10 Nov (NucNet): Key conditions for the faster deployment of nuclear power include the promotion of incentives for all types of low-carbon solutions to provide financing certainty for investment, the International Energy Agency says in its World Energy Outlook 2015 report, published today.
The Paris-based agency’s report says governments that want to deploy nuclear power must recognise the security of supply, reliability and predictability that nuclear power offer.
The report says that in 2014, 72 gigawatts of nuclear capacity were under construction. Three projects began construction in 2014, down from 10 in 2013. Almost 40 countries are considering developing first nuclear plants, while three have committed to phasing out nuclear power.
The report says that nuclear generation worldwide will increase from 11 percent in 2013 to 12 percent in 2040. This is under the report’s New Policies scenario, which takes into account programmes to support renewable energy and improvements to energy efficiency, to promote alternative fuels and vehicles, carbon pricing, reform of energy subsidies, and the introduction, expansion or phaseout of nuclear power.
Coal will fall from 41 percent to 30 percent, and gas will increase from 22 percent to 23 percent.
Renewables continue to expand rapidly, collectively becoming the largest source of electricity supply by the early-2030s and going on to account for more than one-third of the world’s electricity supply in 2040.
The increase in renewables-based electricity generation is led by wind power, followed by hydropower and then solar PV. Hydropower accounts for around 46 percent of all renewables-based electricity generation in 2040, down from 74 percent in 2013.
The outlook for all forms of low-carbon energy – renewables, nuclear power and carbon capture and storage – is more positive in the 450 Scenario and they collectively meet 46 percent of primary energy demand by 2040.
Investment in nuclear power generation is around 65 percent higher in the 450 Scenario than the Current Policies Scenario – in which government energy and energy investment policies remain unchanged – but remains concentrated in a relatively small number of markets.
The 450 Scenario sets out a “pathway” consistent with the goal of limiting the global increase in temperature to two degrees Celsius by limiting concentration of greenhouse gases in the atmosphere to around 450 parts per million of CO2.
By 2040, China’s renewables-based power generation capacity is projected to be equivalent to that in the US and the EU combined, with wind capacity having expanded by 300 GW, solar PV by over 245 GW and hydropower by 195 GW. Coal’s share of electricity generation drops from three-quarters in 2013 to half in 2040, while wind and nuclear both increase from around two percent to 10 percent, natural gas increases to eight percent and solar to four percent.
In a special section on India, the report says India’s current target is to triple nuclear power capacity over the decade from 2014, which would equate to capacity of 17.3 GW in 2024. It also has a longer term target for nuclear power to supply 25 percent of the nation’s electricity by 2050.
India ranks as the world’s 13th largest country in terms of nuclear generation, with installed capacity of 5.8 GW in 2014 with 21 reactors at seven sites. It has a further six reactors, with a total capacity of around 4 GW, in various stages of construction, the report says.
In the New Policies Scenario, levelised costs of electricity (LCOE) for nuclear power plants coming online in India in 2030 average around $69 (€64) per megawatt-hour (MWh). This is lower than in many other parts of the world – for example they are $110/MWh in the EU – primarily because the overnight costs of construction are lower in India.
LCOE is the long-term price at which the electricity produced by a nuclear station will have to be sold at for the investor to cover all their costs. The overnight cost is the cost of a construction project if no interest was incurred during construction, as if the project was completed “overnight”.
Based on these estimates, nuclear power appears to be an economically attractive option in India, particularly in parts of the country that are distant from coal reserves , the report says.
Nonetheless, building a nuclear power plant is a very capital-intensive undertaking, involving a large upfront investment. India’s fiscal and current account deficit means that it will be very reliant on foreign capital for such investments. The report says that for foreign capital to be forthcoming, it will be necessary to ensure there is an attractive legal and regulatory framework in place. “The recent progress that has been made to address issues surrounding the nuclear liability law is a positive development in this respect,” the report says.
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