Many of the blog posts have looked at the constraints of a
nuclear expansion – here I am going to look at the benefits as well as the
current trends for nuclear energy to increase in the coming years. The current
electric production from nuclear amounts to 11% of global demand (WNA 2015). This
is provided by 435 reactors producing 375,000 MWe energy. From 1990-2010 the
global production increased around 18%, this increasing trend therefore promotes
the strong possibility that further future expansions are likely to amount. 70
reactors are currently under construction which would provide an extra 20% of
the current electricity capacity (WNA 2015) – showing signs that the nuclear
future is emerging already.
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| Electricity production trend - general increase since the 1970s. Slight decline in the 2010s is likely attributable to the closures following the Fukushima disaster (WNA 2015). |
Many governments have
plans for the future increases for example the UK government in 2006 applied
plans to replace the ageing reactors with new ones, to continue a reliance on
nuclear – along with new reactors to increase the capacity further, including
Hinkley Point C (WNA 2015). Not only are there plans for expansions in counties
that have had a long history of nuclear such as France and the UK, but also
many new countries are looking to exploit nuclear such as Vietnam and Turkey. Another
example in the Middle East, Iran has recently establishing its first power
station and the UAE are central to the construction of 3 South Korean 1,450 Mwe
reactors (WNA 2015). The capacity as well as the spatial scope of nuclear
energy is therefore enhancing currently – progressing to a larger nuclear
future?
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| Current levels of nuclear generation per country (WNA 2015). |
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| The Bushehr Nuclear Plant in Iran - which opened in 2010 (Guardian 2010). |
The economic investment risk is substantial in nuclear plant
construction, therefore it will often be seen that governmental aid or regulation
is essential for the private nuclear sector to fund nuclear projects. For
example the Price Anderson Act in the US caps private insurance costs at $200
million, otherwise if costs were allowed to be classified in relation to the
possible risks the expenditures would likely be too high for profitability to
be achieved (Balzani 2006). The Bush government asked Congress for a $40 billion
fund for a project known as “Global Nuclear Energy Partnership (Balzani 2006).
The plan would be to provide nuclear potential to developing countries that
would not have the internal funds necessary to self-sufficiently manage a
nuclear energy sector. The agreement would see spent fuel returned to the
supplier nation, which may be seen as a national security precaution. What this
programme provided was the potential for the vast expansion of nuclear on a
global scale – yet at the same time it could be argued that the autonomy of
developing nations was reduced and that a dependency on the US and their regulations
and rules increased (Balzani 2006). Moral and political dilemmas may arise from
this trade-off, which could potentially delay or prevent the nuclear growth.
The US desire for a nuclear future was further displayed by the
Obama government providing $8.3 billion funding for two new reactors – whilst
once again going to Congress for a further $36 billion to fund similar reactor
setup projects. This financial assistance is required to allow the nuclear expansion
but also to allow nuclear to be economically competitive against fossil fuels
(Ferguson 2010). Another way that has been suggested to drive a greater level
of nuclear competiveness is through carbon pricing/taxing (Ferguson 2010).
Placing a value on the emissions will allow for the environmental costs to be
included within cost-benefit analyses within businesses. With the increased
economic damages of “dirty fuels” a greater demand for nuclear will be
provided.
Ferguson (2010) also suggests that merging alliances will
provide greater investor opportunities – especially needed within the US where
a lack of state owned utilities means private investment is essential. An
example being the global connections between French EDF and the US Company
Constellation Energy. Similar global alliances have recently been seen with EDF
selling a share in the Hinkley C, Somerset project to the state owned China
General Nuclear Power (Farrell 2015) – arguably global funding may be
the future for such wider expansions of nuclear energy to be achieved!
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| Global alliances, such as that between the UK and China, may become a common theme in future nuclear investments (Guardian 2015). |
The UK government has ensured a minimum electricity price to
EDF for Hinkley Point C at £89.50 per MW/hr for 35 years (BBC 2015), due to the
need for a guaranteed return to promote the initial private investment. Similar guarantees
were also put in place to entice the Chinese investors. It may be argued that
this cost is relatively high compared to the $40-$50 cost of a barrel of oil –
however when placed in comparison to other renewable energy products it would
appear relatively reasonable (BBC 2015). The issue being that these governmental
subsidies and guarantees will be required to allow for the construction and
economic competitivity, otherwise higher initial costs are likely to mitigate
its demand. There is an inability for nuclear
to function within a free market, that otherwise it will continually be
out-competed by the more environmentally damaging, yet cheaper energy resources
(The Economist 2015).
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| Price per Mw/h - displaying the guaranteed price for Hinkley C electricity to be reasonable in relation to alternate renewable sources (BBC 2015). |
Nuclear energy costs are often far more stable in relation
to fossil fuel fluctuations, however the efficiencies and therefore the costs
between nuclear plants tend to be variable (The Economist 2015). For example
the US cost of nuclear production is $24/MWh on average, which is lower than
both coal and gas – however variability in such costs either side of this
average means such benefits are not always widely experienced. Additionally, there is the threat of ever increasingly cheap fossil fuels, including the declining US
gas prices. With the high setup costs for nuclear it would appear as if the US
is likely to rely on the economically viable gas option in the coming years (The Economist 2015). Despite the governmental assistance towards nuclear energy, it
is claimed that in the West there is a preference to subsidise alternate renewable
sources that are major competitors to the nuclear potential (The Economist 2015). This is likely to be a product of political and public acceptance of solar
and wind over nuclear. Subsidising acceptable energy sources will allow for
greater governmental support than funding a sector that many see as a potential
risk.
Balzani (2006) suggests that for nuclear energy to
significantly provide for future global energy needs it would need to
continually produce energy up to 10TW, this would therefore require 10,000 1
Gwe power plants to be built – if such significant contributions are going to
be achieved then a new reactor would have to be opened every other day for the
next 50 years. This statement lacks substance, I am not entirely sure what a
“significant contribution” is, however it does highlight the lack of current nuclear
potential. This emphasises its role as a background, baseline provider, that
major expansions will be needed if it is to become a dominant energy source.
Such construction requirements seem impossible, yet evidence to show that a new
power reactor was started every 17 days in the 1980s does provide some hope for
a rapid change to be possible (WNA 2015). The estimates for
contemporary potential from the WNA (2015), claims that a 1Gwe plant opening
every 5 days is feasible – therefore this displays the ability to potentially
significantly contribute within short periods of time. This rapid production
ability is important – as climatic change concerns become ever more urgent as potential
thresholds are being approached. The more rapid the response in reducing the
emissions, the lower magnitude the peak temperature increase will be (IPCC 2007). Climatic change is arguably inevitable with the current atmospheric composition,
yet a reduction as soon as possible will mitigate the damage already caused!
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