Nuclear Power Costs and Subsidies

EMD-79-52: Published: Jun 13, 1979. Publicly Released: Jun 13, 1979.

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The full cost of nuclear-generated electricity includes the electric utilities' costs, which are passed on to the consumer, and the costs borne by the federal government, which would generally be financed through tax revenues. As of January 31, 1979, 70 nuclear power plants were licensed to operate in the United States. These plants, having a total capacity of about 50,000 megawatts, provided about 13 percent of the nation's electricity. An additional 126 power plants are either under construction or planned. The large financial risks involved with developing commercial nuclear power required federal participation and cooperation with industry. The government's objective was to eventually transfer all federally-developed reactor and fuel cycle technology to a self-sustaining private industry. Meeting this objective has cost the taxpayer an estimated $12.1 billion since 1950. The federal government's major support to the commercial nuclear industry has been in the following areas: (1) nuclear research, development, and demonstration; (2) nuclear regulation to protect the public's health and safety; (3) enrichment of uranium to make it usable in commercial nuclear power plants; (4) stimulation of domestic uranium mining; and (5) indemnification of power plant owners and others in the industry against nuclear accidents. A large nuclear reactor research, development, and demonstration program for fiscal years (FY) 1950 through 1978 has cost an estimated $8.6 billion and may total about $1.1 billion higher. The regulatory function has cost $1.2 billion from FY 1960 through 1978. The costs and apparent subsidies for uranium enrichment totalled $1.2 billion through FY 1978. Federal subsidies in the mining and indemnification areas have not fully been quantified. Estimates show that the average cost of nuclear-generated electricity was 1.46 cents per kilowatt-hour in 1976, 1.45 cents in 1977, and 1.5 cents in 1978. Two future areas of increased costs will be waste management and decommissioning, but the actual procedures and costs for these are not yet known.

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