By Kathryn Porter, Watt-Logic

I have written a paper for the Global Warming Policy Foundation (“GWPF”) outlining the prospects for nuclear power in GB. The draft paper is now out for an open review process on the GWPF website here: https://www.thegwpf.org/open-peer-review-prospects-for-nuclear-generation-in-great-britain/

In writing this paper, I have set out the market as it is, describing the opportunities as they currently exist. Some early reviews suggest I should go further and make recommendations as to how these opportunities could be improved though policy change – I am open to doing this subject to the agreement of the GWPF, although it does somewhat change the nature of the paper.

It was a surprisingly challenging exercise. As anyone who has ever visited the .gov website will know, the site organisation and tagging is almost non-existent. It isn’t possible to go to the DESNZ website and find a handy menu which includes “nuclear” under which all relevant initiatives are neatly filed. Some of the policy strands I came across by accident through references in other documents. So if I have missed anything I would be grateful for the heads-up!

If you would like to comment on the paper, please visit the GWPF website – do not comment here (I am disabling comments for this post), as the comments will be collated and moderated by The GWPF before they are passed to me. (The moderation will simply be to remove comments which are irrelevant ie not about the paper, or abusive in any way.) There is also an option for reviews to remain anonymous, although the GWPF will need to know who you are!

Prospects for nuclear generation in Great Britain

Executive Summary
The UK Government has renewed its commitment to nuclear power alongside an arguably stronger commitment to intermittent renewable generation, and in particular, wind power. Given the extreme variability of wind output from close to zero to potentially close to 100% of demand at any time, and the uncertainty created by the Russian invasion of Ukraine, the Government’s commitment to nuclear power has strengthened significantly in recent years.

However, while this is superficially positive, the Government is still too tentative in its ambitions. It intends to see one new large-scale nuclear power station reach its Final Investment Decision by the end of this Parliament (likely to be next year), but the only contender is Sizewell C, a European Pressurised Water (“EPR”) reactor of a type its developer EDF has struggled to deliver elsewhere. At the same time, the existing fleet of Advanced Gas Cooled Reactors (“AGRs”) is expected to close by March 2028, leaving only the Sizewell B Pressurised Water Reactor (“PWR”) running until the new EPR at Hinkley Point C opens, now expected to be in September 2028.

The Government has shown an interest in Small Modular Reactors (“SMRs”) and Advanced Modular Reactors (“AMRs”) with a particular focus on High Temperature Gas Reactors (“HTGRs) whose high output temperatures could have a range of industrial applications including the production of hydrogen. None is expected to enter service before the next decade, and so far only one SMR design from Rolls Royce has begun the process to secure a Generic Design Assessment from the Office for Nuclear Regulation (“ONR”).

Nuclear power is low carbon and not intermittent, and is capable of being developed at scale, delivering very large energy outputs from small sites. SMRs and smaller micro-reactors could power remote, de-centralised sites and power heavy industry with minimal on-site operational requirements, and Fast Neutron Reactors (“FNRs”) offer the prospect of greater fuel security and reduced waste considerations. However, the capital costs of conventional large-scale nuclear projects are very high, and largely outside the range of the private sector, absent significant state support. Decades of under-investment have seen a major skills exodus across Western nuclear nations and a slowing in the development of advanced nuclear technologies, where China, Russia and India have taken the lead.

The Government has made moves to leverage the work of well-regarded regulators in friendly nations – it should build on this commitment to accelerate the approvals process for new reactor designs. And it should accelerate research into advanced technologies, particularly in the sphere of alternative fuel models to address concerns over uranium supplies.

The economic opportunities for nuclear power in GB are mixed. The Government hopes that the new Regulated Asset Base (“RAB”) model will attract investor interest by increasing income certainty and transferring some risks to consumers. However, Ofgem has been designated as the economic regulator and its track record in setting consistent and effective price controls for gas and electricity network operators has been mixed. The regulator is under significant pressure to contain energy company profits, which may make nuclear developers nervous about the model and how it may operate in practice.

Arguably, the Government should not shy away from direct investments in new nuclear projects, filling the gaps the private sector seems reluctant to fill – private investors are not expected to fund physical security in terms of the military or the police, this is done by the state. Perhaps the state should directly fund at least some portion of energy security as well.

Britain should be an attractive market for nuclear projects, but in its determination both to avoid adding costs to the Government balance sheet, and any perception of delivering poor value for money, the Government has failed to create the necessary conditions for new projects to flourish. The advancing closure of the AGR fleet, and over-arching climate ambitions make it vital that a more robust approach is taken to securing the next generation of nuclear reactors in Britain.

Original article   l   KeyFacts Energy Industry Directory: Watt-Logic