EU nuclear post-Fukushima

Speech, 22 September 2011, European Policy Centre, Brussels

I will start by addressing the main question of the day – what was the effect of the Fukushima disaster on the path of nuclear power in Europe? The short answer is that it reinforces a trend rather than providing a shock to the system in the way that Chernobyl was. If we consider probably the biggest specific reaction, the reactor shutdowns and accelerated phaseout plans in Germany, we see that net effect is to move quicker to an already planned outcome (or rather, to return to the previous schedule). If we look at Italy, the referendum continues a position Italy has been in since the phase-out decision in 1987. In other words, the trend has been sharpened by Fukushima, but is far from shaped by it.

WWF’s priorities in the energy field are to see that Europe decarbonises by 2050 using sustainable means. In this framework, and after careful consideration, we do not favour nuclear power. The reasons are fourfold:

–         Nuclear brings with it the possibility of very low-probability but very high-impact safety events. These risks are difficult to anticipate, and as a result such risk is largely socialised, since the industry would be unable to bear the full liability costs itself. Ensuring avoiding these risks adds cost to projects.

–         There is little progress on long-term waste solutions. Projects to date are plagued by uncertainties and delays, and current storage arrangements are clearly inadequate. Increasing the waste burden absent a suitable solution is unadvisable.

–         Costs are consistently higher than predicted, negating the supposed benefit compared to other options. This is true both for nuclear as a technology overall and for individual projects. Unlike any other low carbon technology nuclear gets more expensive with time, rather than less. This is because the tougher safety obligations become, the more the industry has to return to the drawing board, and add more expensive features; and with the site-specific elements and long time gaps between projects, each project is essentially a one-off, and there is no learning benefit so evident in the development of other technologies. The idea that conditions would now suddenly change to the point that the industry could achieve a level of standardisation, speed and cost control to engage learning effects simply isn’t credible, and from a planning perspective is a high-risk assumption to make about the future.

–         There are alternatives. WWF has a clear vision of a reliable, cost-efficient and low-carbon energy system in Europe and globally. That vision, based on a renewable energy supply, relies on two main features: energy savings and an interconnected grid with advanced supply and demand management. Europe is witnessing massive growth in renewable energy production (in contrast to nuclear energy, renewables have been outstripping every previous growth prediction). In the system Europe is now heading toward, the need for capacity that is quickly dispatchable and profitable at lower load factors is simply not matched by nuclear energy. Indeed, the addition of nuclear will impede rather than aid decarbonisation as it will be increasingly incompatible with the addition of renewable energy, and hence will compete rather than complement. The drive to add large chunks of capacity also tends to disincentivise energy savings.

I would like to explore a bit further the kinds of ideas we have for advancing decarbonisation without nuclear power.

In February WWF released ‘the Energy Report’, which outlined a scenario for providing commercial energy sustainably to the entire global population using 100% renewable energy, and cutting global greenhouse gas emissions by 80%. The benefits to human health and economies are substantial, and are detailed in that report.

What you will note from this figure is that even as energy services are extended to those who have no access to commercial energy today, and as economies grow globally, energy use peaks and declines, returning to current levels by 2050.

We have also examined decarbonisation in detail in several countries. I’d like to highlight Germany here because the ‘Blueprint Germany’ report outlined a non-nuclear future well before recent developments there, and is more than even looking like a viable action plan.

In this figure you can see how in power generation the phaseout of nuclear is achieved on time, followed by a full conversion away from fossil fuels and toward renewable energy.

As I mentioned, energy efficiency is key to any sustainable decarbonisation pathway. Three recent EU scenarios indicate the impacts of different assumptions. First, bear in mind the strong trend towards electrification, which takes up much of the burden of decarbonising transport and heat over the coming decades. Hence, even in the ‘greener’ scenarios we see electricity use rise, though total energy use falls significantly.

In the ‘EU Green vision scenario’ prepared for the European Greens/EFA, electricity use rises by 13% through 2050. The ECF ‘roadmap 2050’ report foresees a 42% rise, whilst the Eurelectric power choices scenario foresees a rise of 58%. In the latter scenario, although the share of nuclear energy stays essentially constant over time, because of overall demand growth, production would have to rise by 50% – something that especially in the past months seems an unlikely prospect.

The 2011 IAEA forecast of nuclear energy through 2050 was trumpeted in the press at the time of its release as heralding a bright future for nuclear energy – but looking at the underlying demand assumptions reveals a lot about how they came to this conclusion. European electricity use is projected to skyrocket by 80%, and global electricity by 375% – about three times the amount envisioned in WWF’s scenario.

It is a truism to say that the more energy we need, the more pressure there is to use whichever sources are at our disposal. If we want a sustainable energy supply, we need to be meeting a reasonable energy demand. That’s why it’s so disappointing to see an Energy Efficiency Directive proposal that fails to make the current 20% savings target binding, and makes its most substantial proposal, an obligation on energy suppliers to help consumers cut consumption, all but voluntary. We look to Parliament to provide a reality check for the other institutions.

The other factor essential to sustainable decarbonisation of the power sector that I mentioned, beside energy savings, is integrated grid and load management.  Here is another area where coordinated European action is needed to find solutions to the growing inefficiencies if member states continue to act essentially independently. The new ACER and the ENTSO-E are acting in the right direction but their remits are limited. A study to be published next month by WWF-UK highlights the role of European interconnections: official government estimates indicate that the UK’s practical offshore wind resource amounts to six times current electricity demand; if interconnections to neighbours were significantly expanded and market rules and incentives were properly aligned, then by 2030 the UK’s power sector could already by using almost 90% renewable energy, complemented by a small amount of gas. Without that flexibility the picture looks significantly different.

Because of the growing recognition of the need to find a means of exploiting the efficiencies of an interconnected Europe, particularly for renewable energy, we are looking forward to the upcoming instruments on Energy infrastructure. We are also all awaiting the 2050 energy roadmap before the end of this year. Among many others we have been calling for the European Commission to be fully transparent about the assumptions and modelling that report will use, because we fear it may make conclusions about nuclear power in particular based on unjustified optimism. Data in the underlying Primes model indicate an anticipated future drop in the cost of nuclear technology that, as I have already noted, seems based far more in wishful thinking than any available evidence. As a result, faulty conclusions may be drawn about the cost efficiency of nuclear in comparison to other energy sources.

It is our assertion that faulty assumptions about nuclear power’s future costs, combined with a poor understanding of the benefits of a flexible, interconnected grid, could in some countries lead to incorrect prioritisation of nuclear energy alongside other low-carbon forms of energy. If this were purely a private commercial matter, then one could simply accuse companies of bad planning. But as I have noted, a certain amount of the implied cost of nuclear is publicly shouldered. And member states were to provide direct public subsidy for nuclear power, this would quite clearly fly in the face of European law. First, they cannot make the case that it is necessary. Given current build rates of renewable energy and gas power plants, along with efficiency improvements, the role for nuclear is questionable at best. Second, they cannot argue that nuclear is a new, environmentally friendly technology in need of special support, the only other exemption under EU law.

Of course, all low-carbon forms of energy enjoy a competitive benefit though the emissions trading system, which puts a price on carbon emissions. Unfortunately for those wanting to plan investments in low-emitting technology, that price is both variable, and currently very low – both of which contribute to uncertainty. Some argue that this means there should be alternative means of ensuring a least a minimum price of carbon. However, actions in this direction at member state level risk simply amounting to a form of tax without specific environmental benefit, since the total amount of EU emissions under the trading system is set at European level. A far better approach is to solve the structural problem with the ETS, namely too high a cap with too many offsets, and a reduction trajectory that is out of line with what is needed to reach deep decarbonisation by 2050.

In summary what we need are well designed and implemented climate policies, a strong approach to energy savings, and energy innovation support that is targeted to fostering technologies as they become increasingly commercial, and is in conformity with European law. I’m certain that we will see a continuation of the kind of dramatic shift towards renewable energy that is no longer a matter of futuristic thinking, but is underway right now, all around us.

Yesterday Scottish and Southern energy said it may pull out of the NuGen consortium, which is one of three consortia looking to build new nuclear reactors in the UK. They want to focus on renewable energy. Siemens made a similar decision last week, pulling out of new nuclear build and backing the German government’s plans for renewable energy.

We firmly believe that renewable energy and efficiency are the future, and that focusing on what works will be the winning strategy.

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