Expensive nuclear power push ignores opportunity to cut UK electricity system costs

High global gas prices have quadrupled wholesale energy prices for UK consumers in the past six months, those with default tariffs paying by direct debit will likely see their average annual bill increase from £693, from £1,277 to £1,971.

To begin to insulate the public from the volatility of gasoline prices, government plans accelerate the pace of deployment of renewable energies and low-carbon technologies. This means an increase in the country’s offshore wind capacity from 11 gigawatts (GW) today to 50 GW by 2050 – 10 GW more than its previous target – and eight new nuclear power plants.

Yet apart from a promised fivefold increase in solar power generation by 2035, the strategy sets no targets for power generation from some of the country’s cheapest sources, such as onshore wind.

The government can defend its decision to increase nuclear power generation as support for a local and reliable energy source. But some of that huge investment would be wasted if Britain revamped its energy system to make the most of the country’s abundant renewable electricity.

Read more: Gas prices: How to ensure consumers don’t pay for the next energy crisis

When the price of a product such as a soft drink rises, production can be increased quickly enough to meet spot market conditions, again rapidly driving prices down. Building a new nuclear power plant or an offshore wind farm is quite different, requiring significant capital investment and the certainty of a reasonable initial return on investment from the sale of energy over 30 to 40 years.

The cost of building an offshore wind farm has fallen, but onshore wind is cheaper.

In the UK, governments can intervene in the capacity market to ensure a secure supply of electricity by paying reliable sources, which provides the long-term certainty needed to build sufficient generating capacity. Financial support changes to reflect state prioritiesand the construction of eight new nuclear reactors is reported cost the public £13billion.

Building wind farms and nuclear power plants is only a first step, however. The speed at which they can be integrated into power grids and harnessed to keep pace with demand for electricity, transport and heat is what will actually decide the stabilization of energy prices.

Wind and solar power sources cannot change their output to meet the minute-to-minute needs of customers. System operators must either ask renewable energy generators to dump some of their energy when demand is low but wind and sunshine are high, or ask fossil fuel power plants to turn on and run. fill the gap when demand is too great for calmed wind turbines to meet.

The cost of the former is around £20m per day. The annual cost of balancing the energy system in this way reached a record £1.2 billion in 2021, rising from 5% of the wholesale cost of energy in 2010 to 20% today.

How to deliver inflexible, low-carbon energy to homes and businesses reliably and affordably is as important as building reliable new sources. And on this account, do more efficient use renewable sources – and the overall reduction in energy demand – would mean the country could afford to build less nuclear power, which is one of the few low-carbon sources that didn’t get much cheaper.

A gloved hand holds a tool to inject cavity wall insulation into masonry.
Energy can be saved through efficiency measures such as cavity wall insulation.

New technologies

One of the ways to increase customer demand for renewable and low-carbon energy when it is plentiful and reduce it when production is constrained is to encourage storage technologies.

For example, if electric vehicles are charged when there is plenty of wind and solar power, 40 GW of offshore renewable energy would be enough to power the country. the entire fleet of vehicles with nothing wasted.

To help bring UK energy demand into line with times when renewable generation is high, the government could invest in digital technologies such as smart meters and introduce new tariffs that can send price signals to EV chargers. It could also invest in improving short-term solar and wind generation forecasts. These changes would make distributors aware of customer needs and help customers reduce stress on the system.

While electric vehicle batteries can handle the variability of renewable generation, the UK’s energy system also needs fixed storage – such as grid-scale batteries which, unlike the government’s preferred solution of fuel to hydrogen, are capable of very fast response times to handle sudden changes.

Enabling millions of electric vehicles and heat pumps to harness nuclear power and renewable energy generated in the distant North Sea is no small feat – it requires urgent changes in the way the energy system works British.

For example, the use of electric passenger vehicles to help manage renewable energy generation will require access to personal data, such as a vehicle’s location when plugged in or energy consumption. in real time at a customer’s home. Rules must be established to assure customers that this data will be protected rather than abused and used for something other than system management.

But the energy strategy offers little to navigate the complexities of integrating EVs in garages with offshore wind farms. The result could be a fragmented, unreliable, and expensive-to-maintain system as decarbonization intensifies.

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