Fusion and Economics

It may seem premature to evaluate the cost of production of a kilowatt-hour for an energy source that is still several decades away from being on the market. It is therefore worth defining the goal of this sort of study.

• The first point is to highlight the impact of this or that physical variable or this or that hypothesis of technological achievement on costs. These results, which determine the relative scale and meaning of variations, obviously have a direct influence on development strategy.

• The second point is to carefully evaluate that the proposed device complies with the requirements of the market. Before going any further, let us say something about the validity of these evaluations. The economic models that are used carry on directly from the models used for the design, enhancement and cost calculation for current machines. These models are moreover based on the costs put forward for the ITER project concerning magnetic fusion. In many aspects, this project is closely related to the reactor, but the project construction costs, were above, all determined by industrial partners involved : Europe, Japan, Russia and the United States. Thus we have a sound basis for assessment and, to come back to the kilowatt-hour, the uncertainties that remain are certainly significant, but rather concern the availability of the reactor than the direct cost of its components.

1 - The internal costs

In energy production, the internal costs (or direct costs) represent the costs invoiced. Roughly-speaking, they include the costs of building the power station, general running expenses and fuel costs. As for nuclear energy, it is worth knowing that the costs linked to fuel reprocessing, waste storage and power station dismantling have been included in the kilowatt-hour cost.

With the price of deuterium around 4000 $ a kilogram (lithium is much less expensive) and a daily consumption of 500 g per day for a reactor of 1000 electric MW, the fuel cost amounts to less than 1 % in the total cost of the kilowatt hour (figure below). The cost of energy produced by a fusion reactor is thus determined by the level of initial investment, to which must be added the cost of regular replacement of used components.

Typical breakdown of direct costs for different sources of energy

The typical volume of a fusion reactor combustion chamber is about 1000 m³. To give an idea, the volume of a fission reactor vessel (1400 eMW) is less than 300 m³. Consequently, and this is confirmed by all calculations, the investments that fusion requires are high simply for reasons of size of the installation. The absence of fuel cost partly compensates this drawback in relation to other conventional sources of energy (coal, gas and fission), but it only does so partially. Economic calculations today situate the cost of a fusion kilowatt hour above that of the production cost of conventional sources of energy (coal, gas and fission) putting it between the cost of off-shore wind-turbines and photovoltaic production, given that for these latter sources, the evaluations are carried out without taking into account the cost of storing the energy. Two points may be highlighted. First of all, contrary to what is often put forward, the costs of fusion production do not necessarily bankrupt its future. In the find outcome, fusion will be a source of energy for which investment (and therefore the availability of the installation) will have a very great importance.

2 - The external costs (externalities)

The notion of external cost or externality is a method enabling the measurement of environmental impact of human activity (Cf paragraph : The very low global impact of fusion energy on the environment). Let us remember that fusion energy is the energy sector offering the lowest environmental impact and it consequently has the lowest external costs.

3 - Total costs

The chart below compares the typical kilowatt-hour costs of several sources of energy. This type of comparison is always sensitive: for example, for one and the same energy source, the costs related to fuel purchase may vary by as much as 50% from one country to another. We will therefore only consider the main trends, which are, for their part, relatively well detailed .

Typical global costs for different sources of energy

• If we limit ourselves to direct costs, "conventional" means, such as coal, gas or nuclear fission power stations, are the most competitive.

• Taking externalities into account puts nuclear fission reactors ahead of coal and gas. As for the other sectors, technological breakthroughs may enable significant reduction of emission (CO2 and particles) but at the price of greater complexity and therefore a higher direct cost. We should add that this chart does not take into account a possible tax on CO2 emission causing the greenhouse effect, which would particularly affect the sectors of coal and gas.

• Renewable energies (solar, hydraulic, wind power and biomass) involve an overall higher global cost, varying from 30% to 100% in relation to fission. In the case of wind and solar power, the assessments presented here-in do not take into account the storage of energy, which could lead to the final cost being doubled or even tripled.

• Energy from fusion is situated between wind and solar power, with the notable advantage of enabling constant production of electricity at any time of day.

These studies confirm that energy from fusion is economically credible.

For further information :

• International Energy Agency (IEA) : http://www.iea.org/,

• The IEA Research and Development programme concerning reduction of the greenhouse effect : http://www.ieagreen.org.uk/,

• Socio-Economic Research on Fusion : Summary of EU Research 1997 - 2000 (EFDA report)
  SERF report  , July 2001 (pdf, 1089 ko)