Electricity market competition and nuclear power

Throughout the world, the Organization for Economic Cooperation and Development (OECD) member countries' governments are promoting competitive electricity markets. In particular, there is a move away from administrative price-setting by government institutions to market price-setting through the introduction of competition. Today this is often focused on competition in generation. However, competition among final electricity suppliers and distributors to provide effective consumer choice is a further step that governments are likely to pursue as experience with market reform grows. This competitive environment will undoubtedly impact upon the nuclear generation industry. Competition will provide an opportunity to reinvigorate nuclear power; it will improve the transparency of energy policy-making and the policy framework for nuclear power; it will spur innovation in existing plants and help prospects for new plant build; and provide a strong impetus for cost reduction and innovation. This paper discusses these issues in detail. It looks at the potential benefits and challenges to the nuclear generation industry arising from an increasingly competitive market. (author)