The nuclear energy industry has been all over the map in recent months, leaving many questions about future investment in nuclear power plants. In the latest development, last week Hitachi touched off something of a crisis in the United Kingdom’s long-term energy planning when the company bailed on plans for a new power plant in Wales.
That may look like the beginning of the end for nuclear energy, but on closer inspection the picture is much more complicated.
Hitachi's announcement only adds to the hurt. As noted by The Guardian, the Hitachi power plant also fell to the wayside over financing when the company "failed to reach a deal with the UK government."
The company has also ditched plans for a new reactor at the site of the former Oldbury nuclear power plant in Gloucestershire. The Oldbury plant had been decommissioned in 2012, and the new reactor had been given the green light as recently as December 2017.
The only bright spot for nuclear advocates has been the Hinkley Point C project. That project has been moving forward despite vociferous opposition. At last count, the plant was expected to go online in 2025 and account for about 7 percent of Britain's power needs.
Adding fuel to the opposition fire, Hinkley’s guaranteed rate is higher than current market prices. That provides solar and wind power advocates with some leverage to argue that renewable energy should fill the gap left when nuclear power plants close.
Whether renewable energy can fill the gap is another matter entirely. Wind and solar advocates point out that renewable energy development has been shortchanged by the U.K.'s support for nuclear subsidies.
In other words, technological obstacles are one matter. Political obstacles are quite another.
On the plus side, the political winds may be shifting in favor of renewables. The Guardian cites Greg Clark, the U.K. Secretary of State for Business, Energy and Industrial Strategy, who notes that the falling cost of renewable energy is working against nuclear energy:
“Clark told MPs [members of parliament] that renewables had been getting cheaper in the past five years while nuclear had become more expensive because of safety measures. “The challenge of financing new nuclear is one of falling costs and greater abundance of alternative technologies, so that it is being outcompeted,” he said.”
The question then becomes one of scaling up. That could be a tough row for solar, which currently holds a negligible ranking in U.K. electricity sources.
On the wind power front, it’s another story. Wind already accounts for 17.3% of electricity generation in the U.K.
Though it gets little attention compared to news about the latest solar or wind project, energy efficiency is another key piece of the puzzle.
According to a new report from the organization Carbon Brief, electricity generation in the U.K. has fallen to 1994 levels despite an increase in population.
The savings in carbon emissions has been considerable:
“If this electricity had instead been generated from gas, CO2 emissions for the entire UK economy would have been around 80 million tonnes (MtCO2, 20% )higher than the 368MtCO2 total seen in 2017. If it had come from coal emissions would have been some 180MtCO2 (50%) higher.”
Elsewhere around the world, nuclear energy also faces a mixed future.
Here in the U.S., the industry is on shaky ground in the power generation sector as the cost of wind and solar continue to drop. The availability of vast renewable energy resources in the U.S. is quickly making nuclear power plants obsolete.
The opportunities are more promising in national defense, foundational research and space exploration, where the U.S. cannot afford to fall behind its global rivals.
It’s likely that the U.S. government will continue to promote at least some level of nuclear power generation in support of those aims, though it’s unclear whether investors will continue to express interest. The U.S. Department of Energy is currently exploring small scale nuclear power plants as one potential area of growth. One of its projects supports the next-generation nuclear energy Terrapower, which is backed by Microsoft’s Bill Gates.
Another hotspot of nuclear activity is — or was — China. In one interesting development in that country, near the end of 2018 TerraPower stopped construction on a new power plant in China. Industry observers have recently noted that China appears to be falling out of love with nuclear energy, though TerraPower attributed its drawback to the fragile state of trade relations with the U.S.
Japan presents another interesting case. The country suspended its nuclear fleet after the Fukushima disaster of 2012, replacing it with coal, oil, and natural gas — which is not a particularly sustainable solution. It began re-engaging with nuclear power just a few years later.
That doesn’t mean the end of the road for renewables in Japan. Leading auto maker Toyota is spearheading a futuristic “hydrogen society” based on renewable energy, though that kind of foundational transformation could be many years in the making.
Finally, yet another country to watch is Saudi Arabia. The kingdom has been under fire internationally for the state-sanctioned murder of journalist Jamal Khashoggi in October 2018. Nevertheless, within a month Saudi Arabia was celebrating the launch of its first nuclear reactor with another one on the way.
The month after that — in December 2018 — U.S. Energy Secretary Rick Perry visited the kingdom and either offered — or threatened to withhold — engagement with Saudi Arabia’s nuclear energy industry.
The underlying issue, of course, is the idea that nuclear-powered countries will invariably develop nuclear weapons.
That threat all but guarantees that some countries will continue to subsidize nuclear power generation in some form or another, at least to some extent, even if other, less costly low carbon alternatives are available.
In this context, it’s worth noting that between Hitachi, Toshiba and TerraPower, investor risk is a major factor in the viability of the nuclear energy industry. However, even if private investors shy away, the national security angle could still be used to justifying investing taxpayer dollars in new nuclear power plants.
In other words, don’t hold your breath for the end of nuclear energy. The industry may shrink, but it will survive into the foreseeable future.
Image credit: Horizon Nuclear Power
Tina writes frequently for TriplePundit and other websites, with a focus on military, government and corporate sustainability, clean tech research and emerging energy technologies. She is a former Deputy Director of Public Affairs of the New York City Department of Environmental Protection, and author of books and articles on recycling and other conservation themes. She is currently Deputy Director of Public Information for the County of Union, New Jersey. Views expressed here are her own and do not necessarily reflect agency policy.