Energy crises and the case for new nuclear
Driven by supply shortages - and pursuit of a green agenda across multiple geographies - many countries were already facing an energy crisis. Fuel prices at the pumps are at eye-watering levels we’ve never seen before, and some people have seen their power bills double in a matter of months. One consequence of the energy deficit is renewed interest in nuclear power, which under the circumstances is looking very attractive as an option, as energy consultant Jeremy Gordon, who runs the nuclear advocacy initiative “fluent in energy”, and Simon Taylor from Cambridge University's Judge Buisness School, explains to Evelyna Wang...
Simon - The UK was one of the pioneers in nuclear power and nuclear power has made quite a significant contribution to UK electricity generation over many decades. It's still around 15% of the power that we produce, but it's now shrinking, or about to shrink, quite rapidly because, on current plans, all but one of the older stations will close by the end of this decade. So, unless we build new nuclear stations, the nuclear share will shrink. The problem has been that new nuclear has proved economically very troublesome, both in the United States and in continental Europe.
Evelyna - Why is it so challenging to get a new station built?
Simon - Nuclear power plants are exceptionally complex structures. The underlying argument for nuclear is that you get a great deal of energy from a very small quantity of uranium. The problem is that process generates a great deal of radiation, which is dangerous, so you have to build protective structures around it. You also have to build in various backup systems to make sure that in the event of an accident or a loss of power, the plant can shut down safely. That essentially makes for a very complex structure which, in turn, Is very complicated to build. The good news is that there is learning by doing in nuclear, at least to some extent - there is a sense of benefit in building more of these stations because you get better and better at doing it, and the costs will progressively come down. How much lower remains to be seen. There is some evidence that things are getting better, but investors are obviously sceptical about this until it's actually happened, and that's where the government has to take some of the risk.
Evelyna - I see. If they were to build new plants, then where would these be located?
Simon - Well, the government did a sighting survey quite some time ago and identified several sites, which are almost all existing sites, where there are nuclear power stations of the first or second generation, some of which have now closed. These are all sites that have both the physical characteristics which, amongst other things, is that they need to be reasonably far from urban areas and they need to be on the coast because you need a lot of water for cooling and the grid connection is already there, which means you don't have to add a great deal of extra investment. They also have, for the most part, local support because nuclear power stations employ quite a lot of people; they generate very well paid jobs, additional economic activity in what are typically rural areas where there isn't a lot of alternative employment.
Evelyna - As a projection into the future, do you think we can count on nuclear technology as part of a clean energy future?
Simon - The main case for nuclear is that it is a proven source of reliable and predictable low or zero carbon electricity. The value of having predictable and reliable electricity supply, particularly in the winter, is quite high. So, I think there's a pretty good case for the UK to have at least some nuclear as part of the mix, as long as it's not outrageously expensive. As I say, the evidence is that it's getting better. With what's been going on recently in Ukraine, one message that's come through is that being dependent on imported energy is a risk. I would expect this to reinforce the case for nuclear in the UK and possibly other countries as well.