By Callum Thomas, Thomas Thor Group Founder and CEO
It is always interesting to hear perspectives on the nuclear industry from experts in renewable energy, especially when they make objective arguments in favour of nuclear energy being a significant part of the global energy mix.
‘’Taming the Sun: innovations to harness solar energy and power the planet’’ is a book published in 2018 by Massachusetts Institute of Technology (MIT) and written by Varun Sivaram, a rising star in the solar power industry. As someone whose career is centred in the nuclear industry, I read the book in the hope that it would give me some interesting perspectives on developments in the solar power industry and what they mean for the nuclear industry. I was not disappointed. The author makes comments and observations on nuclear power throughout the book, and although he is a fervent ambassador for solar power there are frequent positive take-aways for the nuclear industry. This is a book about solar power that shows why nuclear is so important in the energy mix. Here are a few of the relevant points that I took from reading the book:
- Armed with vast knowledge about the capabilities of solar power, the author puts forward an ambition for 33% of the world’s electricity to be generated by solar power in 2050. This would be up from just over 1% in 2017. The intermittency of solar power and the challenges of storing the electricity and transporting it over large distances mean that we need reliable forms of carbon free electricity generation. The choices are: nuclear power plants or fossil fuel plants fitted with carbon capture and storage devices. Both could play a role, but the Harmony goal launched by the World Nuclear Association to generate 25% of the world’s electricity by 2050 fits perfectly with the ambitions of the solar industry. The important point here is that the world’s leading experts in renewable energy see a critical need for reliable sources of electricity generation, such as nuclear, in the coming decades. This is a message that does not seem to have made it to the mainstream.
- In the 1950’s, general opinion was that nuclear would be the dominant form of electricity generation of the future, and now there is a growing general opinion that solar will play this role (along with wind). However, the more solar power capacity that comes online (and wind), the more electricity is delivered to the grid around the middle of the day. This means that the price of the electricity reduces towards zero in the middle of the day, and in some cases (as seen in California), generators pay to unload the surplus electricity. Currently, a solution does not exist to store large amounts of electricity or transport it long distances to where it may be needed. The author makes a powerful argument that even though the cost of solar panels is decreasing, the value of the electricity is decreasing faster, and the whole industry could collapse as the number of solar panels rises. If this happens then the winners are fossil fuels, and the loser is the environment. Nuclear plants are closing down because they cannot compete with the low cost of electricity generated by fossil fuels (especially gas) and renewables (when they are available during the daytime). This creates a powerful argument for a ‘’carbon tax’’ to increase the cost of carbon intensive forms of electricity generation.
- All the electricity storage capacity in the world including all hydropower facilities (pumping water uphill and storing it to send downhill and turn turbines is by far the world’s biggest battery storage solution), amounts to enough globally to store 47 minutes of electricity based on our consumption. I learned from this book that we are a very long way from developing the kind of storage capacity that we would need to provide all the world’s electricity from renewable sources. Furthermore, the cost of batteries, such as lithium-ion batteries, is prohibitively expensive and involves the use of heavy metals which add to environmental damage. In short, the common perception that we are nearly there in terms of electricity storage solutions is far from reality.
- The author argues that the solar industry is doomed unless ‘’technological innovation’’ is ramped up to develop new technologies. The solar industry is dominated by the silicon PV panel technology currently, and nearly all R&D investment is going towards making silicon PV panels slightly more efficient and slightly cheaper, with smaller and smaller marginal improvements being the result. The solar industries in Europe and North America have collapsed over recent years because they cannot compete with the economies of scale that China are realising in manufacturing silicon PV panels. A parallel is drawn between solar and nuclear in terms of a reliance on a single technology and a long term lack of investment in innovation. Around 90% of the world’s nuclear reactors are based on the light water design. This is a design that has become increasingly expensive to build and has very occasionally been associated with incidents. The suggestion is that if there had been more innovation investment in nuclear technology, then the industry would not have stalled in the 1990’s. This is a debatable point, but it is certainly true that sources of finance for innovation are hard to come by (as many SMR designers will confirm).
- A whole section is dedicated to the need for ‘’financial innovation’’ in the solar industry, through initiatives such as creating bundles of investments in solar projects and attracting institutional investors such as pension funds and sovereign wealth funds. It is an interesting parallel that both solar and nuclear struggle to raise finance from institutional investors, whereas oil and gas has successfully managed it for decades. There are some positive signs on this front though in the nuclear industry, such as Bruce Power, which is half owned by a Canadian pension fund, and investments in new nuclear technology by high profile investors such as Bill Gates. Perhaps the renewable energy and nuclear industries could work together to create large and diverse portfolios of ‘’carbon free electricity generation assets’’ that offer the type of scale and spread of risk that institutional investors look for.
The book provides a clear and up to date account of the current capability of solar, the technological and cost limitations of storage and long distance transport of electricity and the importance of reliable electricity generation from sources such as nuclear. It is enlightening to see how all these factors fit together, and that even the world’s most active solar advocates visualise a 2050 where renewable energy is integrated with nuclear to provide the world with clean electricity.