Nuclear power poor economic choice



Nuclear Power Poor Economic Choice

In recent months several arguments have been made in support of building nuclear power plants in Saskatchewan. Many of these arguments are based on the assumption that nuclear power will act as a driver of economic development. I would like to argue that nuclear power is actually a poor choice for stimulating economic development, and that building such a facility in the province may actually harm the economy in the long run.

First, nuclear power is only cost effective as a source of electricity when it utilizes large reactors. By taking advantage of the economy of scale, nuclear plant operators can cut construction and operating costs significantly. Most of the commercial nuclear plants in Canada operate with several large reactors on-site that produce around 600 MW of electricity per reactor. Since Saskatchewan’s total electricity demand is around 3000 MW of electricity, one nuclear plant could provide a very high percentage of the overall need. As a result, many of the other modes of producing electricity in the province would become less necessary, and there function as drivers of local economies depressed.

Second, nuclear power plants are not good drivers of economic development. Although during the construction phase many skilled workers are employed, a nuclear plant requires relatively few workers to operate it. The cost of building these facilities is often very high, and cost over-runs are common. Although Saskatchewan has ample reserves of uranium ore, the cost of uranium is a small fraction of the total cost of running a nuclear plant. In short, building one nuclear power plant in Saskatchewan would cost billions of dollars and constrain the opportunity to develop other technologies for decades to come.

Third, the experience of Ontario with nuclear power should teach us some valuable lessons. Before splitting into several different companies in the late 1990s, Ontario Hydro posted a debt of close to $40 billion. Much of this debt came from building expensive nuclear plants. As these Ontario power plants aged, there reliability declined and operating costs increased dramatically. When one considers the cost of construction, operation, and eventually waste disposal and reactor decommissioning, the economics of nuclear look less attractive.

Fourth, those who argue for building nuclear capacity in Saskatchewan assume that more electricity is needed. An examination of demand for electricity shows that growth is flat. Residential, farm, and commercial users have been consuming the same amount of electricity for several years. The biggest increase in demand comes from industrial users (e.g., the oil and gas industry). Why should the people of Saskatchewan take on the risks associated with nuclear power to satisfy one segment of the economy?

Last, other sources of electricity production function as stronger drivers of economic development than nuclear. Hydro electric projects provide opportunities for northern communities in Saskatchewan to benefit from local construction projects. Wind generation projects provide partnership opportunities, and have economic advantages (e.g., credits) associated with producing “green” electricity. Biomass facilities for producing liquid fuels like bio-ethanol and bio-diesel have the power to transform rural economies. Coal plants have significant local benefits to communities that mine coal and operate them. Reserves of coal are plentiful in Saskatchewan, and new technologies are being developed to make coal emissions more environmental friendly, and to store and utilize carbon dioxide. Nuclear power centralizes power production and destroys the opportunity for all of these other technologies to provide local economic and social benefits across much of the province. We develop nuclear at our own peril.

With permission from

Dr. Michael D. Mehta is a Professor of Sociology at the University of Saskatchewan.