Don’t Ignore the Nuclear Option

(Bloomberg Opinion) -- With billions of workers at home and factories idle, early April saw daily carbon emissions fall 17% compared to 2019 averages, according to a study by a team of international scientists published this month. That’s great. Unfortunately, it only takes us back to 2006 levels, and it’s temporary..For an even more painful reminder of the scale of the climate task, consider that for 2020 overall the same researchers from the University of East Anglia and Stanford estimate coronavirus lockdowns will amount to an emission reduction of about 4% to 7% — the sort of decline we need every year to limit warming to 1.5 degrees Celsius, the boldest global target. The challenge is clear. So why are we leaving a major existing source of low-carbon power out of green stimulus discussions, as the European Union appeared to do last week?.Nuclear energy is hugely polarizing, geopolitically sensitive and not without risk. It’s also a reliable source of clean power that can displace fossil fuels and effectively work in tandem with renewable energy. True, new plants have proven slow and costly. By managing projects (a lot) better and tinkering with the models less, that can change. We can certainly keep existing reactors alive reasonably cheaply. Small, modular plants, already in the pipeline, may make a difference, too. Leaving nuclear off the agenda in the debate on a post-pandemic, carbon-light recovery is a mistake we will rue..Simply, it’s about emissions. We have to make electricity production greener, so it can in turn become a low-carbon energy source for transport, heating and more. Atomic energy does generate emissions during parts of its lifecycle, like uranium mining. Still, globally, it avoided 63 metric gigatons of carbon dioxide from 1971 to 2018, according to the International Energy Agency. Without it, emissions from electricity generation would have been 20% higher. Yet rather than increasing when we want cleaner power, it’s fading fast in the West as aging plants close, and is often replaced with cheap gas. Nuclear generation did rise by 2.4% in 2018, its fastest growth since 2010 — but only thanks to China..It’s not that solar and wind are unable to replace fossil fuels. They have made huge strides, and costs have deflated dramatically. Without nuclear, though, achieving a transition in the necessary time frame requires extraordinary extra effort and cost — around $1.6 trillion in additional investment in the electricity sector of advanced economies between 2018 and 2040, according to the IEA. That’s a big number even from a body that has admittedly underestimated renewables before. It also wastes an existing resource..To cut emissions in the electrical sector by the 45% needed to keep global warming to 1.5 degrees Celsius would require adding by 2030 as much as four times the total solar and wind capacity built over the past two decades, BloombergNEF founder Michael Liebreich estimated last year. Adding transport, heating and industry would raise that to as much as 15 times the current installed capacity, he said. The IEA, meanwhile, reckons that wind and solar capacity has increased by about 580 gigawatts in advanced economies over the past two decades — and that offsetting nuclear’s decline will mean adding five times that in the next 20 years..For an idea of scale, consider Liebreich’s example: In 2018, German utility EON SE’s Isar-2 nuclear power plant in Bavaria wasn’t far off producing the same amount of clean energy as all the wind turbines in Denmark. Then consider that nuclear operates more than 90% of the time — a reliable base for fluctuating wind and solar — and occupies less space..What about the economics? Here, the picture is less positive. While the cost of solar has plummeted, nuclear has soared. Extending the life of existing plants, where possible, is still a no-brainer, especially if a reasonable carbon price is included in the calculation. Many of these hulking plants are now fully depreciated..A sustainable reduction in carbon, though, requires new plants — and the industry has done itself no favors. Experiences over the past decade or so will deter future construction, with rare exceptions like Britain. Projects have overrun, and costs have soared. The most egregious examples are Electricite de France SA’s Flamanville nuclear plant, now more than a decade behind schedule and expected to start around 2023; and the Hinkley Point C reactor in England, delayed and based on an eye-watering energy purchase price of 92.50 pounds ($114) per megawatt-hour in 2012 money, guaranteed for 35 years. Even China has hit delays in Taishan..None of this, though, should obviate a discussion on how to do it better, with more design standardization, some innovation and simply by repeating proven construction practices, as suggested in a 2018 Massachusetts Institute of Technology study. Including nuclear in green recovery plans can accelerate that process. The push toward smaller, modular reactors will help too, though large-scale application may be some time away..Popular worries about safety, waste and decommissioning are understandable — even if a comparison of fatalities per terawatt hour shows other forms of energy are far deadlier, given air pollution and industrial accidents. There is a messy geopolitical layer here, too, as China and Russia enthusiastically use subsidized projects as diplomatic tools. .For now, though, it needs to be an option on the table. The carbon cost of ignoring nuclear is just too great..This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners..Clara Ferreira Marques is a Bloomberg Opinion columnist covering commodities and environmental, social and governance issues. Previously, she was an associate editor for Reuters Breakingviews, and editor and correspondent for Reuters in Singapore, India, the U.K., Italy and Russia..©2020 Bloomberg L.P.

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Don’t Ignore the Nuclear Option

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