The price that Canadians pay for electricity generated by nuclear power depends on a variety of capital costs (investments needed to build plants and get infrastructure running) and operating costs (the day-to-day costs of turning fuel into electricity). When compared with other major methods of electricity generation, nuclear power requires a large investment up-front, but a very low cost to actually produce electricity.
There are also external factors that determine the actual price paid for electricity: governments can choose to subsidize certain types of power generation that they wish to encourage, or tax those they discourage. Furthermore, public demand for electricity can, in the long term, force utilities to change their prices – for example, as hotter summers prompt more people to use air conditioning.
Building a nuclear power plant requires billions of dollars and thousands of workers. For example, the cost of building the four reactors at Darlington in the 1980s was $14.5 billion. Power stations must also be decommissioned when they are past their useful lifespans. Decommissioning involves the safe containment of plant components that have themselves become radioactive over decades of operations.
Provinces that choose to work with nuclear technology must also invest in people: nuclear power requires engineers, technicians, skilled trade workers, and a full range of financial, human resources, communications, education and training, and administration staff to support the companies and facilities.
Given these high start-up costs, how does nuclear technology deliver electricity at a price lower than for any other method of power generation besides hydro?
The answer lies in the ability of uranium to produce a vast amount of power. Though uranium fuel costs in the order of $100 per kilogram in Canada, it delivers 20,000 times the amount of energy per weight than coal. So, a much smaller amount of fuel is needed in comparison to any of the non-renewable sources.
Despite the vastly smaller operational costs, it is important to note that the capital costs of nuclear power must still be paid. However, they must be paid once only, and the operation of a nuclear power plant spans decades. To ensure that Canadians can afford nuclear power, capital costs for nuclear power are paid as part of the operation. This arrangement also ensures that future generations will not be burdened by the long-term costs (for example, of decommissioning plants or storing spent fuel).
It must also be noted that the development of a skilled workforce tends to attract other advanced-technology enterprises that can help build local economies.