What role for nuclear energy?

By Luis E. Echávarri, Director-General, OECD Nuclear Energy Agency

This article is taken from G8 Summit 2007 - Growth and Responsibility, published by Newsdesk Communications Ltd (www.newsdeskmedia.com).

Today, nuclear energy is a significant component of world electricity supply. Four hundred and thirty reactors are connected to the grids in some 30 countries providing around 16% of the electricity consumed worldwide and almost one-quarter in OECD countries. Globally, the technical, environmental and economic performance of nuclear power plants in operation is very satisfactory. Improvements in safety and reliability of current-generation nuclear systems are demonstrated by fewer unplanned shut-downs, lower collective dose to workers and reduced probability of severe accidents.

Around 60% of the nuclear power plants in operation are less than 25 years old and will continue to operate for several decades. This means that nuclear power plants will remain part of the energy supply landscape for many years. The role of nuclear energy in the longer term has to be examined in the overall context of supply/demand balance at the world level. The need for more energy is recognised broadly by analysts and policy makers. According to the reference scenario of the International Energy Agency (IEA), the world demand for primary energy will increase by 50% between now and 2030 and its electricity consumption will nearly double.1 Governments are considering, and could take, policy measures to slow down demand growth but significant increases are inevitable, in particular in developing countries.

Security of energy supply is a burning issue for OECD countries and is vital for developing countries where lack of energy may mean economic stagnation, continued poverty and shorter life expectancy. Against this backdrop, the challenge for energy policy makers is not to select between fossil, nuclear and renewable sources, or between supply measures and energy conservation, but to make sure that all sources and all energy-saving means are used effectively taking into account their environmental, social and economic characteristics.

Policy makers responsible for driving national decisions should face the challenge of making the right trade-offs between risks and benefits of alternatives taking into account their specific situations, goals and priorities. Security of energy supply and global climate change are key concerns for civil society and accordingly are driving factors in policy decisions. Consequently, the role of nuclear energy in future supply mixes will depend largely on its ability to address both concerns in a cost-effective manner.

In terms of economics, the volatility and escalation of fossil fuel prices contribute to enhancing the attractiveness of nuclear electricity. With their very low running costs, nuclear power plants become the cheapest generation source once their capital costs are amortised. Furthermore, in terms of capital investments, the designs of new plants being built today benefit from decades of industrial experience which contributed to cost reductions.

In most countries relying on the nuclear option, the costs of generating nuclear electricity, which internalise safety, radiation protection and waste management and disposal, are competitive with alternatives. According to the study published in 2005 by the OECD,2 based on data provided by 21 countries on some 130 power plants, the average lifetime costs of generating electricity, levelised at 10% discount rate, for plants to be commissioned by 2010-2015 range between 30 and 50 US$/MWh for nuclear, 35 and 60 for coal and 40 and 63 for gas, with gas prices at around 4 US$/GJ.

The technology based on nuclear fission, allowing retrieval of energy from uranium, contributes to diversity and security of supply, adding a new resource to fossil and renewable energies. Uranium, the natural resource used for fuelling nuclear power plants, is an abundant commodity with no significant use other than energy. Uranium resources which have been identified - around 4.75 million tonnes - are sufficient to fuel the reactor fleet in operation today for some 85 years. Total conventional resources of uranium - some 14.8 million tonnes - represent 270 years of current annual consumption.3

Uranium-producing countries are located in various geopolitical regions of the world, preventing significant risk of market pressure resulting from abuse of producers' power. More than half of the world uranium production comes from two OECD countries: Canada and Australia. The other main producers include countries in transition, Kazakhstan and Russia for example, and African countries such as Namibia and Niger. This rather large distribution of supply sources is a guarantee of security which is lacking for hydrocarbons. In addition, security of nuclear fuel supply may be reinforced easily through inventory building. The low cost and small volume of nuclear fuel facilitate the accumulation of strategic inventories representing more than one year of consumption, protecting users from short-term supply disruption.

Furthermore, in the medium and long term, technology progress is expected to enhance the efficiency of nuclear energy systems, increasing the amount of energy retrieved per tonne of uranium and thereby easing the pressure on demand. The nuclear power plants now in operation already achieve higher burn-ups than reactors of previous generations, and even better use of uranium will be obtained with evolutionary advanced water reactors under construction. In the longer term, advanced fast neutron systems under development will offer more drastic improvements through recycling of fissile materials and breeding, multiplying the lifetime of conventional uranium resources by 30 or more.

The role of technology progress in enhancing the efficiency of uranium use is a means to reinforce security of supply and is also very important because efficient use of natural uranium resources reduces environmental impacts from uranium mining and waste management and disposal. Reductions of waste volumes and radiotoxicity by more than one order of magnitude are expected to be obtained with the development of fourth-generation nuclear systems with closed fuel cycles that will respond better to the environmental and social goals of sustainable development.

Global climate change, like security of energy supply, is very high on the agenda of civil society and government policy makers. The energy sector, a major source of greenhouse gas (GHG) emissions, has a key role to play in alleviating the risk of global warming. Very stringent policy measures are needed to curb the GHG emissions of the energy sector. There is no unique solution to the problem but a combination of energy conservation measures, carbon-free energy sources and carbon capture and sequestration methods will be required to address the issue adequately.

Nuclear energy is a nearly carbon-free source, with only minute secondary emissions of carbon dioxide resulting from some fuel cycle steps and processes included in the life cycle of nuclear facilities. Per kWh of electricity generated, the nuclear energy chain emits 2.5 to 5.7 grammes of carbon equivalent as compared to 100 to 350 for fossil fuel chains and 2.5 to 75 for various renewable energy chains.4 Therefore, substituting nuclear power plants for fossil-fuelled units can significantly reduce the carbon intensity of the electricity sector.

The present use of nuclear energy is confined nearly exclusively to electricity generation. By maintaining or increasing its share in total electricity supply, nuclear energy could help alleviate the tensions on the natural gas market and the risk of global climate change. The rate of construction of nuclear power plants in the early 1980s demonstrates that doubling the world installed nuclear capacity within 30 years is technically feasible, provided adequate policies are implemented by governments wishing to rely on the nuclear option.

Besides its contribution to electricity supply, which could be increased significantly in many countries, nuclear energy has the potential to broaden its market to non-electricity applications. Nuclear reactors produce heat which can be used directly for process or district heating, to desalinate water or to produce hydrogen by different means, from electrolysis to chemical decomposition of water. It offers opportunities for the nuclear option to play a major role in policies to address security of supply and global climate change issues.

However, in spite of the recognised advantages of the nuclear option and of renewed interest of government and industry policy makers in nuclear energy, decisions to build new nuclear power plants remain scarce, except in countries with a long tradition of reliance on nuclear energy. The reluctance of investors to embark on capital-intensive projects with long amortisation times is not unique to nuclear energy, but it raises specific concerns requiring government involvement to be addressed.

Nuclear energy projects raise financial, regulatory and socio-political risks. Government leadership, which is essential in energy policy making, is particularly important for alleviating the risks specific to nuclear energy. Stable national regulatory and policy frameworks are a prerequisite to attract investors in nuclear projects. The role of international co-operation is also important to facilitate technology adaptation and transfer, and security of fuel cycle service supply in the respect of non-proliferation criteria.

The issue of radioactive waste management and disposal illustrates the social dimension of nuclear risks. Experts agree that the safe disposal of all types of radioactive waste in a manner that protects present and future generations and the environment is technically feasible at acceptable costs. However, the implementation of repositories has proven to be challenged by civil society concerns at the local and national levels. Progress being made in several countries, such as Finland, towards the construction of a repository for high-level waste is a key contribution to the future development of nuclear energy.

Technology progress is essential, together with policy measures, for ensuring that the future role of nuclear energy will correspond to the needs of society. Several decades of industrial experience with commercial nuclear power plants and fuel cycle facilities are already providing today the base for designing and implementing advanced systems responding to the requirements of the 21st  century. Evolutionary nuclear power plants under construction in several countries integrate significant, enhanced safety features and improvements leading to higher availability factors, lower uranium consumption and reduced waste streams, and decreased costs.

For the longer term, national and international R&D programmes devoted to the development of a fourth generation of nuclear systems are aiming at achieving even more ambitious goals in terms of safety, economics, resource management, proliferation resistance and physical protection.5 Those systems, which are expected to be available on the market by 2020-2030, will be ready on time to replace obsolete nuclear units and face increased electricity demand.

Addressing simultaneously security of energy supply, global climate change threat and socio-economic goals of the 21st century is a major challenge for policy makers worldwide. Without effectively combining technology and policy measures, reaching the objective of sustainable development will not be possible. Nuclear energy is one option among others which can play a significant role in secure, carbon-free and competitive supply of energy on a large scale. Governments interested in the nuclear option should ensure that the policy frameworks in place in their respective countries are adequate for the timely implementation of nuclear systems.

International organisations such as the OECD Nuclear Energy Agency have a major role to play in facilitating exchange of information between countries, strengthening multinational co-operation, helping in the development of consensus on key issues and supporting joint endeavours such as the Generation IV International Forum, aiming at developing future-generation nuclear systems, or the Multinational Design Evaluation Programme, which is an initiative of top regulators to promote the exchange of information and the harmonisation of approaches to safety reviews of advanced systems.

Notes

1. International Energy Agency (2006), World Energy Outlook 2006, OECD, Paris, France.

2. OECD Nuclear Energy Agency and International Energy Agency (2005), Projected Costs of Generating Electricity: 2005 Update, OECD, Paris, France.

3. OECD Nuclear Energy Agency and International Atomic Energy Agency (2006), Uranium 2005: Resources, Production and Demand, OECD, Paris, France.

4. Spadaro, J.V. et al. (2000), Greenhouse gas emissions of electricity generation chains: Assessing the difference, IAEA Bulletin, 42/2/2000, IAEA, Vienna, Austria .

5. Generation IV International Forum (2003), A Technology Roadmap for Generation IV Nuclear Energy Systems, USDOE, Washington, DC, USA.


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G8 Summit official website

OECD G8 website