Nuclear power and the French energy transition: It’s the economics, stupid!
Mycle Schneider
Abstract
France is at an energy crossroads. To meet future electricity needs, the country could extend the operating lives of nuclear power plants beyond 40 years, accepting the safety challenges and costs of such a move, or it could change its energy mix, moving away from nuclear power and toward energy-efficiency measures and other energy sources. Until recently, the French government had refused even to examine the possibility of reducing the country's reliance on nuclear power. But a study by independent French experts suggests that staying the nuclear course would be more expensive and less environmentally beneficial than authorities make it out to be. The difficult financial situation of two state-controlled firms involved in nuclear energy, EDF and Areva SA, will seriously affect the government's operating margins. Those financial difficulties, the aging reactor fleet, and public opinion - which is largely in favor of a nuclear phase-out - will force the government to make fundamental choices in the near future about its energy strategy.

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The hidden price tag
...The Court of Accounts provided its own estimates of electricity-generating costs for existing nuclear plants. Instead of the levelized cost (i.e., the electricity price needed to break even with the investment cost over the life- time of the plant) of 33.4 euros per mega- watt-hour used by the government and EDF in their amortization calculations, it calculated an average cost of 49.50 euros per megawatt-hour, which could go up to 54.20 euros in the coming years to cover the expenses of projected safety-related improvements ordered since the Fukushima disaster. This esti- mate does not include public research and development expenditures, which, if accounted for, would bring the cost up to 69 euros per megawatt-hour (Dessus, 2012). Also, the court warned about the high uncertainty of long- term decommissioning and waste- management costs and the impossibility of adequately reflecting the risk of a major accident in these kinds of cost estimates.

Despite nuclear power's historical popularity with the government, its actual contribution to the country's wealth has been rather limited. According to an assessment by PricewaterhouseCoopers commissioned by Areva, the nuclear sector contributed 0.71 percent of GDP in 2009, thus gener- ating a total value of 33.5 billion euros (PricewaterhouseCoopers, 2011)... (pg20)