Not that long ago, NordSIP published a series of articles on nuclear power. At the time, ESG wasn’t as politicised and weaponised in US politics as it is today and the debate focused on whether nuclear power should be included in the EU′s taxonomy of sustainable activities. Despite its appeal, there seemed to be a lot of hidden or uninternalised costs to nuclear power (regarding proliferation, safety, waste management or economics) that undermined the argument in its favour. My compromise conclusion was that whilst European countries should not necessarily be building new nuclear power plants, they should also not be switching off the ones that are still working.
In this week’s Future Surfer, I take a look at the waters of a new type of nuclear power plant, its (potentially overinflated) promises and raise an eyebrow at some of the people entering this industry. For now, those waters definitely murkier than we should hope for, given the dangers inherent to nuclear power.
Rekindling Nuclear Love
Shortly after we published that series of articles on nuclear power, Russia′s president decided to invade Ukraine and reshuffled European leaders′ geopolitical, strategic and energy priorities. Freshly aware of Europe′s dependence on Russian gas, Western leaders sought to decouple the old continent′s energy sector from Russia.
Nuclear energy, which had been in the naughty corner since the 2011 Fukushima accident, received a second lease on life. Despite controversy, not least from within the EU Parliament (EP) during the regulation’s development, opposition was overcome and a Complementary Delegated Act (CDA) to the Taxonomy supportive of including nuclear power was adopted on July 6th, 2022 and entered into effect on the first day of 2023.
The rehabilitation of nuclear power has been such that by the end of 2023 Electricité de France (EDF) could issue a €1 billion 3.5-year Green bond “dedicated to the financing of the existing nuclear fleet.” According to International Energy Agency (IEA) estimates, “annual global investment in nuclear power rises from US$30 billion during the 2010s to over USD 100 billion by 2030 and remains above US$80 billion to 2050.”
Small Nuclear Reactors
Now a new option is on the rise: Small Modular Reactors (SMRs). As Swedish electricity company Vattenfall enthusiastically puts it, “SMRs are essentially small nuclear power plants with simplified reactor design and more flexibility in response to demand” and they might just be “the next big thing”.
The main benefit of SMRs vis-à-vis the consideration of the aforementioned 2022 nuclear power article series is economic. Whereas it make take up to 16 years for standard nuclear power plants to be completed, SMRs vendors “believe that building a full plant could be done in 3-5 years”, thanks to the modularity of their designs. SMRs area also more autonomous.
The hype is real. In the summer of 2022, Vattenfall even began a feasibility study on the construction of small modular reactors at their current nuclear power plant in Ringhals, on the west coast of Sweden. The green transition is a significant motivator for SMRs, since nuclear power plants do not produce CO2 emissions. Even the European Commission has gotten on board, supporting the creation of the Industrial Alliance on Small Modular Reactors and seemingly connecting SMRs with the fulfilment of its ambitious goal of cutting 90% of Net Emissions by 2040. Even the International Energy Agency embraces SMRs, noting that “nuclear power plays a significant role in a secure global pathway to net zero” and that “policy and regulatory reforms are needed to stimulate investment.”
Too Much Hype?
At first glance, SMRs are faultless. But, as you probably expect by now, there is no free lunch. In 2019, Swedens EnergiForsk noted that “there are challenges primarily from a viewpoint of regulation. There is also still uncertainty regarding how far along the designs are in the context of manufacturing and deployment strategies, which are the primary tools to ensure that these plants reach competitive price levels utilising the modularity of the designs.”
Similarly, EnergiForst also notes that the “SMR study ordered by the British government, for example, evaluates that SMR FOAK prices include a 54-66% optimism bias – even for the fairly mature designs.” Standard power plants can often take over a decade to become active, but they often promise completion times of 5 years.
The production of nuclear waste is also a concern that should remain a priority. Unfortunately, a 2022 Stanford-led research project found that SMRs will increase radioactive nuclear waste. “Our results show that most small modular reactor designs will actually increase the volume of nuclear waste in need of management and disposal, by factors of 2 to 30 for the reactors in our case study,” says study lead author Lindsay Krall, a former MacArthur Postdoctoral Fellow at Stanford University’s Center for International Security and Cooperation (CISAC). “These findings stand in sharp contrast to the cost and waste reduction benefits that advocates have claimed for advanced nuclear technologies.”
Ed Lyman, Director for Nuclear Power Safety at the Union of Concerned Scientists (UCS) is more critical. According to him, SMRs are not more economical than large reactors. Although the reactors themselves cost less to build, Lyman argues what matters is thethe cost to produce a kilowatt-hour of electricity, which is a function of the economies of scale of the power plant. Since SMRs are smaller, the economies of scale that can be exploited are smaller too. Lyman cites the example of a cancelled SMR in Idaho which would be a third more expensive than the competition.
Despite their smaller size, SMRs are also not necessarily safer or more secure than large light-water reactors. Lyman warns that “the so-called passive safety features that SMR proponents like to cite may not always work, especially during extreme events such as large earthquakes, major flooding, or wildfires that can degrade the environmental conditions under which they are designed to operate. And in some cases, passive features can actually make accidents worse: for example, the NRC’s review of the NuScale design revealed that passive emergency systems could deplete cooling water of boron, which is needed to keep the reactor safely shut down after an accident. In any event,regulators are loosening safety and security requirements for SMRs in ways which could cancel out any safety benefits from passive features.”
From Tech Bros to Nuclear Bros
Adding to my natural skepticism, because the hype is indeed real, it also seems to have attracted tech bros. In 2023 it was revealed that Sam Altman, of ChatGPT fame, was also leading nuclear energy compay Oklo. There are synergies for AI and other IT businesses, whose activities famously consume large amounts of electricity. But do we want the people in charge of this industry to come from the same pool of investors that gave us Elon Musk entering Twitter holding on to a toilet “for the lolz”?
I would like them to be boring, competent, humble and with a disproportionate sense of accountability towards society, not an inflated ego and the attention span of a 10-year old. Wealth is not a signal of expertise. Expertise is a specialised quality that is not necessarily easily transferable. What makes a good IT entrepreneur is not necessarily the same thing that makes a good nuclear company. I love innovation and I’m entirely open to the possibility that a well-managed nuclear sector has a role to play in the energy transition. But this is not a field where you can blindly operate by making overinflated promises in the hope that things will turn out well.
Allow me to conclude by echoing Lyman’s words: “SMRs may have a role to play in our energy future, but only if they are sufficiently safe and secure. For that to happen, it is essential to have a realistic understanding of their costs and risks. By painting an overly rosy picture of these technologies with often misleading information, the nuclear bros are distracting attention from the need to confront the many challenges that must be resolved to make SMRs a reality—and ultimately doing a disservice to their cause.”
Speaking of accountability, unrealistic promises and untrustworthy models of governance, I’m going to go ahead and rewatch HBO’s Chernobyl.
