Last week, the influential weekly news and international affairs publication, The Economist, ran an essay on the future of nuclear energy – The dream that failed: Nuclear power will not go away, but its role may never be more than marginal.

As you might have guessed from the title, it was decidedly cool towards nuclear’s future prospects. Below I sketch some thoughts on what was wrong (and right) about the article. Interestingly, I understand that the author of this piece (Oliver Morton) will be joining us at the Breakthrough Dialogue in San Francisco in June 2012 — so I’m sure we’ll have some robust dinner conversations!

In his assessment of the current situation in Japan — 52 of its 54 reactors shuttered (at least 6 permanently), 100,000 people displaced by the evacuation resulting from the 20 km exclusion zone, and the speculation that Japan’s share of nuclear in the country’s electricity mix over the next few decades could decline rapidly or evaporate completely — the article is accurate and suitably sanguine.

The energy supply problems Japan now faces, due to the lack of baseload electricity for heavy industry and domestic consumption, is putting real pressure on the economy, and of course on the social fabric of the nation and the people’s respect for government.

As reported by The Breakthrough Institute blog(see table to the right), costly imports of fossil fuels to partially cover the shuttered reactors has led to a chronically increasing fuel bill and the country’s first trade deficit in 30 years (to the tune of -$32 billion).

From a climate change perspective, it also looks bad — emissions are rising steeply as the Japanese electricity sector once again ‘goes fossil’, as illustrated in the carbon-intensity-from-energy chart below:

An obvious question to ask is, would Japan have faced this situation today if it had never pursued nuclear energy? I think the answer is two-fold:

Cosmo refinery fire - who knew, who cares?

(1) No, because even if a few coal- and gas-fired power station had been wrecked and burned by the earthquake/tsunami, no one would have cared. This is evidenced by low-level media coverage, and no future follow-up or mention by environmental groups, of the Cosmo refinery fire (which spewed petrochemical wastes into the local suburbs of Chiba for days following the earthquake).

(2) Yes, because a historically more fossil-fuel-dependent Japan would have faced an ongoing trade deficit over many years, if the 30 % nuclear portion of its electricity supply had instead always been supplied by coal and gas. Japan is one of the least energy-independent nations in the OECD, needing to import virtually all of its fossil fuels (and uranium — but it needs relatively little of this, costing ~$1.2 billion per year).

So, nuclear power — or, more to the point, radiophobia (see Footnote) — has caused a major economic and social upheaval in Japan, post-Fukushima. But over the last 40 years, nuclear power has also substantially reduced Japan’s need to import coal and LNG, and kept its ongoing carbon emissions lower to the tune of roughly 250 million tonnes of CO2-e per year.

Anyway, back to The Economist article. Japan is, it is claimed, just the latest context setter for what the author posits are fundamental and socio-economicaly fatal problems with nuclear energy — the public fear that translates into risk aversion from the market, utilities and investors, the potentially high (but actually unknown) cost of cleanup following major accidents, the finger pointing that is possible for specific cases of poor regulation, laxity in the culture of operations, and unavoidable human error.

(In his book Prescription for the Planet, author and SCGI president Tom Blees spent considerable space describing how these types of problems have dogged nuclear power in the past, and explained what he thinks is needed to fix them, especially under an expanded future scenario — but to explain this requires a different post for another day).

I disagree with Morton that:

Barring major technological developments, though, nuclear power will continue to be a creature of politics not economics, with any growth a function of political will or a side-effect of protecting electrical utilities from open competition.

Politics and social stigma certainly matters in the short term — these are clearly the overriding reasons behind the inability of Japan to restart its reactor fleet, and why Germany has turned away from its reactors. But as Per Peterson (and others) have emphasised, if the “renaissance that wasn’t” is to happen after all, nuclear energy will have to win the war on cost.

Yet for an article in a magazine called The Economist, the Morton article is remarkably vague about the economics of alternatives to nuclear. Let’s look at the two arguments:

In liberalised energy markets, building nuclear power plants is no longer a commercially feasible option: they are simply too expensive. Existing reactors can be run very profitably; their capacity can be upgraded and their lives extended. But forecast reductions in the capital costs of new reactors in America and Europe have failed to materialise and construction periods have lengthened. Nobody will now build one without some form of subsidy to finance it or a promise of a favourable deal for selling the electricity.

I concede that it is not feasible to build nuclear reactors in a fully liberalised energy market. But exactly what would be? The large coal, hydro and nuclear plants that underpin the baseload electricity supplies of Europe, North America, Australia, Japan and China were all built with substantial (typically dominant) investment from the public sector. Here’s a challenge: can you name any country that has built the majority of its historical large-scale electricity supply infrastructure without strong government support? Anywhere, anytime?

To dismiss nuclear energy by saying that it can’t compete in the new energy markets, without buttressing this statement by explaining what will be commercially feasible, is a serious oversight. I can proffer an answer, based on what I see happening today in the U.S., Australia and elsewhere — it is gas, especially the low-capital-cost open cycle gas turbine (OCGT) plants, that wins in this scenario. OCGTs can be cheaply, quickly and incrementally added to an existing grid to deal with additional peak loads, with little risk — at least in the short- to medium-term. As to their long term capacity, well, that will depend sensitively on fuel price and market pricing structures. But these aren’t providing the core supply role.

An economic victory for nuclear will have to come (if it does come within the next 50 years) from an ever increasing focus on standardised designs and their accompanying construction and operating licences, modular components or fully modular units with integrated passive safety systems, some considerable learning experience from building multiple reactors of the same design, and cooperative government-commercial financing, among other factors. This is starting to become a reality in Asian countries like China and South Korea (based on AP1000, APR-1400 and related Generation III+ designs), although the end result remains far from clear. At present, in most countries, however, fossil fuels still rule.

In 2010 the world’s installed renewable electricity capacity outstripped its nuclear capacity for the first time. That does not mean that the world got as much energy from renewables as from nuclear; reactors run at up to 93% of their stated capacity whereas wind and solar tend to be closer to 20%. Renewables are intermittent and take up a lot of space: generating a gigawatt of electricity with wind takes hundreds of square kilometres, whereas a nuclear reactor with the same capacity will fit into a large industrial building. That may limit the contribution renewables can ultimately make to energy supply. Unsubsidised renewables can currently displace fossil fuels only in special circumstances. But nuclear energy, which has received large subsidies in the past, has not displaced much in the way of fossil fuels either. And nuclear is getting more expensive whereas renewables are getting cheaper.

In this statement, Morton correctly identifies some of the key limitations facing large-scale non-hydro renewables — intermittency and unsubsidised cost. But he wholly fails to explain what the implications of the variability problem is (the need for overbuild of generation capacity and expensive/unfeasible large-scale energy storage), nor whether, if an effort is made to deal practically with these problems in real national electricity grids, the ‘increasingly cheaper’ renewables will ever become cheap enough (when all relevant real-world factors are considered) and reliable enough (without natural gas ‘backup’), to actually substitute for and displace fossil fuels (or nuclear) at the scale required.

Now as regular readers will know, there has been a lot of attention to this general problem on Brave New Climate (e.g., Solar combined with wind power: a way to get rid of fossil fuels? AND 100% renewable electricity for Australia – the cost), so I won’t dwell on it here. Yet for The Economist to just leave the economic argument at this point, with a poorly contextualised homily that completely ignore the realities of what large-scale renewable energy systems without nuclear require, is breathtakingly shallow. (Unless of course Morton meant to imply that neither nuclear OR renewables will ever cut it against fossil fuels, but then, another Pandora’s Box on fuel supply and environmental damage is opened.)

Radiation realities versus radiophobia - will the scientific and medical realites be heard above the din of hysteria? I argue that eventually, they must do, because the world, and especially countries like Japan, have no other choice.

The Economist concludes with the following:

In the energy world, nuclear has found its place nourishing technophile establishments like the “nuclear village” of vendors, bureaucrats, regulators and utilities in Japan whose lack of transparency and accountability did much to pave the way for Fukushima and the distrust that has followed in its wake. These political settings govern and limit what nuclear power can achieve.

There is truth in this statement. But equally, there is much missing from it. Political and social settings of the future will be governed by a mix of energy-price, energy-security and climate-change-mitigation realities that MUST be faced. Fossil fuels have to be replaced. Energy costs from fossil fuels will rise as demand continues to increase, and supply — especially from conventional sources — declines and becomes increasingly regionally concentrated.

In this context, the past is only a weak guide to the future, and as George Monbiot once again sagely pointed out, there is no primrose path to a low-carbon future.

…The likelihood is that if we press for gas with CCS, we’ll get gas without CCS. As the difficulties with carbon capture and storage mount up, investors will flee. But the gas plants will still be built and the public won’t perceive a great deal of difference between gas with or without abatement. It could scarcely be a better formula for ensuring the abandonment of the UK’s carbon targets.

The environment movement has a choice. It has to decide whether it wants no new fossil fuels or no new nuclear power. It cannot have both. I know which side I’m on, and I know why. Anyone who believes that the safety, financing and delivery of nuclear power are bigger problems than the threats posed by climate change has lost all sense of proportion.

Oliver Morton’s article is not really about environmental imperatives, but even on the economic and public risk fronts, it sorely lacks this crucial sense of proportion. His essay also fails to address the practicalities of the cost and energy supply problems facing a world without fossil fuels. So I ask, how realistic is The Economist about this critical global issue?

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Footnote

Some interesting articles from last week that provide a more grounded perspective include:

(NPR) Trauma, Not Radiation, Is Key Concern In Japan

(NatureJapan’s nuclear crisis: Fukushima’s legacy of fear

Also worth reading is the testimony of the leading American radiation expert John Boice, and the transcripts from the Health Physics Society press conference on March 1 (also summarised here).