Back to OurEnergyLibrary search

Putting Nuclear Regulatory Costs in Context

Putting Nuclear Regulatory Costs in Context

Full Title: Putting Nuclear Regulatory Costs in Context
Author(s): Sam Batkins, Philip Rossetti, Dan Goldbeck
Publisher(s): American Action Forum
Publication Date: July 1, 2017
Full Text: Download Resource
Description (excerpt):

Nuclear power is among the safest, but also the most regulated forms of energy in world. As measured by harmful emissions, workplace injuries or fatalities on the job, nuclear has a sterling safety record, but the regulation imposed on the industry generates incredible costs and deters new reactors from producing zero-carbon energy.

Based on a review of publicly available 10-Ks, the American Action Forum (AAF) found $15.7 billion in regulatory liabilities for the industry, or $219 million per plant. These were largely related to long-term costs associated with disposing of waste. Annual ongoing regulatory costs range from $7.4 million to $15.5 million per plant, mostly related to paperwork compliance. Combined with regulatory capital expenditures and fees paid to the federal government, the average nuclear plant must bear a regulatory burden of $60 million annually.

These figures have profound implications for the industry’s bottom-line. Based on a review of per-plant profitability, there are at least six plants nationwide where regulatory burdens exceed profit margins. In total, AAF found 15 plants where regulatory burdens would exceed the nominal corporate tax rate in the nation. There is little doubt regulatory costs are one factor contributing to the retirement of nuclear facilities across the nation.

Finally, despite new nuclear reactor designs being safer, reactor design approval times still take several years, and these delays cost money and discourage new plants from ever being built. Regulators appear to regulate based on the risk of disaster from the 1970s, not 2017. AAF recommends a focus on one of the most significant regulatory liabilities of nuclear power plants: nuclear waste management. Mitigating the pecuniary and risk exposure of waste management, along with aligning regulation with the (low) risk generated by nuclear facilities will help to make the power source competitive once again.

All statements and/or propositions in discussion prompts are meant exclusively to stimulate discussion and do not represent the views of, its Partners, Topic Directors or Experts, nor of any individual or organization. Comments by and opinions of Expert participants are their own.

Sign up for our Press Release Distribution List

    Your Name (required)

    Your Email (required)

    Please sign me up to receive press releases from