Conditions for and system implications of restarting nuclear fission in Italy

The paper "Key determinants of nuclear fission competitiveness and implications of its potential restart for the Italian power system", authored by Andrea Mastrantuono, Matteo Nicoli, Valeria Di Cosmo, Daniele Mosso, Anderson Rodrigo de Queiroz and Laura Savoldi has been published on Energy.

Abstract

This study introduces two key methodological enhancements to an open-source multi-regional model of the Italian power sector, namely a detailed representation of the nuclear fuel cycle and a discrete capacity formulation to capture the indivisible nature of reactor units and their systemic interactions, and applies them to assess the techno-economic feasibility and policy conditions under which nuclear fission could re-emerge as a competitive player within an Italian decarbonized power system by 2050. Through a structured scenario analysis, we examine both the combined influence of investment costs and hurdle rates on the competitiveness of nuclear power, comparing large light-water reactors and small modular reactors, and the potential implications of nuclear fission reintroduction for the Italian power system. A dedicated sensitivity analysis investigates the potential of Generation IV designs, such as lead-cooled fast reactors and high-temperature gas-cooled designs, under alternative cost assumptions. The results indicate that nuclear power would become economically viable in most scenarios with stable or moderately increasing capital costs, reaching up to the 8 GWe maximum constraint for the installed capacity by 2050 and reducing electricity imports by nearly 50%. Nuclear deployment would decrease the total system costs by up to €8 billion, while also reducing storage requirements (-42%), curtailed generation (-35%) and land use (-25%) compared to a non-nuclear decarbonization pathway. Overall, the study highlights the decisive role of financing conditions and policy frameworks in determining the future competitiveness of nuclear energy in Italy, emphasizing its potential contribution to energy security, system reliability, and cost-efficient decarbonization.

Summary

The ongoing energy transition is reshaping energy systems worldwide through rapid renewable deployment, increasing electrification, and ambitious climate targets. Within this framework, Italy is experiencing a renewed institutional and political interest in nuclear power as a stable, low-carbon baseload to complement variable renewables. However, nuclear deployment is characterized by high capital costs and long construction timelines. Navigating these trade-offs under deep uncertainty requires rigorous, model-based insights to support informed policy and strategic decisions. Energy system optimization models may be used as a critical tool to identify the techno-economic conditions under which nuclear energy becomes competitive, clarifying how financial risks propagate through the system and ensuring the design of robust transition pathways.

In this regard, the MAHTEP Group assessed the following issue: Under which economic and policy conditions could nuclear fission re-emerge as a competitive player in Italy by 2050, and which would be the implications of investing in nuclear generation for the country’s power system?

This activity is carried out by Andrea Mastrantuono, Daniele Mosso, Laura Savoldi (Politecnico di Torino), Matteo Nicoli, Valeria Di Cosmo (Università degli Studi di Torino) and Anderson Rodrigo de Queiroz (NC State University), combining expertise in energy system modeling, economic analysis, and policy scenario evaluation.

Implementing the nuclear fuel supply chain in TEMOA-Italy

To conduct a robust sensitivity analysis, the open-source TEMOA-Italy framework was significantly enhanced by introducing two major methodological upgrades designed to overcome traditional modeling oversimplifications:

1. A Complete Nuclear Fuel Cycle: Instead of treating reactors as isolated entities, the model captures the entire supply chain, from initial fuel supply to temporary storage, spent fuel reprocessing, and final waste disposal.
2. Discrete Capacity Formulation: To overcome the limitations of continuous approximations, capacity expansion is constrained to realistic, indivisible units. This allows the framework to correctly capture the high-capacity nature of nuclear technologies and their specific regional grid interactions.

Figure 1. Schematic representation of the comprehensive nuclear technology chain implemented in the TEMOA-Italy model, tracing from fuel input to final waste disposal.

Nuclear competitiveness is evaluated by combining uncertainty across two critical economic dimensions:

• Future Capital Cost Trends: Investigating paths where overnight construction costs remain stable (=), experience moderate increases (+), or face sharp escalations (++) by 2050.
• Financing Conditions: The cost of capital is represented by hurdle rates ranging from an optimistic 4% to a conservative 10%. Given that nuclear projects are highly capital-intensive and feature extended construction periods, high discount rates cause significant Interests During Construction (IDC).

These economic pathways are then simulated under four different geographical siting policies subjected to a strict national net-zero emission constraint by 2050:

• FREE: A purely cost-optimal benchmark with no regional restrictions.
• CNEN: Deployment restricted to regions identified in the historical 1979 CNEN suitability map.
• CNAI: Siting restricted to regions hosting areas listed in the recent 2023 national radioactive waste repository map.
• CENT: Fission restricted exclusively to the four Italian regions that historically hosted nuclear plants in the past.
• NONUC: The reference scenario where nuclear energy is completely excluded, implying a 100% renewable generation mix.

 Findings

The simulations show that if financing conditions remain favorable (hurdle rates below 8%), nuclear power is consistently selected by the model, saturating the maximum cap of 8 GWe by 2050.

When comparing the 100% renewable scenario (NONUC) against a site-restricted nuclear scenario (CNEN), a clear geographic pattern emerges: nuclear integration primarily acts as a regional substitute for solar capacity in northern Italy (see Figure 2). By placing dispatchable baseload reactors close to major northern demand hubs (such as Lombardia), the system avoids deploying massive quantities of solar panels in northern areas where solar capacity factors are structurally low. However, the southern regions continue to deploy substantial generation capacity by intermittent renewables. Indeed, the Italian power grid suffers from a structural spatial mismatch: demand is concentrated in the industrial North, while the highest renewable potential sits in the South. This requires massive power transmission across the country, which is not significantly affected in our scenarios, despite the availability of nuclear.

Figure 2. Regional electricity generation mix in 2050. Comparison between the renewable-only baseline (NONUC) and the nuclear-integrated scenario (CNEN).

Regarding the system implications of nuclear introduction, they can be summarized as follows (see Figure 3):

• Economic savings: Integrating nuclear power reduces the total net present value of Italian system costs by up to €8 billion compared to the NONUC baseline, heavily cutting expenditures on backup fuel and massive battery deployment.
• Reduced backup requirements: Deploying a reliable, dispatchable nuclear baseload reduces the national need for thermoelectric backup capacity by up to 12%, equivalent to a 6 GWe reduction (Figure 3a-b).
• Fewer batteries: The presence of constant baseload generation slashes national storage capacity requirements by up to 42% (Figure 3c-d).
• Reduced energy waste: Nuclear integration reduces national curtailment by 35% (Figure 3e-f).
• Land conservation: Due to its high power density, nuclear energy mitigates the extensive solar footprint in the North, dropping the total land required for power infrastructure by 25% (Figure 3g-h).

Figure 3. System-wide implications of nuclear deployment: (a-b) reduction in thermoelectric backup capacity, (c-d) sharp decline in utility-scale storage needs, (e-f) reduction in renewable energy curtailment, and (g-h) decreased total land-use requirements.

To understand how the grid functions on an operational timeline, hourly generation profiles are tracked across 24-hour periods for each season. Looking at the hourly generation dynamics (Figure 4), the steady “baseload” block of nuclear power is immediately apparent. In high-demand zones like Lombardia (LOM), the pink nuclear generation band covers the base of the load curve. This dramatically flattens the daytime solar generation peaks – preventing the need to aggressively cycle power into and out of batteries – and virtually eliminates Lombardia's structural reliance on cross-border electricity imports (visible as the gray area disappearing in chart d).

Figure 4. Hourly power generation profiles at the national level (a NONUC – b CNEN) and a specific focus on Lombardia (c NONUC – d CNEN) across four seasons.