Is Solar More Expensive Than Nuclear?

The relative costs of solar and nuclear power have been hotly debated, with both technologies touted as cost-effective carbon-free energy sources. However, the costs of solar and nuclear are complex, and involve not just upfront construction expenses but also operating, waste disposal, decommissioning, and grid integration costs. Government subsidies also play a major role.

While historically nuclear has been cheaper per kilowatt hour (kWh) than solar, recent trends show solar costs declining rapidly while nuclear costs are rising. Most experts agree that currently, on average, nuclear power is cheaper than solar. But the future trajectories suggest solar may become less expensive than nuclear in the coming years.

Upfront Costs

The upfront costs for solar power are quite high compared to nuclear power. Installing solar panels, inverters, and batteries for utility-scale solar farms can cost over $1,000 per kW according to some estimates (Source). The high equipment, land, and labor costs make solar power have a higher upfront price tag.

In contrast, the upfront costs for nuclear power plants are lower on a per kW basis. Though the absolute costs are high due to the size of nuclear plants, the cost per kW can be 60-70% less than solar power. This is because nuclear plants have high fixed costs but very low variable costs, allowing them to produce large amounts of electricity at a lower upfront cost per unit of capacity (Source).

Operating Costs

When it comes to ongoing operating costs, solar power tends to be more affordable than nuclear power. Solar panels require little maintenance once installed, with no fuel costs. The main operating costs for solar come from occasional panel cleaning and inverter replacement every 10-15 years.

In contrast, nuclear power plants have substantial operating and maintenance costs. These include the costs for enriched uranium fuel, plant staffing, security, waste disposal fees, equipment maintenance and repairs. According to Lazard’s analysis, the operating costs for utility-scale solar power average around $13 per MWh, while nuclear power averages around $29 per MWh.

A 2021 report by Energy Innovation found the operating costs of existing nuclear plants to be 2-5x higher than the operating costs for utility-scale solar or onshore wind farms. They estimated nuclear’s operating costs at $28-44 per MWh, compared to $7-14 per MWh for solar and $10-20 per MWh for wind.

While nuclear plants can generate large amounts of constant baseload power, their high operating costs make them less economically competitive compared to renewable energy sources like solar and wind power.

Government Subsidies

Both solar and nuclear receive government subsidies, which can impact their costs. According to sources, the solar industry has received significantly more federal subsidies in recent years compared to nuclear. One analysis found that in 2018, the American solar industry received around 250 times more in federal tax incentives than the nuclear sector when comparing subsidy amounts (source). The Inflation Reduction Act passed in 2022 also allocates over $370 billion in climate investment, with tax credits for solar projected to cost $32 billion through 2031 while nuclear receives a smaller $30 billion allocation (source). However, determining the full impact of subsidies on costs is complex, as different energy sources receive varying types of direct and indirect subsidies.

Waste Disposal

Solar panels generate very little waste compared to nuclear power plants. At the end of their useful life, solar panels can be recycled, with as much as 95% of the material extracted and reused. The small amount of hazardous waste contained in solar panels is minimal.

On the other hand, nuclear reactors produce tons of radioactive waste that can remain dangerous for thousands of years. There is no permanent storage solution for this waste in the U.S., which has accumulated over 70,000 metric tons stored temporarily at nuclear plant sites. The projected clean-up cost after the Manhattan Project is well over $300 billion, more than the original cost of the weapons program.

The federal government charges nuclear plant operators around 0.1 cents per kWh generated to fund nuclear waste disposal. However, this nuclear waste fund has accumulated over $43 billion and rising despite no permanent repository being available. Managing radioactive waste safely is a major economic challenge for the nuclear power industry.

Decommissioning

When it comes to end-of-life costs, solar has a clear advantage over nuclear. Solar panels are almost entirely recyclable, with a recycling rate of over 80% in Europe ^[1]. The glass, aluminum, and semiconductors in solar panels can be recovered and reused. Decommissioning a solar farm is relatively inexpensive.

In contrast, decommissioning a nuclear power plant is an extremely expensive and challenging process. The cost to decommission a typical 1,000 megawatt nuclear reactor is estimated to be between $300-$400 million ^[2]. The plant must be dismantled, radioactive waste must be safely stored long-term, and the site must be decontaminated. This complex process can take over a decade and cost well over $1 billion for the largest nuclear plants ^[3]. These massive decommissioning costs are often underestimated and can leave taxpayers footing the bill.

Cost Trends

Research shows that the costs of solar power have been declining rapidly over the last decade, while the costs of nuclear power have been rising. According to recent analysis from Lazard, the levelized cost of energy (LCOE) for utility-scale solar PV has dropped 88% since 2009, from $359 per MWh to just $36 per MWh in 2019. The LCOE for nuclear, on the other hand, has increased from $123 per MWh in 2009 to $155 per MWh in 2019, a 26% increase.

A study by Energy Innovation found the cost for new utility-scale solar fell 89% between 2009 and 2020, while the cost of new nuclear power increased by 23% over the same time period. They estimate the cost per KW for utility-scale solar at less than $1,000, compared to over $6,500 per KW for nuclear (see source).

This dramatic divergence in price trends between solar and nuclear is widely expected to continue, as solar benefits from ongoing technological improvements, economies of scale from increased deployment, and streamlined installation processes. In contrast, new nuclear plants face rising construction costs, complex regulations, project delays, and reduced demand. As a result, solar is rapidly becoming one of the lowest cost sources of electricity production, while nuclear struggles to compete economically.

Grid Integration

While solar power can provide electricity at a lower operating cost than nuclear, integrating large amounts of solar onto the electric grid poses challenges due to its variability. Solar power only generates electricity when the sun is shining, meaning output fluctuates throughout the day and is zero at night. This intermittency requires grid operators to balance supply and demand using other more flexible sources like natural gas plants or energy storage from batteries (source).

In contrast, nuclear power provides steady baseload electricity around the clock. Nuclear plants operate at maximum output over 90% of the time, except when taken offline for maintenance and refueling. This makes nuclear a reliable source of carbon-free electricity that complements variable renewables like solar. However, it also makes nuclear less flexible at ramping up and down to match changes in demand (source).

Estimates for integrating solar and storage onto the grid range from $25-41 per MWh, while nuclear integration costs are near zero given its steady output. So while solar has a lower operating cost, its integration costs make it more comparable to nuclear when levels exceed 30-40% of the electricity mix (source).

Safety

Solar power is considered extremely safe with very few safety risks involved. The panels and batteries used in solar systems do not pose significant hazards. Additionally, solar does not rely on any fuel source that could cause dangerous accidents like nuclear meltdowns.

In contrast, nuclear power plants come with the constant risk of severe accidents like Fukushima and Chernobyl that can have massive economic costs as well as health impacts. The Chernobyl accident imposed huge economic costs on Ukraine and surrounding countries, with estimates ranging from hundreds of billions to trillions of dollars when factoring in long-term health effects. The clean-up costs alone were massive, and the areas surrounding Chernobyl remain unsafe for habitation decades later.

While nuclear accidents may be rare, their potential consequences mean the safety risks and costs associated with nuclear cannot be ignored when comparing it to the relatively minimal risks of solar power.

Conclusion

When looking at the full life cycle of energy generation, solar power is currently more expensive than nuclear power in most contexts. The high upfront costs of building solar farms and integrating solar onto the grid make it a more costly option per kWh generated. Operating and maintenance costs are also lower for nuclear plants compared to solar panels that require regular cleaning and replacing.

However, the costs of solar have been dropping rapidly over the past decade while nuclear costs have stagnated. Solar panel efficiency continues to increase as technology improves. Government subsidies have also helped make solar more affordable and expanded its adoption. The modular nature of solar gives it advantages for incremental capacity additions that avoid major capital outlays. Waste disposal and decommissioning costs also favor solar long-term.

While nuclear maintains cost advantages today, market conditions and technological advances are likely to make solar the cheaper option over the coming decades. The lower environmental impacts and greater safety of solar compared to nuclear also support forecasts of solar becoming the predominant power source worldwide.