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A warmer climate may result in lower thermal efficiency and reduced load—including shutdowns—in thermal power plants. Focusing on nuclear power plants, we use different European datasets and econometric strategies to identify these two supply-side effects. We find that a rise in temperature of 1°C reduces the supply of nuclear power by about 0.5% through its effect on thermal efficiency; during droughts and heat waves, the production loss may exceed 2.0% per degree Celsius because power plant cooling systems are constrained by physical laws, regulations and access to cooling water. As climate changes, one must consider measures to protect against and/or to adapt to these impacts.
Linnerud et al. (Sat,) studied this question.