Thursday November 12 2020
Business Comment, The Times
Even Boris Johnson should be able to make his mind up on this one. What’s better for Britain: politically radioactive mega-nukes built by China or a shiny fleet of small modular reactors, home grown by Rolls-Royce and other plucky Brits?
Have a squint at the engine maker’s latest missive and a glowing nuclear future awaits. Or so it says. Just a “clear commitment” from the PM is all the Rolls consortium needs, apparently, and it’ll unleash 16 modular power plants over the next two decades. And what better way to solve our energy fix than a plan that creates 40,000 jobs, contributes “massively to the levelling-up agenda”, helps “secure the UK’s net zero” pledge and brings in exports of “at least £250 billion”?
If it all sounds too good to be true, that’s because it probably is. Yes, almost any energy solution beats big nuclear: a toxic mix of old tech, uncontrollable costs, post-Fukushima safety demands and a giant clean-up bill. Plus, in Britain, an uneasy reliance on China: the Hong Kong crackdown, cyber-hacking nation jointly behind the £22.5 billion, 3,200MW Hinkley Point C and the mooted plants at Sizewell C in Suffolk and Bradwell B in Essex, the latter using its own tech.
Yet, despite Rolls’ nous with nuclear submarines, mini civil nukes are a leap in the dark. For starters, its version isn’t small. It says each reactor will provide 440MW of electricity, enough to power 450,000 homes for 60 years. That’s bigger than most old Magnox nukes. There’d also be a jump in the number of UK plants. Nuclear consultant David Lowry reckons any “proliferation in nuclear sites” ups the safety risk. And even if, as Rolls says, they’d be built on the sites of existing nuke plants, each would need its own safety approvals and security.
Then there are the costs. The economics of modular reactors only work if there are lots coming off the production line. But who pays for the factory and all the start-up losses? Short answer: the taxpayer. What the Rolls consortium really means by a “clear commitment” from the government is around £2 billion to fund the factory and first reactor. Even after that, there’s the logistical headache and costs of moving bits of reactors from the factory to the assembly sites.
Luckily one consortium member, consulting engineer Atkins, has a decent grasp of mini-nuke costs, having done a report for the business department in 2017. It found that electricity from the first few would be almost a third pricier than that from the rip-off Hinkley Point C. And the ’leccy from that is costing a guaranteed, index-linked £92.50 per megawatt hour — in 2012 prices. Today’s wholesale price? Around £40/MWh.
Yes, the more mini-nukes built, the more the costs should fall. Rolls is shooting for £40-£60/MWh after the fifth reactor. But the costs of renewables keeps dropping. And offshore wind is already getting built at £39.65/MWh. True, you can’t rely on the wind or sun every day and Britain needs an energy mix. But don’t bank on small reactors bringing nuclear nirvana.