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UK turns to nuclear power

JUST THREE years ago, a UK Energy White Paper all but dashed hopes of a nuclear renaissance. It said renewables were the best means for the UK to create a low-carbon economy. But an energy review, published by the Department of Trade and Industry last month, has reversed that position: nuclear power is good – very good.

Since it became clear that renewables would be unable to replace the deficit in capacity left by the decommissioning of the country's ageing gas-cooled nuclear reactors, prime minister Tony Blair has been on the nuclear trail. Nuclear power generates just under a fifth of the UK's power, but in 20 years' time, only Sizewell B, the country's most modern nuclear station, will remain.

"Our assessment is that higher projected fossil-fuel prices and the introduction of a carbon price to place a value on CO2 have improved the economics of nuclear as a source of low-carbon generation," the review says. "New nuclear power stations would make a significant contribution to meeting our energy policy goals," it says. For example, claims the government, if existing capacity were replaced with new nuclear capacity, by 2030 the UK's carbon emissions would be around 8m tonnes of carbon (tC) less than if the nuclear capacity were replaced by gas and the country's gas consumption was some 13% lower. This saving would be equivalent to total emissions from 22 500 megawatt gas-fired power stations.

It will be for the private sector to initiate, fund, construct and operate new nuclear plants and to cover the cost of decommissioning and waste management. But in view of the potential benefits to policy goals, the government says it proposes to "address potential barriers to new nuclear build". For example, companies will be able to obtain an assessment of a reactor design before committing significant sums to planning and construction. The government is also developing a framework for planning inquiries.

Renewable energy, meanwhile, remains an integral part of the government's strategy for tackling climate change. Renewables account for just 3% of the country's installed capacity, but the review sets a target for 20% of electricity to come from renewable sources by 2020.

The ability to reach this ambitious target depends largely on the Renewables Obligation (RO), which is designed to kick-start the industry by mandating minimum levels for renewables as part of electricity companies' mix of generation processes. The RO, says the review, has encouraged renewables developments, including onshore wind farms, landfill gas and co-firing of biomass in coal-fired power stations.

But the government says it will strengthen the RO in the hope of attracting more investment. This will be done in two ways: Previously, the RO was due to rise to about 15% in 2015-16 and to remain at that level until the obligation ceases at the end of 2026-27. The government now says the level of the RO will "always stay" above the level of installed renewable generating capacity, up to a 20% obligation.

The government also intends to tweak the RO so that greater support goes to emerging technologies such as offshore wind. It says bands may be introduced to provide differentiated levels of support to different renewable technologies. Any change would not be introduced until 2009 or 2010. The new arrangements would not apply to projects in operation before the changes were introduced. The review also signals the government's intention to streamline planning rules to reduce delays.

In total, by 2020, the government wants to achieve energy efficiency savings of 6m-9m tC – equivalent to 4-6% of the UK's total emissions in 2005. This is on top of the 12m tC saving that is expected to come from the policies announced in the 2006 Climate Change Programme by 2010.

Yet it will not be easy to achieve. By the Review's own estimates, over the next two decades, it is likely that the UK will need around 25 gigawatts of new electricity generating capacity, as power stations – principally, coal and nuclear plants – reach the end of their lives. "This will require substantial new investment and is equivalent to around one-third of today's generating capacity," the Review notes.

The government also believes coal has a role to play in the UK's generating mix. Last winter, more than 50% of the country's power came from coal-fired stations. That, however, means the government must address its high carbon contribution. This, says the review, could happen through investment in carbon capture and storage technology.

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