The past, present and future of nuclear power

Electricity is expected to be in growing demand in the coming years, with the proliferation of new energy-hungry AI data centres and the electrification of transport cited as key drivers of the world’s future economic landscape.

But this has to be viewed on a backdrop of rising alarm about climate change, meaning that sustainable, low-carbon energy sources like wind and solar are going to play a big part in fuelling these industries. But, according to most industry insiders, they won’t be enough.

The intermittent nature of harnessing solar and wind energy, and the relative lack of scalable storage options, has led scientists to turn their attention to a maligned - and subsequently sidelined - alternative to make up the difference: and that’s nuclear energy. Are policymakers warming to the idea of a nuclear glow?

Many think so, and later on in this programme, we’ll look at the cutting edge of nuclear technology - including speaking with world-leading engineers at the forefront of this field with the UK firm Rolls-Royce who are proposing fleets of much smaller “off the peg” reactors - dubbed SMRs or small modular reactors - which, they say, could be assembled much more rapidly and at considerably lower cost than their gargantuan predecessors. 

So what’s the current state of play in the nuclear energy arena? Simon Taylor at the Cambridge Judge Business School is the author of ‘The Fall and Rise of Nuclear Power in Britain: A History.’

Simon - The UK is now making really quite good progress towards decarbonising its electricity system which is the new government's goal by 2030. Not everyone thinks that will be achieved, but perhaps by 2035 the original target. What that means is that now, at least on days when it's sunny and the wind's blowing, most of the electricity we consume is renewable. There's a small amount that is nuclear. But on days when it's very cold and dark and not very windy, we still rely on natural gas. That's the part which needs to be phased out over the next 5 or 10 years.

Chris - And the nuclear landscape over time, how has that changed in the last few decades?

Simon - Well, Britain was a pioneer in nuclear. For a long time there was a lot of optimism that nuclear could become the main source of electricity in the UK. Those hopes gradually became more and more frustrated as the cost of nuclear and also the efficiency of the nuclear stations both disappointed. By the 1980's, we had pretty much given up building nuclear, although we still had quite a lot of existing stations. Really, until the early 2000's, nuclear was seen as simply a legacy asset. We make the best of what we have, but we won't build anymore. That changed really around about 2006/7 when the government, facing both the gradual running out of North Sea oil and gas on the one hand, and also a desire to decarbonise the electricity system on the other, created a new argument for building new nuclear. Since then we've had one nuclear reactor project under construction at Hinkley Point C and probably a second to start in the next year or so at Sizewell C in Suffolk.

Chris - How has the proportion of energy we get from nuclear changed? Because we're down now at single numbers of percent, I think, aren't we? But we were much higher in the past.

Simon - Yes. Nuclear reached a little over 20% of total electricity generated at its peak, which would've been round about the late 1990's. That was partly a reflection of the fact that it was only in the 90's that some of the early reactors that were built in the 60's and 70's reached their full potential in terms of running for a large proportion of the year. But since then, the reactors have been gradually closing. The really old reactors, the so-called Magnoxs, the first generation, are all closed. Quite a lot of the second generation, the advanced gas cooled reactors, have also closed. There are some still operating and they've already had their lives extended in some cases more than once. That may go on a little bit longer. But, by 2030, we are unlikely to have any reactors operating other than the reactor at Sizewell, B, which is the one that was the last new reactor to be built.

Chris - But those new reactors have been dogged by overruns and cost inflations year after year to the point where we're talking about hundreds of percent over original starting estimates and are nearly a decade late and so on. So why is there now an appetite to do more of this?

Simon - Yes, nuclear power in Europe and the US - but not in Asia - has a really terrible track record in the last 10 or 15 years of overruns which, as you say, extend to many years. I think the main reason for that is that in Europe and in the US we stopped building reactors and we're having to relearn how to build them. It's turning out to be a very painful experience. I think the hope is that the costs will come down further, or we will switch to a new version of nuclear, the so-called small modular reactors, which have the potential at least of much lower costs. What nuclear has in its favour, particularly for a country like the UK, is that it generates a lot of reliable, continuous, low carbon energy in a very small area compared with, for example, wind farms or solar, which take up a lot of space. In the UK context, that is potentially very attractive

Chris - As an economist, you'll know all about economics of scale. The argument was, if we build a really big nuclear power station, we've got a huge economy of scale because it will serve a big population. Now, the message coming through is that it's inefficient and we need to build lots of little nuclear power stations because then we can get economies of scale, albeit in production. Why this switch around?

Simon - Well, the key word is production. You're right, it wasn't just nuclear, but even in coal stations, which were the backbone of British electricity generation for really most of the last a hundred years, scale was seen as a good thing. There are certain fixed costs of building a power station in terms of grid connections and security and water supplies and so on. There was some merit in the argument that bigger is better. The argument for small modular reactors is that we observe in manufacturing, whether it's making cars or iPhones or whatever, that people, when they do something on a large scale, large volume, they get very good at doing it. They learn by experience. That learning by experience, that falling unit cost is something that we have not observed in the nuclear industry. We've seen it to a very limited extent in Asia, but not in Europe or the US. The idea is, if you can design a new type of reactor, which is in effect built in a factory in a very controlled environment, and which benefits from that learning by doing that we observe in other areas of manufacturing, it should be possible to get the unit cost down considerably as long as you build a lot of them.

Chris - And what's that magic number of ‘a lot?’ 10, 20, 50?

Simon - That's a very good question. I think you struggle to find anyone wishing to own up to that. It's probably nearer 10 or 20 than it is, say, 5 or 6. But the problem is, because these reactors have not yet been built, any forecast about the magic point where the costs fall rapidly is something of a forecast, it's a conjecture. While the argument is a very plausible one in principle, it does have a slight chicken/egg conundrum, which is that somebody has to provide the financing to buy the first few reactors and indeed to pay for the factory that builds them, knowing that they will almost certainly be the most expensive units and it's only later on that the costs come down. That somebody probably has to be the government. Although we do see some of the big technology companies in the US signing contracts now for small modular reactors which will help to provide the kind of early investment needed to get to the scale at which point costs should in principle come down.

Chris - And what do the critics say?

Simon - Well, the critics say, at one level, this is all fine and it's a perfectly good argument, but we actually have no evidence yet. Rolls-Royce, a company I greatly respect and admire, has a wonderful sales video for their small modular reactor. It's a wonderful video and it shows you this very nicely designed reactor. And at the end of it, you sort of have to remind yourself there is no such reactor in existence yet. It doesn't actually exist other than as a computer simulation. That's not a criticism in itself, but it just means that we ought to be a little bit careful about any assumptions we make until we actually start seeing these things built and see how it works out in practice. I'm not negative about them, but I think critics have the right to say, well, show us some actual engineering data. Show us some complete reactors and let's see how much they actually cost.