UK Energy Policy, Nuclear Optimism, and the Future

The prospect and pursuit of long-term sustainable energy security has caused progressive anxiety among fossil fuel dependent countries as they come to grips with dwindling supplies and an unstable Middle East. Increases in the cost of uranium and fossil fuels, expanding populations, finite energy supplies, and the globally swelling demand for energy factor into a worldwide energy policy shift away from fossil fuels and towards alternative forms of energy.[i] Many thought nuclear power would be the solution, but recent events  at the Fukushima Daichii plant in Japan, as well as concerns over the safety of nuclear materials, has forced many governments to reassess their nuclear ambitions. The UK offers a case in point.

Between 2001 and 2008, the demand for nuclear power increased substantially because its ‘green reputation’ suggests a cleaner alternative to coal-fire plants and oil.[i] In the past decade, it appears that the world energy market has encountered both the opportunity and the necessity for entering a nuclear renaissance. However, in March 2011, the combined effects of an earthquake and a tsunami caused a nuclear disaster at the Fukushima Daiichi power plant in Japan.[ii] Due to the regularity of earthquakes in Japan, Fukushima was well prepared. “Reactors 4, 5, [and] 6 had been powered down earlier for scheduled servicing, and 1, 2,  [and] 3 were successfully shut down”. [ii] But Fukushima was ill prepared to handle the earthquake’s resulting tsunami. Less than an hour after the earthquake occurred, an enormous tsunami flooded Fukushima Daiichi. The resulting wave was almost double the height of the 17-foot sea wall, and Fukushima suffered a facility blackout, cooling system malfunction, and reactor meltdowns. [ii] The events at Fukushima produced uncertainty about whether or not nuclear safety could actually be managed. It was also the impetus behind the decisions of multiple countries to re-evaluate, suspend, or in some cases, terminate their commitments to nuclear energy. The International Energy Agency reduced by half its estimate of additional gains in nuclear generating capacity by 2035 following the nuclear disaster in Japan. [iii]

In spite of these concerns, the UK has exhibited marked optimism with regard to nuclear energy. On September 9, 2011, a British Science Association poll reported that over 41 percent of people support nuclear energy in the UK. [iv] On October 13, 2011, Energy and Climate Secretary Chris Huhne declared that the UK would commence with plans to build eight new nuclear energy reactors by 2025. [v] These will be the most recent nuclear power plants constructed in the UK in three decades. Despite the global shift away from nuclear energy since the Fukushima meltdown, the UK has not altered its plans to address the need for alternative energy resources. In light of the stark contrast between the energy policies of most countries and those of the UK, a question presents itself: Why, in the face of such mounting controversy and international opposition, did the UK not only retain, but bolster it’s commitment to nuclear energy?

After the Japanese nuclear disaster, many countries decided to re-evaluate their nuclear energy programs. The crisis could not have occurred at a worse time, as governments of many of the world’s most vital economies had started to take action towards constructing nuclear energy facilities to meet rising demand. [vi] In April 2011, an analysis prepared by UBS predicted that close to 30 nuclear power stations worldwide would be taken offline due to the events that occurred at Fukushima.[ii]  On March 21,  Platts released a report that made serious inferences that the accident brought the speed and scale of planned nuclear expansions around the world into doubt.[vi] A Deutsche Bank report published shortly after the incident contended that the future would hold a preference for renewable, as opposed to nuclear, energy. [vii] 

Months after what appeared to be a nuclear renaissance in the UK, Parliament decided to suspend any new developments in conjunction with its nuclear power program until the government reviewed the new reactor designs. In March of 2011, Secretary Huhne announced that the British government might revise its commitment to nuclear energy as a result of the nuclear disaster. [viii] In the next month, government plans for the new nuclear stations were put on hold so the Department of Energy and Climate could review the consequences of Fukushima. [iv] Huhne requested that chief nuclear inspector, Mike Weightman, draft a thorough analysis on the ramifications of the events at Fukushima and what lessons the UK should take away from the accident. [vi] Huhne further specified in his request that Weightman publish an interim report in May 2011 and a separate finalized version in September 2011. [vi] In the interim report, Weightman asserted that the UK had no reason not to continue with its nuclear plans. In June 2011, the Government promulgated its continued support of nuclear energy, but stated that it would wait to make any official announcements on future plans until Weightman’s final report had been released. [x] However, the Office of Nuclear Regulation (ONR) did stipulate that the government would not subsidize the construction of any additional reactors, and that new development would be paid entirely by private interests. [x] Therefore, energy companies with aspirations to construct reactors at any of the new sites would have to compete for the right to do so. [x] On October 12, after reviewing Weightman’s final report and meeting with representatives, Secretary Huhne formally announced that Japan’s nuclear power disaster would not stop the use of nuclear energy in the UK, and that the NuGeneration Consortium would continue as planned. [v] [1] “We [the UK],” Huhne asserted, “need nuclear energy!” [xi]

The UK’s increasing reliance on nuclear energy, in the face of a global shift away from the technology, is related to its convenience as an investment and improvements made on the technology. [xii] In the past, the UK had been able to address the demand for energy with domestic natural resources such as oil, gas, and coal. However, domestic sources of fossil fuels are continuously decreasing and, as a result, have fostered a dependence on foreign energy at a time when global demand and prices are climbing. The economics behind nuclear energy, while controversial, assert that nuclear power plants provide low direct fuel costs. Additionally, proposals aimed at curtailing climate change, such as the carbon tax or carbon emissions trading scheme, are to the benefit of nuclear energy as opposed to other forms of energy.[2] A recent study compared the costs of generating electricity from wind, nuclear and coal plant’s in the UK, and found nuclear power to be the cheapest option. [xiii]

While the UK government has decided not to provide subsidies for the nuclear energy industry, it has provided other incentives to encourage investment, including the carbon floor plan and the Green Investment Bank (GIB). [xiv] The government is committed to increasing the costs of emitting carbon, thus rewarding long-term investment in low-carbon technologies. [xv] The carbon floor plan represents a financial encumbrance on all carbon emitting UK businesses, and does not affect companies that operate outside the UK. Therefore, the carbon floor plan could pose a serious disadvantage to these carbon emitting UK businesses in terms of market competition as they try to cope with increased prices and cheaper alternatives.  The Green Investment Bank (GIB) is another government initiative that seeks to encourage private investment in a green UK economy. [xiv] The combination of increasing costs for fossil fuels, positive government regulatory procedures, and additional government incentives for new stations have created a promising outlook for the future of the nuclear industry in the UK.

The Office for Nuclear Regulation is the administrative body charged with the oversight of the UK nuclear industry, and it has outlined mandatory regulations for the nuclear industry within its Safety Assessment Principles. [xvii] As a result, the UK nuclear industry has acknowledged previous problems, made demonstrated improvements, and taken a leading role in the commitment to green technology. Technological improvements in the UK nuclear industry have also worked to address the issue of climate change. Compliance with the ONR Safety Assessment Principles includes numerous phases and appraisals to confirm that the reactors are mechanically sound and functionally safe. As climate change poses a new series of threats to the operation of the nuclear industry, new stoppages and safety mechanisms have been implemented to better address these risks.

In the last few years, there have been multiple endorsements from high ranking officials in and out of government that have factored into a nationwide improvement in the UK nuclear industry. Overall, the technological improvements to address concerns relating to safety, security, radiation, and proliferation have strengthened and upgraded the nuclear energy framework in the UK as whole. Risks have been reduced, and better management schemes have been promoted. The UK nuclear energy industry has retained the support of the general public and government because it has become attractive for private investment, and because the industry has improved upon related, once riskier, technology. To date, a wide-range of mechanical and procedural improvements have been instituted and have resulted in marked progress towards addressing issues related to terrorism, radiation, nuclear proliferation, and reserve safety structures. [xix] Both domestic improvements and investments and progressive government policy have worked in combination to cultivate UK support from the general public and, if polls can be trusted to indicate energy-future optimism, nuclear energy represents both necessity and possibility for UK citizens.

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[ix] Aldred, Jessica and Katy Stoddard. “Timeline: Nuclear Power in the United Kingdom.” The Guardian. 27 May 2008. Web. 2 Nov. 2011. <http://www.guardian.co.uk/environment/2008/jan/10/nuclearpower.energy>.

[xiii] Black, Richard. Environment. “BBC News – Nuclear ‘cheapest Low-carbon Option’ for UK Energy.” BBC – Homepage. 9 May 2011. Web. 19 Nov. 2011. http://www.bbc.co.uk/news/science-environment-13300595.

Consultation on the Strategic Siting Assessment Process and Siting Criteria for New Nuclear Power Stations in the UK. Rep. BERR: Department for Business Enterprise and Regulatory Reform, July 2008. Web. 18 Nov. 2011.

[vii] Deutsche Bank Group (2011). The 2011 inflection point for energy markets: Health, safety, security and the environment. DB Climate Change Advisors, May 2.

Fleming KN, Silady FA. A risk informed defense-in-depth framework for existing and advanced reactor. Reliability Engineering & System Safety; Volume 78, Issue 3, December 2002, Pages: 205–225.

[iii] “Focus: The Future of Oil and Gas | The Economist.” The Economist – World News, Politics, Economics, Business & Finance. 11 Nov. 2011. Web. 19 Nov. 2011. <http://www.economist.com/blogs/dailychart/2011/11/focus-1>.

[xi] Groves, Jason. “Chris Huhne: Nuclear Energy Is Vital to Our Future.” Home | Mail Online. 14 Oct. 2011. Web. 17 Nov. 2011. <http://www.dailymail.co.uk/news/article-2048787/Chris-Huhne-Nuclear-power-vital-future.html>.

[xvii] Health and Safety Executive (HSE). The Licensing of Nuclear Installations., 2007. Print. Pg. 4.

[xv] HM Treasury. Carbon Price Floor Consultation: the Government Response., Mar. 2011. Web. 19 Nov. 2011. <http://62.164.176.164/d/carbon_price_floor_consultation_govt_response.pdf>.

[xiv] Holmes, Ingrid. Financing the Green Deal: Carrots, Sticks and the Green Investment Bank. Rep. E3G, May 2011. Web. 19 Nov. 2011. <http://www.transformuk.org/attachments/products/27/e3gbriefing-on-financing-the-green-dealmay-2011.pdf>. Pgs. 1-25.

[vi] “Japan Crisis Puts Global Nuclear Expansion in Doubt – Electric Power | Platts News Article & Story.” Energy Products & Services, Oil, Coal Insight, Natural Gas Shipping, Electric Power Methodology Analysis, Metals, Petrochemical, Reference – Platts. 21 Mar. 2011. Web. 20 Nov. 2011. <http://www.platts.com/RSSFeedDetailedNews/RSSFeed/ElectricPower/6925550>.

[ii] Lekander, Per, Stephen Oldfield, Jim Von Riesmann, and Pankaj Srivastav. UBS Investment Research: Global Nuclear Power. Rep. 4 Apr. 2011. Web. 22 Nov. 2011. <http://www.tegenstroom.nl/sites/default/files/UBSGlobal%20Nuclear%20Power_0.pdf>.

[v] Livsey, Greg. “Chris Huhne Says No Reason to Stop Nuclear Plants After Fukushima.” The Daily Mirror. 12 Oct. 2011. Web. 20 Nov. 2011. <http://www.mirror.co.uk/news/politics/2011/10/12/chris-huhne-says-no-reason-to-stop-nuclear-power-plans-after-fukushima-report-115875-23482559/>.

[xviii] NuGen – Home Page. Web. 09 Dec. 2011. <http://www.nugeneration.com>.

[x] Office for Nuclear Development (OND) Department of Energy and Climate Change. 2011. Web. 20 Nov. 2011. <http://www.decc.gov.uk/en/content/cms/meeting_energy/nuclear/new/office/office.aspx>.

[viii] “Policy Responses to the Fukushima Accident.” World Nuclear Association | Nuclear Power – a Sustainable Energy Resource. 16 Sept. 2011. Web. 20 Nov. 2011. <http://www.world-nuclear.org/briefings/policy_responses_fukushima_accident.html>.

[iv] Populus. British Science Festival: Nuclear Power Research. Rep. British Polling Council, 2011. Print. Pgs. 1-13

[i] Rogner, Hans-Holger, and Alan McDonald. Nuclear Power Revival: Short-Term Anomaly or Long-Term Trend? Rep. International Atomic Energy Agency, July 2005. Web. 23 Nov. 2011. <http://www.iaea.org/OurWork/ST/NE/Pess/assets/wna-iaea-050829-final.pdf>. 1

[xii] Smith, Eric. R.A.N. Energy, the Environment, and Public Opinion. Lanham, MD: Rowman & Littlefield, 2002. Print.

[xix] Weightman, Mike. Japanese Earthquake and Tsunami: Implications for the UK Nuclear Industry. Rep. Crown, 2011. Print. Pgs. v-viii.

[xvi] Whitfield, Stephen C., Eugene Albert Rosa, Amy Dan, and Thomas Dietz. “The Future of Nuclear Power: Value Orientations and Risk Perception.” Risk Analysis. 29.3 (2009): 1-15. 2009 (Print). Web. 24 Jan. 2011.