Warns of Government Nuclear Plans: Affecting Generations

Warns of Government Nuclear Plans: Affecting Generations

ENERGY

Financial Markets Minister Niklas Wykman (M) in the finance committee on Thursday.

The government’s plans to build new nuclear power can have major economic consequences for generations to come, according to Tomas Kåberger, professor of industrial energy policy.
– The risk that you ultimately run is that these projects are not completed, he says.

On Thursday, Kåberger and other experts were invited to a meeting in the Riksdag’s finance committee on the topic of financing new nuclear power.

The government has set the goal of having nuclear power equivalent to two large-scale reactors in place by the year 2035.

Affects generations

To make this possible, an investigation proposes a new financing model. The three components of it are government loans, a price hedging agreement – ​​with a guaranteed price of 80 öre/kWh – and a risk and profit sharing mechanism.

– You can imagine that for an ordinary Swedish villa household, it costs SEK 50-60 a month to have a price hedging agreement like this, says Minister of Financial Markets Niklas Wykman (M).

At the same time, Tomas Kåberger at Chalmers University of Technology warns that many nuclear power projects in the world have become more expensive than what was first said, and if the state is included in the equation, taxpayers risk being hit hard.

– This is a proposal with very large financial consequences for many decades. These are decisions to be made by a generation, and by people who risk not only their own money, but that of future generations as well.

He points to two projects in the US that have been canceled even though upwards of SEK 100 billion have already been invested in them.

– The risk that you ultimately run is that these projects will not be completed anyway, says Kåberger about the Swedish nuclear power plans.

Risk until 2040

In Sweden, the cost of nuclear power can amount to SEK 600 billion or more, he says. Kåberger also highlights that the cost of solar and wind power continues to fall.

Another expert on the panel, Mia Bodin of Bodecker Partners, pointed out that the financing model risks the profitability of all existing electricity generation and new generation until 2035-2045, when nuclear power may be in place.

– It risks Swedish industry’s green transformation and competitiveness, she says.

Even from the side of the opposition, the criticism is harsh.

– The analysis we saw at the hearing shows that this will be terribly expensive for ordinary consumers and the industry, says Center Party spokesperson Martin Ådahl.

FACT

So the state can subsidize new nuclear power

A few points from the investigation’s proposal for state financing of new nuclear power:

The program includes four to five large-scale reactors, which together can produce 4,000-6,000 megawatts.

Building these is estimated to cost SEK 400 billion in today’s price situation, and of this the state will be responsible for SEK 300 billion in loan capital and the owners will contribute SEK 100 billion in equity capital.

Another security for the nuclear power owners is a price hedging agreement. For 40 years, the nuclear power companies must be guaranteed at least 80 öre/kWh in payment by the state.

A third component is a risk and profit sharing mechanism. It must be activated if necessary, based on the outcome of a market valuation of the project company two years after the routine start of operations.

Source: www.nyteknik.se