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"Making the wrong judgments about the first plant is not an option for a nation that has made a long-term commitment to nuclear to meet carbon reduction goals."

 

ARUN MANI, ENERGY CONSULTING, PA CONSULTING GROUP  

Energy planners must know what they’re getting us into

The Times
Arun Mani
11 November 2011

 

As the Government moves ahead on developing nuclear power stations to secure energy supplies, the political impact of the Fukushima Daiichi accident seems to have been lower than in other countries.

However, events in Japan have raised issues for the nuclear industry and for policymakers seeking to incorporate nuclear in their low-carbon energy strategy. Previously, the focus was on balancing three Cs: carbon reduction, cost of development and certainty of supply. This has become a more complex three Ss: station blackouts, seismic events and stacked events, taking the nuclear debate from a “why" to a “how" discussion.

In a station blackout a nuclear plant loses all offsite and onsite power. In seismic events, physical damage is caused by earthquakes. Stacked events entail multiple incidents, such as flooding, earthquakes and blackouts, occurring together, as happened in Fukushima. These are “black swan" events, the term coined by the essayist Nassim Nicholas Taleb to describe an unexpected and highly unlikely occurrence that has a significant impact on society and should have been planned for. Fukushima, with its ageing reactors and dated technology, and situated in an area of high seismic activity, was a clear candidate.

There are many differences between the situation in Japan and that found in Britain. The technology here is far more advanced. The candidates for the UK’s new nuclear reactor fleet — Areva’s EPR reactor and the Westinghouse AP1000 — are quite unlike the 40-year-old Hitachi boiling-water reactors at Fukushima. Both boast a range of safety features and, critically, do not require diesel generators to keep coolant flowing through the core. Equally, Britain does not have the seismic exposure of Japan.

However, given that the UK’s first new nuclear generator, to be built by the EDF/Centrica consortium, is planned to start up in 2018, it is important to have an up-to-date understanding of the business case, risks, uncertainties and any potential black swan events. The first area that needs examination is financial, including the ultimate all-in costs of the initial plant.

The next priority is analysis of how proposed market reform policy changes will affect that business case. Equally important is the need to assess whether regulatory changes resulting from Fukushima will affect the operators’ ability to secure an operating licence by 2018. Finally, the developers will need to assure the public that they have learnt from their experience at Flamanville and Olkiluoto, and that those mistakes will not be repeated in Britain.

Neither policymakers nor operators can resolve all these issues today, but they need to do careful work and scenario planning now to test the business case and assess what they can reasonably expect to deal with. This is vital. Making the wrong judgments about the first plant is not an option for a nation that has made a long-term commitment to nuclear to meet carbon reduction goals and secure energy supplies.


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