Renewable Energies versus Nuclear Power – Comparing Financial Support
Renewable energies were compared with the nuclear option by looking at the quantities of power they can both generate and the level of financial support this requires. This mirrors the extra costs which must be borne by the end consumer or society. Five different renewable technologies were analysed: biomass, onshore and offshore wind, small-scale hydropower plants and photovoltaics.
The static approach compares the current (as of 2013) level of incentives for renewables with the state support mechanism for Hinkley Point. The dynamic approach, in contrast, also considers additional factors including future cost reductions achieved through increasing technological experience and aspects of market integration of variable renewables like solar and wind power. The dynamic approach has been calculated up to 2050; the nuclear option is added from 2023 onwards (planned start-up for Hinkley Point C). The dynamic calculation applies a detailed model-based analysis using the Green-X-model (www.green-x.at). This model takes into account a multitude of factors including costs, potentials, regulatory frameworks, diffusion constraints like non-cost barriers, electricity prices and energy demand, all of which have a strong impact on the economics of power generation.
The static and dynamic calculations were conducted for five different EU Member states (United Kingdom, Poland, Germany, France and the Czech Republic) and the EU 28 overall. The countries were selected to reflect different starting points with regards to the current and potential use of nuclear power and renewable energies.
The static approach showed that, in the five countries examined, under the same budgetary conditions it is almost always possible to generate more electricity from renewable sources than from nuclear power. Currently, among the assessed technologies small hydropower plants and onshore wind are the least expensive methods of generating electricity.
The dynamic approach dares to take a broader look into the future. It calculates, amongst others, the future cost of generating electricity (€ per MWh) and the extra costs (i.e. support expenditures) which society and the end consumers must bear. Figure 1 illustrates the expected market value of the electricity supplied (broken line) and the remuneration required for renewables and for nuclear power (solid line) at EU level. The resulting differences are the costs which must be borne by the public.
The remuneration needed for renewables is less than for nuclear power. The expected market value of electricity generated by nuclear power is, however, greater than that of renewables, and this difference will continue to increase through to 2050.