New cost estimates for nuclear power generation in Japan are over 50% higher than previous figures, but are still comparable to costs for wind and geothermal generation and competitive with fossil fuels.
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The costs are estimated in a draft report prepared for a committee reporting to the ministerial level Japanese ¶¶Òõ´«Ã½ÔÚÏß and Environment Council and estimate nuclear generation costs for 2010 to be Â¥8.9 per kWh (11.4 US cents). Following on from the March 2011 Fukushima Daiichi accident, the estimate factors in the possibility of a core meltdown at a nuclear plant, and includes societal costs such as the cost of dealing with future accidents and policy costs related to governmental budgets for the first time.
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Like earlier estimates, the ¥8.9 includes capital costs (¥2.5 for the 2010 estimate), operation and maintenance costs (¥3.1) and fuel cycle costs (¥1.4). In addition, the newest estimate includes ¥0.2 for additional post-Fukushima safety measures, ¥1.1 in policy expenses and ¥0.5 for dealing with future nuclear risks. The ¥0.5 for future nuclear risks is a minimum: the cost would increase by ¥0.1 for each additional ¥1 trillion ($13 billion) of damage.
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The ¥8.9 figure is calculated based on a model nuclear power plant using average figures from four plants operating over the period since the last estimate, with an output of 1200 MWe and construction costs of ¥420 billion ($5.4 billion). Costs were calculated assuming a discount rate of 3%, a capacity factor of 70% and a 40-year operating life.
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Although the latest estimate is some 51% higher than the Â¥5.9 estimatedÌýby the same committee inÌý2004, it shows that even factoring in the experiences of Fukushima Daiichi, nuclear remains competitive in Japan. The same study found best-scenario 2010 wind generation costs of Â¥9.4 for offshore wind, Â¥9.9 for on-shore wind, and Â¥8.3 for geothermal – although in less favourable conditions onshore wind could reach Â¥17.3 per kWh with offshore wind estimated to cost a maximum of Â¥23.1. 2010 costs for fossil fuel generation, including costs for CO2 measures, range from Â¥9.5 for coal through to Â¥10.7 for LNG to Â¥36.0 for oil.
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The estimates were also carried through to 2030. For nuclear and geothermal, the estimated cost remains unchanged over the period. Likewise, maximum costs for wind generation remain unchanged, and minimum costs could even decrease very slightly, the report finds. All the fossil fuel options are estimated to increase still more by 2030.
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The cost of solar power in Japan,Ìýcurrently estimated at betweenÌýÂ¥33.4 and Â¥38.3 per kWh, is forecast to fall substantiallyÌýover the next two decades through technological innovation and the effects of mass production. By 2030, the report estimates, solar generation will cost at best Â¥9.9 per kWhÌý- still more than nuclearÌý- and at most, Â¥20.0 per kWh.
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For nuclear, the report would appear to concur with calculations released earlier this year by the Institute of ¶¶Òõ´«Ã½ÔÚÏß Economics of Japan, which put the cost of nuclear electricity generation at Â¥8.5 taking into account compensation of up to Â¥10 trillion ($130 billion) for loss or damage from a nuclear accident.
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Nuclear power has long been a cornerstone of energy policy in Japan, a country with few natural resources of its own, generating some 30% of its electricity. A significant expansion in the use of nuclear energy - to more than 50% in 2030 - had been proposed under the country's basic energy plan, which had been based on the 2004 figures. Following on from the Fukushima Daiichi accident, the Japanese government is now in the throes of reviewing its energy policy. Prime minister Yoshihiko Noda has said that the country must aim to reduce its reliance on nuclear power in the longer term. However, the country still remains firmly in support of exporting its nuclear goods and services, with Japan's lower house recently signing international agreements on nuclear trade with emerging nuclear countries Jordan and Vietnam and renewing agreements with Russia and South Korea.
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Researched and written
by ¶¶Òõ´«Ã½ÔÚÏß Nuclear News
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