How to manage flexible nuclear power plants in a deregulated electricity market from the point of view of social welfare?

•We determine the management of flexible nuclear plants to maximize social welfare.•We model the nuclear fuel stock as a “reservoir” of energy.•Social optimum is given by a totally flexible management of the nuclear production.•The level of thermal production of the optimal solution is always constant.•We need to invest in nuclear energy to ensure social optimum within our model.

Flexible nuclear power plants can adjust their electricity production to the predicted evolution of demand. Under certain conditions, flexible operation is necessary to ensure the stability of the electricity system. However, despite the potential advantages of nuclear energy including the flexibility of nuclear reactors, the social acceptance of nuclear has reduced after the Fukushima accident, leading some countries to reduce or even phase out nuclear (e.g. Germany). So, a question that arises is how flexible nuclear power plants have to be operated in order to maximize social welfare. The French nuclear fleet gives an illustration of flexible management while social acceptance of nuclear is questioned; this was reflected in the new French Energy Transition law. Theoretically and numerically, we found that the production behavior that maximizes social welfare is characterized by a constant thermal production and a totally flexible nuclear production given sufficient nuclear capacity.