2015 Nuclear Issues Vol 38 No 2 March

Posted by NucNet on 31 March 2015 in Issues

The elephant in the room

To mark his retirement from the paper the editor of the Guardian has commissioned a series of articles on threat of climate change as a consequence of the ever-increasing discharge of carbon dioxide into the atmosphere from the combustion of fossil fuels.

His intention is to remedy the insufficient attention the paper has given in the past to the “overshadowing, overwhelming issue of how climate change will probably, within the lifetime of our children, cause untold havoc and stress to our species.” The problem as he sees it is, that to keep an increase in temperature below 2°C the world should not discharge more than 565 gigatons of carbon dioxide into the atmosphere by mid century, but some 5 times that would be released if all the proven reserves of fossil fuel were burnt. Although the words nuclear power are carefully never mentioned the need for an additional, reliable, and sustainable and affordable energy source to replace fossil fuels is obvious.

This is supported by a January study by the UK Energy Research Centre which finds that a third of oil reserves, half of gas reserves and over 80 per cent of current coal reserves globally should remain in the ground and not be used before 2050 if global warming is to stay below the 2°C target agreed by policy makers.

Comparable figures are given in a Carbon Tracker report, “Unburnable Carbon” which claims that “using just the reserves listed on the world’s stock markets in the next 40 years would be enough to take us beyond 2°C of global warming.” This calculation also assumes that no new fossil fuel resources are added to reserves and burnt during this period – an assumption challenged by the reality that fossil fuel companies are investing billions per annum to find and process new reserves. It is estimated that listed oil and gas companies had CAPEX budgets of $798 billion in 2010. In addition, over two-thirds of the world’s fossil fuels are held by privately or state owned oil, gas and coal corporations, which are also contributing even more carbon emissions.

But fossil fuels are now widely subsidized in most countries. The British Government for instance, alarmed that the fall in oil price is threatening the profitability and employment in the North Sea is proposing support for the industry. A report by consultancy Ecofys for the EU Commission claims that Europe spent €113 billion on energy subsidies in 2012. Public support for coal was equal to that for onshore wind and the total support for renewables was higher than for non-renewables.

If it is accepted that only one fifth of the total carbon reserves can be used if we are to stay below 2°C warming, and applying this uniformly, only 149 of the 745 GtCO2 listed can be used unmitigated. This is where the carbon asset bubble is located. For the world’s stock markets, this could result in a repricing of assets on a scale that would dwarf past profit warnings and revaluation of reserves. This situation persists because no financial regulator is responsible for monitoring, collating or interpreting these risks. The Carbon Tracker report also claims that according to the latest IEA projections of energy-related fossil fuel CO2 emissions, unburnable carbon will be reached in just 16 years if energy consumption continues unfettered.

The Guardian response is to mount a campaign to persuade investors and corporate bodies to disinvest from fossil energy companies. To this end they have a contribution from George Monbiot which proposes that a reccmendation from the Paris climate conference in December should be, to accept that “Scientific assessments of the carbon contained in existing fossil fuel reserves suggest that full exploitation of these reserves is incompatible with the agreed target of no more than 2C of global warming.

The unrestricted extraction of these reserves undermines attempts to limit greenhouse gas emissions. We will start negotiating a global budget for the extraction of fossil fuels from existing reserves, as well as a date for a moratorium on the exploration and development of new reserves. In line with the quantification of the fossil carbon that can be extracted without a high chance of exceeding 2°C of global warming, we will develop a timetable for annual reductions towards that budget. We will develop mechanisms for allocating production within this budget and for enforcement and monitoring.”

But even in the unlikely event that this were accepted, what then? We know that the renewable green energies wind and solar are expensive and intermittent and will need back up from fossil fuels and that the exaggerated claims for increasing energy efficiency in use will more probably, as Jevons pointed out many years ago, lead to an increase in demand (reducing the energy cost of a product or service will reduce its total cost and thus encourage a greater use). We also know that, unless there are dramatic and unexpected social and economic changes, world energy demand will continue to increase as an increasing number of people seek ever-higher standards of living. This can only lead to an increased demand for energy and nuclear power.

As pointed out in NI Oct 2014 nuclear power was already the major source of primary energy within the 28 EU countries in 2012 when it met 28.7% of domestic production, against solid fuels 20.9% (mainly coal, some lignite), natural gas 16.8%, oil 8.9% and 22.3% from renewables, in which 10% was from solar and only 5% from wind; 65% of this renewable energy was from burning biomass.To limit and eventually reduce the combustion of fossil fuels and with it the discharge of carbon dioxide, other greenhouse gases and particulates, and in so-doing also improve public health, there must be a continuing expansion of nuclear power, throughout the world.

If only

In its Nuclear Industry Strategy of 26th March 2013,the Government looked back on what it described as nearly sixty years of successful and safe exploitation of low-carbon nuclear power which has also enhanced our energy security, and set out its vision for the future, with endorsements from Vince Cable, Secretary for State for Business, Innovation and Skills, Ed Davey Secretary of State for Energy and Climate Change, supported by Michael Fallon, Minister for Business and Enterprise and John Hayes, Energy Minister. For good measure Lord Hutton, chairman of the Nuclear Industry Association pledged “the industry’s strongest endeavours to delivering a successful and prosperous nuclear future.” Government and industry speaking with one voice.

The Strategy was a response to earlier reports which underlined the increasingly significant role that nuclear energy can play in the UK’s energy mix up to 2050 and beyond. The Nuclear Supply Chain Action Plan, published in December 2012, which focused on near-term opportunities predominantly in the nuclear new build sector was a forerunner to this Strategy and reiterated that “New nuclear power is essential to meeting the Government’s objective of delivering a secure, sustainable and low-carbon energy future. The UK has everything to gain from becoming the number one destination to invest in new nuclear. That is why Government and industry are taking action now.”

But “now” was two years ago and there are few signs of any immediate action to carry out these aims, particularly in the planning and construction of new nuclear power stations. There is of course Hinkley C, but it is not clear what seems to be delaying a start of this project – the terms and extent of Chinese participation or financial problems for AREVA with the difficulties experienced in Finland and France for similar stations. There are also proposals for new stations at Wylfa (Horizon – 80% Hitachi, 20% GE) and Moorside (NuGen -Toshiba 60% GDF Suez 40%). In the end the decision of when and how to proceed will be taken by foreign utilities which could be influenced by the situation in Japan. The Government can only indirectly try to influence the outcome through the financial terms it makes available. This falls far short of the bold declaration that “Government and industry are taking action now.”

There is also the repeated problem of diverse designs, which has bedeviled the British nuclear programme in the past. The Magnox and AGR reactors were all built to variant designs by different nuclear consortia. We noted last month the claim by the former US Energy Secretary Steven Chu that with the benefits of replication a 10th plant would cost just 60% of the first.

It also now seems possible that the development and introduction of Small Modular Reactors could change the nuclear power market, reducing the role of the large utility companies and encouraging the growth of municipal and other small collective suppliers, a return to the prenationalisation days before the war.

Russia as an international supplier

Against the background of the need for world-wide expansion of nuclear power should we welcome the indications that Russia is now seeking an increasing share of international nuclear market.

With the economic rise of Eastern Europe and the growing demand for power supplies Hungary has signed an agreement with Russia for the construction of 2x 1200 MW reactors to be built in Hungary by the Russian Atomenergoproect. The cost is projected to be within 12.5 billion Eur, and of this 10 billion will come from Russia. Construction is to begin in 2018 for the plants to be in operation by 2025 and 2026.

There are also reports that President Vladimir Putin and Egyptian President Abdel Fattah el-Sisi signed a preliminary agreement to build Egypt’s first nuclear power plant, when the two leaders met in Cairo on February 9-10, 2015.

Rosatom is also reported to be assisting Iran with plans to build several nuclear reactors, including an expansion at Iran’s Russian-built Bushehr nuclear power plant.

Rolls-Royce and Rosatom

Rosatom is also collaborating with Rolls Royce and Fortum of Finland on the feasibility of adopting Russian nuclear reactor technology for the UK.