A major new independent report, Power from Nuclear presents the latest evidence on what new nuclear has to offer the UK, highlighting strategic priorities for politicians and policy makers. It comes as the Government, backed by broad political consensus, lays the ground for new nuclear power led by the private sector. Chaired by former Energy Minister, Charles Hendry MP, and Shadow Energy Minister, Baroness Bryony Worthington, the report is written by cross-party think tank group, Carbon Connect. The report will be published in Parliament at a cross-party debate with a key note speech from Tim Yeo MP (Chair of the Energy and Climate Change Select Committee).
The report, sponsored by Costain, is part of a cross-party and independent inquiry series, sponsored by the Institution of Gas Engineers and Managers. The Future Electricity Series brings together experts from parliament, industry and academia to build consensus, lay down the facts and point to policy challenges in the power sector. Power from Nuclear completes the Future Electricity Series trilogy and presents 25 findings.
MORE DETAIL ON REPORT FINDINGS
The report highlights the key role that political consensus can play in helping to reduce the costs of nuclear power in the UK, as well as other low carbon technologies. This political consensus has never been more important than in this ‘defining decade’ for the power sector.
Hinkley Point C and State Aid
The report highlights that an immediate challenge facing the UK’s new build programme is agreeing with the European Commission a regime for supporting new nuclear power. Changing the proposed support package would not be an impossible task if made necessary, but maintaining broad political consensus and considering the implications of delay are also important.
The State Aid process is an important opportunity for scrutiny, with the report demonstrating that shareholders for Hinkley Point C could see bigger returns (19-21%) than those typically expected for PFI projects (12-15%). However, it is too early to conclude on the value for money of the Hinkley Point C agreement. Both the negotiation process and the resulting investment contract are important, but there has been little transparency over either so far and the negotiations were not competitive.
The inquiry calls for more urgency and better coordination in seizing the opportunity to reuse the UK’s plutonium stockpile. The UK’s stockpile of separated plutonium presents opportunities to tackle a number of national strategic priorities including implementing long term solutions for nuclear waste, developing new technologies that could redefine the sector, laying the ground for new nuclear power and pursuing nuclear non-proliferation.
Government has identified three ‘credible solution’ for reuse, and the report recommends that it now sets clearer criteria against which to assess options and identifies budgetary requirements to help expediate the process.
New technologies and fuels
The report also argues that Government should do more on new nuclear technologies that could redefine the sector – such as considering smaller reactors, nuclear for industrial heat or hydrogen production, and closed or thorium fuel cycles.
The Government’s initial response to a review of nuclear R&D a year ago by the then Chief Scientific Advisor, Sir John Beddington, has been welcome, and it needs to build on this. In particular, the UK should capitalise upon its existing expertise and past experience to focus efforts where there is most strategic value.
On affordability, the report finds that it is not yet clear which electricity generation technologies will be cheapest in the 2020s and beyond. Coal and gas could get more expensive if fossil fuel and carbon prices rise, whilst low carbon technologies could get cheaper as technology costs fall with more deployment. This is the main reason for adopting an ‘all of the above’ strategy, including nuclear power, until costs become clearer, and there is broad consensus behind this general approach.
On security of supply, the inquiry says that deployment of nuclear power is likely to be influenced more by the economics of system balancing rather than technical system balancing challenges, which can be met with greater deployment of existing balancing tools. The cost of maintaining system security is likely to mean that the UK maintains at least some baseload capacity, such as nuclear power, to limit system costs.
On sustainability, the report finds that the environmental impacts of nuclear power are comparable to some generation technologies and favourable to others, although the long lived nature of some radioactive nuclear waste and the dual use potential of nuclear technology for civil and military applications create unique sustainability challenges, which the UK is a world leader in managing.
Having failed to date, the Government must urgently revisit plans for finding a site to store nuclear waste underground for thousands of years. Implementing this is a crucial part of demonstrating that nuclear waste is a manageable challenge. Despite being rejected by Cumbria County Council, the continuing strong support amongst communities in West Cumbria for hosting a site is a promising sign.
Speaking ahead of the launch, inquiry co-chair and former Energy Minister, Charles Hendry MP, said: “The Nuclear report completes the series by Carbon Connect into our energy future. It applies the same rigorous analysis to the future role of nuclear in the UK that the earlier reports have already done to renewables and hydrocarbons.
“The report concludes that Nuclear can play a very significant role in delivering secure, low carbon electricity, but there is much work still to be done to secure the nuclear renaissance that many of us want to see.
“The Future Electricity Series provides an in-depth analysis of each aspect of our power sector. They are outstanding reports, which should be read by anyone who wants an expert, easily-understood explanation of the opportunities and challenges that each technology presents.”
Fellow inquiry co-chair and Shadow Energy Minister, Baroness Worthington, said: “This report joins up the dots on nuclear energy – a big and complex topic. It is not only an invaluable guide for evidence-based and constructive debate, but it highlights and discusses some of the most pressing issues for policy makers. One is the future of the UK’s plutonium stockpile and the links with generating low carbon electricity and new nuclear technologies. It is clear that this is an important opportunity, which calls for more joined up thinking from Government. The Future Electricity Series has looked across all the main electricity generation technologies. At this stage it is impossible to tell which will be the cheapest in the future so we need an ‘all of the above’ energy policy, including nuclear power.”
Sarb Bajwa, CEO of IGEM, sponsor of the inquiry series, said: “This report sets out how new nuclear alongside renewables and fossil fuels including gas could contribute to meeting future electricity demand. IGEM is committed to a diverse energy mix including a central role for the cleanest fossil fuel, natural gas, so that the UK can continue enjoying safe, secure, sustainable and affordable energy in the future. That’s why IGEM has supported Carbon Connect’s three stage Future Electricity Series inquiry and I’m pleased IGEM’s wide-ranging and expert membership has added significant value to this debate.”