State or market: Investments in new nuclear power plants in France and their domestic and cross-border effects

Florian Zimmermann*, Dogan Keles

*Corresponding author for this work

Research output: Contribution to journalJournal articleResearchpeer-review

4 Downloads (Pure)

Abstract

France wants to become carbon-neutral by 2050. Renewable energies and nuclear power are expected to make the main contribution to this goal. However, the average age of nuclear power plants is approaching 37 years of operation in 2022, which is likely to lead to increased outages and expensive maintenance. In addition, newer nuclear power plants are flexible to operate and thus compatible with high volatile feed-in from renewables. Nevertheless, it is controversially discussed whether nuclear power plants can still be operated competitively and whether new investments will be made in this technology. Using an agent-based simulation model of the European electricity market, the market impacts of possible nuclear investments are investigated based on two scenarios: a scenario with state-based investments and a scenario with market-based investments. The results of this investigation show that under our assumptions, even with state-based investments, carbon neutrality would not be achieved with the estimated nuclear power plant capacity. Under purely market-based assumptions, large amounts of gas-fired power plants would be installed, which would lead to an increase in France's carbon emissions. State-based investments in nuclear power plants, however, would have a dampening effect on neighboring spot market prices of up to 4.5% on average.

Original languageEnglish
Article number113403
JournalEnergy Policy
Volume173
ISSN0301-4215
DOIs
Publication statusPublished - 2023

Keywords

  • Capacity remuneration mechanism
  • Cross-border effect
  • Electricity market
  • France
  • Investment
  • Nuclear

Fingerprint

Dive into the research topics of 'State or market: Investments in new nuclear power plants in France and their domestic and cross-border effects'. Together they form a unique fingerprint.

Cite this