Big nuclear build makes no climate or economic sense

By Richard Halsey

This article was published in BDLive

Nuclear+PlantTHE climate negotiations in Paris set in place national commitments to reduce greenhouse gas emissions. This prompted some support for nuclear as a climate-friendly alternative to electricity-generation, due to its low operational emissions.

There are, however, inherent problems with nuclear plants — including high construction costs, radioactive waste, decommissioning requirements, long construction times, and disaster-management plans.

SA’s Integrated Resource Plan (IRP) from 2010 suggested that 9.6GW of nuclear capacity could form part of the electricity mix by 2030. The updated IRP has still not been finalised, and conditions stipulated in the plan are no longer realistic. Despite this, the government continues with the recommendations from 2010 as its mandate.

A major issue lacking clarity is what effect this nuclear investment will have on the price of electricity. The Energy Research Centre at the University of Cape Town has released a study that examines the macro-economic effects the commitment to build 9.6GW of nuclear would have against a flexible approach that aims to minimise overall costs, while meeting electricity demand. This flexible plan does not preclude nuclear, but allows it to be used only if prudent.

The study is divided into two scenarios. The first assumes a realistic “best case for nuclear”: a future with advantageous nuclear parameters, high costs for renewables, no gas or hydro alternatives, and high electricity demand. The second assumes a “worst case for nuclear”: where the assumptions are reversed; unfavourable nuclear variables, affordable energy alternatives, and lower economic growth.

In each case, the outcome of a forced nuclear build is compared with flexible planning. In the first scenario, a nuclear commitment has no significant effect on the economy.

However, in the second scenario, electricity prices would be 20% higher in 2040, up to 75,000 jobs could be lost, and welfare would decrease — all as a result of committing to nuclear rather than flexibility.

No one knows how the future will unfold, but it is possible to conduct analyses of what is more likely to happen. By modelling 1,000 different scenarios, the researchers concluded that it was less likely that conditions in the future would favour promotion of nuclear power.

By having the 9.6GW nuclear build, there is a 94% chance that electricity prices will be higher by 2030 than if we were to adopt a flexible approach.

“Our results show that there is no economic case to be made for a firm commitment to commissioning a full fleet of 9.6GW of nuclear power by 2030,” the researchers say.

An over-investment in nuclear will decrease SA’s ability to invest in small-scale and more cost-effective technologies. It is a classic case of putting all our eggs in one basket. And the Energy Research Centre data suggests it is the wrong basket.

This is critical information. In the debate on nuclear, there is now a rigorous study that examines the exact situation, and concludes that it does not make economic sense to forge ahead with nuclear at this stage.

The Department of Energy is pushing for the procurement process to happen as fast as possible, yet the IRP has not even been finalised. As the Energy Research Centre study states: “There is no rush to make this decision, and there is no justification for making a commitment of this scale at this time.”

The argument for nuclear from a climate change mitigation standpoint is weak. Renewable energy solves the emission problem, without the issues associated with nuclear.

SA has much better solar and wind resources, which have demonstrated their viability, than most countries in Europe.

Renewables have been criticised for their intermittency, but energy-storage technology is improving constantly.

Coupled with smart grids, renewable energy can provide-base load power.

Uruguay now gets 95% of its electricity from renewable resources and the electricity price has decreased. Last year, the global investment in this sector was $286bn, resulting in 134GW of additional capacity.

This was more than all new large-scale hydro, coal, gas, and nuclear capacity for the past year combined.

So, if there are better options from both a climate change and economic point of view, we must again ask why the government is pushing for this nuclear build. Vested interests and out-of-date planning documents are not justification enough.

• Halsey is policy and research officer at Project 90 by 2030

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