Autumn Number 2019

The 'Nuclear Power' Myth is Crumbling

Pradip Datta

Anew study published by the German Institute for Economic Research reviewed the development of 674 nuclear power plants built since 1951 found that none of the plants was built using private capital under competitive conditions. When nuclear power plants were built using private investment, large state subsidies were used to make the project viable, and in most cases, nuclear power stations were built at a loss. The report on economics of nuclear power has found that nuclear power has never been financially viable, finding that most plants have been built while heavily subsidised by governments, and often motivated by military purposes.

Throughout the last two decades it was campaigned that nuclear power is an important option to replace coal-fired electricity. No longer is it playing that role. Non-hydro renewables generate over 3,000TWh more power than a decade ago, while nuclear produces less (TWh=terawatt-hours, equivalent to one billion kilowatt-hours).It is worthwhile to mention that, apart from destroying biodiversity throughout its life cycle nuclear power produces up to 37 times the emissions of renewable energy sources, owing partly to the mining and refining of uranium.

Profound changes have occurred in the structure of global energy supply and demand. The annual increase in power generation by wind and solar sources has independently surpassed that of nuclear. Solar and wind energy are now the cheapest grid-connected sources of energy in almost all countries. The electricity system is becoming more decentralised with smaller incremental investments by utilities, industries and households. They are becoming producers as well as consumers of power. Globally, wind power output grew by 17% in 2017, solar by 35%, but nuclear by 1%. Out of total estimated capacity increase of about 257GW, 157GW was renewable. Wind added 52GW and solar PV 97GW, while nuclear power capacity increased only by 7GW in 2017 and first half of 2018. In 2018 wind power capacity reached 564GW while solar was 480GW. Wind capacity increased by 49GW and solar capacity 94GW. Renewables in total added 171GW.

On the other hand the number of nuclear reactors under construction in the world has been steadily decreasing for the last five years. The share of global nuclear electricity production decreased from a peak of 17.5 percent in 1996 to 10.3 percent in 2017. Global reported investment for the construction started in 2017 of the four commercial nuclear reactor projects is nearly US$16 billion for about 4 GW. Renewable energy investment was US$280 billion, including over US$100 billion in wind power and US$160 billion in solar photovoltaic's (PV). China alone invested US$126 billion. Although the top line of the IEA report is that energy investment in general is falling short—renewable spending needs to double by 2025 to get the world on track below 2 degrees of warming.

Recently the International Institute for Sustainable Development (IISD) report found that coal, oil and gas get more than $370 billion a year in support, compared with $100 billion for renewables, Just 10-30% of the fossil fuel subsidies would pay for a global transition to clean energy, the IISD said. Taking away subsidies from fossil fuels and channelling them towards clean energy would boost their development at a much faster pace, and help secure climate goals. The transition from polluting fossil fuels to clean energy is already under way. Annual investment in renewables has been greater than that in fossil fuel electricity generation since 2008 and new renewable capacity has exceeded fossil fuel power each year since 2014.

As of 1 July 2018, a total of 413 nuclear reactors are operating in 31 countries with a total electric capacity of 363.4GW. The International Atomic Energy Agency (IAEA) continues to count 42 units in Japan in its total number of 453 reactors "in operation" while only nine reactors were operating there. The attitude shown by the IAEA by considering the entire stranded reactor fleet in the country as "operational" is misleading. Including reactors as "operable" when they have not generated power for many years is clearly ridiculous and deplorable. This fabrication of facts show their desperation to show nuclear power is growing.

Seven years after the Fukushima disaster, Japan had restarted five units by the end of 2017 and nine by February 2019. As of mid-2018, 32 reactors-including 26 in Japan-are in Long-Term Outage (LTO). A nuclear reactor is considered in Long-term Outage or LTO if it has not generated any electricity in the previous calendar year and in the first half of the current calendar year. It is withdrawn from operational status from the day it has been disconnected from the grid.

In China, as in the previous five years, in 2017, electricity production from wind alone (286TWh) exceeded that from nuclear (233TWh). The same phenomenon is seen in India, where wind power (53TWh) outpaced nuclear-stagnating at 35TWh-for the second year in a row. China, India, Brazil, Germany, Japan, Mexico, Netherlands, Spain and U.K generated more electricity in 2017 and 2018 from non-hydro renewables than from nuclear power.

The nuclear industry seems perplexed by these developments. As the competitiveness of solar and wind energy become undeniable the nuclear industry shifts the debate away from the costs of nuclear power to issues of system reliability and to its role in the transition to a low-carbon economy.

Nuclear power is simply not competitive under ordinary market economy rules anywhere. In the U.S., many reactors are threatened to be shutdown long before their licenses expire because they cannot compete in the market. A recent paper published by the Proceedings of the National Academy of Sciences in the US concluded that "because of their great cost and complexity, it appears most unlikely that any new large plants will be built over the next several decades". So the recent revelation by the Wall Street Journal is not surprising. "A major donor to President Trump agreed to pay US$10 million to the president's then-personal attorney if he successfully helped obtain funding for a nuclear-power project, including a $5 billion loan from the U.S. government…", just day before federal agents raided the lawyer's office.

Another major barrier to nuclear power development or its survival is the time factor. The WNSR cited a good example. In June 2018, Siemens completed connection of 14.4GW of turnkey natural gas combined cycle power capacity to the grid in Egypt, 27.5 months after construction started, three years after contract was signed. The next step is the implementation of setting up of 2GW capacity wind turbines, part of the goal of 7.2GW wind power capacity by 2020. This is a new benchmark to compare with all of the 14 nuclear reactors started operating in the world in 2016 and 2017 with a total capacity of 13GW and an average construction time of 6.4 years, excluding the record holder Watts-Bar-2 where construction work was going on for 43.5 years.

Nuclear power plants need vast amounts of cooling water. It is estimated that in France 51 percent of freshwater is consumed by nuclear power plants. No other electricity generating source needs more water than nuclear energy. Four reactor sites along French rivers has 10 reactors with no cooling towers They return about 90 percent back to the environment, but significantly heated up.

The past few years have seen the bankruptcy of nuclear energy industries: the U.S./Japan's Westinghouse and France's AREVA, which has had to be taken over by another state-owned enterprise EDF (Electricite de France). There are fewer and fewer nuclear technology vendors.

In 2007 Areva, the then nuclear power company of France, began construction of the first EPR project in Flamanville in France in 2007. And they started aggressively marketing the technology to customers around the world. But the Flamanville project has exceeded budgets repeatedly and innumerable safety audits continue after repeated incidents in the construction phase itself.

In 2015, the French nuclear safety agency said it had detected a very serious fault in the reactor vessel at Flamanville, causing outrage against the project. The French government has since announced its aim of bringing nuclear power's share in the electricity mix down from the current 75 per cent to about 50 per cent. The French Nuclear Safety Agency, ASN ordered EDF, the constructor of the plant, to repair at least eight key welded joints.

Barely a fortnight after an independent audit has been ordered into the entire European Pressurised Reactor (EPR) project. The audit puts a huge question mark on the project. The Flamanville reactor was due to be operational by 2012 at a cost of Euro 3.3 billion, showcasing a European Pressurised Reactor. The end of 2022 is now the earliest starts date with the project costs already exceeding Euro10.9 billion.

The construction of world's first EPR began in 2003 at Olkiluoto-3 in Finland, expected to be completed in 2009. The project has also suffered numerous delays and the latest pushback was announced in late November. The cost of Olikiluoto was estimated at 3 billion Euros, but Areva in 2012 estimated the cost at about 8.5 billion Euros. Since then it has not updated cost projection.

And that is a problem. For now, the heat wave is only a secondary problem for the industry. Operators in several countries, including Finland, France, Germany, Sweden and Switzerland, had to put operational restrictions on some of their nuclear power plants. While in most cases the output of the reactors were reduced to about 10 percent, some reactors were shut down, at least four reactors in France, to deal with the problem.

Nuclear is becoming an option for fewer countries, and only to those that are prepared to offer significant government support or in states where nuclear power is produced by the states, like that in China and India. Nuclear weapon states remain the main proponents of nuclear power programmes. In China, due to the slow growth in demand for electricity, in combination with the rapid development of wind and solar power as well as the 'excessive' installed capacity of coal power, the need for nuclear power has already diminished considerably. The result is the cancellation of some nuclear programmes in the preparation phase, and delay of those under construction.

The annual amount of electricity generated by wind and solar energies is now level with and even higher than that from nuclear energy. True, the amount of electricity generated by China's non- hydropower renewable energy still makes up only a very small percentage of the entire amount.

However, the number of units globally under construction declined for the fifth year in a row, from 68 reactors at the end of 2013 to 50 by mid-2018, of which 16 are in China. Two reactors have been listed as "under construction" for more than 30 years in Slovakia. Four reactors have been listed as "under construction" for a decade or more, the Prototype Fast Breeder Reactor (PFBR) in India, the Olkiluoto reactor project in Finland, Shimane-3 in Japan and the French Flamanville-3 unit. At least 33 of the 50 units under construction are behind schedule, mostly by several years. China is no exception, at least half of 16 units under construction are delayed.
50 is a relatively small number compared to a peak of 234 units listed as under construction-totalling more than 200GW-in 1979. In China since December 2016 no construction of reactors has been started.

South Africa provides an interesting case study. It has only one nuclear power station, built by the French in the 1980s. Electricity generation expansion plans over the past decade showed nuclear did not feature in least-cost scenarios. The previous administration, under President Jacob Zuma, signed an agreement with Russia committing South Africa to invest in 9600MW of nuclear reactors, supplied by Rosatom. This agreement was struck down by the South African High Court. Fortunately, the new government has made a commitment to a least-cost energy and environmentally sustainable investment path.

For over last two decades worldwide nuclear power is in bad shape. Meanwhile coal-fired power has declined by nearly a quarter in Europe and almost 40 percent in North America over the past decade. But the change has been overwhelmed by a 63 percent increase in Asia and there's a further 236 gigawatts of plants under construction worldwide, according to the Global Coal Plant Tracker. Final investment decisions for coal plants have fallen by about three-quarters over the past three years, from about 88GW over the course of 2015 to around 22GW in 2018.Some 30GW of generators were retired last year, so more capacity was closed in 2018 than was approved possibly the first time since the 19th century.

Announced coal retirement plans in the US, Europe and India alone are enough to offset all plants currently under construction. Europe will retire 100 GW capacity, US 86 GW; India 48GW capacity. Even China—which accounts for more than half of the construction pipeline, with 129GW underway—is slowing down. It shutters between 5GW and 10GW of coal every year, and added just 4GW of net capacity last year.

Plant utilisation is at low levels in most of the world's major coal markets because over-investment and inroads being made by renewables and gas are forcing generators to switch off furnaces for longer and longer stretches. The UK, for instance, just went without coal-fired electricity for a week. In countries like India and China where over-investment is the main problem and electricity consumption is still increasing, it's just possible that overall coal-fired generation could rise as energy demand climbs to align with the supply that's already built.

In 2008, India and France had decided to collaborate in setting up six units of 1650 MW nuclear power plant at Jaitapur in Ratnagiri district of Maharashtra. The construction was supposed to be completed in five years. Total cost was estimated Euro 3.3 billion for a single reactor. It has already taken 12 years and the cost has escalated to almost Euro 11 billion. Now on 10 July, 2019 the government stated in Loksabha that discussion is in progress with EDF to arrive at a project proposal. The latest delay and the audit of EPR projects expected to have a serious impact on India-based Jaitapur nuclear power plant.

The entire energy scenario in India also has changed over the last decade, making Jaitapur look more like a white elephant. In the last 10 years, the mismatch in energy demand and supply has been almost bridged and as a result many proposed power plants- coal, gas, nuclear- have stayed on the drawing board.

In the last few years, solar energy generation in India has risen sharply. Solar energy production has been made at extremely low prices. As a result, power producers are selling electricity at to Rs 2.5 a unit to Rs 3 per kwh, Renewable excluding hydro is now having 22% of the total electric capacity. At the end of March 2019 India's total capacity stood at 358 GW, renewable accounted for 80 GW. Solar capacity has reached 30 GW, wind 35 GW, Large hydro 45.3 GW, small hydro 4.6 GW and coal 194 GW, while nuclear electric capacity accounted for 6.78 GW. There are 22 nuclear power plants in 7 nuclear countries. 7 more reactors are under construction which would add 4.3 GW in future.

In this situation, it becomes impossible to justify prices that are triple or more, as in the case of Jaitapur. In the decade since the announcement, there has been little progress on the project and in the global energy scenario has been changed that raises questions about the feasibility and the need for such a large nuclear power project. Even in 2009, the cost of electricity produced at Jaitapur was estimated at around Rs 9 a kwh, nearly thrice the price of power from a coal-fired thermal power plant. Currently, an Indian designed reactor costs about 2 million Euros per MW, translating into Euro 3.3 billion for 1650 MW. Flamanville has already crossed three of that for the same capacity.

References
1.      "Nuclear energy is never profitable", new study slams nuclear power business case, Michael Mazengarb 29 July 2019, https://reneweconomy.com.au/nuclear-energy-is-never-profitable-new-study-slams-nuclear-power-business-case-49596/
2.      World Nuclear Industry Status Report (WNISR) 2018.
3.      Renewable Energy Capacity Statistics 2018—IRENA
4.      Linda Rogers, Iain Climie, Nuclear power is helping to drive the climate crisis, The Guardian, 2 July, 2019.
5.      Michael Rthfeld, Rebeca Ballhans, Jolazzolo, Top Trump donor agreed to pay Michael Cohen $ 11 million for nuclear project push, Aug 2, 2018, The Wall Street Journal.
6.      David Fickling, The world's last coal plant will soon be built, May 15, 2019, Bloomberg.
7.      Damian Carrington, Just 10% of fossil fuel subsidy cash 'could pay for green transition' The Guardian, 1 Aug 2019.
8.      EDF admits huge Flamanville setback, https://www.energy-reporters.com/transmission/edf-admits-huge-flamanville-setback/
9.      Question mark on fate of Jaitapur N-power plant as France orders technology audit, IANS, July 08, 2019.
10.        Pratheeksha, India's solar capacity reaches 30 GW milestones, May 7, 2019, Mercom India.

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Frontier
Autumn Number 2019
Vol. 52, No. 13 - 16, Sep 29 - October 26, 2019