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Leopard changes its spots

Nuclear energy is re-establishing its credentials, as proponents emphasise its capacity to provide baseload electricity without exacerbating global warming. Technological advances and fears over future energy supply are steeling governments to reconsider decommissioning programmes and to give the green light to new construction. James Gavin reports

The times are changing. Nuclear energy, once deemed an expensive, dangerous and unsustainable folly, is making an unlikely comeback against a backdrop of rising fears about the consequences of global reliance on fossil fuels.

Even the most ardent pioneers of green thinking are looking at nuclear in a fresh light. James Lovelock, a scientist whose Gaia theory conceives of the earth as a biological organism, has become one of the foremost green proponents of nuclear energy. "I find it extraordinary that the one safe and proved energy source that has minimal global consequences – nuclear power – is so readily rejected," he told a UK conference last year.

A pertinent answer

To its growing band of adherents, nuclear offers a more pertinent answer to concerns over global warming and energy supply disruptions. When the alternatives on offer are weighed up, the potential for nuclear to take on a more central role in the future energy mix is fast becoming apparent – not least because nuclear reactors do not produce any greenhouse gases (GHGs).

In 2003, a wave of power cuts experienced worldwide brought home to many consumers and policymakers the growing urgency of addressing the issue of sourcing future power supply. "That the world had that series of power cuts in summer 2003, which nobody had thought possible in developed countries, combined with concerns over rises in fossil-fuel prices and fears of over-dependence on Russian gas in some European markets, has swung general opinion towards nuclear," says Malcolm Grimston, nuclear policy adviser at the London-based Royal Institute of International Affairs.

The UN's International Atomic Energy Agency (IAEA) claims nuclear power, accounting for around 16% of globally produced energy, saves around 0.6bn tonnes of carbon emission a year, around twice the amount that the Kyoto Protocol is designed to save. The IAEA says the nuclear power chain emits some 2-6 grams of carbon per kilowatt hour, about the same as wind and solar power.

Although concerns over nuclear safety retain a potency among large sections of populations throughout the developed world, the more pressing claims of curbing GHG emissions has taken some of the spike out of the anti-nuclear lobby's protests.

The evolving consensus in favour of nuclear energy stands in stark contrast to the situation just a few years ago, when the existing 16% share enjoyed by nuclear was expected to fall dramatically by 2030. With newbuilds off the agenda, most governments have adopted decommissioning programmes. Of the eight European Union (EU) member states operating nuclear plants, five have announced moratoriums. Italy set the ball rolling in 1987, when a national referendum decided in favour of mothballing its four plants.

In the 1990s, Spain, the Netherlands, Germany, Sweden and Belgium opted to force the early closure of existing plants, while others have adopted broadly anti-nuclear strategies. In the UK, newbuild programmes were cancelled in the 1990s. Six of the UK's series of Magnox plants are scheduled for retirement by 2010. Even in countries without a national policy on nuclear generation, such as the US, no new plant has been commissioned in more than 25 years.

Energy security fears

That consensus is slowly fracturing. Growing fears about energy supply security have prompted some to reconsider their phase-out plans. Last year, four EU member states joined forces to block EU proposals to set deadlines on decommissioning plants. A recent study may result in the revision of Belgium's nuclear phase-out. The government intends to modify its policy to allow reactors to continue to operate past 40 years "where there is a need".

Sweden has postponed the decommissioning of one of its reactors, while Germany has decommissioned only one so far, despite having the Green Party as a coalition partner in government since 1998. Italy's prime minister, Silvio Berlusconi, recently said the country should return to the nuclear business.

In the face of strong pressure from member states, the EU energy commissioner, Loyola de Palacio, admitted in 2004 that the EU would have to retain the option of building new capacity for at least the next 50 years.

And the rethink is not restricted to lifetime extension of existing plant, which may prove a more palatable option for governments wary of pushing newbuild programmes on unconvinced electorates. Finland broke the mould in late 2003, when the Olkiluoto 3 consortium – France's Areva and Siemens, with the Finnish utility Teollisuuden Voima – signed a contract to build a next-generation European pressurised water reactor (EPR), set to start operations in 2009.

The Finnish approval for the reactor coincided with the US' Nuclear 2010 programme, which envisages a much stronger role for nuclear generation in the US energy supply mix. Political deadlock stymied progress on the plan in President George Bush's first term, but expectations are high that the political momentum behind nuclear will result in the licensing of new plant in his second term.

The appetite for newbuild retains force in France, Europe's largest nuclear market, with 125 installed reactors and an 80% dependence on nuclear in local electricity. In 2004, Electricité de France (EdF) said it would build a Euro3bn ($3.9bn) EPR advanced-reactor plant on the Normandy coast, at Flamanville – in EdF's words a "safer, cheaper and more environmentally friendly" option than previous reactor models. The project is to begin in 2007 and should take five years to complete.

The decision comes after the French government's announcement in June 2004 that it intended to maintain nuclear's "considerable share" in the country's energy production, confirming the need for a third-generation (3G) pressurised water reactor by 2015.

Meanwhile, Asia has proved stubbornly resistant to nuclear decommissioning. From a total of 27 nuclear stations under construction across the globe, 16 are in China, India, Japan and South Korea.

Nuclear lobbyists are confident the shift in mood is permanent. "In Sweden, Germany and Belgium, minority coalition political dynamics enforced support for moratoria, part of the horse trading that goes on with coalitions. But in countries that face running out of power, greater rationality will prevail," says Ian Hore-Lacey of industry lobbyists World Nuclear Association (WNA).

WNA forecasts world electricity demand will rise by 30% by 2020. The stark reality that electricity demand is rapidly outpacing the capacity for alternative fuel-supply sources is sinking in. A recent report from the EU Energy and Transport directorate says that, although nuclear power is not generally accepted by large parts of the European public because of the problem of nuclear waste disposal, alternatives to nuclear power might be very hard to find in the short run without further increasing energy-import dependency.

According to European Commission forecasts, if nothing is done to change the EU's energy mix, by 2030, it will continue to be dominated by fossil fuels – 38% oil, 29% natural gas, 19% solid fuels, 8% renewables and barely 6% nuclear.

The message was driven home in a study released in January by the association of German power plant operators on how electricity demand to 2020 may be met, with reference to both Kyoto targets and present government policy. The latter includes both nuclear phase-out by 2023 as well as providing 20% of electricity from renewables.

It says the implication of these policies is that 37 gigawatts (GW) of new fossil-fuel-fired power plants would be needed, including the replacement of 21 GW of nuclear capacity, making the country's 40% carbon dioxide (CO2) reduction target unattainable. The study says the simultaneous realisation of both the nuclear phase-out and the ambitious CO2 reduction targets "is out of the question".

One of the aces up the industry's sleeve is that nuclear power is still best suited to supplying baseload electricity. The long-term cost advantage is also evident. France's estimated 80% nuclear share of electricity generation has enabled the country to enjoy one of the lowest electricity price rates in Europe.

Confident that opinion is swinging back in its favour, the nuclear industry has been girding itself to persuade governments to start to commission new plant or plan and permit the extension of existing plant's lifetimes. WNA points out that much upgrading of nuclear plant is going on worldwide, with some 153 megawatts (MW) of capacity added in 2004. Seven large new reactors were connected to grids in 2004, most of those in Asia.

Look again

The UK government is expected to look again at nuclear after the general election, expected this year. Although it did not rule out nuclear's role in a 2003 Energy White Paper, it has its work cut out in resurrecting it. "The problem the government has is opening the door again to firms bidding for nuclear through consortiums, without being seen to be backtracking on renewables," says Chris Lambert, director of the Westminster Energy Forum, a lobby group that is preparing seminars and reports on the nuclear issue over the next year.

The UK, which relies on nuclear for 21% of its total electricity supply, is due to retire a large portion of its capacity relatively early compared with elsewhere in western Europe. The Westminster Energy Forum projects that by 2015 only three nuclear plants – 3.9 GW of capacity – will remain in operation.

But the rolling-out of new plant capacity, if it is eventually sanctioned, is likely to take a different form from previous expansion programmes. "In the past, industry has come forward and proposed big programmes involving 10 new stations. But Asia has shown you don't really need that many all at once – you can do it better in a staggered programme," says Lambert.

Lambert reckons a newbuild programme in the UK could involve new consortia emerging and asking the government to provide some form of cash guarantee, which would enable it to fast-track the expansion (see p29). The restructured operator British Energy (BE) says new stations would need the go-ahead by 2007 given the long lead time to build new plant, estimated on average at between seven and 15 years.

Analysts say the extremely capital-intensive nature of building greenfield nuclear plant is one obstacle to a swifter roll-out of new capacity worldwide. This problem is particularly acute when utilities are labouring under the massive financial commitments of decommissioning obligations. EdF has to fund a long-term Euro48bn decommissioning programme, while Areva faces a Euro12bn bill.

Reduced costs

But the industry claims technical advances will dramatically reduce both the construction and operating costs of new capacity. In September, the US Nuclear Regulatory Commission (NRC) granted a licence to Westinghouse for the AP1000 advanced-reactor design, which promises to halve the construction cost of traditional pressurised-water reactors (PWRs) through the use of "passive safety" systems.

These are considered significantly simpler than the traditional PWR safety systems, not requiring the large network of safety support systems needed in typical nuclear plants. The AP1000 has 50% fewer valves, 83% less piping, 87% less control cable, 35% fewer pumps and 50% less seismic-building volume than a similarly sized conventional plant. These reductions in equipment and bulk quantities could lead to major savings in plant costs and construction schedules.

The EPR, developed by Areva's Framatome ANP subsidiary, and based on pressurised-water technology, is designed for a 60-year service life and promises: reduced electricity-production costs; better use of fuel; reduced volumes of long-lived waste; improved availability; higher operating flexibility; fewer maintenance constraints; and a considerable reduction in the doses of radiation received by operating and maintenance personnel.

Areva says the EPR's high unit output is particularly suitable for regions with extensive, robust electricity grids and areas in which population density is high, with little space available for building power plants.

Analysts say late 3G types such as the Finnish/French EPR model could also prove attractive in other markets, such as the UK. Most global reactors are 2G plants, built in the 1960s and 1970s. Japan has several early 3G units and others, such as Taiwan, are also building 3G plants. "With the EPRs and other late 3G models, the 2005 model is much better than its 30-year-old predecessor. It does the job more elegantly and is more durable. They are explicitly designed for 60-year licences," says Hore-Lacey.

Manageable risks

But the new generation reactors will need to demonstrate their effectiveness if they are to convince authorities to sanction construction. "The problem with nuclear is that a lot of plant didn't work well in the early years, so someone will have to show this plant works properly," says Grimston. "If that happens, a number of risks become manageable."

The US Congress is even seeking to go ahead with an even more advanced reactor-design programme, the so-called generation IV initiative, although these plants are not expected to be in commercial use until 2020 at the earliest. No new nuclear power plant has been licensed in the US since 1973. But new consortia are taking shape in anticipation of a strategic push for new capacity, based on the Generation III+ model.

In November, the US Department of Energy (DOE) announced awards to two nuclear utility-led consortia under the Nuclear Power 2010 programme. The DOE will begin the first phase of nuclear plant licensing demonstration projects with teams led by Dominion Resources and NuStart Energy.

The Dominion project could lead to a licence to build and operate an Atomic Energy of Canada Advanced Candu Reactor (ACR-700) at the North Anna site in Virginia. The NuStart Energy consortium will evaluate the Westinghouse AP1000 option and the GE Economic Simplified Boiling Water Reactor. The consortium plans to select a final reactor technology and a site by 2007. If a nuclear power plant order results from this work, NuStart Energy aims to have a plant in operation as early as 2014.

The DOE is also looking to establish a partnership with a consortium of companies to promote the development and implementation of next-generation nuclear technologies that will be used to cogenerate electricity and hydrogen for use in hydrogen fuel cells. The US' experience will be critical for countries looking at new-generation plant. "The success of the US reactors will have a knock-on effect 10 years into the future," says Grimston.

If the combination of lifetime extensions and newbuild expansion succeeds, nuclear's role in meeting rampant electricity demand seems assured. The key to success lies in the industry's arts of persuasion. Focusing on nuclear's prime advantages – being more technically suited to providing baseload electricity than traditional renewables, while offering lower long-term operating costs than fossil-fuel based energies – might play to the nuclear lobby's advantage. With licence applications pending, the ball is in governments' courts.

Asia stands out from the crowd
CONFRONTED by rising populations and with insufficient indigenous fuel resources, Asia stands out from the general slackening pace of global nuclear energy expansion. Most of the world's 27 nuclear reactors under construction are in Asia.

India and China are leading the pack, they have started up nine plants in the past five years and plan to build at least 10 more. The World Nuclear Association (WNA) forecasts new capacity in East and South Asia at 38 gigawatts (GW) a year, rising to 56 GW a year in the 2010-2020 period.

Expansion in Asia underscores the reality that new nuclear plant is not being built in liberalised markets, says Malcolm Grimston of the Royal Institute of International Affairs. "This is where the centre of gravity of construction has been. China is pretty much a central controlled market and Japan is only beginning to think about liberalisation."

With oil import costs rising, many Asian governments have turned to nuclear as a cost-stable and high-capacity alternative to providing baseload electricity. As a result, Asia is the only region in the world where both generation capacity and specifically nuclear power is growing significantly. Around 100 nuclear reactors are already in operation in East and South Asia.

The staggering increase in Chinese electricity demand, estimated at 15% annually, has prompted Beijing to ramp up its nuclear capacity. The country's considerable coal resources have ensured that conventional power plants account for 75% of installed capacity. But these resources are located far from energy-demand areas.

The government said it would build four duplicate reactors in July 2004. In addition, it is also set to build four third-generation reactors at Yangjian and Sanmen, following an international tender issued in September. The US' Westinghouse, with its AP1000 design, and France's Areva, with its EPR, are in the running for the project, on which a decision is due late in 2005.

With nine reactors in operation and two under construction, China is well on its way to achieving a more than four-fold increase in nuclear capacity by 2020, to 36 GW. As of this year, with all 11 units in operation, nuclear will provide 8.4 GW capacity – although still a small proportion of overall electricity generated in mainland China.

India, already self-sufficient in reactor design and construction, expects to have 20 GW of nuclear capacity on line by 2020. Nine plants, of which two will be large-scale, are set to join the 14 small reactors in commercial operation. In 2003, nuclear power accounted for only 3.3% of total capacity, but WNA envisages nuclear contributing 25% of generation by 2050.

Japan presents a more complicated picture. Its 54 reactors provide more than 33% of the country's electricity, but Japan saw the closure of more than a third of its nuclear plants in August 2002 after a public scandal involving falsified safety and inspection records. Only by late 2004 were most of the plants back in operation, getting it back up to its capacity of 47 GW.

But bad news has continued to plague the Japanese sector. A steam leak at a nuclear plant in September resulted in the deaths of five workers, adding to concerns about the country's nuclear safety record. The accident is unlikely to halt Japan's ambitious plans to expand capacity by 30% under a 10-year energy plan endorsed in 2001. Japanese utilities are expected to have between nine and 12 new plants operational by 2011. Three are under construction.

South Korea has the region's highest nuclear capacity, with 20 reactors accounting for 40% of electricity supply. Nuclear capacity is planned to grow to 16 GW by 2015, with eight more units added – two will be decomissioned by 2008.

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