Nuclear Energy Costs

The following story originally appeared in NEI’s Nuclear Energy Overview.

Use of nuclear energy will continue “to play a full part in the future energy mix” despite the accident in Japan, a new report says.

The report, by the World Energy Council, notes that the growth of nuclear energy is mainly being driven by non-OECD countries, “the very countries that are seeing ever rising energy demand.” These countries account for 39 of the 63 nuclear plants being built worldwide.

Very little has changed, especially in non-OECD countries, in respect of the future utilization of nuclear in the energy mix,” the report says.
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  • Tokyo Electric Power Co., operator of the Fukushima Daiichi nuclear energy facility, said about 40 gallons of water containing radioactive strontium drained into the ocean following a leak in desalination equipment. TEPCO said it is likely to have little effect on the environment.
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Congress passed a law in 1982 directing the U.S. Department of Energy (DOE) to build and operate a repository for the disposal of used nuclear fuel and other high-level radioactive waste. Under the Nuclear Waste Policy Act, Congress set a 1998 deadline for DOE to begin to dispose of the used nuclear fuel.  However, due to significant delay in the Energy Department’s program, the 1998 deadline is long past due and no fuel has been moved from nuclear energy facilities

To fund the federal program, the 1982 legislation established the Nuclear Waste Fund. Beginning in 1983, consumers of electricity produced at nuclear energy facilities have paid a tax of one-tenth of a cent for every kilowatt-hour of electricity produced into that fund. Commitments to the Nuclear Waste Fund, including interest, total more than $35 billion.
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If a  worker at a nuclear plant suffers a radiation-related injury, the worker’s expenses associated with the injury claim are normally covered by workers compensation. This applies both to employees at the nuclear plant and to contractors working at the nuclear plant.  For tort claims against a third party alleged responsible for his or her injury, the worker is protected by third-party liability insurance provided by American Nuclear Insurers (ANI).  ANI, a joint underwriting association of major insurance and reinsurance companies, provides third-party liability coverage for the nuclear energy industry. ANI’s liability coverage satisfies the requirements of the Price-Anderson Act, the legal framework for public liability claims that could arise in the event of a nuclear energy incident.

Under the Price-Anderson Act, companies that own nuclear power plants are required to maintain the maximum level of financial protection commercially available, and also are required to participate in a secondary financial protection program managed by ANI. The initial limit of liability for nuclear energy facilitiesis $375 million. Should an accident at any reactor result in personal injury or off-site damages in excess of $375 million, all power reactor operators can be charged a retrospective premium of up to $117.5 million per reactor per incident, creating a combined level of protection of nearly $12.6 billion.

Learn more about nuclear energy and related topics in NEI’s “Ask an Expert” section.

Industry/Regulatory/Political Issues

  • There is a “great deal of alignment” between the U.S. Nuclear Regulatory Commission and the industry on initial steps to take at America’s nuclear energy facilities in response to the nuclear accident in Japan, Charles Pardee, the chief operating officer of Exelon Generation Co., said at an agency briefing today. The briefing gave stakeholders an opportunity to discuss staff recommendations for near-term actions the agency may take at U.S. facilities. PowerPoint slides from the meeting are on the NRC website.
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