Common Tragedies

Thoughts on Environmental Economics

Deregulation works – evidence from the “nucular” power industry

Posted by Rich Sweeney on February 6, 2008

EnergyBiz has an interesting piece today on the recent efficiency improvements of the nuclear power industry in the US. Here are some of the highlights:

  • The average capacity factor of nuclear plants around 1990 was a dismal 70 percent, according to statistics collected by the Nuclear Energy Institute…. the 1992 energy act ushered in the era of deregulation… today, the average for all 104 plants is about 90 percent, with some plants running closer to 95 percent.
  • The number of workers-per-megawatt fell from 1.2 at the end of the 1980s to around 0.7 today
  • Operating costs per kilowatt-hour in 2006 were 1.68 cents for nuclear versus 2.2 cents for coal, according to NEI.

The article suggests that these developments are largely the result of managerial improvements post-deregulation, as opposed to any major technological innovations. This story should come as no surprise. As I wrote before, there is academic evidence that electricity deregulation results in demonstrable efficiency improvements.

H/T Dallas.

One Response to “Deregulation works – evidence from the “nucular” power industry”

  1. I recall reading somewhere that improvements in capacity factors began with nukes in restructured markets and then spread to nukes in traditionally regulated markets. Probably a look at EIA data would confirm or deny this idea.

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