Why Britain Still Needs Nuclear Energy
Writing exclusively for The House Magazine ahead of Conservative Party Conference, Tim Yeo outlines the importance of nuclear energy to any future mix.
The fall in the price of renewable energy is welcome. An end to subsidies is now in sight and can be accelerated by allocating future support through technology blind competitive auctions. If the Government encouraged onshore wind where it is acceptable to local communities new subsidy awards could be phased out before 2020.
The unexpectedly low strike price of £57.50 for offshore wind in last month’s second CfD auction round has led to claims that new nuclear plants are no longer either competitive or necessary. This conclusion is wrong for three reasons.
Firstly until affordable flexible, large scale and long term electricity storage is available no government can allow consumers to be dependent on intermittent sources of energy. Modern domestic and business life requires a continuous supply of electricity which solar and wind can’t guarantee. Nuclear remains the only low carbon large scale source of baseload electricity.
Secondly headline strike prices exclude the cost of grid connections, which for offshore wind can add as much as £10 per megawatt hour to the price, and of the back up generation capacity which intermittent renewables need. Factoring these costs into comparisons makes nuclear and other low carbon technologies look more competitive.
Thirdly the cost of nuclear is also falling despite the need to meet more stringent safety and environmental standards than any other energy industry. The Hinkley Point C strike price of £92.50 was agreed four years ago and is now irrelevant to negotiations for future nuclear plant.
Nuclear and renewables are complementary, not alternatives. But investment in new nuclear capacity will only occur if new plants generate subsidy free electricity at prices which are competitive with the actual cost of renewables. The good news is that the latest offerings from Chinese, South Korean and Russian vendors already are.
CGN has entered the Office of Nuclear Regulation’s Generic Design Assessment process with a view to building plant at Bradwell. Kepco and CGN are in talks with Toshiba about NuGen’s Moorside project. At the World Nuclear Association Symposium in London earlier this month Russia’s Rosatom, which is now building more of the latest generation reactors across the globe than all other vendors combined, made a strong case for how the economies of scale reinforce the competitiveness of nuclear.
Using Chinese, South Korean or Russian nuclear technologies raises issues of public and political acceptability. New Nuclear Watch Europe has suggested four criteria which should be met before they can be deployed in Britain.
Firstly the technology must be approved by the ONR; secondly the shareholding of any non-EEA state controlled entities must be less than 40%; thirdly operational control must remain with EEA companies or organisations; and fourthly IT control systems must be supplied by a trusted British vendor.
Greg Clark can cut energy costs and meet climate targets by opening Britain to any projects which meet all these criteria and thereby trigger a competitive bidding process from which British consumers will benefit.