February Newsletter No185

Posted by SONE on 28 February 2014 in Newsletters

Let’s be clear about sone and global warming

There is nothing like a drought, a heat wave, a deep freeze and, of course, a flood to bring out the global warmers. And so, with California, Australia, North America and the southern half of the UK variously afflicted, the doomsayers have been falling over themselves.

The Prime Minister, the Deputy Prime Minister, assorted Ministers, Lord Stern, who is an economist, and Lord Deben, politician-chairman of the Climate Change Commission, have all told us that the flooding over some six weeks of the Somerset Levels and the Thames Valley and the smashing of southern coasts by gales stem from global warming. We must expect more of these extremes of weather.
Nobody has been quite so intemperate as the Energy Secretary, Ed Davey, who described “climate change sceptics” as “wilfully ignorant, head-in-the- sand nimbys”, dismissing doubts about climate change as “diabolical”.

In all these circumstances, we feel we must get a few facts straight. SONE is not – repeat not – a global warming “denier”. We are too modest to deny or assert anything in this opaque area of science. We accept that man, partly through greenhouse gases, could be warming the climate. Indeed, there is some evidence in the relative warming of cities vis a vis the surrounding countryside. But global warming?
It may well be that the globe has warmed 0.7C since the Industrial Revolution. But what is happening that goes beyond recorded human experience?
We can safely say that no one has done the cause of steadily adapting to any global warming more damage than the hysteria of fanatics like Energy Secretary Davey. We might take them more seriously if they were energetically advocating nuclear power as a means of effectively combating the supposed problem.

Scientific and policy failures

No doubt it adds to the gaiety of the nation to have Prince Charles describing climate change sceptics as “the headless chicken brigade” and a Daily Mail writer dismissing Energy Secretary Davey as “dim as an eco-friendly light bulb”. Unfortunately, it does nothing for energy policy or the development of nuclear power.

This is a serious issue. On it turns the security of the planet, if the global warmers are right, but much more immediately the economies of Western Europe and the UK. Too little is done against the systematic propagandising to argue the case for the gradual development of an effective instead of ignorant, politically correct approach to whatever risks arise from man’s substantial reliance on fossil fuels.

USA’s scientific failure
In America the Environmental Protection Agency’s three-pronged “scientific” justification for regarding CO2 as damaging is seriously challenged by scientists. They say its claim:

  1. to a distinct human fingerprint – a hot spot in the atmosphere centred over the tropics at 33,000ft – has never been found by weather satellites and balloons.
  2. of unprecedented and dangerous surface warming in the late 20th C was preceded by a similar claim early in the 1900s not associated with CO2.
  3. that climate models are reliable is contradicted by their exaggeration of observed warming over the past 30 years and their failure to predict it would stop16 years ago.

UK’s (and the West’s) policy failure
None of this means that the global warmers might not eventually be right, even if their case is looking a bit sick at the moment. Hence perhaps their growing insistence it is an urgent problem. But that is no excuse for their:

  1. utterly failing to reduce the supposed menace from CO2 over the last 25 years;
  2. going for every so-called low carbon technology that does not work and until recently writing off the one that does – nuclear;
  3. rendering manufacturing industry uncompetitive with such a plethora of subsidies for gash remedies that effectively export our CO2 emissions abroad and then intensify them because emerging foreign economies burn fossil fuels less efficiently;
  4. artificially raising the cost of nuclear through a strike price mechanism that only became necessary because the last three Energy Secretaries (Ed Miliband, Chris Huhne and initially Ed Davey) set their anti-nuclear faces against any subsidy for new nuclear plants:
  5. naively believing that Britain, responsible for a mere two per cent of the world’s CO2 output, will make a global difference and even more risibly set an example to be followed by worse polluters anxious to develop their economies; and
  6. wilfully refusing to make a fresh start when it is manifestly clear we need one – notably a rational plan for the secure supply of low carbon electricity at an affordable cost.

We make no apology for insisting yet again that to have any credibility such a fresh start – if it ever comes – must have nuclear power as its central core.

Who will come up with a fresh start manifesto?

With increasing calls for a fresh start on energy policy, now is the time insistently to press the claims of nuclear. It is true that a succession of critics over recent years has implied the need to start afresh. But they are now being more explicit.

One of them over the past month was no less than the aforesaid Lord Deben, who as John Selwyn Gummer was a Tory Environment Secretary. It is true that he did not mention energy. Instead he concentrated on causes of flooding, given we can expect more extremes of weather, such as reduced capital spending, farming practices and concreting over front gardens. He wants a new Department of Planning and Land Use carved out of DEFRA and the Departments of Transport and Local Government.

Assuming that made any difference, it would, however, do only half the job. We need a new start on energy policy, too. That is exactly what the Daily Telegraph commentator, Jeremy Warner, called for on February 11. He argued that “with competitive ruin looming, energy policy needs a brand new start”.

Is the Chancellor a straw in the wind?

**He was picking up on remarks made by Lord (David) Howell, former Tory Energy Secy, who called for an immediate change of energy policy direction in a presentation to the Centre for Global Strategy. He said bluntly: “We need a fresh start for UK energy policy – one that delivers affordability rather than soaring bills, helps competitiveness rather than holding Britain back, promises reliability instead of power shortages and green advance instead of green pain and environmental damage”.

And so say all of us. Well, the politicians have a constitutional opportunity: they can respond in their manifestos for next year’s general election. Don’t hold your breath. But there seems to be one promising straw in the wind. Chancellor George Osborne, in Hong Kong on February 20, called for an end to “ideological” opposition to nuclear power and shale gas. Climate change, he said, should be tackled in “as cheap as possible way”. Indeed.

We know what we need – cut out the complications

Part of the problem is that no one is in charge with the power to get things done. As the EU’s state aids inquiry into the Government/EdF deal to build a new nuclear power station at Hinkley Point, Somerset, shows, Westminster does not own its energy policy. The British Government has conceded to Brussels all sorts of (probably unachievable) legally binding targets for CO2 emissions and renewables development as well as the closure of coal-fired power stations on environmental grounds.

But even if it were master in its own house, it has frittered away controls. As the Financial Times pointed out on February 20, privatisation of the electricity industry ended statutory responsibility, previously held by the CEGB, for keeping the lights on. Now the National Grid is responsible for balancing supply and demand but cannot build new power stations. The supply companies that can have no obligation to do so. Their primary obligation is to shareholders not to consumers in terms of security of supply.

Then we had a capacity market, similar to one now being revived, that ensured new plant would be built if needed. But Labour abolished it in 2001, along with the electricity pool, and replaced it with a new wholesale market. And regulatory pressure to slash wholesale prices by 40% conveniently bankrupted the nuclear generator, British Energy, for a Government that saw nuclear as “economically unattractive”.
The result of all this is more and more desperate tinkering through the Energy Act which promises to make the British energy market as complicated as sin. Yet the solution is staring the politicians in the face: a policy that provides security of supply with value for money and a progressively lower carbon content.

As things stand that would mean ending subsidies for most new renewables, keeping coal-fired power stations open so long as security of supply is in doubt, building more gas-fired plants and exhibiting a sense of urgency in getting soundly financed nuclear power stations on the grid. We need to replace complication with simplicity – and nuclear power.

Iceland and Welsh tides “to beat nuclear”

It would also help if we stopped lusting after every new fangled power generating idea that comes along. Full marks to Fatih Birol, chief economist at the International Energy Agency, for saying that the UK should focus on nuclear power instead of expecting a US-scale shale gas revolution in the UK where the economics are not as favourable as in America.

The damage done to the perception of nuclear’s new economics under the strike price system has been evident in headlines twice this month. “Plug us into Iceland, it will be cheaper than a nuclear plant” (Sunday Times, February 16); and “Tidal project aims to beat nuclear power” (Guardian, February 7).

The Sunday Times waxed lyrical over an old idea of sending geothermal and hydro-power 1,000 miles by cable from Iceland. It all fits in with the renewable fanatics’ idea of a North Sea grid as means of (hopefully) making use of offshore wind feeding into a pan-European grid, though the Sunday Times suggested that it would do away with the need for “pricy offshore wind farms and atomic power stations”. That is as may be. Like most of these dreams it won’t happen without in this case unspecified dollops of public subsidy.

By then we had digested yet another tidal project, this time a £12bn scheme for Swansea and Colwyn Bays and the Severn Estuary, with five lagoons meeting 10 per cent of UK demand before 2023 when the first new nuclear power is due to come on stream, EU willing. But how on earth it is going to compete with nuclear when it needs a £156/MWh subsidy – higher even than offshore wind – and a good £63/MWh above that proposed for Hinkley Point?

We advise the pension fund supposedly behind it not to be so daft – unless, of course, it can squeeze riches galore out of Energy Secretary Davey. After all, he is still mad on offshore wind – unlike consumers.

Will the euro-commission remain unimpressed?

This brings us to the EU’s state aids inquiry into the Government/EdF deal for the construction of a new nuclear power station at Hinkley Point. The EU got off to a very negative start with a 70-page critique for consultation arguing that subsidies could be entirely unnecessary because nuclear power would become economic by 2027, distort the market and result in a “substantial transfer of wealth” from consumers to EdF. (Only a few years ago UK government figures showed nuclear running gas a very close second in levelised costs).

All sorts have, of course, been weighing in on the consultation including a so- called group, Energy Fair, of anti-nuclear politicians, activists and academics, arguing that the deal should not be approved. We are also told that the German Renewable Energy Federation is trying to orchestrate opposition by EU energy companies to the EdF deal, with the threat of a European Court appeal if the Commission approved it.

Why the Commission should approve – the market is failing.

An Anglo-French summit on January 31 agreed to “engage onstructively” with the EU Commission to demonstrate it comes within the rules. We shall have to see what France’s famed influence in Brussels does for the deal.

While all this was going on Malcolm Grimston, a SONE member, marshalled academic forces to persuade the Competition Commissioner that it should be approved. Writing from Imperial College, they say that it is self-evident that the market in the UK is seriously failing to stimulate investment in new power – and especially low carbon-capacity required to safeguard secure, economic and environmentally acceptable electricity supplies. The measures under the contracts-for-difference regime are not a crude “subsidy” but an attempt to correct market failures.
The group goes on to make, among others, these further points:

  • when the full system costs of renewables are taken into account, nuclear power is a much cheaper option
  • the argument that renewable technologies deserve higher levels of support than nuclear because they are cheaper is patently illogical and also untrue
  • the UK’s geographical location means that it will always be relatively less well interconnected to the continental European grid than those in the centre such as Germany. The market failings in the UK in relation to any single European electricity market will therefore always be greater than on the European mainland and will require more measures to correct them.

And now the good news – and lots of it

The first two months of the New Year have also brought some positive developments for nuclear power. In the UK EdF has moved to extend the lives of its fleet of seven AGR nuclear power stations by an average of eight years and has awarded a contract, potentially worth £1bn, to Doosan Babcock to help it do so. Dungeness B, Hinkley Point B, Hunterston B, Hartlepool, Heysham 1 and 2 and Torness were due to close between 2016 and 2019. Their continued operation seems crucial to avoiding supply disruption through an over- concentration on renewables and a failure to invest in conventional new plant. Maintenance investment in those plants over the past five years is clearly paying off. Last year they achieved their best output – 60.5TWh – for eight years, 0.5TWh up on 2012.

As for UK attitudes to nuclear power, Tees Valley Unlimited, the local development body, wants to know when it is going to get a new nuclear power station. Overall British attitudes have proved “surprisingly resilient” after the Fukushima tsunami disaster. The UK Energy Research Centre reports nearly one-third (32%) support the use of nuclear power with 29% against. Those who think the risks of nuclear power either slightly or far outweigh the benefits have fallen from 41% in 2005 to 29% last year.

We seem to be making some headway, not least with renewables. The favourability rating of wind has fallen from 82% in 2005 to 64% in 2013 and for solar from 87to to 77%.

Swiss, Belgians and French positive, too

Elsewhere, the Swiss are made of sterner stuff than their politicians. A poll of 2,200 has found 64% consider the country’s five reactors essential to meeting demand and 68% say they should remain in operation as long as they are safe. In 2011 the Federal Government and Parliament voted to ban new reactors and close the five existing plants at the end of their useful lives.

Another poll found that 46% of Belgians had “a high level” of confidence in the authorities to protect them from the risks from a nuclear accident. And in France a panel of 17 of residents from the area in the North East where a deep geological repository is planned to open in 2025 unanimously say they are not opposed to it in principle, provided tests over a reasonable period produce favourable results. The repository will take both intermediate and high level waste.

The Energy Policy Institute for Australia has called for barriers to nuclear’s development there to be removed, pointing out that small modular reactors (SMRs) are particularly suitable for mines and towns in remote areas. It is, however, only fair to point out that the director of the Bulletin of Atomic Scientists claimed on February 4 that SMRs would not offer satisfactory solutions to nuclear’s most pressing problems – high capital cost, safety and weapons proliferation. While their capital cost would be lower, the price of power produced would probably be higher than that from larger plants.

Reliable, steady nuclear

As we all know, the United States has been having a terrible winter (thanks to global warming, according to some), with snow on all bar one of 50 states. But throughout the record freeze up nuclear power stations have been operating at nearly 100% capacity. Every one of the country’s 100 commercial power units was on line, returning an average load factor of 97%. In the New England states nuclear met 29% of demand, compensating for reduced output from gas plants. Just imagine America’s mess if it relied on wind power – as Scotland seems to think it can.

In another cold climate Finland’s nuclear operator, TVO reported that last year its two units at Olkiluoto produced a record 14.63TWh with a load factor of 95.1%. The two smaller Lovisa units averaged a 92.5% load factor. No wonder Finland is building a (much delayed) EPR and is combining with a Russian Rosatom subsidiary to build a fifth nuclear plant in Western Finland.

Developments on the way

BP may forecast only modest growth of 1.9% in global nuclear power by 2035 (by which time it estimates CO2 emissions will have risen by 30%), but there has been a lot of development going on across the world this month.

It is not just 17 Japanese reactors awaiting clearance to go back on line after Fukushima, much to the relief of the economy. Poland has adopted a programme to start generating its first nuclear power by 2024. South Korea has approved a $7bn project to build two APR1400 reactors on an existing nuclear site. Hungary has reached agreement with Russia on the financing of two new reactors at its Paks nuclear plant. The United Arab Emirates is building its first two reactors to generate 25% of demand by 2020 and is on track to start building a third this year. Bolivia is planning its first reactor and the Argentine has just poured the first concrete for its domestically-designed SMR.

It’s all nuclear stations go. And one day, God, EU, environmentalists and cranks willing, it will be in the UK. Whether we shall live to see it is entirely another matter such is the nature of our politicians, with the possible exception of Chancellor Osborne.

Electronic transmission

We are grateful to all members – more than a third – who have joined in the cost-saving scheme to send out the monthly SONE Newsletter and Nuclear Issues by e-mail. Some of you may have been surprised to find that you got a printed version when you were expecting a downloadable copy over the internet. This is because, in spite of all the care we thought we took in recording e-mail addresses, a few have bounced back on us. Could we ask those affected to e-mail the Secretary again on bernardinghamcom@aol.com. We will try to do better this time.