Investigating nuclear energy viability in Texas with decision making model GenX

Abstract

As the population grows and AI datacenters look to expand, Texas is in search of reliable and economical power to fill the increased demand the state is facing. This study assesses the economic viability of nuclear energy within the Electric Reliability Council of Texas (ERCOT) using the GenX capacity expansion model. Utilizing a simplified ERCOT grid developed by the Webber Energy Group at UT Austin, this research simulates various deployment scenarios to determine cost thresholds at which nuclear power becomes competitive with wind, solar, battery storage, coal, and natural gas. Simulations for projected 2025 and 2030 demand scenarios reveal that nuclear energy is economically viable at a capital expenditure (CAPEX) of approximately $4700 per kW, an upfront cost 38% below the National Renewable Energy Laboratory's (NREL) 2030 moderate estimate of $7616 per kW. This assumes that the full 50% Investment Tax Credit (ITC) is applied in the model as a direct capital cost reduction. Modeling also shows that if natural gas CAPEX nearly doubles or if gas fuel costs rise by 235%, nuclear becomes the preferred alternative. When both natural gas capital and fuel costs increase, nuclear clearly emerges as a cost-effective and competitive alternative. These findings suggest that nuclear power, while currently not cost-competitive, is an important part of the fuel mix that Texas will need in 2030 as electricity demand increases. State and federal policies such as the ITC and grants are recommended to continue in order to ease nuclear power through the heightened costs of first-of-a-kind construction.