After fifteen years of dithering about nuclear energy policy we learned yesterday that the UK can carry on running its existing fleet of nuclear power stations for longer. The safety case will be examined reactor by reactor, but the mood is to lengthen their lives yet again. It’s certainly a cheap and immediate answer to the short term problem of how to keep the lights on.
We also learned that the government has found a way of paying investors and operators more to generate power from future new nuclear stations that does not fall foul of EU subsidy rules. The consumer will have to pay more, but we are told this will be a bargain if as the planners assume fossil fuel prices soar later this century. The present dear prices of nuclear and renewable energy will look cheap, they argue, as the UK benefits from its low or no fuel cost for much of its power generation.
Nuclear and renewables have two big advantages. Not only do they have low or no fuel costs in the future, but they are built on UK territory so they help to provide us with greater security of supply. Perpetual renewables like hydro and wave power offer much more security than interruptible renewables like wind power, where the UK will need substantial fossil fuel back up capacity for when the wind does not blow.
On the back of the government’s decision it is still not clear what mix of power generation the UK will enjoy in ten years time. It is one thing to offer suitable contracts to woo the nuclear generators, it is another to get them to commit to building very large investments on the promise of a stable and profitable price regime for forty or fifty years ahead in such a political area. The government has wisely licensed a large amount of new gas capacity, but so far the industry has been reluctant to commit to construction. Gas remains the cheapest way of generating power, and the UK may well have much more gas available as shale gas is added to the North Sea natural gas deposits.
Let us hope that on the back of the latest statements of intent from the government some building work is started. I hope the industry will go for cheaper power by committing more to gas stations, and recommend getting more of the gas out of the ground as part of our industrial revival. I also would like to see more of the renewable element coming from perpetual renewables.