing a stable load for industry, business, and households. In a world in which more power needs to be supplied by other sources and where buildings and vehicles are being electrified, there might be g
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