1 Aug (NucNet): The UK government’s decision to procure a two-unit, 3.2 GW nuclear power station at Hinkley Point C is a big risk, but also represents a crucial opportunity for the conventional nuclear industry, which is under significant financial stress, to rebuild itself, a briefing paper by researchers at Imperial College London said.
The successful completion of two EPR units supplied by EDF at Hinkley Point C and reductions in the cost of subsequent nuclear power stations will be critical for the future of the industry in the UK, said the paper, published by Imperial College’s Grantham Institute - Climate Change and Environment.
“UK government policy supports a new programme of nuclear power and the recent agreement to guarantee the price of electricity from Hinkley Point C is a major first step,” the paper said. “Much will depend on the successful construction of this station. There are four other proposals for nuclear power stations in the UK. Unless costs can be significantly reduced these will prove more expensive than solar or wind energy.”
Cost is probably the most controversial aspect of nuclear power in the UK today, the paper said. To get Hinkley Point C agreed the government has guaranteed an index linked price for its power, of £92.50 (2012 prices) per MWh over 35 years. This is more than twice the current wholesale price of electricity in the UK. It is also significantly above the prices of £74.75 for 2021/22 projects and £57.50 for 2022/23 projects for offshore wind. If the Sizewell EPR goes ahead the contract price of Hinkley Point C will be reduced to £89.50 per MWh.
There is no simple comparison with the cost of offshore wind, the paper concluded. Hinkley Point C will provide reliable power, whereas offshore wind power is intermittent. The Hinkley Point C price guarantee runs for 35 years whereas the offshore wind guarantee is only 15 years.
“On the other hand, Hinkley Point C will probably have at least 30 years of life after the price guarantee has ended, whereas the post-subsidy life of wind farms is expected to be much shorter.”
According to the paper, nuclear power will be essential for meeting the UK’s greenhouse gas emissions reduction target, unless the country can adapt to depend largely on variable wind and solar, or there is a breakthrough in the commercialisation of carbon capture and storage.
It said the need for nuclear may be greater if electricity becomes the preferred low-carbon solution for transport and heat.
The paper concluded that investment in nuclear power is “risky”. Nuclear power stations take time to build and require heavy up-front investment, but should last for 60 years or more. In the US and Europe the cost of new builds has been high and construction performance troubled. “As a result, it is difficult to attract private investment,” the paper said.
It said the UK may regret building nuclear power stations if the cost of renewables continues to fall and we find solutions to the problem of the variability of these generation sources. “On the other hand, if progress in reducing the costs of energy storage is insufficient, we may not be able to achieve climate targets without new nuclear generation capacity.”.
Small modular reactors (SMRs), currently being assessed by the UK government, could be largely factory built and less prone to construction delays than larger plants. The smaller unit size should make them easier to finance and more flexible to deploy.
The paper said advanced reactor concepts, including advanced SMRs, are under development for the longer term. These aim to deliver low-carbon energy solutions, such as high-grade heat for industrial processes, as well as improved economics and safety.
The paper is online: https://bit.ly/2M7XV28
