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The nuclear option returns

Net-zero targets make nuclear energy a credible option – if it can resolve safety, cost and other concerns.

Nuclear energy has had a chequered history. But as the world targets net-zero emissions, it is re-emerging as a potential decarbonisation option.

The electrification of energy-consuming activities such as transport, heating homes and powering industry is a cornerstone of decarbonisation. Global electricity use is forecast to double by 2050, but while nuclear can play a role in meeting future increasing demand for low-carbon power, it needs almost to re-invent itself to do so.

Being zero-emissions is not enough. Nuclear must emphasise its distinctive strengths, which other energy routes cannot offer – low-carbon, large-scale, baseload electricity generation – and address its unique weaknesses, including costs, safety, reliability, waste, and financing issues.

For many, nuclear’s negative characteristics – particularly waste and safety – make it a non-starter. But ignoring a proven and large-scale low-carbon technology makes hitting net-zero even harder.

The 440 nuclear power reactors in 35 countries make nuclear second only to hydropower as a low-carbon energy source for generating electricity. It generated more electricity than wind and solar combined in 2020: they will overshadow nuclear by 2050, but its share of global energy supply could still grow from 5 per cent to 12 per cent.

However, global capacity has been flat for two decades, with renewables’ rapidly falling cost among the factors deterring expansion. New plants in emerging and developing nations such as mainland China, India, Russia and the Middle East have been offset by closures in developed countries – though some developing countries see reactors as a solution to growing energy demands rather than a way to tackle climate change.

That trend looks likely to continue, with mainland China expected to account for almost half the world’s 500GW capacity by 2050 – though the International Energy Agency’s net-zero scenario requires capacity to exceed 800GW, implying additional investment exceeding USD1 trillion.

Unlike wind and solar, nuclear provides a continuous low-carbon energy supply. It is also less exposed to volatile global energy commodity markets like oil, natural gas and coal – though unrest in Kazakhstan, the world’s largest uranium producer, highlights other risks – and nuclear’s large-scale can make countries dependent on very few plants.

The Fukushima disaster, Chernobyl and Three Mile Island continue to loom large over the industry and its safety reputation; handling and storing hazardous toxic waste is also a pertinent ongoing concern.

Following Fukushima, Germany decided to end nuclear generation by 2022; Italy has rejected reviving nuclear and Belgium is phasing it out. Safety improvements and increased design complexity have lengthened completion times causing costs to soar and we expect no new nuclear reactors in Europe will attract sufficient financing without some sort of guaranteed (and often high) selling price for the electricity generated.

Nuclear advocates claim it is cost competitive, but while low fuel and staffing costs mean operating expenses are relatively small per unit of electricity, the upfront construction costs are high and numerous projects have been late and overrun budgets.

Current reactors are fission-based but oil giants are investing in nuclear fusion, which does not rely on uranium or produce radioactive waste, hoping it can become commercial. South Korea aims to have fusion-powered generation by 2050.

There is also interest in small modular nuclear reactors whose standardisation would make construction easier and cheaper. They aim to capture nuclear’s positives while limiting the pitfalls of large-scale plants. But even if they deliver on-time and on-budget, an established presence is unlikely before the 2030s.

Global decarbonisation has thrown open the possibility of a nuclear revival. But while new energy technologies have to battle to convince sceptics of their feasibility, nuclear has to win over those who are cautious of its past.

First published 26th January 2022.
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