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Shifting to a renewable energy system: should we target nuclear before coal?

Publicerat den 5 juli, 2011 av Oskar Englund

In an attempt to reach a wider audience, we will henceforth write some posts in English. This is our first try. Note that most links are to Swedish articles.

(Kära läsare: tala gärna om för oss om ni finner det svårt att följa resonemanget när inlägget inte är på svenska)

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Nuclear energy is often debated in politics and media, in Sweden as well as internationally. I assume that no one has missed the speed-up of Germany’s planned nuclear energy exit (all plants to close by 2022). Immediately after the announcement I was rather ambivalent. Naturally, it would stimulate production of renewable energy (which is good). On the other hand, as many people have pointed out by now, Germany could be forced to replace the low-carbon nuclear energy with more coal, Russian gas and/or French nuclear (which is not so good). I remember stating it was a shame that they didn’t target fossil energy first.

But then researcher Fredrik Hedenus made a very good point in an interview with GP:

We have an emissions trading system in the EU. If Germany shuts down their nuclear power plants and replace the low-carbon energy with higher-carbon energy, emissions will have to decrease elsewhere. Therefore, as long as this system is in place, the climate effects will be rather neutral.

This made me quite embarrassed (why wasn’t that obvious to me?)…

When I recovered from the embarrassment (which I did when I realized that several seemingly more competent people than I had raised the same concerns that I so hastily did), I started to think some more. In order to develop these thoughts further, I want to ask all pro-nuclear (or anti-nuclear for that matter) people to point out the errors in the following reasoning. It should be noted that this is purely speculative, so do not feel offended by the final ”suggestion” in case you are in favor of nuclear energy. Instead, contribute to the discussion by writing a balanced comment. Emails are also welcomed.

That said, let’s say that we are contemplating two very different alternatives:

Exit fossil energy: Then we can replace it with either nuclear energy or renewable energy.

Exit nuclear energy: Then we will have to replace it with renewable energy, since we have an emissions trading system in the EU (as previously discussed).

The immediate feeling is that the former alternative would be the fastest way to obtain a non-fossil energy system (something that I have claimed several times in this blog to be the preferred choice, by the way). This makes sense since the fossil energy is what we really want to get rid of. Right?

Let’s say that we choose the former alternative. In this case, the demand for both nuclear and renewable energy would naturally increase. However, nuclear power would probably be the preferred alternative for many countries as it can provide a reliable base load without significant modifications of  the grid . This means that, even though the demands for renewable energy are likely to increase, the incentives to modify the grid (as necessary for renewable energy to provide a stable and reliable load) would be weak, since the base load is guaranteed anyway from nuclear energy. Renewable energy would thus remain a complementary energy source in the energy system.

Let’s say that we choose the latter alternative instead. Then the demands for renewable energy would become very high, since it would be the only alternative to the energy that is being phased out from the system. This would naturally decrease production costs rapidly as well as increase the incentives to adapt the grid accordingly, in order to safeguard the stability of the base load. As the production costs would decrease faster than in the ”exit fossil energy” alternative, renewable energy would become competitive faster and eventually be used not only for replacing nuclear energy but also fossil energy – it would simply be cost-effective to do so.

Therefore, I (most deliberately provocatively) suggest that the transition to a renewable energy system in the EU would be completed faster by targeting nuclear energy instead of fossil energy. Disagree? Explain why!

Kategori: Energisystem, Kärnkraft Etiketter: , , ,

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  • http://www.math.chalmers.se/~olleh/ Olle H

    I disagree, at least to some extent. The point made by Fredrik Hedenus and elaborated in this blog post is a good one, but it is based on an oversimplification in viewing the EU carbon trading scheme as a fixed and deterministic boundary condition. Isn’t it at least conceivable that if major players such as Germany fail to reduce their carbon emissions as much as previously hoped for, then there will be political pressure to make carbon emission targets less ambitious?

    • http://ekologistas.se Andreas Hanning

      I do agree with you Olle, that it might create a larger political pressure to make the emission targets less ambitious. But, when we’re talking about Germany, they’ve got a massive anti-nuclear opinion among the general population, which I think will safeguard Germany from changing their political opinion on nuclear decomissioning once again.
      The decision to get rid of nuclear and go renewable, was backed by 85 % of the Bundestag, which gives a really good backing to the decision. Since the next election for the German Bundestag won’t take place until the fall of 2013, and since the deadline for closing down nuclear power will take place rather soon (on a company and political timescale), this forces companies (and the CO2 emission lobby organizations) to change their approach rather quickly, since they don’t have time to wait for the next election in order to change the course of politics in Germany. With this in mind, I think that the short timeframe we’re taking about might just be one of the most important aspects of the German decision, and one of the reasons why it might just work.

  • Johan Höglund Åberg

    Do you really think that countries that are dependent on their export industry, Germany for instance, will allow higher energy costs to interfere with their production? When reality catches up to the germans they will probably either step away from the 2022 date for nuclear or step away from the trading scheme. The Netherlands have already decided not to honour the mandatory target of producing 20% renewables by 2020 for instance.

    • Lassesson

      A large part of the german export industry is within solar and wind power. This decisition (phasing out nuclear by 2022) might be damaging to energy intesive industy (which might lead to more energy savings) but it might also be positive for the german industry producing solar cells and wind turbines.

  • http://profiles.google.com/marcuslinder Marcus Linder

    As I have previously commented on this blog, and completely in line with the two previous comments, I believe your main mistake is that you assume that the ETS will work 100% as ”in theory”, in other words: as espousedly intended. It might of course turn out so that it will, but it can hardly be assumed to.

    There are many ways that it may work out differently. For example, the amount of allowable emissions rights could be extended through lobbyism/political maneuvering, or reduced at a lower than otherwise rate, or cheaper electric power could be imported from other countries – outside of the European ETS. In the latter case, it might even be German businesses that in practice produce the energy. (Possibly, of which I know too little, the current legislation around the ETS might require some small amount of political work in order for the latter case to be allowed.)

    F.ö. tycker jag ni ska köra på svenska. :-)  
    Men det är förstås en klurig avvägning och beror i hög grad på era personliga mål med bloggen.

    • http://ekologistas.se Andreas Hanning

      I totally agree with you Marcus, that we can’t assume that the ETS will be 100 % perfect. But, I think the German decision will create something which has been lacking in politics (in Germany, and as well as in Sweden), and that’s a very clear path and a clear agenda pointed out by the German government.
      Ten years is a very short time when it comes to politics, and it’s a timescale in which almost all large companies operate. I’d say that all companies (that are large consumers of electricity) will have a very detailed five year plan, and almost all of them will have a rather well described plan for the coming 10 years. On the other hand, very few companies will have a plan regarding what they will do in 20, or in 30 years. This means that the old Swedish decision, which stated that nuclear power would be decomissioned in 30 years, was in effect, totally worthless. The same stands for the German decision made last year, which extended the lifespan of the reactors for 17 more years.
      However, a quick shutdown taking place within ten years will have to be incorporated in all of the five year, and ten year, plans for all major companies operating in Germany (and Europe as well), since it will affect their business. This, in turn, will force the companies to do drastic measures to increase their electricity realiability, like building their own windmills, or increase their efforts in energy efficiency measures. This can be related to the political climate in Sweden, where the industry are still hoping for a future nuclear power plant to be built, but since it would be extremely expensive no one wants to build it, which in turn just creates a loop where nothing happens. In this sense, the German decision is the best thing that could happen the renewable industry, whether or not the ETS will work to 100 %.

      I know that it’s possible to argue that the companies might just relocate outside of the ETS area, or they might just buy cheap energy from outside the area. But, this would just shift their response in time, since there’s a good chance that there will be rather strict rules regarding emissions coming along in more countries. Also, the EU might impose rules in imported goods, stating how much CO2 they are allowed to generate, which in turn might make it rather useless to relocate to an area outside the ETS. If the companies stay in Germany, they will have a long term decision to rely on, and they will be able to plan for the coming ten years, which might be impossible if they move somewhere else.

      • http://profiles.google.com/marcuslinder Marcus Linder

        Good point about that most corporations operate on short time horizons and that the German decision will play out in a comparatively short amount of time! I had not previously considered this, and I believe it could indeed make a considerable difference as to the outcome in terms of economic behavior of the same firms.

    • http://ekologistas.se Andreas Hanning

      Bra tips att du tycker vi ska köra på svenska. Vi håller mest på att testa just nu med engelska, så vi får se hur det blir i fortsättningen. Vi vet att vi har en del läsare utanför Sverige, så det här är ett sätt att försöka möta upp dem.

  • http://www.ekologistas.se Oskar Englund

    Back again from a few days recreational rock climbing in Bohuslän and happy to see some reactions to the post! Andreas and Henric have already replied to the comments (in a very good way) so I will just recap the discussion so far. 

    No one seems to disagree with the reasoning in the post, which is good. On the other hand, no one agrees immediately with the ”suggestion”. This was perfectly expected, as it does not ”feel” right (it doesn’t to me either). The main concern has been that the ETS does not work perfectly and that it may be affected by large and rapid changes to the energy system. It is wise not to expect it to work perfectly, although it is probably unwise to expect it not to. Incentives to improve and regulate the system sufficiently will not be strong as long as people expect it not to work…

  • anna wolf

    My reactions come a bit late, because I found your (great) blog today for the first time! But I felt I have to point something out here… I have half my family in Germany and close relatives in the German power industry. Apart from that I work with energy issues and I listened to the German ambassador in Almedalen this year, on this particular issue. I think the main point is that the choice between the two options above are highly theoretical. It might be reasoned that it would be better for climate to phase out coal. However, the German ”phase out” of nuclear is as much a ”phase in” of renewables, which will give positive effects on the prices on renewables (as you mention above) and thus make renewables competitive etc. The effect might have been the same if coal had been phased out, since I doubt that they would have build the more expensive nuclear instead. The only thing lacking in this reasoning is the obvious fact, to those who understand the German situation, that a phase out of coal simply wouldn´t have been possible today due to the political opinion! The only way that the Germans could come through with their ambitious program to phase in renewables was to simultaneously phase out nuclear! This is something we do not understand in Sweden since most people here prefer nuclear to coal, but in Germany the situation is very much the other way around. There is a strong opinion against nuclear, at the same time as very many people and regions are depending on coal. Hopefully, which I believe is also the plan, the phase in of renewables, or ”Energiwende” as they call it, will create sufficient jobs and new industries to make the phase out of coal possible, not only from an energy- and price/kWh perspective, but also from a political perspective!

    So the real choice was 1) doing nothing and keeping both coal and nuclear or 2) phasing out nuclear, temporarily keeping coal and investing in renewables. And then I think the choice is easy…

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