Financing the Nuclear Renaissance

This paper considers the key economic risks associated with nuclear power. The authors observe that the bulk of the risks of a nuclear power station project fall during the roughly five year period of plant construction. This window of risk follows a lengthy siting process and comes before power station operations lasting up to sixty years. As a consequence of the nature of the economic risks, operational nuclear power plants are more attractive targets for initial investment than new build projects. The authors suggest that the first glimmers of a US nuclear renaissance were visible in 2000 when dramatically higher prices were achieved for second-hand nuclear power plants following a period of depressed prices in the 1990s. The paper closes with a consideration of the prospects for nuclear new build in both Europe and the United States and the key financial and economic factors that could drive such developments differently in each case.