Wednesday, August 11, 2010

Nuclear in France, Egypt, Germany: Has It, Wants It, Needs It

lens-post-nuke-1024x737 A company called Research and Markets has put out a report called France Power Report 2010. I couldn’t begin to afford it – almost 600 Euros – but the description includes some interesting tidbits:

Nuclear energy is the dominant fuel in France, accounting for 38.4% of primary energy demand (PED), followed by oil at 36.2%, gas at 15.9%, coal with a 4.2% share of PED and hydro-electric power with 5.4%.

This is for all power sources, not just electricity generation – France is at about 80 percent there with nuclear energy.

And this:

The new France Power Report from the analysts forecasts that the country will account for 7.77% of power generation in developed markets by 2014, and to remain a net exporter of electricity to neighboring states. The analyst-developed power generation estimate  for 2009 is 7,152 terawatt hours (TWh), representing a decrease of 4.8% over the previous year. We are forecasting a rise in regional generation to 7,745TWh between 2010 and 2014, representing an increase of 6.0%.

That decline likely speaks to the recession. France’s immediate neighbors are Spain, Italy, Germany, Switzerland, Luxembourg and Belgium, so they are presumably the beneficiaries of the nuclear halo produced by exported electricity.

If you take a look at this chart from the IEA, you can see that nuclear energy’s growth over the last 40 years in France has had two purposes: to eliminate oil based generation and lately to replace coal-fired plants – France never used coal as a primary generator because it doesn’t have an impressive domestic supply – and to keep pace as France’s electricity needs ballooned. Virtually all additional capacity added since 1977 has been contributed by the atom.

And finally:

France's reliance on nuclear energy allows it to produce electricity at lower cost than other European countries.

Quel surprise!

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Let’s stay international for a bit:

In an attempt to meet the country's increasing energy consumption rates, Egypt's Ministry of Electricity and Energy announced that it will open bids for its first nuclear power plant this year.

"Egypt's nuclear program is progressing steadily and we expect to start the tender before the end of the year," Minister of Electricity and Energy, Mahmoud Younes, told state-owned newspaper Al Ahram.

Nuclear advocates like to point out the fact that nuclear energy does not produce greenhouse gasses, but what about when those gasses are already working their mischief? I am not competent to say that is what is happening in Egypt, but for that country, it’s the heat that makes nuclear energy appealing.

The decision to develop Egypt's power and energy capabilities comes as the country is suffering from another hot summer that has the government struggling to meet increased electrical demand. Large parts of Egypt's cities and towns – including Cairo – still have to bear constant and sometimes daily power outages during June, July and August.

The government responded by dimming street lights on main roads by 50%, as well tripling electricity prices during peak hours and imposing laws forcing citizens to reduce their daily consumption.

Now, there’s a growing population there and perhaps more widespread air conditioning, so crediting electricity shortfalls solely to the heat may not be fully accurate. But it’s still a huge factor. So where nuclear energy can avoid harmful emissions – and reduce them if Egypt is able to switch off elderly coal plants - it can also provide needed electricity and a lot of it.

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I’ve mentioned – maybe even harped on- Germany’s ill-advised plan to use nuclear energy to keep its greenhouse emissions down while planning to shut down the reactors when renewables are ready to take over – feh! – while taxing the reprieved nuclear plants because they do not qualify to be taxed for producing carbon, because they don’t (whew!).

There had to be fallout from this deeply hypocritical and short-sighted plan and German utility E.ON has provided it:

Utility E.ON AG Wednesday said the German government's plan to impose a tax on nuclear fuel rods could cost the company up to EUR1.5 billion in adjusted earnings before interest and taxes per year, making the operation of nuclear reactors uneconomic.

Now, it’s only fair to say that companies, like people, are loath to pay new taxes and E.ON may be maneuvering around them. Currently, the government plan is to shutter the plants in 2022, but that seems highly unlikely in the absence of an alternative.

So where might E.ON locate a compromise?

"I believe there's no doubt that in the medium term Germany can't forego zero-carbon, inexpensive nuclear power if it intends to continue to play a leadership role in Europe's climate protection effort and if the economic recovery is to continue," E.ON's [CEO Johannes] Teyssen said.

He also said the company is willing to give up some of the profits generated from longer operation of nuclear power plants.

And therein lies the other shoe, dropping.

German daily newspaper Handelsblatt earlier Wednesday reported that the four nuclear operators have proposed to the government that they pay a total of EUR30 billion in return for a 12-year extension of reactor lives. The money would be paid into a fund to promote the expansion of renewable energy generation. Both E.ON and the Finance Ministry declined to comment on the report.

And, if true, that gets E.ON and Germany to 2034, when it will be a new generation of executives and politicians. They can see where they are with renewables – I have a couple of guesses I could offer - and decide what to do then.

So, if this becomes the deal, see you in 2034!

Germany’s Biblis B nuclear plant. I’d take bets on the likelihood on nuclear energy in Germany past 2022 – even 2034 – but my heirs would probably have to collect.

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