Britain to get its first SMR

 

From the BBC

A first-of-its-kind nuclear power station is to be built on Anglesey, bringing up to 3,000 jobs and billions of pounds of investment.

The plant at Wylfa, on the Welsh island's northern coast, will have the UK's first three small modular reactors (SMR), although the site could potentially hold up to eight.

Work is due to start next year with the aim of generating power by the mid 2030s.

Prime Minister Sir Keir Starmer said Britain was once a world leader in nuclear power but "years of neglect and inertia has meant places like Anglesey have been let down and left behind. Today, that changes."

The project, which could power about three million homes, will be built by publicly owned Great British Energy-Nuclear and is backed by a £2.5bn investment from the UK government.

SMRs work similarly to large reactors, using a nuclear reaction to generate heat that produces electricity - but are a fraction of the size, with about a third of the generating output.

Prof Simon Middleburgh, director of the Nuclear Futures Institute at Bangor University, said the SMRs would be "built in a modular manner in factories and shipped to the site to be put together a bit like an Ikea chair".

There were "a few more hurdles to go through", he cautioned - from securing regulatory approval, building the factories required to construct the SMRs and training the workforce that will run them.

Opponents of the project point to the fact that a long-term storage facility for the UK's nuclear waste is yet to be agreed upon and say investment in renewable energy schemes - wind, wave and tidal - is what Anglesey needs.

The government sees them as a secure, reliable, affordable and low carbon energy system and is convinced that, with investment, SMRs will create thousands of jobs and boost manufacturing.

Wylfa beat competition from a site at Oldbury in Gloucestershire, with the reactors designed by Rolls-Royce, subject to final contracts, which are expected later this year.

The argument for SMRs, as opposed to the giant nuclear reactors that have been built so far, is that if they can be produced on an assembly line, they will be much cheaper, because they will avoid the cost overruns (and the lengthy delays) associated with big project bloat.  After all, wind and solar farms tend not to have huge cost overruns, because almost everything is "off the shelf".   But SMRs' success also depends on mass production, which requires (just like solar panels and wind turbines) volume.   Except solar panels and wind turbines are already high volume, and buyers can take advantage of that fact.  I suspect SMRs will only be a thing when China starts to produce them at volume.   Which isn't happening because wind + solar + batteries is so cheap.

 Notice how no indication of cost is given,   Notice also that the new SMRs will only start producing power in 10 years' time--and that's the optimistic scenario.  I remain sceptical.  Still, Hungary has signed an order for 10 SMRs, and they are also planned for Czechia.

Nuscale SMR costs jump to $119/MWh

From IEEFA

Last week, NuScale and the Utah Associated Municipal Power Systems (UAMPS) announced what many have long expected. The construction cost and target price estimates for the 462-megawatt (MW) small modular reactor (SMR) are going up, way up.

From 2016 to 2020, they said the target power price was $55/megawatt-hour (MWh). Then, the price was raised to $58/MWh when the project was downsized from 12 reactor modules to just six (924MW to 462MW). Now, after preparing a new and much more detailed cost estimate, the target price for the power from the proposed SMR has soared to $89/MWh.

Remarkably, the new $89/MWh price of power would be much higher if it were not for more than $4 billion in subsidies NuScale and UAMPS expect to get from U.S. taxpayers through a $1.4 billion contribution from the Department of Energy and the estimated $30/MWh subsidy in the Inflation Reduction Act (IRA).

It also is important to remember that the $89/MWh target price is in 2022 dollars and substantially understates what utilities and their ratepayers actually will pay if the SMR is completed. For example, assuming a modest 2% inflation rate through 2030, utilities and ratepayers would pay $102 for each MWh of power from the SMR—not the $89 NuScale and UAMPS want them to believe they will pay.

The 53% increase in the SMR’s target power price since 2021 has been driven by a dramatic 75% jump in the project’s estimated construction cost, which has risen from $5.3 billion to $9.3 billion. The new estimate makes the NuScale SMR about as expensive on a dollars-per-kilowatt basis ($20,139/kW) as the two-reactor Vogtle nuclear project currently being built in Georgia, undercutting the claim that SMRs will be cheap to build.

NuScale and UAMPS attribute the construction cost increase to inflationary pressure on the energy supply chain, particularly increases in the prices of the commodities that will be used in nuclear power plant construction.

For example, UAMPS says increases in the producer price index in the past two years have raised the cost of:

• Fabricated steel plate by 54%
• Carbon steel piping by 106%
• Electrical equipment by 25%
• Fabricated structural steel by 70%
• Copper wire and cable by 32%

In addition, UAMPS notes that the interest rate used for the project’s cost modeling has increased approximately 200 basis points since July 2020. The higher interest rate increases the cost of financing the project, raising its total construction cost.

Assuming the commodity price increases cited by NuScale and UAMPS are accurate, the prices of building all the SMRs that NuScale is marketing—and, indeed, of all of the SMR designs currently being marketed by any company—will be much higher than has been acknowledged, and the prices of the power produced by those SMRs will be much more expensive.

Finally, as we’ve previously said, no one should fool themselves into believing this will be the last cost increase for the NuScale/UAMPS SMR. The project still needs to go through additional design, licensing by the U.S. Nuclear Regulatory Commission, construction and pre-operational testing. The experience of other reactors has repeatedly shown that further significant cost increases and substantial schedule delays should be anticipated at any stages of project development.

The higher costs announced last week make it even more imperative that UAMPS and the utilities and communities participating in the project issue requests for proposal (RFP) to learn if there are other resources that can provide the same power, energy and reliability as the SMR but at lower cost and lower financial risk. History shows that this won’t be the last cost increase for the SMR project.

The problem with this analysis is that renewable costs have also risen (see chart from Lazards' latest LCOE calculations below).  Supply chain difficulties because of Covid, the Ukraine War, China's Covid lockdowns, "onshoring" (returning manufacturing to your own country, to reduce supply chain difficulties) and rising interest rates have increased wind and solar costs for the first time in decades.   And, presumably, as we improve the supply chain, these costs will fall.   Also, if more NuScale's SMRs can be built, unit costs will fall, in a classic learning curve feedback loop.

We may well need SMRs at high latitudes, while SMRs even in lower latitudes will add to grid security, because the more different sources of electricity available to the grid, the more balanced and secure it is.  It would be a pity not to at least try NuScale's SMRs, given the strong possibility that component prefabrication will cut costs compared to the hugely expensive giant nuclear power plants which are a decade behind schedule everywhere.  

I have said before that if nuclear is necessary for de-carbonising the world's electricity grid, I would grit my teeth and support it, because the climate emergency is so severe.  But the problems with nuclear remain:  expense and delay.  This SMR will only start operating in 2030, if there are no further delays.  By then, if we are to avoid an increase in global temperatures since pre-industrial times of more than 1.5 degrees C, we will need to have increased the share of renewables in the grid to 80%.  The last 20% will be the hardest to de-carbonise.   SMRs may be necessary for that.   

Source: Lazards
Click on graphic to see clearer image

Why are coal supporters so keen on nuclear?

 From The Guardian

I think it's because they know how long nuclear plants will take to build.  While they're being built, we will (they think) have to go on using fossil fuels.   But then I'm a bit cynical.

The Coalition didn’t do much on nuclear energy while in office. Why are they talking about it now?

Last week, the Nationals’ new leader, David Littleproud, said it was time for Australia to have a “mature” conversation about nuclear energy while his predecessor, Barnaby Joyce, called for a national moratorium to be lifted and argued nuclear power would be “really important” if the country was serious about reaching net zero emissions. [The National Party was one of the parties in the former Coalition government in Australia which is strongly in favour of coal power and against renewables]

Advocates [for nuclear] have acknowledged nuclear power is the most capital-intensive energy technology, takes the longest time to recoup on investment and has not benefited from the economies of scale experienced in solar and wind energy. Costs have increased as technology has advanced.

Despite the global push to cut greenhouse gas emissions, the large-scale nuclear energy industry is going backwards. More units closed than opened in 2020. Construction began on only five reactors; four of those were in China, which is investing in all energy types. Excluding China, global nuclear generation is at its lowest level in 27 years.

The few major plants under construction in developed democracies have suffered years of delays and cost blowouts. In the UK, the Hinkley Point C station – the country’s first new nuclear plant in decades – is running 10 years behind schedule and is expected to cost at least A$45bn, nearly 50% more than initially expected. [The Vogtle 3 and 4 reactors in Georgia, USA, have more than doubled in cost and still aren't completed] 

What about SMRs?

At this point they barely exist.

SMRs are proposed to be 60 and about 200 megawatts, a fraction of the size of the traditional nuclear plant. Proponents say they would employ similar technology used in nuclear-powered submarines and icebreakers and would be easier to keep safe than bigger plants.

But a report by the World Nuclear Industry last year found talk and media coverage about SMRs was “not reflected by any major industrial achievements on the ground”.

It said SMRs in China and Argentina had been beset by delays. There had been no concrete steps towards construction anywhere else except Russia – which is pursuing a model that barely qualifies as an SMR, is years behind schedule and does not have the regulatory process expected in developed countries.

In South Korea, an SMR model was approved in 2012 but there had been no orders because it costs too much. Plans in the US had stalled; a government-backed model by the company NuScale was approved by the safety regulator, but the design was later changed and several municipalities dropped plans to host them. Backers agree that no reactors are expected before 2029 at the earliest.

The industry report concluded there was growing evidence that “SMRs, like large reactors, will continue to be subject to delays and cost overruns and the high likelihood that they would not be economical even under the most favourable circumstances”.

Is nuclear power needed in Australia?

It is a different story in some other countries, but there are plenty of analyses that say nuclear isn’t necessary here given the range of available energy options.

For example, the Australian Energy Market Operator’s integrated system plan – a blueprint for an optimal future grid – lays out a vision under which the country would run overwhelmingly on solar and wind, supported by better transmission links and backed by “firm” capacity that can be called on when needed: batteries, pumped hydro, some gas (at least initially) and demand management.

Cost is the key issue. While estimates are difficult, CSIRO’s latest analysis of different energy costs suggested SMRs would be far more expensive than solar and wind energy and at least as expensive as fossil fuel power with carbon capture and storage, which has not proven economically viable.

Why does the case for nuclear energy persist?

There is an assumption by some people, including Coalition MPs [the coal-supporting party in Australia], that renewable energy cannot do the job, despite the expert advice that says otherwise. These critiques rarely address that advice head on.

But there is also a long history of nuclear energy being used as a delaying tactic for acting on climate change in Australia, including by fossil fuel interests.

It is possible SMRs could play a role globally beyond 2030, but anyone arguing for them in Australia should be asked why they disagree with the nuclear advocates who say otherwise – and why [their] efforts aren’t better directed into backing zero-emissions technologies that are affordable and available now.

 

Small modular reactors

Source: Rolls-Royce

There's a push on in the UK for the government to embrace small modular reactors (SMRs).  These are much smaller than the giant at Hinkley Point in England (1/10th the size) .  They're being developed by Rolls-Royce, who have a long involvement with the nuclear-powered submarines of the Royal Navy.   Rolls-Royce, needless to say, is enthusiastic:

Traditional large nuclear plants are bespoke projects often relying upon state support, but small modular reactors could be made in centralised manufacturing facilities and then transported to anywhere in the country or overseas, producing benefits of scale which would drive down costs. Rolls-Royce is developing a patented modular concept which is designed specifically for factory manufacture and commissioning, speed of installation and reduced onsite construction work. This mitigates the programme risk associated with conventional nuclear plants. Our concept is the best of breed in terms of design, manufacture, cost and ownership.

Rolls-Royce believes its SMR design will:

• Provide 220MW to 440MW of power, depending on the configuration, that’s the equivalent of up to 150 onshore wind turbines.
• Supply power to the grid in a timely manner at lower cost to the taxpayer and consumer, generating electricity that is at least as cheap (per MW) as power generated by today’s large scale reactors – potentially even cheaper when SMRs go into volume production.
• Represent the lowest risk by using proven technology and best value by using a high degree of commercial or standardised off-the-shelf components.
• Open up opportunities for UK supply chain companies to enter into volume manufacturing as over 75% of the design (by cost) is modular.
• Appeal to a UK commercial or international utility company or power station operator.
• Be so compact (16 metres high and 4 metres in diameter) it can be transported by truck, train or even barge.
• Sit within a power station that would be roughly five and half times the size of the pitch at Wembley, which is just one-tenth the size of a typical large-scale reactor site
(40,000m2 vs 400,000m2).
• Take just 5 years from the start of construction to the generation of the first electricity.
• Be up and running by 2028, maximising the UK’s first-mover advantage in the race for exports.
• Minimise operating costs such as refuelling and the burden of decommissioning.
• Last for 60 years. 

[Read more here]

Rolls-Royce reckons that these new SMRs will produce electricity at £60/MWh (US$80/MWh), which is cheaper than  Hinkley Point, but will only be possible with economies of scale.  To be fair, that's similar to the situation with concentrated solar power (CSP) and batteries.  Unlike the giant bespoke nuclear plants being built at Hinkley Point, Flamanville and in Finland, the risk of huge cost overruns is less (or at least controllable).  We could build one SMR at a fraction of the cost, see if it works and how much it really costs, and then build others.

Rolls-Royce only expect this technology to be available in 2028.  By then, at the current growth rates for wind and solar, let alone CSP, renewables could be close to 2/3rds of total global electricity supply.  Will the world need new nuclear then?  The costs of renewables will have fallen further, but how much further will the costs of SMRs fall?  Plus, baseload is no longer very attractive (what is and will be needed is dispatchable electricity rather than baseload) and nuclear is very much baseload.  Can the activity of SMRs be dialled up or down, even on a 24 hour time frame?

I have said before that if I believed nuclear could be instrumental in our shift towards a carbon-free economy, I would grit my teeth and support it.  If  SMRs are not much more expensive than renewables, and if  they are safe, and if  they will still be useful in 10 years time when they come on stream, then they might be part of the solution.  But I hae me doots.

Nuclear power's future is grimmer than ever

 From RenewEconomy

Phasing out nuclear power

The number of countries phasing out nuclear power steadily grows and now includes:

Germany: Fourteen reactors have shut down since the 2011 Fukushima disaster and the final three reactors will close this year.

Belgium: The country’s seven ageing reactors will all be closed by the end of 2025.

Taiwan: Final reactor closure scheduled for 2025. Four reactors were shut down from 2018 to 2021 and only two remain operational.

Spain: Nuclear power capacity is expected to decline from 7.1 GW in 2020 to 3 GW in 2030 with the final reactor closure in 2035.

Switzerland: The government accepted the results of a 2017 referendum which supported a ban on new reactors and thus a gradual phase-out is underway. The Mühleberg reactor was shut down in 2019 and most or all of the remaining four ageing reactors are likely to be shut down over the next decade.

South Korea: Long-term (2060) phase-out policy with concrete actions already taken including the shut-down of the Kori-1 and Wolsong-1 reactors in 2017 and 2019 respectively, and suspension or cancellation of plans for six further reactors. The current plan is to reduce the number of reactors from a peak of 26 in 2024 to 17 in 2034.

Too cheap to meter or too expensive to matter?

Despite the abundance of evidence that nuclear power is hopelessly uncompetitive compared to renewables, the nuclear industry and some of its supporters continue to claim otherwise.

Those economic claims are typically based on implausible cost projections for non-existent ‘Generation IV’ reactor concepts. Moreover, the nuclear lobby’s claims about the cost of renewables are just as ridiculous.

Claims about ‘cheap’ nuclear power certainly don’t consider real-world nuclear construction projects. Every power reactor construction project in Western Europe and the US over the past decade has been a disaster.

The V.C. Summer project in South Carolina (two AP1000 reactors) was abandoned after the expenditure of at least A$12.5 billion leading Westinghouse to file for bankruptcy in 2017. Criminal investigations and prosecutions related to the project are ongoing, and bailout programs to prolong operation of ageing reactors are also mired in corruption.

The only remaining reactor construction project in the US is the Vogtle project in Georgia (two AP1000 reactors). The current cost estimate of A$37.6-41.8 billion is twice the estimate when construction began. Costs continue to increase and the project only survives because of multi-billion-dollar taxpayer bailouts. The project is six years behind schedule.

In 2006, Westinghouse said it could build an AP1000 reactor for as little as A$2.0 billion, 10 times lower than the current estimate for Vogtle.

The Watts Bar 2 reactor in Tennessee began operation in 2016, 43 years after construction began. That is the only power reactor start-up in the US over the past quarter-century. The previous start-up was Watts Bar 1, completed in 1996 after a 23-year construction period.

In 2021, TVA abandoned the unfinished Bellefonte nuclear plant in Alabama, 47 years after construction began and following the expenditure of an estimated A$8.1 billion.

There have been no other power reactor construction projects in the US over the past 25 years other than those listed above. Numerous other reactor projects were abandoned before construction began, some following the expenditure of hundreds of millions of dollars.

Western Europe

The only current reactor construction project in France is one EPR reactor under construction at Flamanville. The current cost estimate of A$30.1 billion — yes, over A$30 billion — is 5.8 times greater than the original estimate. The Flamanville reactor is 10 years behind schedule.

The only reactor construction project in the UK comprises two EPR reactors under construction at Hinkley Point. In the late 2000s, the estimated construction cost for one EPR reactor in the UK was A$3.8 billion. The current cost estimate for two EPR reactors at Hinkley Point is A$41.6-43.5 billion, over five times greater than the initial estimate of A$3.8 billion per reactor.

In 2007, EDF boasted that Britons would be using electricity from an EPR reactor at Hinkley Point to cook their Christmas turkeys in 2017, but construction didn’t even begin until 2018.

One EPR reactor (Olkiluoto-3) is under construction in Finland. The current cost estimate of about A$17.4 billion is 3.7 times greater than the original estimate. Olkiluoto-3 is 13 years behind schedule.

Nuclear power is growing in a few countries, but only barely. China is said to be the industry’s shining light but nuclear growth has been modest over the past decade and it is paltry compared to renewables (2 GW of nuclear power capacity added in 2020 compared to 135 GW of renewables).

There were only three power reactor construction starts in Russia in the decade from 2011 to 2020, and only four in India.

Small modular reactors

Small modular reactors (SMRs) are heavily promoted but construction projects are few and far between and have exhibited disastrous cost overruns and multi-year delays.

It should be noted that none of the projects discussed below meet the ‘modular’ definition of serial factory production of reactor components, which could potentially drive down costs. Using that definition, no SMRs have ever been built and no country, company or utility is building the infrastructure for SMR construction.

In 2004, when the CAREM SMR in Argentina was in the planning stage, Argentina’s Bariloche Atomic Center estimated an overnight cost of A$1.4 billion / GW for an integrated 300 megawatt (MW) plant, while acknowledging that to achieve such a cost would be a “very difficult task”. Now, the cost estimate is more than 20 times greater at A$32.6 billion / GW. A little over A$1 billion for a reactor with a capacity of just 32 MW. The project is seven years behind schedule and costs will likely increase further.

Russia’s 70 MW floating nuclear power plant is said to be the only operating SMR anywhere in the world (although it doesn’t fit the ‘modular’ definition of serial factory production). The construction cost increased six-fold from 6 billion rubles to 37 billion rubles (A$688 million), equivalent to A$9.8 billion / GW. The construction project was nine years behind schedule.

According to the OECD’s Nuclear Energy Agency, electricity produced by the Russian floating plant costs an estimated A$279 / MWh, with the high cost due to large staffing requirements, high fuel costs, and resources required to maintain the barge and coastal infrastructure. The cost of electricity produced by the Russian plant exceeds costs from large reactors (A$182-284) even though SMRs are being promoted as the solution to the exorbitant costs of large nuclear plants.

SMRs are being promoted as important potential contributors to climate change abatement but the primary purpose of the Russian plant is to power fossil fuel mining operations in the Arctic.

A 2016 report said that the estimated construction cost of China’s demonstration 210 MW high-temperature gas-cooled reactor (HTGR) is about A$7.0 billion / GW and that cost increases have arisen from higher material and component costs, increases in labour costs, and project delays. The World Nuclear Association states that the cost is A$8.4 billion / GW. Those figures are 2-3 times higher than the A$2.8 billion / GW estimate in a 2009 paper by Tsinghua University researchers.

China’s HTGR was partially grid-connected in late-2021 and full connection will take place in early 2022.

China reportedly plans to upscale the HTGR design to 655 MW (three reactor modules feeding one turbine). China’s Institute of Nuclear and New Energy Technology at Tsinghua University expects the cost of a 655 MW HTGR will be 15-20 percent higher than the cost of a conventional 600 MW pressurised water reactor.

NucNet reported in 2020 that China’s State Nuclear Power Technology Corp dropped plans to manufacture 20 additional HTGR units after levelised cost of electricity estimates rose to levels higher than a conventional pressurised water reactor such as China’s indigenous Hualong One. Likewise, the World Nuclear Association states that plans for 18 additional HTGRs at the same site as the demonstration plant have been “dropped”.

The World Nuclear Association lists just two other SMR construction projects other than those listed above. In July 2021, China National Nuclear Corporation (CNNC) New Energy Corporation began construction of the 125 MW pressurised water reactor ACP100. According to CNNC, construction costs per kilowatt will be twice the cost of large reactors, and the levelised cost of electricity will be 50 percent higher than large reactors.

In June 2021, construction of the 300 MW demonstration lead-cooled BREST fast reactor began in Russia. In 2012, the estimated cost for the reactor and associated facilities was A$780 million, but the cost estimate has more than doubled and now stands at A$1.9 billion.

SMR hype

Much more could be said about the proliferation of SMRs in the ‘planning’ stage, and the accompanying hype. For example a recent review asserts that more than 30 demonstrations of ‘advanced’ reactor designs are in progress across the globe. In fact, few have progressed beyond the planning stage, and few will. Private-sector funding has been scant and taxpayer funding has generally been well short of that required for SMR construction projects to proceed.

Large taxpayer subsidies might get some projects, such as the NuScale project in the US or the Rolls-Royce mid-sized reactor project in the UK, to the construction stage. Or they may join the growing list of abandoned SMR projects.

A failed history of small reactor projects. A handful of recent construction projects, most subject to major cost overruns and multi-year delays. And the possibility of a small number of SMR construction projects over the next decade. Clearly the hype surrounding SMRs lacks justification.

Everything that is promising about SMRs belongs in the never-never; everything in the real-world is expensive and over-budget, slow and behind schedule. Moreover, there are disturbing, multifaceted connections between SMR projects and nuclear weapons proliferation, and between SMRs and fossil fuel mining.

[Read more here]

 Fukushima nuclear clean-up a failure.
Source: Bloomberg

Nuclear power somehow always makes a loss

Source: Lazard and my estimates
N.B.  Lazard's estimates for nuclear do not include costs of implicit government insurance,
or of decommissioning, or of government guarantees of nuclear power station debt.
Solar does not include costs of storage (currently $18/MWh for 4 hours) and is before subsidies.

From Climate News Network:

Two new studies together make an eloquent case against nuclear power: that its civilian uses are inseparable from nuclear warmaking, and that it is always uneconomic and has to be subsidised by taxpayers.

The first report, by the Berlin-based German Institute for Economic Research (DIW), says that private economic interests have never played a role in nuclear power; instead the military have always been the driving force behind their construction. The report’s title sums up its contents: High-Priced and Dangerous: Nuclear Power is not an option for the Climate-Friendly Energy Mix.

The researchers calculate, after analysis of the 674 nuclear power plants built since the 1950s, that on average they make a loss of €5 billion (US$5.6 bn) each, and that is without taking into account the cost of getting rid of their radioactive waste.

The report does not simply investigate the past. It also looks ahead, reviewing the industry’s plans for a new generation of nuclear power stations, and particularly the small modular reactors (SMRs) in which the US, Canada, Russia, China and the UK are currently investing huge amounts of development money. The researchers conclude that they too are doomed to be an expensive failure.

The second study, specifically into SMRs, is by the Nuclear Consulting Group (NCG), an international team of academics and other experts [the writer of this news report is a member].  It reaches the same conclusion: that they will be expensive for the taxpayer and never live up to expectations.

The NCG, which works with Nuclear Free Local Authorities in the UK, says its opposition is based on close scrutiny of the industry. After examining all the designs of SMRs currently being developed globally, the NCG says: “It remains likely that no substantive deployment of the technology will be realised, with just a very few reactors built, at most.

“This will be despite large amounts of public money being invested in these projects and, worse, the neglect of other more viable non-nuclear options. It provides another example of the industry talking a good game but delivering little.” There are recurrent reports that SMRs are managing to break into the market, but so far without any sign of widespread success.

[Read more here]

Coal spruikers and climate denialists are in favour of nuclear, because they know damn well that reactors (in democracies) will never be built because of strong opposition by the public.  They believe that by favouring nuclear this will deter the roll-out of renewables, helping to maintain fossil fuels in the generation mix.  Solar, even with 12 hours of storage, is much cheaper than nuclear in most parts of the world.  There is, perhaps, a case for nuclear in high latitudes (north of 60 degrees) because although solar is surprisingly productive in summer, in winter, when demand is highest, it isn't.  But even there, power to gas may be the better alternative.

First SMR in a G7 country

Construction of its first SMR (Small Modular Reactor) has started in Canada.    I've talked about SMRs  before, but have been sceptical.    But I've also said that high latitudes will probably need nuclear power, because solar is so variable from summer to winter. 

The electricity from this SMR is forecast to have an LCOE (levelised cost of electricity) of about US$108 per MWh, and completion is expected by 2030.  Nuclear power stations tend to come in late and over budget, so we'll see whether this one is any different.  If it is on time and under budget, there will be many more built.  Even in countries in lower latitudes, adding another power source to the grid will make the grid more stable and easier to manage.

From CBC

Premier Doug Ford's government has given Ontario Power Generation the green light to start construction on Canada's first small modular reactor, a new nuclear energy technology to be built next door to the Darlington power plant. 

The small modular reactor (SMR) would provide 300 megawatts of power, enough electricity to supply about 300,000 homes, according to briefing documents from Ontario's Ministry of Energy and Mines. 

It would be the first of four such reactors that OPG aims to build on the site, at a total project cost of $20.9 billion, in an effort to meet what's forecast to be a steep rise in demand for electricity in the province.

The estimated construction cost of the initial reactor is $7.7 billion, which includes $1.6 billion of infrastructure to be shared across the project.

"Ontario needs more power, I think we understand this problem today. When you turn the lights on in your living room you may not think about where that power comes from," said Stephen Lecce, Ontario's minister of energy and mines, on Thursday.

"But ensuring that we have reliable, affordable energy is essential to the economic sovereignty of our province and country," he continued.

Lecce made the announcement near the Darlington nuclear generating station. Preparation work has already begun at the project site, immediately east of the existing nuclear plant along the Lake Ontario shoreline. 

The province's electricity system operator recently estimated that demand for power across Ontario is set to increase 75 per cent by 2050.

"As it stands today, we just don't have the supply to meet that demand," Lecce said.

In a briefing, ministry officials told reporters that roughly 80 per cent of the SMR project spending will go to Ontario companies, another 15 per cent to European and Asian firms, and just five per cent to companies in the U.S., primarily for GE Hitachi's design and development of the power plant model, called the BWRX-300. 

Ontario would become the first place in the world to build the BWRX-300, which is a smaller version of GE Hitachi's existing boiling water reactor technology.

The officials say the Canadian companies involved in the project will have the potential to export components to other countries that decide to build this type of SMR. 

The timeline is to finish construction of the first reactor by the end of 2029, and connect it to the grid in 2030.  

The average lifetime cost of electricity generated by the SMRs is estimated to be 14.9 cents per kilowatt hour (kWh)[C$149/MWh, US$108/MWh], according to an analysis by the Independent Electricity System Operator, the provincial agency that oversees the provincial grid. 

According to that analysis, providing a similar level of base power as the SMRs by building wind and solar power with battery energy storage would cost in the range of 13.5 to 18.4 cents per kWh. However, that alternative would require additional transmission, use up far more land and potentially face constraints in finding acceptable sites. 

A concept image of a GE Hitachi BWRX-300 small modular reactor (SMR), the nuclear technology Ontario Power Generation is using for its new project adjacent to the existing Darlington nuclear plant. (GE-Hitachi)

 

Is renewable energy cheaper than fossil fuels?

Answer:  Mostly, yes, but there are complications

From The Climate Brink.

Is renewable energy (RE) cheaper than fossil fuels?

To begin to answer this, we need to define what cost we’re talking about. Let’s first talk about the cost of RE energy vs. fossil-fuel energy on a grid that’s dominated by dispatchable power, such as fossil fuels. This is what most electrical grids are like today.

 

For a grid dominated by dispatchable power (i.e., power sources that can be turned on or off at will), the intermittency of wind and solar imposes no costs. Thus, the relevant cost comparison is between the so-called Levelized Cost of Energy (LCOE) of the various energy sources:

Virtually all credible analyses agree that RE has the lowest LCOE. Therefore, it is the cheapest energy source for grids that contain a lot of dispatchable power.

 

This explains why, for example, 95% of the power scheduled to be hooked up to the ERCOT (Texas) grid is RE (solar, wind, or batteries). Natural gas is 5%.

 

For a grid that’s mainly fossil fuels, every kW of renewable power (RE) you add displaces a kW of expensive and dirty fossil fuel power. But, as the grid gets more and more RE, that changes. At high levels of RE deployment, the intermittency of the wind and solar means that you need to add several kW of wind and solar to displace a single kW of fossil fuels. This drives up the marginal cost of RE energy.

 

In addition, high RE levels mean that RE is competing with the most efficient and cheap fossil-fuel generation, some of which have not yet been paid off. Additionally, the more RE you add, remaining RE sites are higher cost and lower quality.

The net result is that, beyond some point, the price of energy on the grid starts increasing as you add RE. Qualitatively, the price of electricity vs. RE deployment looks like this:

Right now, around 20% of our electricity comes from wind and solar and this is already saving consumers billions of dollars a year. As we increase RE deployment, the price of electricity will continue to decline and consumers save money.

 

Then we reach the minimum price point. One study from NREL concluded that this occurs when RE penetration reaches 57% (in 2050). At this point, electricity produced on this grid is cheaper than a fossil-fuel heavy grid and, as a bonus, we’re also emitting a lot less CO₂.

 

As we move beyond 57%, the declining value of wind and solar to the grid means the price of energy increases. However, it remains below what we’re paying today for a fossil fuel grid until we get to around 90% RE.

 

Let me repeat for those in the backrow: we can get to a 90% RE grid and pay about the same as we’d pay with a fossil-fuel heavy grid. And this doesn’t account for the external costs of fossil fuels (see below).

A significant amount of the discourse about RE focuses on the cost of achieving net zero by 2050, which requires completely eliminating fossil fuels. No one knows how much this will cost, but some studies have produced eye-popping numbers: 

Many analyses have looked at this goal and they agree that a lot of the costs of reaching net zero are driven by the cost of phasing out the last few percent of fossil fuels. The reason is that the last few percent of emissions are the hardest to abate and the ones for which technology to replace fossil fuels is expensive or undeveloped. For example, decarbonizing long-distance airline flights is one of the last things we’ll decarbonize because it would probably require biofuels, which could have very high costs.

 

This is quantified in this plot, which shows the incremental abatement cost (orange line) as a function of how much RE is on the grid. For a 95%-RE grid, the abatement cost is $200/tonne, increasing to $930/tonne for 100% RE.

Figure 1 of Cole et al.

Thus, it’s easy to look at the price tag for getting to net zero and conclude, “Wow, this is too expensive.” But that misses the fact that the cost of getting to a slightly lower value, e.g., a 90% clean-energy grid, is actually quite modest.

 

These net-zero estimates also hinge heavily on future innovation — a variable notoriously difficult to predict. History has shown us, particularly in the last decade, that technological advancements can drastically outpace predictions, as seen with the enormous drop in the cost of solar panels, which no one predicted.

 

External costs

All of these discussions focus on the market price of energy. Such a discussion neglects the extensive subsidies that distort the energy market. While RE sources receive financial support, the subsidies for fossil fuels are substantially larger and more ingrained within global economies.

 

Moreover, the price of fossil fuels seldom reflects their full societal costs — what economists call externalities. Recent estimates of the cost of climate impacts puts it around $185/ton of CO₂ emitted. These costs are not included in the cost of fossil fuels.

 

Air pollution from fossil fuels kills millions of people every year. Like the climate impacts, the costs of this are not included in the price. Fossil fuels have also been linked to significant political and social instability. For instance, the U.S. invaded the Middle East twice in the last 35 years in order to stabilize the oil supply. The Russian invasion of Ukraine is intimately tied to fossil fuels. These costs are also not included in the costs of fossil fuels.

 

If we added these externalized costs to the cost of fossil fuels, the argument increasingly tilts in favor of RE.

 

Summary

In any complex discussion, you need to carefully define the question you’re asking. Much of the discussion around renewable energy focuses on net zero, because that’s what we ultimately need to aim for. We really don’t know how much achieving net zero by 2050 will cost because it will depend to a large extent on future innovation.

 

But a large chunk of the cost of net zero is driven by the last few percent of decarbonization. If you talk about, say, a 90% clean grid, the cost of achieving that using today’s technology is approximately zero. And this cost comparison excludes the external costs of fossil fuels: climate impacts, air pollution, geopolitical instability. Taking all factors of those into account, there’s no question that we can largely decarbonize today and end up with a better economy and cleaner environment.

 

I found this article extremely enlightening.  It put into words something which I had only intuitively understood.  But it highlights how the cheapest RE now might not be the cheapest RE in 2040 (ignoring of course technological advances).  For example, CSP (concentrated solar power) is more expensive than solar panels.  However, it can produce dispatchable electricity, which means it will be very valuable for that last 10% of electricity supply.  Another example:  SMRs (small modular reactors) are prolly 3 or 4 times as expensive as solar, now.  But to convert solar into dispatchable power would require at least 12 hours of storage.  That's still very expensive, though no doubt battery costs will continue to decline.  But so might the costs of SMRs.  Again, for that last 10%, SMRs might be the answer.    Yet another example: power-to-gas.  Using green methane (produced using green electricity to make hydrogen by electrolysis, which is then converted into methane by the Sabatier process) to run peaking gas plants will be expensive, but again, makes sense for the last 10%.

We may have an answer sooner than we thought.   The state of South Australia has been steadily increasing the percentage of renewables in its grid for 17 years.  So far this year, it has averaged 75%.  It could reach 100% within 5 years.  Now, this isn't a perfect test for how high renewables can go, because SA (unlike, say, Texas) has high-voltage links with other grids, so it can buy or sell power to the other states.  Nevertheless, we will get a clear idea of the issues quite soon.