Japan Sees Nuclear as Cheapest Baseload Power Source in 2040

Nuclear power is forecast to be the cheapest baseload electricity source in Japan in 2040, highlighting the government's desire to restart the nation's idled reactors. From a report: The cost of constructing and operating a new nuclear power plant for 2040 is estimated at 12.5 yen ($0.08) per kilowatt-hour, according to documents released from a trade ministry panel meeting on Monday. This cost assumes reactors will be used for 40 years at a 70% operational rate. The meeting was held to discuss the so-called levelized cost of electricity for each power asset, the document said.

A previous study published in 2021 saw LNG-fired power plants as the cheapest power source in 2030. However, the latest analysis includes a cost to reduce emissions, while fuel prices are also higher. Intermittent renewable sources, like large-scale and residential solar, were priced lower than nuclear for 2040, the most recent report showed. However, when including the total system cost, including deployment of batteries, nuclear is cheaper than solar in some scenarios.

Japan is currently in the process of revising its national energy strategy, which will dictate its power mix targets beyond 2030. The government has doubled down on nuclear as a way to curb dependence on pricey fossil fuels. The analysis released Monday also estimated LCOE of ammonia and hydrogen co-fired electricity, as well as pairing carbon capture and storage with LNG and coal power plants -- technologies that the Japanese government is considering for its long-term energy transition. Co-firing with hydrogen boosted the cost of an LNG plant by about 6% for deployment in 2040, while CCS didn't meaningfully change the price.

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