Events in Japan earlier this year have sent policy shock waves around the globe as governments react to the nuclear disaster at Fukushima. George Archer gives an overview of these reactions and considers what they might mean for British manufacturers who were wooed by promised riches in supplying UK nuclear new build.
In the wake of the devastation wreaked on the Fukushima nuclear power plant by the earthquake and subsequent tsunami in Japan, opinions on nuclear power all over the world were thrown into disarray. Germany, Switzerland, China, Thailand, Malaysia, Italy and Japan have all announced either a complete halt to the building of new nuclear power plants, or initiated major reviews of nuclear new build plans.
In Britain, responses to the Japanese disaster have been somewhat muted. While government statements and attitudes expressed by industry bodies have confirmed a commitment to the growth of Britain’s nuclear industry, manufacturing companies which have taken strategic decisions to invest in supplying new build in the hope of capitalising on a promising new market for advanced manufacturing, have reported a freeze on procurement activity and a lack of clarity on possible changes to market prospects. So just what is the lay of the land for British nuclear policy post-Fukushima?
Targets, deadlines and more targets
The reasoning behind Britain’s nuclear strategy prior to the Fukushima disaster is clear. While renewable energy sources such as wind and wave will play their part in the move to a low carbon economy the demand for power both on a consumer and commercial front, far exceeds the capacity of such methods. In addition, potential investors seem unconvinced about the returns they might see from the significant spend on infrastructure these power sources would require.
Nuclear power has been identified as the solution to this shortfall, offering a way out from reliance on ‘dirty’ fossil fuels while still supporting large scale power supply for the national grid.
Björn Stigson, president of the World Business Council for Sustainable Development, said in early June that there is the possibility of a feasible scenario in which 77% of the worlds global energy needs could be met by renewable energy (not including nuclear power). “Such an ambitious path isn’t unattainable but would require countries to commit to significant new infrastructure investments and major policy shifts away from traditional sources of power, particularly fossil fuels,” he commented.
Mike Saunders, president of AMEC Power and Process Europe said in an interview with John McNamara, editor of Industry Link, the Nuclear Industry Association (NIA) magazine, that politicians in the UK “should not lose sight of the drivers which will dictate future UK energy policy.” “By 2025 the forecast increase in UK electricity demand combined with the reduction in capacity due to retirement of coal and nuclear plants means that we need to find alternative supply equating to more than 50 per cent of today’s capacity, at the same time as also meeting our commitment to reduce our carbon footprint by 34 per cent… doing nothing is not an option,” he adds.
NIA have expressed concerns that nuclear energy proliferation will be shelved after the events in Japan. In an attempt to restore confidence they have pointed to evidence, like that of scientist and Guardian columnist, George Monbiot, which claims the play of events in Japan supports the idea that nuclear power is relatively safe; The loss of life as a direct result of the disaster was minimal and Mr Monbiot said in a statement to Industry Link: “Every energy technology carries a cost; so does the absence of energy technologies. Atomic energy has just been subjected to one of the harshest of possible tests, and the impact on people and the planet has been small. The crisis at Fukushima has converted me to the cause of nuclear power.”
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Norfolk’s nuclear island In mid June this year, a partnership of Imperial College London, Constructionarium, Cogent Sector Skills Council, Engineering Construction Industry Training Board (ECITB) and Construction Skills, received funding from the National HE STEM Programme and the Royal Academy of Engineering to develop a ‘nuclear Island programme’. In this programme, 25 engineering students from Imperial College London construct a scaled down nuclear core reactor, in a simulated highly secure environment. The programme will be run from the established Constructionarium facility at Bircham Newton, Norfolk. Cogent CEO Joanna Woolf said: “The prospect of replacing the current fleet of nuclear power stations represents a multibillion pound private sector investment, but one which is dependent on a highly skilled workforce. Cogent’s research shows that the industry will require a thousand new recruits every year to ensure that power generation meets projected demand to 2025 and beyond.” Jean Llewellyn, CEO of the National Skills Academy for Nuclear said: “This is an exciting time characterised by growth and development for the UK nuclear Industry. Also, it offers a range of exciting careers and development opportunities.” |
International knee-jerk reactions: counter-productive?
In mid-May this year Mike Weightman, the UK’s the nuclear chief inspector said that there was absolutely “no need to curtail the operation of nuclear power stations in Britain.” Weightman was asked by the Secretary of State for Energy and Climate Change, Chris Huhne, to produce an interim report into British nuclear prospects and the need for regulation. This report was published in May and another will be due within the next four months. At the Nuclear Development Forum (NDF), Mr Huhne announced to delegates that government would consider the Nuclear National Policy Statement stabled by industry representatives in light of the emerging nuclear crisis in Japan before proceeding with the ratification process.
The NIA praised Mr Huhne for commissioning the report from Weightman. Keith Parker, chief executive of the NIA said: “We applaud the Government’s committed leadership in this difficult time, and welcome their continued support for the UK’s existing nuclear fleet and plans for new nuclear build.” Parker said in a statement in May that “we must recognise that nuclear energy is a controversial issue, and requires a high degree of political and public acceptance for its licence to operate. Positive statements by the Prime Minister and Energy and Climate Change Secretary Chris Huhne about the need for nuclear to be an integral part of Britain’s future energy mix demonstrate that political support remains strong.” Germany’s reaction to the Japanese disaster has been a provocative talking point across the EU.
The country is home to an active nuclear industry however the equally sizeable anti-nuclear power lobby recently congratulated Chancellor Angela Merkel’s decision to entirely phase out nuclear power generation by 2022. The German cabinet also approved the action despite a situation in which Germany currently gets around a quarter of its electricity from nuclear power. Plans have been drawn up by the German government to double electricity sourced from renewable sources such as wind power.
Commenting on the proposals to the Financial Times, Mark Lewis, managing director of commodities research at Deutsche Bank, said: “No advanced industrial country in the world has decided to generate so much electricity from renewables and, remember, Germany is still the world’s largest industrial exporter.”
The future of nuclear power in the UK
Parker says he is aware of the sensitivities regarding nuclear power in Germany but underlines his organisation’s strong view that nuclear is necessary for supporting a modern low-carbon economy.
He said in early June: “Of course we agree that we should conserve energy wherever we can. We also support a major increase in renewables as the Germans do. However, nuclear power supplies the essential base-load electricity needed to power an advanced industrial economy, and it is key in protecting the UK from becoming too reliant on imported energy.” Parker added: “Nuclear is the only low-carbon base-load source we have. It currently gives us 80% of all our low-carbon electricity in the UK. It offers security of supply which puts Britain in a good position, and it helps us lead the way in delivering a low-carbon economy.”
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Skills shortages in the sector Of course the events in Japan earlier this year are only the most recent blocker to come in front of nuclear proliferation in the UK. A longer term and trickier challenge is how to create a skilled workforce to build and maintain the new plants as well as decommissioning those outdated sites. Cogent, sector skills council for science based industries, published a report in March 2010 underlining the need for a huge workforce if nuclear power is to be retained as a prime source of energy for the UK. The report says: “Job creation on the scale of three London Olympics would be generated by a significant nuclear new build programme. Thousands of training opportunities, new apprenticeships and new jobs will be needed in the construction, manufacturing, operation and maintenance of anticipated stations over the next 15 years.” |
Post-investment problems
One West Yorkshire-based manufacturer that has invested in preparing to supply the UK nuclear industry is Halifax Fan, a company that has expanded to China and has established a sales office in Bangkok.
Malcolm Staff, managing director of the company says to companies facing post-investment problems in the UK and elsewhere: “Get on your bikes like Halifax Fan has done, and go sell to those countries and contractors who have seen the future and are actually building nuclear power plants. Don’t rely on the UK government or you’ll wait a long time while they prevaricate and procrastinate.” With emerging economies like China and India seemingly much more focused on providing constantly increasing energy demands, moving operations elsewhere seems like the sensible thing to do. However, in a Financial Times article in early June, Staff commented on the fact that many foreign customers still want their fans made in Britain. “We tend to forget that Brand Britain is worth shouting about,” he says. “It is so disappointing to go to trade fairs and find just one or two British companies but dozens of other Europeans. Italian and French companies, in particular, are much better supported [by their governments].” Staff’s comments should be a comfort to those companies worried about wasted investments in nuclear supply preparation.
The global market is full of opportunity for UK advanced manufacturing.
