Nuclear shipping depends on global climate policy

Nuclear propulsion could become a cost-competitive option for container shipping, but only if reactor costs fall significantly and an effective global emissions policy supports investment, according to new research from University College London’s (UCL) Energy Institute.

The report, ‘Nuclear Reactors for Merchant Shipping: A Total Cost of Ownership Assessment of a Low-Carbon Pathway’, compares nuclear-powered large container ships with conventional fuel oil and dual-fuel ammonia alternatives, assessing costs under different policy and reactor-price scenarios.

Farah Bziker, researcher at UCL’s Shipping and Oceans Research Group, said: “Nuclear can compete, but only with much cheaper reactors and a global emissions policy, and neither exists yet. How both develop over the coming years will decide whether nuclear has a place in shipping.”

The analysis finds that nuclear vessels are not cheaper than conventional ships without the IMO’s proposed Net-Zero Framework (NZF), even under the lowest reactor-cost assumptions. With the framework in place, selling surplus emissions units to other vessels could improve nuclear’s economic competitiveness.

Reactor costs remain decisive. Published estimates range from approximately US$2,600 to US$12,400 per kilowatt of electrical capacity. Nuclear becomes the cheapest option from 2040 under the lowest-cost scenario, which assumes series production and substantial cost reductions. At the upper end, reflecting first-of-a-kind reactors, it is not the cheapest option in any scenario.

The report also highlights significant legal and financial obstacles. Existing nuclear liability conventions were designed for land-based installations, while interviewees expect a mature insurance framework for nuclear shipping could take 15 to 20 years to develop.

Dr Tristan Smith, professor of energy and transport at UCL, said: “Nuclear is not a reason to weaken maritime climate policy. It is one of the technologies that depends on it.”

The researchers caution that their model excludes several nuclear-specific costs, including insurance, reactor maintenance and hull integration. They conclude that commercial viability will require lower costs, sustained emissions incentives and international agreement on liability, insurance and regulation before deployment can expand.