Cost

The cost of decommissioning a nuclear power plant varies according to a number of factors. Site-specific factors such as the type of reactor, labour costs and waste management, as well as the sequence and timing of decommissioning stages are all variable. (1)

Decommissioning cost estimates are necessary however to guide government policy, to assure funds will be available when needed and to serve as a basis for industrial strategy and planning. (2)

The Nuclear Energy Agency OECD's 2003 report (2) produces decommissioning estimates for a variety of nuclear power reactors from 26 countries around the world. The cost identified for decommissioning a nuclear power plant encompasses:

• faculty shut-down activities
• procurement of material
• dismantling activities
• security and surveillance
• waste treatment and disposal
• site cleanup
• project management and engineering
• research and development
  

The range in cost for nuclear decommissioning is as follows:

The data for the cost estimates ranges shown in figure 1 is based on past experience, scaling from the decommissioning of other nuclear facilities, as well as non-nuclear decommissioning and activity-based models of the specific site being decommissioned. Most cost estimates are based on a specific engineering cost model, the NEA/IAEA/EC cost model. (2)

From the data sets collected from the OECD survey, dismantling contributed between 25-34% of the total cost while waste management ranged from 17-43%. Security, engineering and site cleanup each averaged around 10% of the total decommissioning costs while the remaining cost items did not exceed 5% in any case. The data suggested that for PWR, BWR and VVER reactors, immediate dismantling as opposed to deferral had no immediate impact on the overnight decommissioning cost; however the decommissioning strategy did affect the amount of the discounted cost.

Funding

As decommissioning expenses will be incurred long after the plant is established, decommissioning costs represent a future financial liability. In nearly all countries the operator is responsible for the decommissioning funds. If the plant is state owned, as is the case for Lithuania and Hungary, the costs are distributed between the utility and the state. Regulatory requirements vary from country to country. In approximately 50% of the 26 countries surveyed by the OECD, the accumulated funds are required to cover all decommissioning expenses at the time of plant shut down.

In the United States for example, the Nuclear Regulatory Commission requires that licensees establish a decommissioning fund for each reactor and every year licensees must review the amount of money required for decommissioning and the adequacy of collections. Estimates are adjusted periodically to account for change of labour costs, energy, technological advancements and low-level waste disposal.

Due to the nature of the funds, they build up slowly and then accelerate as compounded earnings on the trust funds investments increase. Assuming the plant has a 40-year life span, in the 30th year, half of the funds are expected to be collected. The Nuclear Energy Institute (3) estimates the total cost of decommissioning the United State's 104 reactors to cost $40 billion, of which $22.5 billion is already collected from ratepayers. The average cost of decommissioning a nuclear power reactor in the United States is US$370 million. (1998 Figure) (4) In 60% of the countries included in the OECD report, funds are collected by a charge included in the consumer's electricity price.

In the United States 0.1-0.2c per KWh is collected to fund decommissioning. Other options utilised to collect funds include compulsory fees, Government funding and contributions from donor organisations.

What happens if a nuclear plant is required to be shut down before planned?

If the plant is required to be shut down prior to the completion of its estimated life (~40years) decommissioning funds are still needed, but almost certainly won't be available. The cost of decommissioning in this case is often shared between the consumers and the stakeholders. In 1997, the American reactor 'Main Yankee' was shut down 11 years prior to expiration and costs were distributed between ratepayers and shareholders. An introduction of a non-bypassable wires charge may be introduced to account for the advent of early decommissioning. Another option is government funding, but this must compete with other government priorities such as healthcare and education.

References

1. http://www.eu-decom.be/about/decominshort/whatis.html
2. "Decommissioning Nuclear Power plants: Policies, Strategies and Costs" 2003, Nuclear Energy Agency, Organisation for Economic Co-operation and Development,
3. Nuclear Energy Institute Website
4. "Decommissioning Nuclear Facilities: Nuclear Issues Briefing Paper 13" 2005, Uranium Information Centre, Australia
5. Nuclear Regulatory Commission Website