Context and Challenges For Nuclear Energy

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1 EU ENERGY POLICY/RM 2050 Context and Challenges For Nuclear MARC DEFFRENNES EUROPEAN COMMISSION - EURATOM

2 EU energy challenges 1. Sustainability (GHG, safety, waste, ) 2. Security of energy supply (ia stability and reliability of elect) 3. Competitiveness (Affordability) To tackle these challenges, EU needs: ambitious energy efficiency measures proper mix of a wide range of low carbon energy sources + large investments NOTE: Nuclear provides today around 30% base-load electricity (contributing to reliability and stability of supply)

3 policy for Europe Integrated energy and climate policy Objective: 80 to 95 % GHG reduction in 2050 Year 2020 targets (2007): 3x20% AND SET Plan 80 Billion Euros over 10 y incl Nuclear Fission 2 nd Strategic Review (2008) CO2 free electricity in 2050 Strategy 2020 (2010): 5 priorities (EE, Market Operation and Infrastructures, Innovation SET Plan, Safety and Security, International Cooperation)

4 Strategy 2020 and MFF: nuclear "Continuously improve safety and security" Safeguards and Decomm Funds: 700 MEuros for MFF "Keep EU leadership in safe nuclear energy" H2020 EC Proposal: Euratom IAFI 350M + DAFI 720M + FU 700M + ITER 2,5 B + Structural Funds? + Euratom Loans? +??? H2020 EC Proposal: TEU nearly 6B Euros (+ EERP 1,5B and NER300 to be spent over same period) + other tools (structural funds, RSFF, ) "Contribute to its responsible use worldwide by promoting legally binding standards" (INSC 630M)

5 Roadmap 2050 Adopted by the Commission in December 2011; Presidency conclusions in June 2012 An exploration of possible futures for the EU energy system: 7 scenarios Diverse Long-term perspectives for nuclear Discussion with Member States and stakeholders A basis for policy action = regulatory framework and financing/investment policy

6 Context: Low-Carbon Economy Roadmap (Mar 2011) Basis of scenarios 80% domestic GHG reduction in % 80% Power Sector Current policy 100% 80% Efficient pathway: -25% in % in % in % 40% 20% Residential & Tertiary Industry Transport 60% 40% 20% Non CO 2 Agriculture Non CO 2 Other Sectors 0% 0%

7 Roadmap scenarios 1 Business as usual (Common Reference Scenario) 1bis Current Policy Initiatives scenario 2 High Efficiency 3 Diversified supply technologies 4 High Renewables 5 Delayed CCS 6 Low Nuclear

8 EU-27 results Reference scenario: GDP, energy consumption and CO2 emissions 40 years back and ahead (1990 = 100) GDP Gross energy consumption CO2 emissions

9 Results Current Policy initiatives scenario: Primary energy demand, savings from REF and carbon intensity Mtoe Carbon intensity savings from REF RES nuclear gas solids oil carb. int. (REF)

10 Results Gross energy consumption: range in current trends and decarbonisation scenarios (in Mtoe) REF/CPI: effects of additional policies and updated assumptions Decarbonisation cases: effects from different policy focus / technology availability

11 Results Share of electricity in final energy demand under current trends and with decarbonisation (in %) 40% 35% Range regarding decarbonisation scenarios 30% Range for current trends scenarios: 25% 20% 15%

12 60 Results Import dependency under current trends and decarbonisation in (%) CPI 55 low Nuclear 50 Efficiency 45 Div. Supply Techn. 40 delayed CCS 35 RES

13 Results Ratio of energy system costs to GDP under current trends and decarbonisation (average over ) 20% 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% Reference CPI Efficiency Div. Supply Techn. RES delayed CCS low Nuclear * EU GDP = 15 Trillion Euros per year 0.5% is 75 Billion Euros!!! per year

14 Results: Shares in the energy mix range of fuel shares in primary energy across scenarios 70% 60% High RES 50% 40% Delayed CCS 30% Low nuclear 20% 10% High RES Delayed CCS High RES Delayed CCS Low nuclear 0% Low nuclear High RES RES Gas Nuclear Oil Solid Fuels

15 Roadmap 2050 scenarios (2/2) Renewables move centre stage but all fuels can contribute in the long-run Decarbonisation scenarios - fuel ranges (primary energy consumption in %) 75% % % 50% 25% 25% 0% 0% RES Gas Nuclear Oil Solid fuels RES Gas Nuclear Oil Solid fuels 15

16 Decarbonisation of the energy system: Some conclusions Decarbonisation under global climate action is feasible; several pathways are possible and costs do not differ substantially from current trends Reduction of energy consumption through energy efficiency improvements All decarbonisation options can contribute: EE, RES, nuclear, CCS But Renewables increases a lot in all cases Electricity will play a greater role in energy supplies (20% of final energy demand today, almost 40% by 2050) also in areas such as transport and heating = 4800 TWh per year in 2050 Power generation almost carbon free by 2050 Electricity prices increase up to 2030 and slightly decline afterwards (besides the High RES scenario where electricity is 25% more expensive) Transition from high fuel / operational expenditure to high capital expenditure Reduced import dependency and external fuel bill Massive investments in generation capacity and grids to ensure stable and reliable energy supply

17 Nuclear in Roadmap 2050 Reference scenario (pre-fukushima) - shares of nuclear 14.3% in 2030 and 16.7% in 2050 in primary energy (around 14% today) 26.4 % in 2050 in power generation (around 28% today) Current Policy Initiatives scenario (post-fukushima scenario) change in assumptions 12.1% in 2030 and 13.5% in 2050 in primary energy 20.5% in 2030 and 2050 in power generation Share of nuclear in decarbonisation scenarios vary depending on assumptions taken = from 2 to 18% in primary energy 3 to 19 % in electricity (note: RES between 55% and 75% in final energy which correspond to 60% to 90% in electricity) of 4800 TWh (mean between 4300 and 5200) A Low nuclear scenario and a Delayed CCS scenarios are showing the extreme results for nuclear (no high nuclear scenario was modelled) (EU 27 results mask important differences at MS level) Both scenarios with high nuclear share (Delayed CCS and Diversified supply technologies scenarios) show lowest costs; lower electricity prices so diversified supply can keep costs and prices down High renewables is 25% more expensive in price of electricity

18 Roadmap 2050 scenarios (1/2) GHG reduction target in 2050 RM 2050 Scenarii Nuclear in eletricity generation in %in 2050 [eq. capacity operating in GWe vs 125 GWe today] 40% Reference Scenario 26,4% [161 GWe] 40% Current Policy Initiatives 20,6% [117 GWe] 80% High Efficiency 14,2% [79 GWe] 80% Diversified supply technologies 80% Low Nuclear 2,5% [16 GWe] 18 16,1% [102 GWe] 80% High Renewables 3,6% [41 GWe] 80% Delayed CCS 19,2% [127 GWe]

19 For info - EURELECTRIC Study «PowerChoices» Scenario Target: EU 75% GHG reduction in 2050 vs 1990 to respect IPPC 4th Assessment: 440 ppm CO2 eq and 2 deg C 50% GHG reduction worldwide and 60 to 80% OECD Means carbon-free electricity in 2050 in EU = 2 nd SER Lot of energy efficiency and savings primary energy needs decrease from 1800 Mtoe (2005) to 1400 Mtoe (2050) Electricity demand increases from 3100 to 4800 TWh Mainly RES from 15% to 40 % mainly wind 2x15 % by Coal and Gas Nuclear from 950 TWh to 1300 TWh (31 to 28%) Overall cost of PowerChoices: Investment needed: 2 trillion Euros for 2050 (of 2005) EC estimation Power Infrastructures trillion Euros= 600B plants + 400B grid of which 200B priority interconnections (10B from MFF Infrastructures Interconnecting Europe

20 Nuclear in Roadmap 2050 (2/2) Share of nuclear in decarbonisation scenarios vary depending on assumptions taken from 3 to 19 % in electricity of 4800 TWh 3 scenarios on 5 between 15 and 20%... BUT what does it mean: 20% of 4800 TWh electrical capacity needed in 2050 in terms of Investments? Growth and Jobs? 20

21 A Nuclear Scenario 2050? EU Roadmap 2050 up to 20% Nuclear Electricity 4800 TWh per year Today Average age of NPPs ~140 Gwe (for 7000 hour per year) 100 Units of 1400 MWe avg 28% Nuclear Electricity = 125 Gwe 135 Units - Closing DE+BE+UK AGRs? rest 100 Units LTO 30 years (today in EU) 21

22 Age of EU NPPs in Age 22

23 Scenario Impact on Investments, Growth and Jobs Long Term Operation (100 Units) New Built (100 Units) Several units in construct in parallel Long term operation ( ) New Built ( ) Investments 900 M per Unit 5 B per Unit Jobs (base) Value added 70 B /y (base) In addition jobs (LTO + ST upgrades) In addition 5 B /y In addition jobs (New Built) In addition 25 B /y 23

24 LTO Scenarii (with and without new built forecast in 2012) MWe NO LTO with NB (2012) LTO 50y with NB (2012) LTO 60y with NB (2012) NO LTO LTO 50y LTO 60y Years 24

25 EU New built forecast in 2012 (estimation) MEMBER STATE Facility Process Electricity Capacity (MW) Current Status Owner Commercial operation MEMBER STATE Facility Process Electricity Capacity (MW) Current Status Owner Commercial operation Bulgaria Kozloduy PWR 1000 Approved 2020 Czech Temelin-3 PWR 1600 Approved 2020 Republic Czech Temelin-4 PWR 1600 Approved 2020 Republic Finland Olkiluoto-3 EPR 1600 Under construction Teollisuuden Voima Oy (TVO) 2014 Slovak Republic Slovak Republic UK Mochovce-3 PWR/VVER 420 Under construction Mochovce-4 PWR/VVER 420 Under construction Hinkley Point- C1 Slovak Board Slovak Board EPR 1600 Planned Electricite de France (EdF) Finland Olkiluoto Approved Teollisuuden Voima Oy (TVO) Finland Pyhäjoki 1600 Approved Fennovoima 2022 France Flamanville-3 EPR 1600 Under Electricite de 2014 construction France (EdF) France Penly-3 EPR 1600 Planned Electricite de 2020 France (EdF) NL Borssele 1600 Approved DELTA NV 2020 Lithuania Visaginas ABWR 1350 Approved VAE 2020 Poland General policy 3000 Planned 2025 Romania Cernavoda-3 PHWR 650 Under construction Romania Cernavoda-4 PHWR 650 Under construction UK Hinkley Point- C2 EPR 1600 Planned Electricite de France (EdF) UK Sizewell-C1 PWR 1600 Planned Electricite de France (EdF) UK Sizewell-C2 PWR 1600 Planned Electricite de France (EdF)

26 Perspectives for nuclear in EU Further development is contingent on: high level of nuclear safety & security - at large (technology, waste mgnt, emerg mgnt, liability, ) public acceptance + MS position on nuclear climate targets maintained + how well are "others" doing positive investment climate international cooperation and opportunities research and innovation critical leadership/ knowledge

27 Illustrative Nuclear Programme of the Community (PINC 2013) CO2 reduction targets Roadmap 2050 Growth and jobs initiatives EU Directives related to Nuclear EU Context Investments needs Industrial capacity needs Harmonisation needs (licencing and Code & Standards) Human Ressources (Transposition in terms of education and training needs) Research and innovation needs EU worldwide leadership (safety standards, nuclear technologies and supply chain) PINC 2013

28 Working together at EU level