Creating Value for Money in new nuclear
The cost of energy is a long-running debate which has been thrown into sharp focus in recent weeks by the collapsing oil price. Obviously this fall has been positive for consumers and most businesses but we can’t rely on it staying down near $50 a barrel forever. Nuclear on the other hand is still relatively expensive but has the potential to be sustainably lower without the wild (and sometimes damaging) fluctuations that the price of oil and gas can bring to the world economy.
Part of NNWE’s remit is to highlight the need for the cost of new nuclear to be more competitive and for Value for Money (VFM) to be considered at all times too. New nuclear power achieves two of the three aims of energy policy by promoting energy security and cutting carbon emissions but it currently struggles on the third aim of affordability. Electricity generated by new nuclear is more expensive than coal or gas and will remain so for the immediate future in the absence of a carbon price which is much higher than anything currently envisaged. New nuclear is also more expensive than some renewables such as solar and onshore wind, both of which will become cheaper in the next few years, though its ability to provide baseload power justifies a premium over these intermittent sources. Stressing the need for nuclear to offer better VFM shows policy makers and consumers that we recognise that the cost of new nuclear is one of the obstacles to its deployment
Adhering to NNWE’s first principle, namely the importance of using, wherever possible, technology that has been tried and tested in commercial use, promotes VFM. First of a kind technology often tends to be very expensive as the current problems besetting Hinkley Point C reflect. Winning wider public acceptance for new nuclear will be helped by a laser-like emphasis on reducing it’s costs so that it can compete with fossil fuels and renewable energy and enjoy a strong and sustainable future. We believe that using tried and tested technology helps to meet this aim. VFM is an area NNWE will be focusing on.