Extracts from NATTA's journal
Renew, issue 159 Jan-Feb 2006

3. New Energy Review

The government will give a ‘yes or no’ to nuclear power by the end of the year following a decision by Tony Blair to inject ‘greater urgency’ into the nuclear debate. ‘We have to now make government decisions so we can put proposals before the British people next year,’ said Alan Johnson, Secretary of State for Trade and Industry last Sept., following Blairs announcement of a new Energy Review, including nuclear power as an option, at the Labour Party Conference. Malcolm Wicks, energy minister, told the Financial Times (29 Sept): ‘Don’t think this government’s in the business of saying we’re going to become heavy subsidisers of nuclear energy, because we aren’t.’ But he conceded that industry and investors would need a ‘lead from government’ before they would commit to the idea.

Philip Dewhurst, chairman of the Nuclear Industry Association, said they were not looking for handouts: ‘We’re looking at things like planning and carbon taxes (on energy from fossil fuels) rather than holding our hands out to government. We don’t want direct subsidy. Given the huge price rises in other fuel sources, we believe nuclear is competitive.’ But Tony Juniper, executive director of Friends of the Earth, warned that a decision in favour of building nuclear stations would result in ‘the chancellor writing a big blank cheque’.

Despite these early shots in what looks like being a long battle, Wicks said the review would not be dominated by the lobbyists for either alternative energy sources or the nuclear industry, saying the decision would require an ‘evidence-based, grown up, serious, well-informed debate involving public opinion’. Wicks claimed that nuclear and renewables were complementary. ‘Some people are fearful that what Tony Blair said undermines the renewables industry. Well, it doesn’t. I’m confident that by 2020, we’re going to be getting 20% (of electricity) from renewables.’  He added that the decision to build new nuclear stations was not a foregone conclusion. ‘I happen to be nuclear-neutral and so is Alan Johnson. I think that’s helpful.’  But he somewhat undermined that later by telling the FT (26th Oct) that the DTI might consider letting nuclear share in the Renewables Obligation. Unless the RO was changed (and expanded) radically- something the DTI keeps saying can’t be done- that would crowd out renewables.  See below.  Details of the review emerged on Nov 29th when Tony Blair spoke (after an interruption by Greenpeace) at a CBI Conference: see below.

Energy Review- terms of reference

Energy Minister Malcolm Wicks has been asked to lead a Review of UK energy policy and report back by the ‘early summer’ with the aim of bringing forward proposals on energy policy. The Reviews scope will include ‘energy sources, electricity generation and energy consumption’. The DTI explained that ‘The Review will be informed by analysis and options drawn up by a Review team led by the Energy Minister Malcolm Wicks. This will be a team of officials drawn from key relevant departments and the Prime Minister’s Strategy Unit. In drawing up the analysis and options, the Energy Minister will undertake extensive public and stakeholder consultation. The Review will be taken forward in the context of the Government’s commitment to sound public finances. The Review team will report to the Prime Minister and the Secretary of State for Trade and Industry in early summer.’

The Terms of Reference are to ‘review the UK’s progress against the medium and long-term Energy White Paper goals and the options for further steps to achieve them. The aim will be to bring forward proposals on energy policy next year.’ The review will look at ‘all options including the role of current generating technologies (e.g. renewables, coal, gas and nuclear power) and new and emerging technologies (e.g. Carbon Capture and Storage). The Review will also consider transport and the role of energy efficiency.’  Overall it will ‘focus on policy measures to help us deliver our objectives beyond 2010. The Review will aim to ensure the UK is on track to meet the goals of the 2003 Energy White Paper in the medium and long term.’

Malcolm Wicks said: ‘The Energy Review is taking place against a background of strengthening evidence on the nature and extent of climate change and increasing concerns about the future security of UK energy supplies. This is the right moment to assess where we are in relation to achieving the goals set out in the 2003 Energy White Paper. The Review will explore all the options open to us taking into account the important international context. There will inevitably be some difficult decisions and trade offs to be made in arriving at the right package of policy proposals. It is crucial that we stimulate a wide-ranging and informed debate and engage the public, business and industry throughout the process as well as academic, private sector, scientific, NGO and other experts.’

Nuclear in the RO?

During an energy debate in the Lords on 27th Oct, Lord Sainsbury, the Science and Innovation Minister, agreed with the proposition that ‘nuclear is a renewable source of energy’. Responding to a Parliamentary Question on Nov 3rd, seeking clarification, Energy Minister Malcolm Wicks commented: ‘There is a technical debate about that. Certainly, nuclear energy shares some scientific characteristics with wind and solar energy. However, although there is a lot of uranium around, it is by definition not a renewable. In any case, those scientific distinctions do not have any impact on the different policy courses that we need to follow.’ And in an interview with the Financial Times (26th Oct) he indicated that the government would not rule out extending the renewables obligation to nuclear and other low carbon sources of energy, such as clean coal, although actually Wicks put it more discretely: since the aim was to reduce carbon emissions,  ‘shouldn’t we try to explore mechanisms which are technology neutral’.  But that puts nuclear in direct conflict with renewables. The FT commented ‘The ministerial willingness to consider a radical revamping of the renewables obligation is a victory for pro-nuclear lobbying’. Keith Parker, of the Nuclear Industry Association, told the The Times (Oct 31st) ‘Bringing nuclear power into the renewables obligation would restore investor confidence without diverting funds from other renewables,’ but its hard to see how- unless the RO targets were expanded dramatically, the large existing nuclear capacity would crowd out the so far small renewables contribution.

Prof Peter Smith from Nottingham University commented in a letter to the Times (1/11/05) that calling nuclear renewable made no sense, since ‘the fuel for nuclear energy is a diminishing resource which has to be mined and transported great distances’. He thought wind power was limited to about 5-6GW but argued that ‘It defies logic that a country with the best tidal energy potential in Europe has done so little to exploit the tried and tested technologies that could extract enough electricity from tidal currents, tidal estuaries and waves to more than meet the shortfall after the demise of present nuclear capacity’.

Given the inevitably limited financial resources, the conflict between nuclear and renewables seems likely to increase if they both try to expand, not least since there are also operational market conflicts.  For example, they will be in direct competition for electricity supply on summer nights and, at some point,  renewables like wind could potentially supply all the demand  cheaply, thus undermining the economics of nuclear plants- which need to be run continuously. To give nuclear room to operate, some complicated protection arrangements would have to be introduced- a segmented market?

EAC Energy Review

As, in effect, a run up to the new Energy Review, the House of Commons Environmental Audit Committee (EAC) has been hearing evidence on the nuclear issue as part of its timely review of UK energy options, with submissions from all parties, including  Greenpeace, FoE, the Green Party and many others.  

Dr Catherine Mitchell from Warwick University, who had been involved with the original Cabinet Office energy review, argued in effect that ‘nothing had changed since then’, so she was at a loss as to why a new review was being considered, unless a different conclusion was required. She also claimed that nuclear and renewables were inevitably in conflict:  ‘if you put the money into nuclear power you will not have these other options coming forward; you are essentially putting all your eggs in one basket’. She also saw renewables as being about more than electricity and as linking in well with wider policies on climate change- including waste resource strategy, and agricultural policy. ‘There is a much wider move away from this simple focus on electricity. My point is really that not only does support for nuclear power not answer the question of keeping the lights on, but it makes the problem of actually addressing climate change worse.’

Writing in the Guardian on Nov 30th, Tom Burke saw the EAC review as far more likely to be effective than the new government review, which he likened to the exercise over WMD. ‘First, a panic is whipped up. Then there are denials that a decision has been taken. The dodgy dossier comes next. Later, the long-made decision is announced. Then we discover there was no reason to panic. Then we find ourselves in a mess.’ He noted that the EAC’s chairman, Peter Ainsworth, ‘asks each witness what has changed since the energy white paper was published in 2003. The answer, from everyone but the nuclear industry, has been “nothing”.’

Will the new Government review be any better?

Although the likes of the CBI have welcomed it, the governments new review has clearly been seen by some as both likely to be biased and as unnecessary.  Predictably, anti-nuclear organisations have been very critical. For example, WANA, the Welsh Anti-Nuclear Alliance, rhetorically asked Blair ‘Which bit of your last energy review didn’t you understand?’ WANA argued that ‘all of the facts were known about three years ago when the last energy review was held.  As a result of that energy review a radical and forward looking white paper based on energy efficiency and renewables was published in 2003. Tony Blair described it as: “a strategy for the long term, to give industry the confidence to invest to help us deliver our goals- a truly sustainable energy policy.” It added ‘Now instead of the clear, settled, long-term framework within which investors and consumers can plan and make decisions with confidence, the Prime Minister has ‘pulled the rug from under it’ and decided to hold a new review to include nuclear power’.

However, it’s not just anti-nuclear groups that are concerned. Colin Challen MP picked up on a report from Defra, concerning the future of the Sizewell ‘A’ Magnox reactor, which claimed that ‘nuclear power is consistent with the objectives of sustainable development from a viewpoint of resource availability, economics, reduced environmental impacts and    intergenerational equity, and the detriment to future generations from the operation of nuclear power stations is likely to be small’. 

Challen said that such a statement was at the very least tendentious and contrary to the Prime Minister’s oft-stated ‘open mind’ attitude to nuclear power. He felt that it ‘shows that there is a predisposition within the government to accept new nuclear build, and that any ‘review’ over the next 12 months will only have one outcome.  If the door has closed on objections to new nuclear build, the government should say so, rather than taking us down a garden path.  Then we can have an honest debate, and not one which is merely about mollifying public opinion.’ 

Lord Sainsbury however had earlier insisted that: ‘As we said in the energy White Paper, before any decision is taken to proceed with the building of new nuclear power stations there would need to be the fullest public consultation and the publication of a further White Paper setting out our proposals’. And writing in the Observer Dec 4th, Malcolm Wicks, the Energy Minister, insisted that ‘on my watch, in my review, there is no foregone conclusion to the prospect of new nuclear power stations’. We’ll have to wait and see what emerges from the governments review- and from the EAC.