Will Nuclear Subsidies Derail a Renewable Europe?

April 7, 2014


Climate deniers often claim to be against subsidies that “pick winners” among different energy options. They are often conspicuously silent when those subsidies go to the nuclear industry.  History has shown that nuclear power cannot exist without massive infusions of public money, and guarantees of profit from taxpayers and ratepayers.  The danger is, this energy is so expensive it may crowd out other options.

Climate News Network:

LONDON, 7 April – The United Kingdom’s plans to build heavily subsidised nuclear power stations have come under withering attack from a coalition of Members of Parliament, academics, energy industry experts and environmental groups.

Evidence has poured into the European Commission, which is investigating whether the deal with the giant French nuclear company EDF breaks EU competition rules. The evidence from many objectors, whose submissions had to be made by today, claims that if the contract goes through it will wreck Europe’s chance of building up renewable energies to avert the worst impacts of climate change.

They say renewables will have to compete in an unfair market where one generator, nuclear, is guaranteed to be able to sell all its electricity at a stable price and with a built-in profit until 2058.

The UK Government has agreed a minimum price of £92.50 (US $153) a megawatt hour from a new nuclear power station at Hinkley Point in the west of England from 2023 – roughly double the existing price of electricity in Britain. The price will rise with inflation and runs for 35 years, a deal unprecedented in the energy sector, and not available to renewable energies like wind and solar. The guarantee will continue for all future nuclear stations too.

The Government has gone further, guaranteeing loans for construction, and providing insurance and compensation payments if policies change for any reason. It claims that the deal will save £75 a year on the average consumer’s bill if electricity prices rise by 2023, as it forecasts. If they do not, then consumers will be paying far more for their electricity than they would otherwise.

EU test case

No-one involved in the investigation into whether the deal constitutes unfair state aid doubts that climate change is a severe threat and needs to be tackled. The argument is about which is the best set of technologies to help deal with the problem.

There are 12 states in Europe interested in nuclear power generation, slightly under half the EU’s members. All see the UK subsidies investigation as a test case into whether they also will be able to give state aid to nuclear stations.

One of the submissions, from the Nuclear Consulting Group, with more than 100 signatures from MPs from six parties in the UK and European Parliaments, plus engineers, academics and energy experts, says the proposed aid to guarantee nuclear’s profitability is incompatible with EU State Aid rules. The NCG says it unfairly discriminates in favour of nuclear and will damage renewable energies with far greater potential.

Given that this level of support is unavailable to other low carbon technologies, it is certain to significantly distort competition and strongly affect trade between member states.

“The development of sustainable and affordable low carbon energy remains a growing economic sector with huge potential for job creation. To seek to delimit this diversity through particular State Aid support of nuclear power at the expense of other, potentially more flexible, safe, productive, cost-effective and affordable technologies seems, at the very least, unwise,” says the submission.

It says the British Government has also not been completely honest about the prospects for existing nuclear power stations. In its announcement about subsidies the Government claimed that all but one of the eight existing nuclear power stations were due to close about the time the new Hinkley Point plant is finished in 2023.


In fact EDF, which owns the plants, and is also building the new one, intends to keep them open until 2030 or even longer if safety conditions allow. If the Government’s current power station-building plans succeed, then more than 50% of Britain’s electricity would be generated by subsidised nuclear stations, effectively cutting out renewables.

Delays and cost over-runs

One big problem for the UK’s plans, apart from the European Commission inquiry, is that the building schedule for the European pressurised water reactors (EPRs) planned for Hinkley Point, and for Sizewell in eastern England, is in doubt.

The first two prototypes, under construction in Finland and France, are subject to severe construction delays and cost over-runs. The Finnish Olkiluto 3 EPR was due to be completed in 2009 at a fixed price of €3 billion (US £4.1 bn), but the cost has now escalated to €8.5 bn and completion has been put back to 2018. The French new build by EDF at Flamanville is already four years behind schedule and the cost has more than doubled to €8.5 billion.

Other groups objecting to the UK subsidy plan also say that rather than promoting a diversity of supply, as ministers claim, the decision to back nuclear will reduce the scope for other technologies.

Bad value

Friends of the Earth says that currently there are seven to ten viable renewable energies being developed in the UK, among them wind on and off shore, solar, biogas, wave, under-sea turbines, small-scale hydro, biomass, and hot rocks, all of which could contribute to the energy mix if nuclear had no guaranteed unfair advantage.

These were all comparatively new technologies, where the price of generation was coming down all the time. In contrast, FoE says, nuclear has been operating for 60 years and still requires a 35-year price guarantee.

By the time Hinkley is in operation, solar and on-shore wind will be far cheaper, with costs falling fast, and it is likely that offshore wind will be in a similar position. The nuclear subsidy “represents extremely bad value for money for UK citizens,” the submission concludes.



77 Responses to “Will Nuclear Subsidies Derail a Renewable Europe?”

  1. While your at it, stroll the halls of this site.

  2. daryan12 Says:

    A follow up comment, you’d think that if what the UK government wanted was low carbon energy they’d just offer say £100/MWh and let the markets decide which energy source to use to meet that.

    But they haven’t. Presumably because the Tories know that the likelihood is that you’d end up with lots of that onshore wind farms that they hate, natural gas tied to CCS, CHP, biomass and as prices fall, more PV, but probably very little if any nuclear.

    Indeed its worth remembering that Hinckley C is something of a loss leader. Initially the government was offer much more of a subsidy for it.

    But despite this carrot they dangled in front of the banks, they still refused to support Hinckley C. At one point EDF started laying off staff and the rumour mill began to swirl that the whole thing was off.

    As would have probably happened had the French & Chinese (state owned companies) not agreed to essentially underwrite the risks that private finance wasn’t prepared too.

    • Whats with all the wind hate? WTF?

      • daryan12 Says:

        Tory opposition to wind farms boils down to 3 factors:
        1) The usual greedy lobbyists for one vested interest (oil, gas, nuclear, etc.) over another
        2) The landed gentry in the party who don’t want wind farms spoiling one’s view of one’s country estate…presumably so they can keep an eye on the peasants! 🙂
        3) UKIP who are threatening to take votes off the Tories and are basically a bunch of bigoted, xenophobic, AGW deniers. I mean “screaming lord” Monckton is UKIP’s science adviser. That’s like the Westboro baptist’s appointing Richard Dawkins to replace Fred Phelps :0

  3. After the Tohoku earthquake in March 2011, Japan was in a seemingly impossible situation. A tremendous amount of conventional generation capacity, including the entire nuclear fleet, was unavailable, and the country faced the risk of power cuts during summer consumption peaks.

    But miraculously, or seemingly so, in just a few short weeks Japan managed to avert the rolling power cuts that many believed inevitable. Even more impressive, the Japanese have turned these emergency measures into lasting solutions.

    So how’d they do it without forcing people back to the Stone Age? Japan overcame this daunting task by tapping the cheapest and most widely available source of energy: energy efficiency and conservation.

  4. […] 2014/04/07: PSinclair: Will Nuclear Subsidies Derail a Renewable Europe? […]

  5. Processing, mining, and other handling are not free of effects. Neither are the routine reactor emissions.

  6. IRT https://climatecrocks.com/2014/04/07/will-nuclear-subsidies-derail-a-renewable-europe/comment-page-1/#comment-56068:

    LWRs are favored for practical reasons.

    One of the most practical being the cost of regulator approvals.  LWRs are the only thing the NRC knows, and I’ve seen a figure of $1 BILLION just to train regulators in a new technology to write the approval procedures… which is billed to the applicant.  Given how political the NRC has become, nobody wants to risk it.

    NPP are all about material science. Neutron bombardment and metal brittlement are what it’s all about.

    For water-cooled reactors, it’s a big deal.  Neutron embrittlement is trouble when you have many tons of water at 300°C and a couple thousand PSI.  Molten salts and other atmospheric-pressure coolants (sodium, lead) are attractive because the reactor vessel is no longer a pressure vessel.  Thickness and cost go way down, and massive forged pieces are no longer required.

    Doing it with relatively abundant materials is necessary for cost. Nuclear engineers have been at this for a while.

    Nuclear engineers ran the EBR-II for 30 years, it worked fine.  Nobody except GE and Rosatom is really interested in trying to build LMFBRs because the fuel cycle is too much of a headache; reprocessing to get the starting fuel charge is banned in the USA, and we all read the news about the MOX plant being halted despite treaty obligations to build and run it.  Russia and China both have BN-800’s in the pipeline (Beloyarsk is loading fuel), and the UK may yet contract with GE to burn their Pu stockpile in S-PRISMs.

    The nuclear establishment is not going for LFTRs, the internet bloggers are.

    Kirk Sorensen went for LFTR because it was a way around some difficulties he saw; I think the hot thing now is the DMSR, a highly economical reactor with a sub-unity breeding ratio.  There’s also LEADIR (TRISO fuel, lead coolant) proposed as a heat source for remote industrial sites.

    Some pooh-pooh Transatomic as a paper company, but nuclear engineering has long been a well-understood discipline where slipstick designs worked according to spec, and today’s 3D video card has more number-crunching power than a thousand 1960’s mainframes.  If their calculations of isotope abundances and cross-sections say that their design can consume today’s spent LWR fuel, they’re almost certainly right.  If we ever have a serious demand to “do something with all that nuclear waste”, at least they’ve got an answer.

  7. After Fukushima, The Blue Ribbon Commission on America’s Nuclear Future, co-chaired by Chu, adopted more cautious language about recycling: “no currently available or reasonably foreseeable reactor and fuel cycle technology developments—including advances in reprocessing and recycling technologies—have the potential to fundamentally alter the waste management challenges the nation confronts over at least the next several decades, if not longer.”
    At odds with transatomic. We have been through the molten salt reactor before here. Bottom line here, what’s the economic advantage? Fuel cost is mostly irrelevant. They claim low capital costs. Every nuclear technology ever invented claimed that. And came up shorter than predicted. They are tiny and must pass nrc licensing. Their chances are the same as any startup. Long odds. Every reactor must sell electricity to make Monet. This is why Chu made the statement. It’s cheaper to bury waste. The problem with waste has less to do with technology than nimby. There is no tech solution for that.

  8. More on reprocessing..
    Nevertheless, although it may be safe to proceed with reprocessing, France’s experience suggests that reprocessing as done now is not ready to catalyze a full-blown nuclear renaissance. The problem in a nutshell is that without breeder reactors, which can break down the most long-lived elements in nuclear waste, reprocessing comes nowhere near achieving Finck’s 100-fold reduction in that waste.

    France’s engineers tried harder than those in any other country to build and run breeder reactors reliably at a commercial scale, but ultimately they failed. The result is that even in France–the best real-world model of what reprocessing can accomplish–the technology remains a tantalizing but only partial solution to the problem of high-level nuclear waste.
    The number and quality of sources saying reprocessing is unsuccessful is overwhelming. The IEEE is conservative, traditionally pro nuclear.

  9. When you add up the increases in volumes of low level wastes in exchange for a reduction in high level wastes it fares poorly against burial. In any case, there is no panacea for wastes. Never has been. Any projections for same are highly questionable given the historic failures and long term experience. Cleaning just means transferring to something else. We want out of mind out of sight and organic decomposition for other wastes. No such thing for nuclear wastes.

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