Is the present government quietly trying to dump the British nuclear industry? In February this year it published a white paper on energy which recommended a massive expansion of renewable energy resources (wind, sea and biofuels), and a significant reduction in our reliance upon coal and oil. But there were no plans at all for new investment in nuclear energy or even for the future maintenance of the existing.
The white paper struck some experts as dangerously optimistic. The Institute of Civil Engineers (ICE) warned that if the government proceeded with this policy, then Britain could end up without electricity or gas for long periods as early as 2020. Following current plans, argued the Institute, meant that 80 per cent of domestic electricity would eventually be generated from imported gas and oil, putting the UK at the mercy of politically unstable energy suppliers like Russia, Iran and Algeria. If supply lines failed, domestic generators would not be able to meet demand for very long and blackouts like those that occurred recently in the United States would be the consequence.
This warning echoed a statement two years ago by the Royal Society arguably representing the main body of scientific opinion in the UK that "the future of UK energy lies with nuclear". It reasoned that if the government wanted to meet its Kyoto obligation to reduce greenhouse emissions while ensuring the country's energy needs are met, replacing dwindling domestic fossil fuels with imports and renewable energy sources would not be sufficient. But ministers chose to ignore this advice.
To understand fully the reasons for this scientific scepticism we need to look at the white paper in more detail. It outlines three major strategies for dealing with future energy needs. The first is to increase the amount of energy coming from renewable sources like biofuels, wind and waves. The government has set a target of 10 per cent of energy coming from renewable resources, and a tentative 20 per cent by 2020. The renewable lobby would like even higher targets.
"We believe there is a much bigger market for renewable energy than the government targets, almost double", says Juliet Davenport of renewable energy supplier Unit[e]. Martin Wright, of Marine Current Turbines Ltd, predicts that tidal power alone could in principle produce as much power as half our current nuclear output.
Energy reduction is the second strategy. The government hopes that energy conservation and increased efficiency, often the ugly duckling in the energy debate, can offset much of the burden of expanding energy demands. The Energy Savings Trust predicts that by 2010 domestic energy efficiency policies will save 15 per cent annually. The government aims to double energy efficiency sales to the domestic market by 2008, and improved energy efficiency standards for building regulations will be introduced from 2005 for new and refurbished buildings, along with improved energy infrastructure. These are all decidedly nonsexy and possibly unpopular as they will require consumers to bear some of the initial cost of improvements. But such policies are crucial to the aims of the white paper.
The third strategy tackles the problem of shrinking domestic fossil fuel extraction. With North Sea oil production dropping, and our coalpowered generating plants expected to close shortly after 2016, nearly two thirds of our energy will come from imported Russian gas by 2020 expect plenty more red carpets for Mr Putin over the coming decades. That will leave us in 2020 with a predicted 70 per cent of our energy coming from gas, 20 per cent from renewables, and the rest from the remnants of the nuclear, coal and oil industry. As well as leaving us vulnerable to a very extended gas supply chain this also does not bode well for our commitments on greenhouse gas emissions. Some perhaps all of the concern about the government's capacity to meet its energy targets through these three major strategies could be allayed by some evidence that the nuclear industry was available to make up significant shortfalls. But it seems that nobody loves nuclear.
Nuclear energy company British Energy recently declared a £3 billion loss and is teetering on the verge of bankruptcy. While its current financial crisis is the result of low fossil fuel prices, it claims nuclear is artificially penalised: paying 20 to 30 per cent more in business rates than similar fossil fuel generators; having to expensively reprocess fuel rather than place it in storage; and having to pay the climate change levy despite producing no carbon dioxide. When you add in the legal action begun by the Irish and Norwegian governments over UK nuclear waste discharges in the sea near Sellafield, you could see why the nuclear industry is feeling somewhat beleaguered, wondering whether the government is quietly trying to dump it.
The UK wouldn't be the first to follow this route. While nuclear is currently the EU's largest single source of electricity, Germany, Sweden and Belgium are all making plans to phase it out. The French, most prominent of nuclear supporters, are due to release results of an energy policy review in the autumn, which will be watched closely by their neighbours.
The trend is by no means clearcut however. In Italy, where companies and state organisations have been banned from getting involved in the nuclear industry since the Chernobyl disaster in 1986, ministers are calling for a nuclear revival: a heatwave this summer caused powercuts throughout the country, highlighting its dependence on electricity imported from France. Now, Italian firms will be able to manage, invest in and construct nuclear facilities abroad to ensure that their country's energy needs are met.
Even the Finns, always at the forefront of environmentalconsciousness, voted last year to construct a new nuclear power plant in order to reduce their dependence on imported Russian fossil fuels and meet Kyoto targets on greenhouse emissions. The decision, which caused the Finnish Green party to leave the ruling coalition, will see the first new reactor built in Europe for over a decade.
One thing the British nuclear industry cannot afford at the moment is a policy of 'wait and see'. The German decision to end its nuclear programme means their last reactor will shut in 2021, but unless the UK starts building new reactors now, we will only have one working reactor ourselves by then. Meanwhile, valuable expertise is being lost. "We cannot wait ten years to make a commitment because that will be too late", says Ruth Stanway of the Nuclear Industry Association. "It's a tragedy for British expertise. In ten years we will only have a quarter of the human resources we have now."
Stanway argues that the white paper is flawed as it promises much but doesn't provide any means of delivery fine words ultimately lacking in substance. "The white paper put a great deal of responsibility for reducing demand on the energy savings people, but didn't actually put any measures in place to help. The numbers are so unrealistic that nobody is taking them seriously."
The nuclear sector is not asking for government finances but instead wants only a 'level playing field'. "We don't want handouts, we don't want huge amounts of money," says Ruth Stanway. "All you need to do is to say that new plant designs are going to be licensed we'll fund them ourselves, we can build them ourselves."
But it isn't only the nuclear industry that has been made to feel insecure by the white paper. Matters don't seem any more certain in the renewable energy sector, which is frustrated that the 'aim' of deriving 20 per cent of our energy needs from renewables by 2020 is simply that an aim with no legal teeth to back it up. And it is keen for the government to stop legislating and let the energy market settle. As Juliet Davenport explains, "if the government keeps changing the market then it undermines the bankability of renewable contracts in the longer term. Over the last four years there have been three new regulations which have been very significant in their content. As a result the renewables industry has been washed around in a sea of uncertainty. We're now settling down into a growth period, and what we really want for the future is not too much change. That's the key to growth in this market stability."
Like nuclear energy, renewable energy needs guaranteed longterm governmental commitment. Nuclear is megalithic in its production capacity and timescales reactor commissioning can take ten years or more, with reactor lifetimes of decades followed by expensive decommissioning.
Renewables function as a collective of relatively small producers, with capital investment only paying off in the medium to long term. "You've got to get the financial world to commit to renewables", explains Davenport. "They are investments that take seven to eight years. Unless you get that commitment, if the perceived political risk is reasonably high, then you won't get the investment level."
What complicates any current debate about energy is public hostility to the nuclear option. The recent government commitment to renewable energy sources such as the construction of huge offshore wind farms has been welcomed as a giant step forward by the environmental lobby. It has been less readily recognised that this is only a small part of UK energy policy. Its bedrock is going to be imported gas and oil. The real question is then, are we happy to rely on this precarious source rather than on our own nuclear energy.
Davenport says we should let the public decide, and strongly backs a new disclosure initiative to be introduced next year. "All suppliers are going to have to say where their electricity is coming from, and it has to be on the bill. I think that will say what people want to do about nuclear." Recent European research suggests that 40 per cent of the public do not want to buy their electricity from nuclear power. "That was a definite statement the question is, are there any positives amongst that 60 per cent that do want to buy?"
But can public opinion be trusted when it comes to nuclear energy? Even minor stories about nuclear facilities can have a dramatic effect. The Brookhaven High Flux Beam Reactor, one of the principal research neutron sources in the world, was shut down after a leak of tritium was detected. What was less well publicised was that the quantity of tritium was roughly a quarter of that used in an ordinary tritiumpowered 'exit' sign.
It is difficult to imagine a better future than one in which all of our energy needs are met through renewable nonpolluting sources such as solar and wind. But we are too energy hungry. Even with a massive expansion in renewable energy generation, we will still only feed a fraction of our demand. The government's white paper solution is to fill this gap with gas, with all its uncertainties of overseas supply, and associated carbon dioxide production. But if we are to honour our commitment to reduce greenhouse gas emissions, maintain a reliable energy supply, and keep the lights on as we move into the 21st century, the surprising dual answer to our energy problems might be that distinctly odd couple, renewables and nuclear.
