The Nuclear Free Local Authorities (NFLA) notes the report by the ‘Expert Finance Working Group on Small Modular Reactors’ as another attempt to promote the benefits of this technology despite large and quite possibly insurmountable hurdles to cross.
The report was commissioned by the UK Government to consider ways to provide market frameworks for the development of small nuclear reactors to prosper. (1) The Government suggests it is an ‘independent’ group, yet at least half of the group have strong links to the nuclear industry, including the Nuclear Industry Association, the main UK supporter for such technology. (2)
Over the past few years, the UK Government has put forward the potential of small nuclear reactors to be a part of a future ‘low carbon’ energy mix. The UK appear to be one of the few governments pursuing such a strategy, as even France and Finland, the only other countries in Europe currently developing large nuclear projects, have no plans to develop such technology. Indeed France has just commissioned a whole raft of new smaller-scale solar energy projects. (3)
Interestingly the report notes:
“London is seen as a leading hub for green finance. However, despite the UK Government’s key and important shift to low carbon power …the financial sector has been slow to follow the Government’s lead; the finance sector still seems to limit green finance to renewable power. This is an unhelpful and often unrealistic narrowing of opportunity by the finance market.”
NFLA would rather suggest that the finance sector is accurate in being sceptical of new nuclear developments given the rapidly decreasing costs of renewable energy.
The report tries to overcome these financial risks, and makes the following key recommendations:
- The Government should help to ‘de-risk’ (perceived and real risks) the small nuclear market in order to enable the private sector to develop and finance projects.
- The Working Group concludes that the UK could be well placed to develop first-of-a-kind (FOAK) small reactors projects, with ‘overnight’ costs of less than £2.5 billion, by 2030.
- The characteristics of small nuclear reactors and the mechanisms by which they can be delivered are such that they may be commercially viable propositions both in the UK and for an export market, however, as with any significant energy or infrastructure project, attracting private finance will be challenging for the FOAK projects.
NFLA would continue to argue such optimism is misguided. In its own analysis of small nuclear reactors it rather concludes:
- Small modular reactors would only become cost effective if a massive supply chain is put in place, but there remains no real likelihood of that taking place at the global level till at least 2050. It may require hundreds of them to be built for them to become truly cost effective – which NFLA see as highly unlikely to occur.
- Their costs per unit of output is higher than larger, conventional nuclear power stations.
- No SMR has yet been built anywhere in the world. At present a NuScale design in the United States is going through a regulator’s design safety assessment process but will still take several years further to be approved, at least 2021.
- Despite the attempts by the Working Group, the actual costs of small nuclear reactors remains largely unknowable at present with the technology so nascent.
- There remain considerably cheaper alternatives in developing a wide renewable energy mix, local decentralised energy, energy efficiency programmes and energy storage back-up schemes. (4)
NFLA also notes that the Working Group’s report makes next to no mention of the increase in nuclear transports that would have to take place, increasing risks on safety and security. It makes no mention either of the radioactive waste such technology could generate and the costs in storing such waste. Similarly, it excludes the issues of increased nuclear proliferation that small nuclear reactors will bring.
NFLA Forum Chair, Councillor Feargal Dalton said:
“The UK Government continues to work hard to bring small nuclear reactors forward, probably due to the huge costs that will incur in funding large projects at Hinkley Point and Wylfa, and the likely collapse of the Moorside project. At the same time, it is cutting subsidies for solar, it has deliberately prevented the development of onshore wind, and it has cancelled the Swansea Tidal Lagoon scheme. NFLA see the Government’s energy priorities as hopelessly muddled and blocking the delivery of cheaper, safer renewable energy, decentralised energy and energy storage back-up schemes. Small nuclear reactors are not the answer to our low carbon needs and effort should be refocused on realising the better alternatives.”
Ends – for more information please contact Sean Morris, NFLA Secretary, on 00 44 (0)161 234 3244.
Notes for editors:
(1) Expert Finance Working Group, ‘Market framework for financing small nuclear’, August 2018
(2) Dr David Lowry’s Nuclear Blog, 7th August 2018
(3) Climate Action 7th August 2018
(4) NFLA New Nuclear Monitor 37, ‘Analysis of Small Modular Nuclear Reactors’, March 2015