The Freedom Premium or the Dependency Subsidy: Nuclear's False Economy

In the 1970s, France willingly paid a high price for nuclear energy—an intentional choice to secure energy sovereignty. We might call this the "Freedom Premium," deliberately choosing more expensive electricity to protect national independence.

Today, some voices urge us to pay that premium once again, justifying the extraordinarily high costs of new nuclear reactors. But here's the critical question: Why pay four times as much and wait ten times longer for nuclear energy, when renewables combined with rapidly improving battery storage technologies can deliver the same energy sovereignty faster and far cheaper?

Yes, genuine energy independence might justify paying slightly more, temporarily. But today's energy landscape has fundamentally changed. Renewables offer the same freedom premium at a significantly lower cost and much quicker implementation.

What was once a freedom premium has morphed into something else entirely: a dependency subsidy. We're no longer paying extra for independence—we're paying to maintain our dependence on outdated technologies, centralized power structures, and financial fictions.

Why cling to costly illusions when authentic, affordable energy sovereignty is now achievable through renewables and storage?

France's Nuclear Illusion: EDF's Dangerous Game of Economic Fantasy

French nuclear reactors operate at capacity factors below 70% - a far cry from the 90% needed for economic viability. This isn't merely a French domestic issue but a warning flare for Finland, the UK, and any nation still contemplating nuclear's siren song, especially those already generating substantial electricity from renewables or plugged into Europe's interconnected grid.

The Vertical Integration Advantage

EDF, France's nationalized energy corporation, enjoys a position that would make monopolists of bygone eras blush. Controlling both generation assets and the retail market, it performs economic alchemy that would impress the court financiers of Louis XIV. This vertical integration isn't just a business model—it's an accounting séance that conjures profitable ghosts from unprofitable machines.

What appears as commercially viable nuclear operation conceals two fundamental problems that would sink any normal enterprise:

First, EDF must keep its aging nuclear fleet shambling forward at almost any cost. Shuttering even a single reactor would expose a financial liability so vast it would make the balance sheet look like it was designed by Picasso during his cubist period. Just as Britain's "British Energy" collapsed when it couldn't fund its decommissioning liabilities (forcing nationalization), EDF has deferred cleanup costs into that most convenient of accounting fictions: somebody else's future. Both countries assumed that future economic growth would absorb these enormous decommissioning costs—a classic case of socializing losses while privatizing gains.

Second, EDF faces immense pressure to show attractive electricity prices to justify six proposed new nuclear reactors—a financial commitment that would make even the builders of the Palace of Versailles pause. Yet reality betrays this narrative: negative spot electricity prices have surged in France, the market's way of screaming "STOP!" in capital letters. This occurs despite nuclear plants running at only 67% capacity—far below the 90% threshold that nuclear economics demands as tribute.

The Price Paradox

What would happen if France ran its reactors at full capacity? The electricity price would collapse faster than a poorly constructed reactor dome. At first glance, this might seem like a victory for consumers—cheaper electricity for everyone! Break out the champagne!

But here's where EDF's economic performance art reveals its true sophistication.

From 2026, nuclear generation receives a guaranteed price of €70 per MWh through Contracts for Difference—a financial instrument that would make medieval indulgence sellers envious. This means spot price collapse wouldn't benefit customers in the long run. Instead, it would trigger two economically devastating consequences:

First, it would force the French government to subsidize the widening chasm between guaranteed prices and market reality—not just for nuclear but for renewables too. Every cent the price falls below €70/MWh becomes a direct liability for the French taxpayer. It's Marie Antoinette economics: cake for producers, breadcrumbs for taxpayers.

Second, and far more damning, it would expose nuclear's true market value in a renewable-rich grid: not €70 or €90 or €140 per MWh as variously claimed... but closer to €40. At that price point, nuclear doesn't just lose its economic clothes—it's parading naked through the financial district at noon. Only renewable technologies—hydro, solar, and wind—can actually function economically at these price points.

The Nuclear Flexibility Charade

This reveals the uncomfortable truth: EDF isn't operating nuclear plants at reduced capacity because of technical sophistication or grid optimization. It's doing so to hide the economic catastrophe that would ensue if they ran at full output. The nuclear industry has spent decades portraying its technology as reliable baseload power—now it's suddenly pretending these plants are flexible assets that can dance to market tunes.

It's like watching a supertanker attempt ballet—technically possible but economically absurd. Nuclear plants were designed, built, and financed to run continuously at maximum output. Their economics collapse when operated flexibly, like using a cruise ship for daily commuting.

The Missing Historical Context

This isn't a new phenomenon. Since the 1970s oil crisis, France's nuclear program has operated under various economic fictions that would make creative accountants blush. What we're witnessing isn't novel—it's the inevitable collision between reality and nuclear mythology that began during the Messmer Plan and continues today.

The pattern mirrors other infrastructure bubbles throughout history: canal manias, railway euphoria, and telecom overbuilding. Each era convinces itself "this time is different" while repeating the same fundamental error: mistaking engineering achievement for economic wisdom. We build monuments to technological hubris, then force future generations to maintain them.

The Political Economy Dimension

The persistence of nuclear fantasy isn't just about miscalculated economics—it's about power structures. Nuclear represents centralized energy production that maintains existing political and economic hierarchies. Renewables threaten not just nuclear economics but the entire centralized model and the influence it bestows.

This isn't merely about euros per megawatt-hour; it's about who controls the electrons and the institutions that profit from them. The nuclear industry has cultivated political protection that would make Renaissance court favorites envious.

The Economic Consequences

The financial impact of operating nuclear at reduced capacity is profound. Reducing nuclear capacity factors from the optimal 90% to around 60-70% doesn't just nudge costs upward—it fundamentally transforms the economics. Such operation can more than double the Levelized Cost of Electricity (LCOE), demolishing any credible business case for new nuclear construction.

EDF's experience with Flamanville—now so delayed it qualifies for its own history curriculum—provides empirical evidence. With actual construction costs and realistic capacity factors, nuclear LCOE rises above €130–140/MWh, numbers that would get most energy proposals laughed out of boardrooms if they weren't protected by six decades of political mythology.

The Global Nuclear Economic Meltdown

If France's nuclear economics resembles a slow-motion financial car crash, America's recent nuclear projects qualify as financial Hindenburgs—spectacular, fiery, and impossible to look away from.

The Vogtle project in Georgia stands as nuclear's financial Waterloo. Initially budgeted at $14 billion for two reactors with a 2016/2017 completion date, it has metastasized into a $35+ billion catastrophe, finally connecting to the grid in 2023—over six years late and 150% over budget. During the same timeframe, solar costs fell by 85% and battery storage emerged as a viable grid technology. Vogtle wasn't just late to its own party—it arrived at an entirely different economic era.

Even more telling is the ghastly tale of the V.C. Summer project in South Carolina—a financial Frankenstein's monster so hideous its creators abandoned it halfway through. After burning through $9 billion in customer and taxpayer money, the project was scrapped in 2017, leaving behind nothing but concrete skeletons and debt. The project's failure was so spectacular it spawned criminal fraud charges and political scandals that continue to this day.

These American nuclear disasters perfectly mirror the European experience: Flamanville in France, Olkiluoto in Finland, and Hinkley Point C in the UK. Together, they form a global testament to economic delusion—a kind of financial Stonehenge where future archaeologists will marvel at our capacity to erect monuments to economic irrationality.

The Nuclear Waste Dimension

Beyond operational economics, France's La Hague facility and its reprocessing strategy represent another economic fiction—one where spent fuel is labeled an "asset" rather than a liability. This mirrors how EDF treats its aging reactor fleet and reinforces the central thesis: nuclear economics requires believing six impossible things before breakfast.

The Warning for Nuclear Aspirants

For countries considering nuclear expansion, France's experience isn't simply data—it's prophecy. Finland's Olkiluoto 3 project—delivered 14 years behind schedule and three times over budget—isn't an anomaly. It's the pattern. The UK's Hinkley Point C, with its eye-watering strike price, already looked questionable when signed. In today's increasingly renewable world, it's a financial suicide note written in invisible ink—the true costs only appearing when it's too late to change course.

The Decommissioning Liability

Perhaps most concerning is the deferred decommissioning liability—the largest intergenerational transfer of costs this side of climate change itself. The nuclear industry has consistently underestimated cleanup costs by factors that would embarrass even Silicon Valley's most optimistic startups.

When France eventually confronts its decommissioning reality, the bill may dwarf the original construction expenditure. This isn't speculation—it's the established pattern at Sellafield, Hanford, and every major nuclear cleanup site worldwide.

Reality Check

The modern electricity system, with its increasing renewable generation and storage, demands flexibility that nuclear simply cannot provide economically. It's like trying to navigate modern digital communications with a telegraph system—technically possible but absurdly expensive.

For nations considering the nuclear path, France's experience delivers an unambiguous message: The economic case for nuclear power in renewable-rich, interconnected grids isn't just weak—it's a dangerous fantasy sustained by accounting illusions and hidden costs that future generations will inevitably discover.

The uncomfortable truth remains: in today's energy landscape, nuclear's economics don't just fail to add up—they actively subtract from future prosperity.

[Skip Bowman is a writer, organisational psychologist, leadership expert and author of "Safe to Great - the New Psychology of Leadership" and "In the Dark - how the energy revolution starts at home and ends up saving us all"]