The new nuclear opportunity: a blend of big and small
With vaccines rapidly being rolled out in the UK and a roadmap for a return to normality set out by the Prime Minister, we can collectively start to turn our attention to our next major challenge: undoing the economic and social damage caused by lockdowns and social distancing measures.
Recovering in the right way
How we recover is, in some ways, as important as the scale and speed of the recovery. With the simultaneous challenges of climate change, an ambition to create a ‘Global Britain’, tackling unemployment, and more inclusive growth so that we level-up the UK, we cannot simply go back to what we were doing before – we need to build back better.
Infrastructure has been recognised and promoted as a key asset in the pandemic recovery and, given the criticality of decarbonising the nation, there must be a prioritisation of delivery of a rich mix of nuclear and renewable energy sources.
While the environmental benefits of these forms of energy generation stand out, it’s important to note that schemes delivered in response to ‘green’ policies offer significant return on investment potential. Indeed, a 2020 study by the Smith School of Enterprise and the Environment at the University of Oxford found that investment in clean energy scored impressively both in terms of having a high economic multiplier effect and ability to decrease greenhouse gas emissions.
While there is no denying that the energy mix must consider all forms of renewable energy, from those we have come to recognise as commonplace, such as wind and solar, to those that are more emergent, such as Carbon Capture, Usage and Storage (CCUS), we must not discount the vital role that nuclear still has to play.
And within the nuclear offering, we must consider a mix too. Gigawatt-scale nuclear schemes have been the backbone of the UK’s nuclear energy generation for decades and new facilities need to be delivered in order to maintain a secure supply. However, developments in Small Nuclear Reactor (SMR) technology now offer us with another viable option.
A new contender
But why are SMRs viable? What makes them a genuine asset to an already diverse mix of energy generation technologies?
For me, they fall neatly into the bracket of being ‘shovel worthy’ schemes, and there is nearly universal agreement that ‘shovel worthy’ infrastructure can help stimulate economic growth, boost productivity and create jobs. In my mind, ‘shovel worthy’ revolves around five broad criteria which may, of course, ebb and flow in importance depending on the specific type of project:
- A clear purpose and outcome for the project or programme
- Potential for exporting the skills and knowledge from the scheme
- Contribution to achieving the UK’s Net Zero Carbon ambitions
- Job creation and economic growth in the most deprived areas of the country to support levelling-up
- A substantial component of the scheme/project delivered using Modern Methods of Construction
Consider the above and it is clear that SMRs fit the bill.
Back in 2014, the regulator Ofgem expressed significant concerns about the tightening of the UK’s generation capacity as we continue to close older nuclear, coal and gas power plants, starkly predicting a one-in-twelve chance of ‘the lights going out’ in the next decade if urgent action wasn’t taken.
While wind and solar are currently generating around 30% of our energy mix, they cannot alone realistically provide the reliable baseload capacity we need due to natural fluctuations and limits in electrical storage technology. A modern energy network needs a true mix of different sources for its resilience and success.
SMRs must be part of that mix. They create low-carbon energy, are exportable, can be produced in an advanced factory located in some of our most deprived communities and, crucially, are an area of competitive advantage for the UK.
Since Calder Hall opened in 1956, leading the world in domestic nuclear generation, the UK built and expanded its academic and industrial capability. Sadly, however, due to the UK’s chosen technology being based on graphite cored reactors and the strategic choices of politicians over the decades that followed, we have failed to truly capitalise on those skills to deliver our own supply or as an export market.
According to the World Economic Forum, the global market for SMRs is projected to be worth more than £300bn by 2040, accounting for between 5-10% of world energy production. With such high levels of UK involvement in SMRs, and a global recognition of UK lead design approval for SMR technology, that presents a tremendous opportunity for Global Britain. But not only that; UK Research and Innovation suggests SMRs could support up to 40,000 jobs and add over £1bn a year to our economy.
Even though SMR technology has successfully and safely been used for 60 years in nuclear submarines, their use for domestic purposes is yet to be established. At the end of last year, the UK government rightly allocated £215m to mature domestic designs, with £300m of further funding coming from the private sector.
As these designs progress over the coming years, the government needs to go further by selecting sites and proving the case for domestic use by example and creating a global export strategy to develop and capitalise on UK expertise, while ensuring the factories building them are located in communities in need of levelling-up. That way SMRs will make a significant contribution to our post-pandemic recovery and help us all build back better.