Renew On Line (UK) 48

12. Nuclear News

De-nuke the EU - a way to go still

Not content with adopting a national nuclear phase out programme (the first plant closed recently), the German red-green government has decreed that Germany should not export nuclear power plant technology anywhere in the world. The interpretation of this however may be disputed. Siemens has bid to supply gas turbines for the planned new Finnish nuclear plant, arguing that these are not nuclear technology, even though, as the counter argument  has it, they have to be specially designed for the size of nuclear plants.  Meanwhile, Belgiums  commitment to phasing out its nuclear plants has meant that it is now looking at renewables very seriously, with ambitious plans for offshore wind. It currently obtains 57% of its electricity from nuclear power.

France has been having a national debate about what to do in relation to nuclear power- which supplies over 75% of its electricity.  When the red-green coalition government first came to power in 1997, it decided to halt the Super Phoenix Fast Breeder Reactor programme and in effect introduced a temporary moratorium on nuclear programmes generally.  Subsequently it has committed heavily to renewables- a decision that began to look even more reasonable after last summers problems with keeping the reactors cooled. Even so, with its large fleet of US styled Pressurised Water Reactors beginning to age (most were built in the 1970’s) a decision about replacements was needed.  Assuming the replacement were going to be nuclear, the front runner seems to be an upgraded PWR design called the European Pressurised Reactor- ‘EPR’. According to WISE (Nuclear Monitor 593), most of the French anti-nuclear groups declined to engage with the public debate, fearing that a decision had already been taken to adopt the EPR- the influence of the greens having diminished at the last election. Indeed there have been reports that three new nuclear  plants might be ordered - to start operating in 1997.  A decision should emerge shortly, in the context of a new comprehensive policy on energy outlined in a recent White paper.   Like the UK

’s White paper on Energy last year, this stressed renewables and CHP, but it also suggested that new nuclear plants should not be ruled out.   See www.debat-energie.gouv.fr

In the UK, where nuclear now supplies around 23% of electricity, we have moved on from debate to crisis.  Certainly things were looking pretty grim for the nuclear industry last Oct., when the governments deadline for a resolution of British Energy’s financial problems came up. The stakes were depicted as very high. Nuclear power proponent, Malcolm Grimston, of Imperial College London, warned that if British Energy went bust ‘the lights would go out this winter’  (BBC On Line) and the spectre of re-nationalisation loomed.

In the event neither of these things happened. As noted in Renew 147, BE’s financial crisis  was at least temporarily postponed by getting creditors and investors to accept some losses, and by the governments agreement to provide £3.9bn to help with clean-up costs. However the deal will leave equity shareholders with only 2.5% of the new company. Even Railtrack’s investors did better than that. Basically, under the new deal, they have been abandoned.  For their part, the major creditors have agreed to swap most of their debts, of over £1bn, for new bonds- and 97.5% of the equity, while the government will take on £3.9bn of BE’s nuclear liabilities, in return for 65% of the companies cashflow.

Although the deal had not been agreed by the EU under the state aid rules, British Energy’s shares edged up slightly to  5.38p- but that has to be compared to their peak value of 730p in 1999. The current value of the company is put at £33 m, compared to £5 bn at its peak.  It remains hopeful that things may improve. They could hardly get worse. It reported unaudited operating losses of £40m between April and the end of August 2003, but said that this was because its precarious financial position had forced it to sell 90% of its electricity at uncompetitive prices, with average price of £15.50 per megawatt hour, compared with the market rate of £19.70 per MWh. Part of the problem is that electricity prices have been pushed down by NETA. But whatever the reason, BE can hardly expect to carry on for long losing over £4 on each megawatt it sells and relying on government support- the direct cost of which will, according to the DTI, be £150- £200 m p.a. for the next 10 years,‘falling thereafter’.  In the event, with further losses due to problems with Sizewell and Heysham, the government has actually expanded the £200m loan it had agreed to provide for the current year to £275m.

Longer term, even more desperate measures may be needed to keep the company afloat. For example, at one stage, there were evidently plans (FT 22/9/03) to seek to extend the allowed operational life of the companies 8 plants by at least five years, thus providing continued income and deferring the cost of decomissioning.  Otherwise the closure programme was set to start in 2008, with all but one (the Sizewell B PWR) due to shut by 2023. Mike Alexander, BE chief executive, told the FT ‘if we achieve all the things we want to, and can make the safety case, we will be able to put forward a case to extend the lives of the plants.’

Time was when the UK nuclear industry talked assertively about new plant construction. Now they- and the government- seem to just be trying to hang on to what they have. Interestingly in this context, as well as containing a lot of other let-out clauses, the Governments ‘Restructuring Agreement’ with British Energy includes a mechanism by which the Government may ‘exercise an option to acquire the British Energy stations at the time  when British Energy plans to shut them, either to prolong their operation where it is economically advantageous to do so or decommission them within the public sector’.

4S Micro Nuclear

The nuclear industry may be facing difficulties in Europe (see above) but around the world it is still looking for market niches.   Japanese  corporation Toshiba is developing a very small 10MW liquid sodium cooled nuclear plant design which it wants to test in Alaska in the community of Galena on the Yukon River. According to the Anchorage Daily News (Oct 21, 2003) the developers claim that  the technology is ‘safe, simple and cheap enough to replace diesel-fired generators as the primary energy source for villages across rural Alaska’. They add it would also have enough excess power to create hydrogen gas, and envision Galena as a demonstration center for a local hydrogen economy, to power cars and trucks.  However, a working reactor is still 6-8 years away and development costs are put at $600m, although, once mass produced individual plants might cost $20m.

Toshiba calls its reactor the 4S system: super-safe, small and simple. The core would be built and sealed in a factory and transported by barge, truck or helicopter. It would then run for 30 years, without the need for an operator, and then be disposed off (but where?). However, as the Anchorage Daily News noted ‘a reactor of this type and size has never been built anywhere in the world, much less tested and licensed for use in the United States. The cost of building a prototype that meets stringent U.S. safety standards could kill it.’

So could  public opposition- it would be the first commercial use of nuclear power in Alaska. While some  environmental groups are keen to replace expensive diesel fuel (Galena uses  700,000 gallons  annually to generate electricity) others worry about accidents  and leaks.   But a US Federal study, published in May 2001, found that micro nukes could be inherently safe and easy to operate, resistant to sabotage or theft, cost effective and transportable.

For more new nuclear ideas, see the Technology section in Renew 148.