Opting out of the nuclear phase-out A new Swiss nuclear power plant would be a major economic risk
The Federal Council wants to allow the construction of new nuclear power plants in Switzerland again under certain circumstances. Nevertheless, there are many hurdles in the way of a new reactor on Swiss soil, not least economic ones.
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- The construction of new nuclear power plants should be possible again in Switzerland. This has been decided by the Federal Council.
- However, a new nuclear power plant would have to pass a series of approval procedures and probably also win several referendums in order to become a reality.
- Electricity from a new Swiss nuclear reactor would therefore not flow for at least 15 years. More realistic would be 20 years.
In 2017, the Swiss electorate decided that no more nuclear power plants should be built in Switzerland. Seven years later, the Federal Council has announced that it will allow this again under certain circumstances.
The short-term reason is the "Blackout Initiative", whose initiators want to reverse the nuclear phase-out. Since the invasion of Ukraine, there have been concerns that Switzerland could face an electricity shortage. Nuclear power plants provide a constant supply of electricity, while the output of renewable energy sources fluctuates seasonally or even throughout the day.
Anyone expecting the operators of Switzerland's active nuclear power plants to rejoice and start planning a new nuclear power plant sooner rather than later is mistaken. They are concentrating on massively expanding renewable energies. This is what the Swiss electorate has decided.
Swiss electricity suppliers cautious
Planning and building a new nuclear power plant in Switzerland would be an enormous task. The technical implementation would be the lesser problem. Legislative changes would be necessary, which could be fought with a referendum. A years-long political battle would have to be won before it would be worth investing funds in project planning.
The Association of Swiss Electricity Companies (VSE) is correspondingly cautious: "The more options we have for the future, the greater the room for maneuver for security of supply and achieving climate targets." There are no concrete plans, and a new nuclear power plant would not be ready for 20 years at the earliest.
A look abroad shows that the construction of new nuclear power plants is not an impossibility. In 2023, new reactors will be connected to the grid in Belarus, China, South Korea, Slovakia and the USA. According to a list by the International Atomic Energy Agency (IAEA), nuclear power plants are under construction in 15 countries and on three continents.
Construction delays and cost overruns abroad
The experiences that some countries have had with the construction of new nuclear power plants indicate the challenges that could also be associated with this in Switzerland. For example, the Hinkley Point plant in the UK, which has been under construction since 2016, should have cost 21 billion euros and been connected to the grid in 2025. The latest forecasts assume costs of over 30 billion euros and commissioning in the early 2030s.
After 18 years of construction, the Olkiluoto 3 reactor in Finland started generating electricity in April 2023. The planned start of operation would have been 2009, and the costs are said to have been almost four times as high as calculated shortly after the turn of the millennium at 11 billion euros.
One reason for the delays in European nuclear power plant projects is that the nuclear regulations were subject to multiple changes during the construction phase and contained many uncertainties, says Andreas Pautz, Head of the Center for Nuclear Engineering and Science at the Paul Scherrer Institute.
10 to 12 years just for the licenses in Switzerland
In Switzerland, he estimates that it would take 10 to 12 years to obtain an operating license. "Only then can you enter the construction phase," he emphasizes. In other words, the economic risk would be too great to invest funds in the development of the plant before it is clear that it can be operated.
"Every new nuclear power plant in Europe today is a new development. There are no off-the-shelf plants," explains Christian Schaffner, Director of the Energy Science Center at ETH Zurich. This is why the costs are so difficult to predict.
The cost of building and operating a nuclear power plant over its lifetime divided by the amount of energy it produces during this time gives the price of a unit of energy. If this is lower than the market price for electricity on a given day, the operator of the nuclear power plant earns money. However, if it is more expensive, it makes a loss.
Costs cannot be calculated - or can they?
"That's why a new nuclear power plant in Switzerland is not a business case from our point of view," says Schaffner. Put simply, it is unlikely to make any money, which is why it is not attractive to investors.
Andreas Pautz, on the other hand, believes that the costs are calculable - provided that politicians create the conditions for a nuclear power plant project to be realized within a reasonable period of time: "To achieve this, Switzerland would have to decide to generally streamline the approval process - even for renewables."
Pautz is convinced that a nuclear power plant the size of Gösgen should actually be feasible for around 5 to 6 billion Swiss francs if the approval and construction phases proceed without significant delays. Schaffner considers this amount to be very optimistic: "Perhaps China can build a nuclear power plant that cheaply in its own country." He refers to the often quoted calculations of the US investment bank Lazard, the "Levelized Cost of Endergy": According to their figures, a 1-gigawatt power plant like Gösgen would cost 7.4 to 12.2 billion Swiss francs.
Is it possible to earn money with nuclear power?
If all the necessary permits were granted, it would be possible to complete a nuclear power plant in five to six years, according to Pautz. "When one nuclear power plant after another was built in France in the 1970s and 1980s, five years was the norm." However, the knowledge required for this level of efficiency has been partially lost over the last 40 years, he explains. "But it was technically possible before and it should be possible again."
Pautz is also not willing to give up on an electricity price, but admits that this is based on various assumptions. "We assume that the cost price for electricity from new nuclear power plants will be between 7 and 12 cents per kilowatt hour." In July 2024, a kilowatt hour of electricity cost just under 7 cents on the European market. According to Wirtschaftswoche, economists at Lazard calculated the actual cost of generating a kilowatt hour of nuclear power at 18 cents at the beginning of 2024.
Today's costs are one thing. However, the decisive factor for a new Swiss nuclear power plant would be those in 15 or 20 years' time. ETH lecturer Schaffner notes that the expansion of renewables in Europe will reduce the capacity utilization of nuclear power plants, which could significantly increase their costs.
The VSE puts this into perspective: "Profitability is a major challenge for all technologies. The economic viability of new nuclear power plants is not a given in Switzerland at the moment." Without state subsidies, new nuclear power plants would hardly be feasible in Switzerland either. Regardless of the Federal Council's decision, the VSE is certain: "In the next 10 to 15 years, there is no alternative to the expansion of renewable energies."
A new Swiss nuclear power plant remains less realistic
Energy Minister Rösti has also admitted that Switzerland currently lacks the legal basis to promote nuclear energy. Supporters are therefore already eyeing the money earmarked for the expansion of renewables. Unsurprisingly, opponents of nuclear power do not think much of it.
The reactions to the implied withdrawal from the nuclear phase-out are a foretaste of the political battles that a new nuclear power plant would have to win. The Federal Council's decision gives the debate a little more space. The possibility of a new nuclear power plant actually being built in Switzerland has become just a little more realistic.
