Archive for the ‘Economics’ Category

Three Mile Island – the real disaster

Posted by Suzanna Hinson on June 2nd, 2017

In 1979, Three Mile Island nuclear reactor in Pennsylvania experienced a meltdown. Although no one died, the incident was labeled a disaster. However the real disaster appears to still be the impact these events had on the industry.

This week the owner of the plant said it would have to prematurely shut down in September 2019 due to unsupportive policy causing financial issues. The Three Mile Island and Fukushima incidents have placed significant pressure on the nuclear industry through increased regulation and further safety systems. These have added to costs making reactors like Three Mile Island unprofitable.

Safety and regulation is obviously important, but they have often been based on fear rather than science, and not accompanied by sufficient support and innovation for the industry. The consequences of a decline of nuclear are severe. Not only does it provide long term, reliable power, it also contributes to energy security and avoids dangerous air pollution and greenhouse gasses. There is concern that the decline of nuclear is offsetting growth in renewables meaning a lack of progress for overall low carbon power.

The American industry is in trouble, but it is also symptomatic of many other countries in the world. Especially in Europe, early retirements are common and even in supportive countries like the UK, new nuclear is struggling to gain traction. However with the consequences to health, security and the climate that a loss of nuclear power risks, it is essential that a new generation of nuclear power is supported and encouraged.

 

 

Switzerland reject rapid nuclear phase out

Posted by Suzanna Hinson on November 29th, 2016

On Sunday the people of Switzerland were offered a choice in a referendum as to whether to accelerate the shut-down of their nuclear power stations. With a result of 55% to 45%, the public showed a clear support for maintaining their nuclear fleet.

Following the Fukushima incident, the Swiss government committed to a nuclear phase out leading to a 100% renewable economy, but the timescales were vague. The proposal to accelerate nuclear closures, put forward by the Green Party, would have resulted in three of their five plants being shut next year, the fourth in 2024 and the last in 2029. However with nuclear providing almost 40% of Switzerland’s power, the risks of compromised energy security, consequential pressures to bills and the economy, and the potential increasing reliance on fossil fuels to meet shortages were more important to voters than the Green’s concerns over ageing plants.  

The results of the referendum mean the current Swiss nuclear plants should continue to operate for approximately 60 years, with the first plant closing as previously planned during the 2030s. Other country’s reactions to Fukushima have been more extreme, with Germany closing all reactors and pushing their energiewende program. Although this has increased renewables, it has also increased coal and thus compromised Germany’s decarbonisation leadership. 

Switzerland also gets a large proportion of its power from renewables with approximately 60% coming from hydroelectric power. Combined with low-carbon nuclear power this means it has a very clean power sector. Swiss nuclear is not just used for power, but also for heat, an example that other reactors should follow. The BBC reported that, “Environmentalists have said no nuclear reactors should be allowed to operate for longer than 45 years”. However it is incorrect to argue all environmentalists, in Switzerland or elsewhere, are anti nuclear power. Hydropower has some severe consequences to biodiversity and also can have significant methane emissions and other renewables also have their impacts. Nuclear may not be renewable but pragmatic environmentalists would argue it is low-carbon, reliable power with no impact on air quality and little impact on biodiversity. Keeping existing plants is a good first step for nuclear and it is encouraging to see that in some areas the technology has public support. But a continued commitment to phase out nuclear could risk the environmental and economic benefits that nuclear provides Switzerland. Reuters have reported that the entire phase out plan is now being questioned, with the Swiss People’s Party (SVP), the largest in parliament, aiming to challenge it with a separate referendum on the grounds it is too expensive. Hopefully this referendum could represent a turning point for nuclear power in Switzerland and around the world, a very timely one considering the accelerating imperative of decarbonisation. 

Weinberg’s response to the Industrial Strategy Consultation

Posted by Suzanna Hinson on September 29th, 2016

A commitment to industrial strategy is welcome, and must include sustainable development, decarbonisation and energy security at its core.

The debate on the extent of state involvement, in reference to climate change and sustainable development, is a valid one. However, the market is far from free. It would only be free if all externalities were included, but they are not. If there was a strong carbon price the government would be able to be less involved, but there will always be a need for some government intervention. Examples of this include research and development for industrial innovation that often requires initial government support.

The government must ensure that the Climate Change Act remains central. It has now been proven that the costs of action on climate change are far less than the costs of inaction (Stern review), with key industry and market leaders in agreement. The CBI says:

Ensuring that we maintain a secure, affordable and low-carbon supply is vital to British business. Additionally, we must continue to use energy more efficiently. The CBI is lobbying for government to provide a long-term, stable policy framework to enable continued business innovation and investment in the UK’s low-carbon transition.[1]

The Governor of the Bank of England Mark Carney said:

The combination of the weight of scientific evidence and the dynamics of the financial system suggest that, in the fullness of time, climate change will threaten financial resilience and longer-term prosperity. While there is still time to act, the window of opportunity is finite and shrinking. [2]

Christine Laggard, of the International Monetary Fund, agreed saying:

If climate change issues are not adequately addressed—if we keep running those nice energy subsidies, if the price on carbon is not adequately set, if policymakers dont have it on their radar screens—then financial stability in the medium and long-term is clearly at stake.[3]

It is thus essential that this significant threat to industries, markets, and the environment is mitigated.

The government also needs to accompany the targets on climate change with action by investing in future solutions. Research and development must continue to nurture infant industries that not only have the potential to benefit the UK’s energy and environmental security, but could also offer exciting new export potential. Initiatives like the Swansea tidal lagoon (a world first), advanced nuclear power including the SMR competition, floating offshore wind farms, Carbon Capture and Storage (CCS) and advanced bioenergy from algae are all great opportunities for the UK to pursue. Until externalities are internalised, low carbon energy industries will often require public financial support. The UK Government should provide this, where necessary, from taxes not consumer bills, and should also stop subsidies to unnecessary high carbon energy, including coal-fired power stations

An industrial strategy should be about developing new industries, whilst providing what existing industries need. Developing sustainable energy options not only consolidates the UK’s position in the growing green economy but also contributes to achieving affordable, sustainable and secure energy that is essential for existing industries. Some options, such as CCS, could give new life to declining existing heavy industry as a new report suggests[4] and development at already approved nuclear sites could help improve the rural economy in those areas. Combining heat and power provision through systems like district heating, also offer promising mutual benefits once the initial investment and development is made.

Industry needs security, but in the uncertainty wrought by the Brexit vote it also needs consistency. Blocking low cost, green solutions such as onshore wind, is unwise. A consistent approach should be used between energy sources. For example, if local communities are not allowed a veto vote over shale gas developments, they should also not be allowed a veto on wind farms. Whatever is decided on veto policy, it should be consistency across technologies.

Similarly, industry needs consistency over time. Regulatory stability and long-term agendas help investor confidence. One of the key mechanisms for delivering regulatory stability was EU membership. In the Brexit scenario that the UK now finds itself in, it is essential that a stable, consistent and long-term approach to policy is developed, to maintain confidence and ensure industrial progress.

The UK must also ensure it stays competitive and open to EU and global markets, whilst also maintaining its leadership in certain fields. One of these fields is emissions. The Industrial Emissions Directive, is a key policy that keep relationships with Europe strong whilst protecting our local and global environment. It is essential that that this, and other environmental initiatives are maintained and strengthened to allow the UK to continue to be a key part of Europe’s sustainable industrial future.

Finally, the UK should take inspiration from around the world. In the USA, Obama’s “all of the above” strategy allows security in energy to be achieved through variety of supply. Germany became a world leader in wind and solar development largely due to its Stromeinspeisungsgesetz law, ensuring a very attractive feed in tariff for renewables. This policy was so successful they now need to invest in storage and interconnection to integrate the renewables into a wider energy system. Sweden’s NUTEK created demand for new technologies with greater energy efficiency by technology procurement and government guarantees for market demands. By keeping abreast of these policy developments elsewhere, and future-proofing industry by investing in sustainability, the UK can ensure it continues to prosper.

A well-designed industrial strategy can propel the UK into a leading role in a number of policy areas, including energy, as well as provide some much needed clarity in the post-Brexit environment.

[1] http://www.cbi.org.uk/business-issues/energy/

[2] http://www.bankofengland.co.uk/publications/Pages/speeches/2015/844.aspx

[3] http://www.wri.org/blog/2013/04/lord-nicholas-stern-identifies-3-obstacles-international-climate-action

[4] http://www.ccsassociation.org/news-and-events/reports-and-publications/parliamentary-advisory-group-on-ccs-report/

New York goes pro Nuclear

Posted by Suzanna Hinson on August 2nd, 2016

In March we were happy to report that nuclear power was gaining acceptance as a clean energy source, specifically in New York. Now there is more good news as the New York State’s Public Service Commission voted yesterday to adopt the New York State Clean Energy Standard, advocating both renewables and nuclear. The overall aim is to increase renewables to provide 50-percent of electricity by 2030, whilst also retaining the state’s six nuclear plants which currently produce 30-percent of electricity.

The plan involves paying subsidies to the upstate nuclear power plants to ensure they keep operating. Nuclear power is struggling at a time of low prices for power and gas but is essential to meet decarbonisation targets and improve air quality. A statement from Governor Cuomo’s office said, “a growing number of climate scientists have warned that if these nuclear plants were to abruptly close, carbon emissions in New York will increase by more than 31 million metric tons during the next two years, resulting in public health and other societal costs of at least $1.4 billion.”

These clear benefits of retaining nuclear were argued by Rob DiFrancesco, director of New York AREA who said “New Yorkers win because they keep abundant, clean sources of power that generate billions of dollars in annual economic activity in the state, while preserving emission free nuclear power plants that help the state meet its goals of reducing greenhouse gas emissions”. Although this controversial plan has received much opposition, Eric Meyer, organizing director for Environmental Progress said it appears there are far more in favour than against.

An all of the above energy strategy, combining both renewables and nuclear, as well as storage, interconnection, CCS and efficiency investments, is the best way forward not just for New York, but for everyone. Our next report will be advocating a Clean Energy Consortium in the UK and hopefully many more will soon be following in New York’s progressive footsteps.

 

https://www.washingtonpost.com/news/energy-environment/wp/2016/08/01/why-new-york-state-just-delivered-extremely-good-news-to-the-nuclear-industry/?utm_term=.7c8204d55522

Open letter to Greg Clark on Hinkley

Posted by Stephen Tindale on July 29th, 2016

Greg Clark MP, Secretary of State for Business, Energy and Industrial Strategy

29 July 2016

Dear Greg

Congratulations on your appointment to run BEIS. I welcome the creation of the new department (see http://climateanswers.info/2016/07/15-july-2016-new-british-government-a-step-forward-for-climate-strategy/). And it is great to have you back working on energy and climate change.

I also welcome your decision to review the Hinkley Point C proposal, following yesterday’s Final Investment Decision by EDF. The UK needs new nuclear power stations, for energy security and climate action reasons. Britain needs to send a clear message that we are ‘open for business’ post-referendum. And there is a strong need for greater policy and regulatory stability on energy and climate matters going forward. But none of these reasons require you to implement decisions inherited from the Cameron/Osborne government without proper consideration.

It is quite possible – indeed very sensible – to be pro-nuclear without supporting all forms of nuclear technology. The European Pressurised Reactor (EPR) is a complicated reactor design. Construction of EPRs in Finland and France is proving very problematic; construction in China seems to be going better, but is also taking longer than planned. You should consider whether the delays and difficulties are due to these being the first constructions of a new reactor design, or whether they are caused by the complexity of the EPR design. I recommend that you consult professor Wade Allison, Emeritus Professor of Physics at Keble College, Oxford. Wade strongly supports nuclear energy, but thinks that the complexity of the design means that an EPR will never be built on time or on budget.

You should also question whether it is consistent with national security to have Chinese state-owned companies involved in UK nuclear infrastructure. Given Nick Timothy’s comments on this (http://www.conservativehome.com/thecolumnists/2015/10/nick-timothy-the-government-is-selling-our-national-security-to-china.html), I am very confident that you will.

If you decide against signing the Hinkley contract with EDF, I recommend that you accompany the announcement with two other statements to emphasise that nuclear energy has a future in the UK. First, a statement that a decision against Hinkley does not represent any change in the Government’s approach to nuclear more widely. You should highlight and welcome the Office for Nuclear Regulation’s plan to deliver decisions on the Generic Design Assessments for Wylfa and Moorside in 2017. Second, confirmation that the £250 million over five years for nuclear innovation, promised by George Osborne in last year’s Autumn Statement, will be delivered, and that the £30 million Small Modular Reactor competition will continue.

Nuclear energy should be an important part of a decarbonised energy system. But it will not be all of it. Continued expansion of installed renewable capacity is essential. Energy efficiency measures to replace the Green Deal are urgently required. And the Government should re-engage with Carbon Capture and Storage (CCS).

George Osborne’s cancellation of the CCS competition was a serious error, undermining investor confidence and leaving the UK facing either higher costs or dependence on technology imports to reach the carbon budgets. The Committee on Climate Change has been clear about the importance of CCS. Restarting UK activity in this area would make financial sense, and also demonstrate that a decision against Hinkley did not represent any lessening of your commitment to decarbonisation.

Good luck.

Stephen Tindale

Director

 

 

Our Summer Newsletter

Posted by Stephen Tindale on July 21st, 2016

The first half of 2016 has not exactly been stable in British politics.

In his March Budget the then Chancellor George Osborne announced a £30 million competition for Small Modular Reactors. This was in line with the recommendations in November 2015. But Osborne has now gone. The Department for Energy and Climate Change has been merged with the business department.  And no new nuclear capacity is being built: EDF have yet to make a Final Investment Decision for Hinkley.

Across Europe, nuclear energy is in decline. The European Commission and the nuclear industry itself expect nuclear to decline by a fifth by 2025. Switzerland is holding a referendum in November on whether to close existing nuclear stations early. An agreement between French socialist and green parties states that, if Flamanville becomes operational, another nuclear facility must be closed down.  Belgium has been formally committed to nuclear phase out since 1999, though the date of closing existing stations shifts according to who is in government.

A pro-nuclear civil society movement is needed to defend existing nuclear plants in these and some other countries. Such a movement is also needed to promote new nuclear, including advanced nuclear, in countries where the government is pro-nuclear, such as the Czech Republic, Finland, Poland and the UK.

The first article below is my suggestion of a progressive narrative for this civil society movement. Then comes an article by John Lindberg on why there is such strong anti-nuclear feeling in Germany. I do not think it would be worthwhile to spend time and resources arguing for nuclear in Germany – the nuclear argument has been lost there. But it is important for pro-nuclear campaigners to learn the lessons from Germany, so we can prevent other countries following Berlin’s example.

In the third article, I consider the state of energy policy in the UK and prospects for nuclear power.

If you would like to support or become involved in Weinberg Next Nuclear’s work, please get in touch.

Stephen Tindale, director
Stephen.tindale@the-weinberg-foundation.org

 

A progressive pro-nuclear narrative

Stephen Tindale

Nuclear energy is clean energy. It produces no air pollution or greenhouse gas emissions during operation. Reactors provides over half of European low-carbon electricity. But nuclear energy has a serious image problem. It is seen by many as too dangerous, too expensive and too old-fashioned to be part of the future. Solar is sexy, nuclear is not. As a result, nuclear energy is in decline across Europe.

It is quite possible to put together a statistics-based argument that nuclear power is clean. Fr example, the UK’s Parliamentary Office of Science at Technology finds that most estimates of nuclear’s lifecycle greenhouse gas footprint “fall below 26 gCO2eq/kWh”. Only large wind farms and run-of-river hydro have lower carbon footprints. Gas has a footprint of around 400, coal around 800. A think tank like Weinberg Next Nuclear needs to base its work on such studies: advocacy should always be evidence-based. But statistics are not inspiring to most people outside think tanks. Powerpoint presentations do not change the world. Alongside the facts and figures, we need a progressive narrative.

Pro-nuclear campaigners must not allow ourselves to be seen as defending the status quo or the energy establishment. If we allow that to happen, we will lose. Populist, anti-establishment political parties and movements are on the rise in many countries. A pro-nuclear movement must demand change, not just more of the same.

That does not mean we have to reject existing nuclear technologies. Before Fukushima, Angela Merkel spoke of nuclear as a necessary low-carbon bridge technology, to be used while Germany moves to become 100% reliant on renewables, which will take many decades. Merkel used the bridge metaphor as an argument against premature closure of Germany’s nuclear stations. This approach was clearly preferable to her post-Fukushima line of closing all nuclear by the end of 2022.

However, nuclear energy is more than just a bridge, because a goal of 100% renewable energy is not the best objective. Not everything renewable is low-carbon. If direct and indirect land use change are taken into account – as they ought to be – much bioenergy is not sufficiently low carbon to protect the climate. Bioenergy also produces air pollutants. In 2014 over half the renewable energy used in Europe was bioenergy.

Nuclear is a dense source of energy. This means that the physical and visual impact of nuclear is lower than that of, for example, wind or solar farms. More wind and solar farms are needed, but should not be constructed anywhere. Some biodiversity and landscape constraints are valid.

Wind, solar and hydro do not produce heat. Bioenergy can produce heat, but has the disadvantages mentioned above. Geothermal energy produces heat, but is only accessible in some locations. Much heat can be provided via electricity (increasing the need for low-carbon electricity). But not all industrial heat can be electric. Nuclear reactors produce heat, which could and should be used in industry. Switzerland is the leader in the use of nuclear heat; several central and eastern European countries also use nuclear heat, though the district heating systems used to transport the heat are communist-era and very inefficient.

Existing nuclear technology is good: clean, safe and reliable. Advanced nuclear – small modular reactors, molten salt reactors and fast reactors – will be even better. These reactors will be more flexible, so able to support intermittent renewables like wind and solar. They will almost certainly be less expensive to build than existing nuclear, because the designs are less complex.

We will not know the cost for sure until some have been constructed and operated. The nuclear industry has a history of promising cheap power (“too cheap to meter”) then delivering expensive power. Much better to under-promise then over-deliver.

What pro-nuclear campaigners can say is that a fleet of advanced nuclear reactors would help deal with spent fuel and plutonium, so substantially reducing the cost of waste management and disposal. Advanced nuclear could be part of an efficient resource economy, turning the legacy of past nuclear activities into an asset rather than a liability.

Advanced nuclear  should therefore be part of the long-term energy mix. With appropriate government support, some advanced nuclear designs could be commercially available within a decade.
However, this is where there is a need for a bridge technology. New nuclear facilities using existing reactor designs are necessary, to maintain or even expand nuclear’s proportion of the energy mix until advanced nuclear is commercialised and widely available.

Advanced nuclear technology should be an important part of the future energy mix. But other low-carbon energy sources will also be needed. The message of a pro-nuclear civil society campaign should not be that we need nuclear instead ofrenewables, but that we need nuclear and renewables.
The best form of energy is energy efficiency; ‘negawatts’. Much more must be done on this. But even if total energy use went down – which is not likely and not desirable given a growing global population and many millions needing more energy – demand for electricity would increase as heating and transport went electric.

So energy efficiency and all low-carbon power sources are needed. Weinberg’s next report, in the autumn, will set out the case for a clean energy alliance.

Progressive, pro-nuclear campaigners should:

  • promote advanced nuclear energy as part of the long-term low-carbon energy future;
  • support  technological innovation in order to deal with the legacy of past nuclear activities and produce reactor designs that are even better than existing reactors;
  • build a clean energy alliance and work alongside those promoting energy efficiency, wind, solar, marine energy, geothermal and carbon capture and storage.
 
Nuclear Metamorphosis: How we learned to start worrying and fear the reactors
John Lindberg
Nuclear power has for quite some time suffered from very poor public relations. Connotations are in most cases negative, with death and destruction frequently being associated with nuclear. The notion of a technology that is mere steps away from causing a nuclear explosion is widespread. These are all misconceptions about nuclear power, which is one of the safest sources of energy. But most arguments made by proponents of nuclear power about its benefits fall on deaf ears. Given this predominantly hostile environment, one might even draw the conclusion that nuclear power as a venture  should be scrapped, because  other forms of energy production would be less controversial.However, the realities of climate change are upon us and a source of low-carbon emission energy is desperately needed that can replace coal and gas for baseload generation, for the cloudy and windless days. So how did nuclear power end up in this situation?

Harnessing the immense power of the atom began as a military venture, and the very word nuclear stirs up ambiguous connotations. The original purpose of nuclear reactors – supplying materials to nuclear bombs – created a powerful legacy of dualism. Nuclear had a dual nature, either as a peaceful reactor providing bountiful clean and stable electricity, or as a potential bomb factory. The early years of civilian nuclear power were filled with optimism about the future, as nuclear promised a virtually limitless energy source.

The 1960s represent the beginning of a watershed in nuclear energy in terms of public perception. During the late 1950s and early 1960s, the number of atmospheric nuclear weapons tests steadily increased, with the fallout from these tests becoming a considerable source of public anxiety. Imagery was created portraying radioactive particles as ‘death dust’ that, regardless of its original source, posed a risk. Public pressure became significant until the signing of the Partial Test Ban Treaty in 1963.

After this treaty, ‘the public view of nuclear energy [underwent] a dramatic and unexpected metamorphosis.’ The fallout controversy led to an increased focus on the supposed dangers of radiation. Concerns about nuclear weapons –  the risk of technological errors that would accidentally lead to either a nuclear detonation or, worse still, nuclear war – were successfully transferred by the anti-nuclear movement which transferred to nuclear power.

Once the imagery and emotions had been transferred, it needed cementing, to create a lasting connection. The accident at the Three Mile Island nuclear power plant presented such an opportunity for the anti-nuclear movement. The public worldwide followed the developments closely, and the situation played straight into the narrative of a technology out of control. This was further amplified by the fear that the reactor itself could explode, with similar consequences of a nuclear bomb. Whilst this risk was later found to have been greatly exaggerated by media and poor communication, the anti-nuclear movement successfully seized the moment. Nuclear power had, at least in the US, completed its journey from a saviour to a potential bringer of death.

This transformation of public opinion struck Europe a few years later, a fateful night in 1986. The Chernobyl disaster, the worst nuclear accident we have ever seen, came to be seen as a final watershed. The death toll from radioactive exposure from the accident is by, for example, Greenpeace claimed to be as high as 200,000. The United Nations Scientific Committee on the Effects of Atomic Radiation (UNSCEAR) has repeatedly rejected numbers of this magnitude, with its chair Lars-Erik Holm calling them “unsubstantiated statements that have no support in scientific assessments”. The notion of mass death, as incorrect as it is, amplified the sentiment of a very dangerous technology, running out of hand. It also increased  fear of radiation.

News reports covering the accident amplified the nuclear fear that already existed. German, American and other Western media outlets widely used graphics from Chernobyl, graphics that frequently would explode. Imagery related to nuclear war was also used. The packaging efforts by anti-nuclear activists attempted to highlight the links between nuclear power and nuclear weapons, which is essential for any fear extension to take place. An excellent example of such packaging is given by Joschka Fischer, former German Vice Chancellor and leading figure of the (West) German Green movement, who states that every nuclear reactor is a potential nuclear bomb. This and the atomic ‘angst’ in Germany were further increased by the usage of ‘atomic cloud’ imagery. The cloud referred to was the radiation that was being spread from the damaged reactor, spreading nuclear fission material across the world. This notion of a cloud taps into the fears of radiation originally connected with nuclear weapons fallout.

By appealing to the fear that this evokes, the fear extension – creating the connections between nuclear weapons and nuclear power in terms of emotions and imagery – is easily made. The fear that Chernobyl’s fallout cloud generated should not be underestimated. It has had significant long-term ramifications that have come to cement the fear of nuclear, in particular accidents. The tremendously popular children’s novel ‘The Cloud’ by Gudrun Pausewang has come to play an important role regarding how Chernobyl is remembered in Germany. The scenes of an invisible killer, mass death, and widespread panic have created a lasting impact in terms of collective memory. Similar developments are seen across the world.

Challenging fear is never an easy task But on this occasion the stakes are too high to ignore. As proponents of nuclear power, we need to dismantle long established and commonly held prejudices. We need to challenge the lies, but more importantly, spread a message of hope and show how nuclear power offers a serious challenge to a failed fossil fuel status quo, a status quo that slowly is pushing humankind towards the edge.

John Lindberg is a MA Climate Change student at King’s College, London. He  is the former UK representative and Secretary-General of the Young European Council’s Energy and Climate Action Committee. Before moving to London he read Politics at the University of Glasgow and worked as policy adviser to former MSP Sir Jamie McGrigor.

We are the UK’s only charity advocating for safer, cheaper and cleaner next-generation nuclear energy. We have accomplished a lot with our small team and are eager to do more. Now we urgently need your support to build on the legacy of Dr. Alvin Weinberg to build a better, cleaner and more sustainable future.

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New British government: a step forward for climate strategy
Stephen Tindale

The UK no longer has a department with the words ‘climate change’ in its title. Climate policy is now the responsibility of a new Department of Business, Energy and Industrial Strategy. This could be seen as a downgrading of climate action – and has been condemned by some green groups. But I think it is a step forward.

Before 2008 energy policy had been the responsibility of the Department of Trade and Industry, and climate change dealt with by the Department of Environment, Food and Rural Affairs (Defra). So different parts of the ‘energy trilemma’ – economic, social and environmental – were in different departments. The economic argument usually trumped the decarbonisation debate. The social part tended to get overlooked.

Before this month’s reshuffle there was some speculation that new prime minister May would return to this arrangement. She has not, which is a relief. Defra is not a powerful department within Whitehall. And climate change is not just an environmental issue: it affects health, the economy, foreign policy and much more.
DECC was also not a strong Whitehall department. During the 2010-15 coalition government, many Tories came to resent DECC as ‘a Lib Dem fiefdom’. After 2015 general election, there was a Tory DECC secretary, but DECC’s staff numbers were slashed, and many of the best officials left.

The new Department of Business, Energy and Industrial Strategy is likely to be stronger than DECC was. Its first secretary of state, Greg Clark, is an excellent appointment. He is clearly on the left of the Conservative party; indeed he was a Social Democrat activist while at university. He was an effective shadow DECC secretary before 2010, taking a pragmatic approach and being willing to listen and learn.

Clark’s new department is in charge of industrial strategy. Lib Dem Vince Cable spoke about industrial strategy when he was running the business department 2010-15, but his Tory successor Sajid Javid did not, wanting to leave pretty much everything to the market. An industrial strategy is necessary in order to deliver decarbonisation. If one thinks that names of departments matter (which I don’t particularly), having industrial strategy in the name of a strong department is more important than having climate change in the name of a weak one.

However, the new business department will only succeed if it is supported by those at the top of government. New Chancellor of the Exchequer Philip Hammond gave some strong speeches on climate change in his previous role as Foreign Secretary, highlighting the economic and security advantages of leading the decarbonisation effort. For example, in November last year he said:

“I do not accept that we have to choose between our future prosperity and safeguarding the future of our planet. This is not a zero sum game. As Conservatives, we choose both.”

New prime minister Theresa May has not been much involved in climate discussions: there is no great overlap with her previous portfolio of home affairs. But Carbon Brief has helpfully found two quotes. In December 2008 she said:

 “I am thrilled to see that after years of Conservative pressure, we have finally passed a necessary and ambitious piece of legislation on Climate Change. Britain is the first country in the world to formally bind itself to cut greenhouse emissions and I strongly believe this will improve our national and economic security. To stay reliant on fossil fuels would mean tying ourselves to increasingly unstable supplies which could endanger our energy security and the Climate Change and Energy Bills mark an important step for both the health of our economy and the health of our nation. It is now vital that we stick to these targets”

So the new prime minister accepts the need to move away from fossil fuels. Does she think that new nuclear reactors should be part of this move? That is less clear. In July 2006 she said:

“I welcome that the Government has responded to cross-party pressure to make it easier for homes in Maidenhead [May’s constituency] and across the country to install renewable energy like solar panels or mini-wind turbines. Where the Government offers positive, constructive and reasonable policies, they will have my support. But the Government could do far more to promote green energy, rather than giving unfair subsidies to new nuclear power stations.”

Does May regard all nuclear subsidies as unfair? Conservative party policy is pro-nuclear, mainly on energy security grounds. Clark is pro-nuclear. Hammond said on his first day in office that Hinkley will go ahead.

However, last week the UK’s public spending watchdog, the National Audit Office (NAO), published a report on Nuclear Power in the UK. While noting that much new generating capacity is needed in the UK, the report states that:

“There are particular value-for-money considerations for nuclear power compared to other generating technologies. The government is offering longer-term CfDs [Contracts for Difference] for new nuclear investment than other low-carbon technologies, reflecting the longer payback periods for nuclear power stations. This adds to price certainty for consumers but increases the risk that they do not benefit as much from any long-term changes, such as technological advances that reduce the cost of other low-carbon sources. The greater complexity and risk of nuclear power projects also could lead investors to require a higher return than for other low-carbon technologies.”

This complexity and financial risk applies to all nuclear pojects. But NAO also raises particular concerns about Hinkley Point C (HPC):

“With CfDs, taxpayers are not exposed to project risks such as cost overruns during construction. However, as part of the government’s deal for HPC, HM Treasury has provisionally agreed to guarantee up to £2 billion of bonds that NNBG [the partnership between EDF and Chines estate-owned nuclear companies] will issue to finance HPC’s construction repayable by NNBG’s shareholders in 2020. If the shareholders fail to repay and the government’s guarantee is ever called, or if the developer manages to negotiate further guarantees that are called, the funds required would be drawn from government budgets. Additionally, the HPC deal includes a Funded Decommissioning Programme, whereby the Department stipulates an amount that NNBG must set aside to cover decommissioning costs. The government will be liable for any decommissioning costs above the amount NNBG sets aside.”

As well as financial concerns, some have expressed national security concerns about Chinese involvement in UK nuclear infrastructure. May’s new joint chief of staff, Nick Timothy, has written that the Chinese might use this to build weaknesses in computer systems:

“For those who believe that such an eventuality is unlikely, the Chinese National Nuclear Corporation – one of the state-owned companies involved in the plans for British nuclear plants – says on its website that it is responsible not just for ‘increasing the value of state assets and developing the society’ but the ‘building of national defence’.”

Given May’s past comments about “unfair” subsidy, Timothy’s attitude to Chinese involvement and the recent NAO report, it is now likely that the Hinkley project will be seriously questioned – as it should be in my view. The European Pressurised Reactor, the design being built in France and Finland and proposed for Hinkley, is very complicated and so very expensive. Other existing nuclear options are less complex and so would require less subsidy.

All new nuclear facilities might well require more subsidy than renewable energy facilities. However, the UK is legally obliged, under the 2008 Climate Change Act, to meet carbon budgets. May has said, as quoted above, that it is vital to stick to these targets. To his credit, David Cameron found time in his last fortnight as prime minister to accept the advice of the Committee on Climate Change that the budget for 2028-32 should be 57% below 1990 emission levels. So the appropriate question for nuclear subsidy is not whether this is higher or lower than subsidies to other technologies, but whether it is possible to meet the carbon budget without new nuclear.

As the late David MacKay argued so effectively in Sustainable Energy – without the hot air, it is much more practical to include nuclear as part of the energy portfolio, and the carbon budgets are much more likely to be met. Size matters as well as cost. Cheaper options should be supported – including onshore wind which the Conservatives have stopped subsidising. But new nuclear must be part of the mix.

The impact of Brexit on clean energy

Posted by Stephen Tindale on June 27th, 2016

What will be the impact of Brexit on clean energy in the UK? Answer: nobody knows, because nothing is remotely clear in British politics now. Who will be prime minister? Will there be an early general election? What will be the relationship between the UK and the remaining EU member-states? Will there even be a UK?

However, some broad predictions can be made – and they are not optimistic.

In the short term, there will probably not be significant change in the policy framework. But there will be further slowdown in investment in energy infrastructure: potential investors do not like instability. Investment in renewables will be reduced because the UK will no longer be obliged to meet the 2020 legally-binding renewables target. Investment in new nuclear will also be reduced: progress on Hinkley looks even less likely this week than it did last. Investment in new  interconnectors will probably suffer less. Other countries’ governments may be very cross with Britain, but that will not stop them wanting to sell us more electricity.

In the medium- to long-term, some laws governing the energy sector will probably be revoked or weakened. The free market right of the Conservative party has been strengthened, and attacks on ‘Brussels red tape’ were frequent in the successful Leave campaign. There were criticisms of the EU’s 2010 Industrial Emissions Directive, which limits air pollution emissions from power stations and protects public health (http://www.thelancet.com/commissions/climate-change-2015). However, air pollution is quite high on the UK political and media agendas. So the Industrial Emissions Directive will probably remain in force post-Brexit.

Weaker climate policies

Climate policies look more vulnerable, because there is a significant overlap between Euroscepticism and climate scepticism. The UK’s Climate Change Act, which commits the UK to reduce greenhouse gas emissions by at least 80 per cent (from1990 levels) by 2050, was passed with all party support in 2008 – only five MPs voted against. There are more climate sceptic Conservative MPs now than there were in 2008, and likely to be even more following a general election called by the new prime minister. But the new government is not likely to repeal the Act. Instead, it will probably weaken it by adopting less ambitious ‘carbon budgets’. The Act requires governments to set such budgets for four year periods, on advice from a Committee on Climate Change. The Cameron government has yet to accept the Committee’s latest recommendation.

The 2010-15 Conservative-Liberal Democrat coalition government implemented an Emissions Performance Standard banning the construction of new coal power stations unless they have carbon capture and storage. The opposition Labour party tried to get this applied to existing coal as well (as Obama is doing with his Clean Power Plan). There is now little likelihood of this happening. And the promise made by energy and climate secretary Amber Rudd (a leading Remain campaigner) to close unabated coal by 2025 looks unlikely to be met. Rudd said in her speech announcing this target that it would only be implemented if consistent with energy security. The slow down in energy infrastructure considered above makes the target much more challenging.

The coalition also introduced a ‘carbon floor price’: emissions allowances under the EU Emissions Trading System are not sold in the UK if the auction bid is lower than £18 per tonne of carbon dioxide. This raises around £2 billion a year, (https://sandbag.org.uk/site_media/pdfs/reports/Sandbag_Carbon_Floor_Price_190312.pdf ), so a Chancellor of the Exchequer will not want to abolish it. But making UK operators pay around three times the cost of allowances elsewhere in Europe does not help UK competitiveness, so the next Chancellor will come under considerable pressure to scrap it.

Advanced nuclear power

Post-Brexit, there will be less Europe-wide collaboration on energy R&D. This will hamper research. In the words of Universities for Europe:

“Working together, UK and European researchers can pool their resources, expertise, data and infrastructure to achieve more together than they could do alone. Many of today’s challenges are global, not national. In the EU, researchers can collaborate more easily to come up with solutions on an international scale, making the most of Europe’s diversity to achieve bigger and better results. EU frameworks, programmes and funding support collaboration are reducing the barriers to working across borders.” (http://www.universitiesforeurope.com/news/Pages/home.aspx)

This additional barrier does not make energy R&D impossible. The UK must continue to invest in energy innovation. Chancellor George Osborne promised in his 2015 Autumn Statement £250 million over five years for nuclear innovation. In his March 2016 Budget he allocated £30 million to a Small Modular Reactor (SMR) competition. The Department of Energy and Climate Change is currently talking to potential SMR developers.  This is in line with our recommendations (see http://www.the-weinberg-foundation.org/wp-content/uploads/2016/04/Next-Steps-For-Nuclear-Innovation.pdf).  However, the referendum result means that the UK government has less money than expected. And a competition does not guarantee that money will be provided. The UK ran a competition on Carbon Capture and Storage but then cancelled it without giving any awards. The top priority for Weinberg Next Nuclear in the coming months will be to try to ensure that the SMR competition continues and leads to financial support to developers.

Report Launch: Next Steps for Nuclear in the UK

Posted by Stephen Tindale on April 27th, 2016

Next Steps for Nuclear in the UK

A new report from pro-nuclear think tank Weinberg Next Nuclear, outlines what the Government should do to make the UK a world leader in advanced nuclear technology. The report argues that the British government should support small nuclear reactors as well as large new reactors, and that by the early 2020s at least three advanced reactor designs should have been assessed by the regulator.

Existing civil nuclear reactor designs provide large amounts of clean, low carbon energy, so improving energy security and air quality and mitigating climate change. But they have high upfront capital costs, and are not sufficiently flexible to back up wind and solar power. Advanced nuclear designs could address these drawbacks.

In November 2015 Weinberg Next Nuclear published a report on ‘The Need for Nuclear Innovation’. Chancellor George Osborne subsequently promised, in his 2015 Autumn Statement, £250 million over five years for nuclear R&D. In the March 2016 Budget, he announced a £30 million competition for advanced manufacturing in nuclear, and a competition to support innovation in Small Modular Reactors (SMRs).

This report:

– outlines criteria which government should use in selecting reactor designs to support (but does not say which designs should be chosen);

– recommends that at least one of the reactors supported should be a Generation IV design, because this could re-use spent nuclear fuel, and also use plutonium as fuel. The UK has the largest plutonium stockpile in the world;

– suggests that SMRs and micro-reactors (less than 20 megawatts) will be cheaper to construct than large reactors because they can be made on production lines then transported to site. Generation IV reactors may also be considerably cheaper than existing nuclear designs due to less complex designs – though this will not be known until one has been constructed;

– supports the Office for Nuclear Regulation’s proposal to increase its capacity by expanding staff numbers. Lack of regulatory capacity is currently the major barrier to nuclear innovation in the UK;

– proposes that UK nuclear regulators should work closely with their Canadian and US counterparts, with the aim of developing a regulatory approval mechanism that would cover all three countries.

 

Download the report.

Stephen Tindale, director of Weinberg Next Nuclear, said:

“The UK’s energy mix must be based on diversity. So the policy argument should not be whether to support solar, wind, CCS or nuclear. ‘All of the above’ will be needed.

Existing nuclear technology is very good, but future nuclear technology can be even better. If the £250 million is sensibly spent, it could contribute to the UK becoming a world leader in both small and Generation IV reactors.”

 

Contact

Stephen.tindale@the-weinberg-foundation.org

07941 433780

 

Notes for editors

1) Weinberg Next Nuclear is part of the Alvin Weinberg Foundation charity. The Foundation plans to continue work on advanced nuclear energy, and to expand its work into other clean energy sources – wind, solar, tidal, geothermal, CCS.

2) Three companies contributed sponsorship support to the workstream behind this report: Terrestrial Energy, URENCO and Moltex Energy. Editorial control remained with Weinberg Next Nuclear alone.

 

A Positive Budget for Nuclear

Posted by Suzanna Hinson on March 17th, 2016

Following the announcement of £250 million for nuclear innovation in his autumn statement, the Chancellor George Osborne renewed his commitment to nuclear power in yesterday’s budget. He announced a competition for Small modular reactors, an SMR delivery roadmap and at least £30 million for an SMR-enabling advanced manufacturing R&D programme to develop nuclear skills capacity.

The £30 million will presumably be part of the pre-pledged £250 million, rather than in addition to it. Nevertheless, the steps on SMR delivery are encouraging. It is necessary under European state aid rules to run a competition on SMRs before a winner or winners can be chosen. The sooner this is done, the closer they are to being realised. A roadmap for realisation will also help progress and in the Chancellor’s words “pave the way to build one of the world’s first SMRs”.

Our upcoming report on “Next steps on nuclear innovation” – which we aim to publish next month – will contain advice on how the government should pursue not only SMRs but all advanced reactors.

South Australia could provide a long term solution to nuclear spent fuel

Posted by Stephen Tindale on February 22nd, 2016

by Priya Aggarwal

A Nuclear Fuel Cycle Royal Commission was set up in March, 2015 to independently look into South Australia’s potential future role in four prominent areas of the nuclear fuel cycle – exploration and extraction; processing of minerals and manufacture of materials containing nuclear substances; electricity generation from nuclear fuels; and, management, storage and disposal of radioactive waste. The commission will have to submit a final report by May, 2016 after considering the following:

     the effect on the environment;

     safety;

     the effect on other sectors of the State’s economy, in particular the tourism, wine and food sectors; 

     technical issues.

South Australia (SA) is currently home to four of Australia’s five uranium mines, and the possibility of the state developing nuclear power generation, enrichment and waste storage facilities have hitherto been contentious issues. The Royal Commission comes at a time of economic contraction for SA, which is suffering from job losses in mining and manufacturing sectors.

Since the commission saw no opportunity to commercially develop further uranium processing capabilities as it says the market is already oversupplied and uncertain, it sees SA could benefit from forging contracts with those that buy its uranium to store the waste products as well, as part of a concept entitled “fuel leasing”. Kevin Scarce, the Royal Commissioner, said the timeframe of building a deep geological disposal project would take 30 years, based on the timeframe it took for Sweden and Finland, who currently store their own waste at present (but, Sweden intends to receive waste from further afield) to set up similar successful projects buried 400 to 500m underground. While avoiding the nomination of a site for nuclear waste, the inquiry found the “likely” development of a storage and disposal facility of used nuclear fuel could be operational in the late 2020s.

Mr Scarce said SA could take 13% of the world’s nuclear waste and had unique characteristics that made it suitable, such as a stable geology and relatively stable seismologically. He feels confident about tapping the market’s potential in this segment and says, “Mind you, we’ve had waste now for 50 to 60 years and there has not been an international solution yet.” After revealing the tentative findings, a consultation period has now begun.

 

Referneces-

http://www.world-nuclear-news.org/NP-Waste-disposal-offers-opportunity-to-South-Australia-1502164.html

 

http://yoursay.sa.gov.au/decisions/royal-commission-our-role-in-nuclear-energy/about

 

http://nuclearrc.sa.gov.au/tentative-findings/

 

Edit: Post previously included the line “The government also faces the task of convincing the locals at six shortlisted sites, of which three are in SA.” which was deleted as it is a separate and mostly unrelated issue.

 

 

 

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