Nuclear Energy Is Not The Savior Some People Think It Is

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Data centers and bitcoin mining operations are sucking enormous amounts of electricity out of the grid. Some stakeholders in those fields are banking on a new generation of nuclear power plants to keep themselves from looking like supervillains against the decarbonization movement. Or not, as the case may be. A new study from the Australia’s premier science agency, CSIRO, indicates that nuclear energy is a costly, time-consuming and ultimately futile solution — at least for Australia, that is.

The CSIRO Nuclear Energy Study

The Intertubes lit up like a Christmas tree when CSIRO released its nuclear energy finding in a press release dated December 9, but it’s important to note that the study is confined to circumstances in Australia, which has yet to field a nuclear power plant of its own. The authors point out that a first-of-its-kind nuclear energy venture in Australia is all but certain to run into exceptional costs that would not apply to continuous-build programs in countries with mature nuclear energy industries.

The newness factor is underscored by another study called GenCost, which the CSIRO authors incorporated into their work. Updated in May of this year, GenCost takes note of the vigorous nuclear energy program in South Korea.

“The large-scale nuclear costs [GenCost] reported could only be achieved if Australia commits to a continuous building program, following the construction of an initial higher-cost unit or units,” CSIRO concluded.

“Initial units of all first-of-a-kind technologies in Australia are expected to be impacted by higher costs. A first-of-a-kind cost premium of up to 100 per cent cannot be ruled out,” the institution added.

What’s So Bad About Nuclear Energy?

All things being equal, there is nothing wrong with nuclear energy. However, the environmental risk factor compared to wind, solar, and other renewables is not equal, as most recently demonstrated by the 2011 Fukushima nuclear disaster. More recently, nuclear vulnerabilities in Ukraine have underscored the potential for national security risks as well as environmental impacts.

As for competing forms of energy, back in the 20th century hydropower was the only other large-scale, low-carbon, 24/7 alternative around. Even  then, the writing was on the wall. The World Bank financed exactly one nuclear energy project in the 20th century, located in Italy. A loan of $40 million was granted under an elaborate set of conditions including the absence of existing hydropower resources. With the assist from the World Bank, the new nuclear power  went online in 1964. An accident shut it down just 14 years later, in 1978. By 1982 it was officially sent to the scrap heap.

That 14-year lifespan is important because one advantage of nuclear energy is the potential for a 60-year lifespan. The longer timeline helps to defray startup costs, leading to a more competitive scenario. However, the CSIRO study pours cold water on the 60-year time frame. “GenCost assumes a 30-year economic life for large-scale nuclear plants, even though they can operate for a longer period,” the authors explain.

“For power stations, warranties expire and refurbishment costs may begin to fall around the 30-year mark,” they emphasize. Nevertheless, the CSIRO study takes the 60-year timeline under consideration. Even with that advantage, nuclear energy still comes up short.

“While nuclear technologies have a long operational life, this factor provides no unique cost advantage over shorter-lived technologies,” they conclude, referring to the cost of refurbishing an older nuclear power plant compared to investing in new wind or solar farms.

In that regard, it’s worth noting that renewable energy began to emerge as a competitive threat to the nuclear energy industry in the US by 2011. The shorter (20-30 years) lifespan of wind and solar technology can also serve as an asset in some circumstances, particularly in the wind industry where developers can take advantage of repowering opportunities availed by ongoing improvements in wind turbine technology.

The Capacity Factor Factor

Adding to the hurt, the CSIRO study also downgrades nuclear energy in terms of capacity factor. Capacity factor refers to the amount of time a power plant operates at full capacity on an annual basis. A high capacity factor can defray startup costs more quickly, by maximizing revenue from power generation.

Since capacity factor is interconnected with demand patterns, the CSIRO team took a look at historical data from the Australian coal power sector, where the capacity factor has hovered around an average of just 59% for the past 10 years. In comparison, CSIRO cites a global average of 80% for nuclear energy, with a range of less than 60% up to a maximum of 89%. While the capacity factor may be favorable to nuclear energy in some other nations, it does not necessarily provide the same level of support in Australia.

Small Modular Reactors And The Nuclear Waste Factor

“Nuclear is not economically competitive with solar PV and wind and the total development time in Australia for large or small-scale nuclear is at least 15 years,” the CSIRO team emphasizes for good measure.

That thing about small-scale nuclear refers to small modular reactors (SMRs), which are designed to be pre-assembled from standardized components and shipped to a site. That’s not quite as simple as it may seem. SMR is a new technology and apparently CSIRO was less than impressed with its potential for reducing the development timeline for nuclear energy by a significant degree in Australia.

CSIRO takes note of the Carbon Free Power Project in the US, which launched in 2015 with the aim of putting SMRs into operation by 2030. The project received certification from the US Nuclear Regulatory Commission under the umbrella of the startup NuScale Power Corporation and the Utah Associated Municipal Power Systems. However, the project hit a brick wall in 2023.

“Despite significant efforts by both parties to advance the CFPP, it appears unlikely that the project will have enough subscription to continue toward deployment,” the two principles reported in a termination announcement dated November 8, 2023.

You don’t say. Coincidentally or not, the US Department of Energy green-lighted a $504.5 million loan for the ambitious “ACES” green hydrogen storage project in Utah in 2022, just about 18 months before the SMR termination announcement. If all goes according to plan, ACES will support a fresh wave of renewable energy development in the very region that was supposed to serve as a showcase for SMR technology (see more green hydrogen background here).

NuScale is forging ahead with other partners and other SMR projects, all but one located outside the US. The exception is a multi-facility partnership aimed at building SMRs for data centers in Pennsylvania and Ohio, where wind and solar development has been less than vigorous.

They may want to rethink that idea once the nuclear waste factor settles in. As described in a 2022 study by researchers from Stanford University and the University of British Columbia, SMRs will not generate less radioactive waste than conventional nuclear power plants, as claimed by nuclear energy stakeholders.

“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,” explains study lead author Lindsay Krall of the Stanford Center for International Security and Cooperation.

Be that as it may, nuclear energy is not going away any time soon, especially not in nations that aim to support their nuclear weapons programs by applying nuclear energy to military and civilian use as well. If you have any thoughts about that, drop a note in the comment thread.

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Image: New SMR technology or not, researchers have thrown cold water on the idea of launching the nuclear energy industry into Australia (SMR artist rendering courtesy of US Department of Energy).