House of Commons - Environmental Audit

Select Committee on Environmental Audit Minutes of Evidence

Memorandum submitted by WWF-UK

EXECUTIVE SUMMARY

Scientists now suggest that we have a window of opportunity of only 10 years to act, if we are to ensure the rise in global temperatures stays below the crucial tipping point of two degrees Celsius above pre-industrial levels. Whilst the Prime Minister's statement that the Government is "absolutely" wedded to this objective, as agreed by the EU Council, is welcome, and despite the need for an effective response to the threat of climate change being accepted across the political spectrum in the UK, the current mix of policies and political decision-making is failing to meet the urgency of the threat.

The power sector is directly responsible for around one-third of the UK's carbon dioxide (CO2) emissions, and has the potential for significant reductions. This inquiry is timely and coincides with WWF-UK's campaign on climate change, which is focusing specifically on reducing CO2 emissions from the power sector. WWF-UK strongly believes, backed up by independent research, that a reduction in emissions from the power sector can be achieved through the increased use of renewables, combined heat and power (CHP) and a strong National Allocation Plan in the EU Emissions Trading Scheme (ETS), without the need to resort to nuclear. For this to be achieved, there must also be significant, but realistic, reductions in the UK's energy demand.

WWF-UK therefore disputes the first premise upon which the inquiry is based—that energy demand will continue to rise indefinitely and unavoidably. The "energy gap" is essentially a political choice. Rising energy demand could and should be addressed with simple and viable energy efficiency measures which would reduce demand year on year.

The Government has a responsibility to its citizens to develop an energy policy that is founded on sustainable development, with positive environmental as well as economic outcomes, and one that is in line with climate change targets for effective and immediate reduction of emissions. Therefore, WWF-UK calls on the Government to build its climate and energy policy around the following principles and actions:

1. Reduce energy demand

If the Government is serious about tackling climate change effectively, energy demand and wasteful consumption must be addressed. Moreover, energy efficiency measures have been proven to be the most cost-effective way of reducing CO2 emissions, with huge economic benefits to the consumer.

This premise is reflected in the Government's own reports. The Energy White Paper (2003) and "Energy Efficiency: The Government's Plan for Action" (2004) were good first steps to promoting energy efficiency and reducing emissions. The package of policies in the Plan for Action is expected to achieve a reduction in emissions of over 12 million tonnes per year by 2010. With more ambitious long-term targets, a stable investment climate can be created which will create significant business opportunities for energy service companies to facilitate the transition to a sustainable low-carbon economy.

2. Take advantage of the fact that renewable energy, energy efficiency technologies and emissions trading are available here and now

Renewable energy and energy efficiency technologies are proven, reliable and ready for use today to deliver the sustained reductions in emissions over time, which are needed to tackle climate change. The European Emissions Trading Scheme (EU ETS) which is operating today also potentially presents one of the most cost-effective mechanisms to deliver real emissions reductions from the power sector.

The contrast with nuclear is stark. The research and development and lengthy planning processes required for the construction of new nuclear plants means long lead-in times of 10-20 years. By the time this energy comes on line, the potentially catastrophic tipping point for people, livelihoods and wildlife of two degrees for climate change (above pre-industrial levels) may well already have been reached. Quite simply, nuclear power does not provide the solution to the urgent threat of climate change.

3. Take the necessary policy decisions to reduce emissions from the power sector

A detailed report by ILEX Energy Consulting in 2004, commissioned by WWF-UK—"The Power to Save our Climate"—showed that CO2 emissions from the UK power sector can be reduced by 60% by 2020, without the need for new coal or nuclear power. If energy demand can be reduced by just 0.2% a year, a radical restructuring of the market is not required. Instead, strengthening and extending current policies would be sufficient. This must include a tighter cap on emissions than Phase 1 in a more ambitious UK National Allocation Plan for Phase II of the EU ETS, and an extension of the Renewables Obligation to at least 20% by 2020.

4. Do not invest in new nuclear power—it is an environmental, social, financial and political risk, which is not carbon-free

The construction, operation and decommissioning of nuclear power plants is rife with risk and problems:

— Liability/Insurance of new plant construction and old plant decommissioning.

— Transportation and storage of nuclear waste.

— Leaks of radioactive materials from plants and stores.

— Threats posed from terrorism.

Using new nuclear power to fill the so-called energy gap carries a particularly large financial risk that will cost the UK billions of pounds. Even if this risk is accepted, the "carbon-free" properties of nuclear are an illusion, grossly exaggerated by the pro-nuclear lobby and do not take into account the carbon-intense nature of the full life-cycle of nuclear power plants from construction, to extraction and decommissioning.

Finally, investing in new nuclear would be a very dangerous decision politically. Voters are deeply sceptical about nuclear power and with good reason. New nuclear is undesirable and unnecessary—there are sustainable and viable solutions to keep the UK's lights on.

WWF-UK'S ANSWERS TO THE NEW EAC INQUIRY

(A) THE EXTENT OF THE "GENERATION GAP"

1. What are the latest estimates of the likely shortfall in electricity generating capacity caused by the phase-out of existing nuclear power stations and some older coal plant? How do these relate to electricity demand forecasts and to the effectiveness of energy efficiency policies?

WWF-UK disputes the presumption of unchecked energy demand and the resulting growth forecasts, which is the premise on which the Inquiry is based. The UK Government can and must take steps to reduce the UK's energy demand and wasteful consumption, through an improved programme of energy efficiency measures, supporting mandatory energy demand reduction targets under the EU Energy End Use Efficiency and Energy Services Directive and encouraging changing practices in our everyday lives.

An independent expert study commissioned by WWF-UK[1] last year showed that implementing energy efficiency measures to drive annual reductions in energy demand was key in achieving 60% reductions in carbon dioxide (CO2) emissions from the UK power sector by 2020, without resorting to new nuclear power and with closure of coal stations. The study also showed that this low-carbon energy supply did not require a radical shift in policy, but an extension and effective implementation of existing policy in order to deliver on the aspirations of the Energy White Paper, which places energy demand reductions at its heart.

Energy efficiency measures are by far the most cost-effective way of reducing CO2 emissions, and can lead to significant savings for the UK economy. In comparison to nuclear power, an internationally reputed research Institute[2] found that "Every dollar invested in electric efficiency displaces nearly seven times as much carbon dioxide as a dollar invested in nuclear power, without any nasty side effects". The "Powerswitch scenario" in the 2004 ILEX report described above also indicated significant financial rewards for the economy, with a likely net saving of more than £4 billion (due to reduced spend required for the construction of new power plants), and with significant savings on electricity bills.

The UK Government's Energy White Paper (2003) and "Energy Efficiency: The Government's Plan for Action", (2004) reports were good first steps to promoting energy efficiency and reducing carbon, but much more can and must be done to improve energy efficiency in the UK's domestic, commercial and industrial sectors.

The 2004 Action Plan sets out how the energy efficiency strategy in the Energy White Paper will be delivered. The package of policies in the Action Plan is expected to achieve a reduction in CO2 emissions of over 12 million tonnes per year (MtCO2/yr) by 2010, whilst potentially saving households and businesses over £3 billion/yr on their energy bills over the same period.

The current potential for energy efficiency in all sectors is summarised by the Cabinet Office's Performance and Innovation Unit in Table 1 below.[3] Savings amount to approximately 30% (ie 31.4%) of final energy demand, with benefits in reduced costs to consumers (net of taxes) of £12 billion annually.

Table 1

SUMMARY OF CURRENT ECONOMIC POTENTIAL FOR ENERGY SAVING

	Energy (Mtoe/year)	Per cent savings (of final UK energy demand)	Estimated Financial (£m) savings per year?

Domestic	17.4	37.2%	5,000
Service	3.8	21.0%	1,190
Industry	8.6	23.8%	1,380
Transport	19.3	35.0%	4,700
Total	49.1	31.4%	12,300

In the UK domestic sector, the National Audit Office (NAO, 1998) has confirmed that existing regulatory programmes are highly cost-effective. In the business sectors, the investments stimulated by the Energy Efficiency Best Practice Programme are now estimated to save over £800 million annually, with a typical payback period of two to four years.

Alongside energy demand reductions, increased renewables (biomass, offshore wind, and wave largely) and combined heat and power (CHP) are key to ILEX's "Powerswitch" scenario1 for delivering a low-carbon power sector. Further, research at Oxford University3 has also shown that intermittent renewables, (ie solar PV, wind and wave), combined with domestic combined heat and power (dCHP) could reliably provide the bulk of Britain's electricity. Diversifying the technologies and sites used to generate renewable energy serves to enhance security and reliability of supply. The research also shows that if the "right mix" is planned, renewable energy and intermittent technologies can be made to match real-time electricity demand patterns.

Using the results of the Oxford University's research, together with estimates of Britain's available renewable resources, wind (onshore and offshore) could provide 35% of the UK's electricity; marine renewables and dCHP each provide 10-15%; and solar cells 5-10%. In other words, more than half of the UK's electricity demand could ultimately derive from renewables. These technologies already exist and are used in a few areas of the UK at present. However, the time and date by which such large-scale uptake and growth of these technologies is achieved is dependent on when the UK Government place appropriate funding and market support, as explained in our recent response to the UK Climate Change Programme Review (CCPR).

Climate Change Programme Review

The Climate Change Programme Review (CCPR) represents an opportunity to set out energy solutions for the next decade and beyond—with the potential to achieve real cuts in CO2 emissions and energy demand, via increased renewable energy, energy efficiency and energy services (decentralised power). This opportunity must not be missed.

The CCPR must strengthen the existing measures to drive energy efficiency in the domestic sector. This should include transforming the existing Energy Efficiency Commitment (EEC 2 and 3) into a mechanism based on absolute reductions of energy or carbon. This should also be coupled with fiscal incentives, such as stamp duty and council tax rebates, to drive householders' demand for energy efficiency measures.

Evidence and from recent Government, industry and independent inquiries (such as the Performance and Innovation Unit (PIU) and Energy White Paper (EWP) reports, as well as WWF-UK's own response to the CCPR this year, demonstrates the following:

— Energy efficiency is the most cost-effective way of meeting all four goals of UK energy policy: reducing carbon emissions, ensuring security of supply, maintaining competitiveness, and tackling fuel poverty.

— The practical usable renewable resource in the UK is very large.

— Based on current costs, new nuclear build is very unattractive as a cost-effective means of reducing emissions.

Government's own publications all recommend a combination of renewables and energy efficiency as a realistic solution to energy supply problems whilst simultaneously tackling climate change, without the need to resort to new nuclear.

B. FINANCIAL COSTS AND INVESTMENT CONSIDERATIONS

2. What are the main investment options for electricity generating capacity? What would be the likely costs and timescales of different generating technologies?

Energy efficiency technologies and measures, in parallel to renewable energy technologies (eg wind, biomass, wave and solar) are available now for implementation as long as the right government financial, policy and regulatory support mechanisms are provided.

Renewable energy plants are already available and can be built now in order to generate energy quickly (usually within a time-frame of two years). These renewable technologies and using our energy more wisely can help to deliver a low-carbon energy supply for the UK, at the same time as offering the sustained and significant CO2 cuts almost immediately and over the coming years to address the urgent need to act on climate change.

By comparison, the proposed "new" nuclear power programme would also take many years to come online. Most independent industry analysts acknowledge that the first of any nuclear power new build programmes probably wouldn't be commissioned until 2018-20.

Chief Scientist Sir David King and Secretary of State Margaret Beckett have also even recently admitted that the possibly safer option of nuclear fission in which the UK government has already sunk £ millions worth of investment, is at least 30-50 years away of being commercial, if at all.[4] By then, it will be too late to tackle climate change effectively and economically.

Furthermore, as with fossil fuels, the nuclear power main material—uranium—is only a finite resource, with limited economic reserves concentrated in a few areas around the world. Research shows that even if we decide to replace all electricity generated by burning fossil fuels with nuclear power today, there would only be enough economically viable mined uranium available to fuel reactors for between three to four years. And even if we were to double world usage of nuclear energy, the life-span of uranium reserves would be just 25 years. i8

Using "new" nuclear power will cost the UK £ billions worth of tax-payers money, rather than the more reasonable £ millions required for increased uptake of renewable energy and energy efficiency technologies. Investment into nuclear power projects can drain badly-needed funds from energy efficiency and renewable energy programmes, most of which have substantially lower costs in terms of reducing carbon dioxide emissions. The costs of renewable energy sources are falling rapidly: in the last 10 years the cost per kWh of electricity from wind turbines fell by 50%, and that from solar cells by 30%.[5] Some winds farms are already generating energy at least at half the estimated cost of nuclear electricity. CHP, a very efficient technology that produces both electricity and heat at the same time, is also a cost-effective energy solution, especially for business and homes (in longer term) that provides both heat and electricity.

In contrast, the costs of nuclear power are rising, despite the fact that nuclear power has been hugely subsidised over the last half century.[6] To date, estimates show that the nuclear industry has received around $1 trillion in state support worldwide, compared to $50 billion for renewable energy.[7] If these huge investments had been made in renewable energy, the total energy production from these sources would today be huge. Refer to Table 1 in the next question for a comparison of costs of nuclear with renewable energy.

This is just comparing the costs of generation. However, there are also additional costs related to nuclear power plants for radioactive waste storage and disposal, and plant decommissioning. These costs would add massively to overall costs of electricity from a new build programme, if the Government committed to internalising the costs of externalities and showing the "true" costs of all types of electricity generation. For example, the clean-up costs for the existing UK nuclear industry have been estimated to be at least £55 billion pounds.[8] Nearly all of this will have to be paid by taxpayers, if factoring the hidden costs of wastes, security, health and environmental costs associated with nuclear power, renewable and energy efficiency technologies weigh in as much more economically attractive options to take up.

What are the likely construction and on-going operating costs of different large-scale technologies (eg nuclear new build, CCGT, clean coal, on-shore wind, off-shore wind, wave and tidal) in terms of the total investment required and in terms of the likely costs of generation (p/kWh)? Over what timescale could they become operational?

Please refer to WWF-UK's answers above. The renewables industry will hopefully be providing more detailed answers to these questions relating to specific costs.

In addition, to information you receive from the power industry, you may find the collated facts and figures in the table below of interest which have been summarised from various information sources by WWF-UK in relation to the cost estimates of different types of new build power plants and schemes. It shows the comparatively lower costs of renewable energy with nuclear in terms of build, energy production and subsidies, to support the conclusions we have drawn above in Question 2.

Table 2

COST COMPARISONS OF NUCLEAR POWER AND RENEWABLE ENERGY

	Nuclear power	Renewable energy
Cost of building power plant	Estimates vary widely between industry and non-industry sources. Roche (2005) calculates that 10 new AP1000 reactors would entail capital expenditure of £4.22 billion-£6.33 billion (industry figures) or around £8.86 billion to £12.65 billion (using figures from the US Congressional Budget Office, which argued that the industry was underestimating costs[9]9).	The DTI estimated that £1.6 billion would be needed to upgrade the UK transmission and distribution network (between 2004 and 2010) to connect the number of renewable energy projects required to meet the Renewables Obligation 2010 target.
Cost of producing energy	In 2004 the Royal Academy of Engineering calculated that the cost of electricity from a new nuclear plant is 2.3p/kWh.[10] These were essentially the same figures as those submitted by the nuclear industry to the governments Policy and Innovation Unit (PIU) review in 2001. The PIU challenged these figures and estimated that, in the future, the nuclear industry would be able to produce electricity at 3-4p/kWh. The current cost of electricity production from Sizewell B is about 6p/kWh.	The British Wind Energy Association (BWEA) estimates the average cost of generating electricity from onshore wind to be 3-4p/kWh. The Policy and Innovation Unit estimated that onshore and offshore wind has the potential to produce energy at costs of 1.5-2.5 p/kWh for onshore wind and and 2-3p/kWh for offshore wind. In the last 10 years the cost per Kwh of electricity from wind turbines fell by 50%, and that from solar cells by 30%.
Clean-up costs	The Congressional Budget Office estimated the costs of clean-up costs from the UK nuclear industry at £55 billion. In 1997 the Sussex University Science, Policy and Technology Unit (SPRU) estimated the cost of UK nuclear industry clean-up (waste management and decommissioning) costs at £42 billion total. £13.2 billion of this will come from "secure funding arrangements" with the government and the remaining £28.7 billion (almost 70%) is likely fall to taxpayers.	N/a
Public subsidies	To date, estimates show that the nuclear industry has received around $1 trillion in state support. In 2002, the UK's nuclear industry (ie BE and BNFL) almost collapsed due to huge financial problems and received a £7 billion subsidy from the government.	Renewable energy has so far received about $50 billion in state support. In 2002-08, the renewables and energy efficiency industries will receive £500 million worth of funding.

With regard to nuclear new build, how realistic and robust are cost estimates in the light of past experience? What are the hidden costs (eg waste, insurance, security) associated with nuclear?How do the waste and decommissioning costs of nuclear new build relate to the costs of dealing with the current nuclear waste legacy, and how confident can we be that the nuclear industry would invest adequately in funds ring-fenced for future waste disposal?

Question B(2) above outlines a brief response from WWF-UK on hidden costs and costs of wastes storage, clean-up and decommissioning of nuclear power plants, as well as our position on subsidies. Please refer to this section.

The hidden costs have to be considered when relating costs of nuclear to other safer and more sustainable technologies that are available today (renewable energy). The generation costs appear minor when compared relative to the potential security, insurance and waste costs of nuclear power. The potential additional health and environmental related to radiation risks and environmental damage associated with leakages, explosions and a 240,000 year waste problem are substantial, but difficult to quantify, and given their significance WWF-UK strongly believes they should not be left out of the debate.

In addition, government costs related to public communications management for implementing a controversial new nuclear build programme are likely to be substantial, and should be factored into decision-making.

Is there the technical and physical capacity for renewable energy to deliver the scale of generation required? If there is the capacity, are any policy changes required to enable it to do so?

Yes, there is the technical and physical capacity for increasing the amount (capacity) of renewable energy and CHP generated electricity in the UK supply mix.

According to DTI figures[11] in 2004, approximately 3.6% of the electricity generated in the UK was sourced from renewable energy, 0.91 percentage points higher than in 2003. However estimates show that renewable energy could meet around 30% of electricity demand (before baseload considerations are warranted). Therefore, the UK has the potential to increase its renewable capacity from around 4% today to at least 20% by 2020 and then around 30% by 2030. This would be in line with the UK's current Renewables Obligation of 10% by 2010 and 15.4% by 2015.

At the every least, creating a low carbon economy and increasing renewable generation capacity will require further financial funding for the less commercially competitive renewable energy technologies such as wave and biomass at present, and a commitment in the forthcoming Climate Change Programme to a longer term target of sourcing at least 20% of electricity from renewables by 2020 under the UK Renewables Obligation. Also, appropriate and sufficient support for CHP and energy efficiency cannot be divorced from this overall goal. WWF-UK describes how this may be achieved below in more detail.

The UK's current electricity demand is around 400,000 GWh per year. As stated earlier, in 2004, the renewables supplied around 3.6% of total electricity supply, but much of this was from large old hydroelectric power plants in Scotland. Only around 1% of the renewable sourced electricity came from new build renewables (mostly on and offshore wind, and some biomass and solar). However the potential for scaling up renewable energy in the UK is significant. Table 2 below provides figures on potential capacity from various technologies.

In addition, a report by Imperial College's Energy Policy Unit has also calculated that about 230,000 GWh/yr could potentially be produced through renewable technologies by 2025, as shown in the table below. [12]This is equivalent to meeting around 58% of current energy demand from a mixture of many different renewable energy sources. Similarly, in 1998, the DTI calculated that the UK can provide 66-70% of its total electricity needs from a wide range of renewables cost-effectively by 2025.

Table 3

Technology
Technical potential
(TWh/yr) Approximate
Practicable Potential by 2025 TWh/yr

Building Integrated PV 250 37

Offshore wind 3,000 100

Onshore wind 317 8

Biomass (energy crops) 140 30

Wave 700 50

Tidal stream 36 1.8

Small hydro 40 3

TOTAL 4,483 230

Wind power:

— The British Wind Energy Association (BWEA) estimates that, by 2010, it will be possible for Britain to get 8GW (or 8000 MW) of power from on and offshore wind, which would constitute around three quarters of the 10% renewables target. In addition to the 1,200 wind turbines which are already in place in the UK, this would mean establishing an estimated 1,800 turbines onshore, and 1,500 turbines offshore by 2010.

— In a report released on 19 May 2005, the Sustainable Development Commission (SDC) argues that wind farms would take up only approximately 0.0001% of UK land to produce 20% of the UK's electricity by 2020. The study states that if UK electricity supply companies met their Renewables Obligations (RO) entirely through wind power, the installed turbines would produce about 10% of current UK electricity sales, therefore meeting the UK 2010 RO target entirely. [

— The UK has the greatest wind energy resource potential in the northern hemisphere, estimated at about 230 TWh/year, but this is not been exploited in comparison to other countries. (Table 4 below uses 2003 figures)

Country	Installed wind capacity/MW
Germany	14,609
USA	6,734
Spain	6,202
Denmark	3,100
India	2,100
UK	1,038

Other Renewables

The UK Government has been criticised in the recent past by some stakeholders for the inadequate investment in currently less commercially competitive forms of renewable energy technologies, such as biomass, solar and wave power. A significant increase in funding and long-term market certainty is needed for these new types of renewables in order to instill confidence in investors.

WWF-UK welcomes the recent announcements by the DTI of increased funding for the Marine Renewables sector, through the Marine Research Deployment Fund, but more support is definitely needed. Sensibly sited marine renewable energy technologies, especially wave and offshore wind energy technologies, can and must play an increasingly important part of the UK energy mix up to 2020. An interesting proposal was proposed by the BWEA in 2004, namely a £75 million "Marine Performance Fund" for the first 50 MW of wave and tidal projects, with developers also obtaining premium payments for a suggested five years following production of electricity. [15]

Micro-Generation (Embedded Generation—dCHP and Renewable Energy)

WWF-UK believes that schemes, such as `Clear Skies' supported by the DTI have been successful in starting to deliver exemplar projects, which are now helping prove the viability of embedded generation (or micro-generation) in the UK.

However, the current uncertainty around the future of the Clear Skies programme, and the lack of clarity on what type of scheme will replace it, will have a detrimental effect. This uncertainty is now in stark contrast with ODPM Planning Policy Statement 22, which has given local authorities the power to require "a percentage of the energy to be used in new residential, commercial or industrial developments to come from on-site renewable energy developments." Although this now sets a firm policy framework for local authorities to require embedded renewables, the reality is that the market is still failing to provide cost-effective technology options. Without continued and increasing grant schemes from government, local authorities will fail to achieve the planning gain that PPS22 allows.

The DTI must provide a long-term future for substantial grants schemes, like Clear Skies, with increased funding year-on-year to increase certainty and confidence of developers and enable communities and local authorities to develop embedded generation schemes (aka microgeneration or decentralised power).

CHP Technology

WWF-UK believes it is important that the UK 2010 CHP target is met. For every 1 MW of CHP installed, carbon emissions are cut by around 1,250 tonnes, as well as providing lower cost energy to tackle fuel poverty and to make industrial installations more competitive. Reaching the government's target of 10 GW capacity of CHP would realise further carbon savings of six million tonnes each year. This saving is more than 25% of the current shortfall required to achieve the UK's domestic target of a 20% reduction in CO2 emissions by 2010.

The reductions attributable to CHP are both proven and reliable. A significant opportunity for further reduction of carbon emissions still exists by increasing the uptake of community/district heating and CHP. In January 2004, the UK Energy Savings Trust (EST) published their study on the UK's Potential for Community Heating (CH) The report maps out the very substantial potential for CH across the UK, which shows potential far greater than Government's target. The vast majority of this potential of the many different types of CHP schemes (public, residential to industrial sector, and district heating to smaller scale embedded/micro-CHP) remain largely untapped to date.

This rationale was summarised by the Advisory Committee on Business and the Environment, who stated in their report to the Prime Minister in 2002:

In the short term the greatest potential …to help meet the 2010 (carbon) targets lies in CHP

While some CHP schemes have been recently been helped by funding from the CEP, as studies have shown, CHP has the potential to deliver far more CO2 emissions reductions than is currently being sought. WWF strongly recommends that in the new Climate Change Programme (due December 2005) the government includes new, robust policies to increase the number of ESCOs and Energy Services schemes (including microgeneration/decentralised power) delivering energy to consumers across the UK.

One option would be to set a meaningful "Energy Services obligation" percentage target for 2010 and 2020 perhaps and provide more funding to do so, in order to motivate electricity generators, suppliers and estate owners to provide energy services and improve the energy efficiency of their customers' premises.

In addition, WWF-UK supports the EWP's pledges that the government should support field trials in micro-CHP, should work with OFGEM to ensure there is a level "playing field" for smaller generators, including CHP and renewables, and should set and achieve targets for government departments and the public sector (including local authorities) to install and use CHP generated electricity.

Energy Efficiency Measures and Savings

As detailed above, the Performance and Innovation Unit (PIU) study in 2002 concluded that the current cost effective potential for energy efficiency is approximately 30% of final energy demand in the UK. The Royal Commission of Environmental Pollution (RCEP) also concluded that "It should be possible to reduce the UK's overall energy consumption without damaging its international competitiveness or causing hardship. Such a reduction would make a major contribution to achieving long-term reductions in carbon dioxide emissions."

In February 2003, the UK Energy White Paper set energy efficiency at the heart of UK energy policy, identifying improved energy efficiency as the most cost-effective way to meet all of our energy policy goals. The Paper envisages that half of reductions expected for the national target of 60% reductions by 2050 will be met by cuts in energy demand.

Please refer to QA (1) for WWF-UK's comments of energy efficiency.

Therefore, the UK Government can and must take steps to reduce the UK's energy demand and wasteful consumption, through an improved programme of energy efficiency measures, supporting mandatory energy demand reduction targets under the EU Energy End Use Efficiency and Energy Services Directive and encouraging changing practices in our everyday lives.

In line with the recommendation of the Sustainable Buildings Task Group, WWF-UK believes that the single most effective measure the government could introduce to improve energy efficiency in households would be stamp duty relief for homes meeting high energy efficiency standards. With the introduction of mandatory energy performance certificates for houses as part of the Home Information Pack, the necessary information for new and existing homes will be readily available.

WWF-UK believes that new energy efficient homes (for example those that meet a minimum standard of EcoHomes `Very Good' standard / Code for Sustainable Buildings) should attract stamp duty relief. For existing stock, the occupants who carry out remedial energy efficiency work on their property within a period after moving in should also attract stamp duty relief.

What are the relative efficiencies of different generating technologies? In particular, what contribution can micro-generation (micro-CHP, micro-wind, PV) make, and how would it affect investment in large-scale generating capacity?

According to a report published by Greenpeace in July 2005 the current, outdated electricity system is so inefficient that two-thirds of the energy in the fuel is wasted before it gets used at homes and workplaces. The huge loss of energy—enough to heat all the buildings and all the water in the UK—occurs because an enormous amount of heat energy is wasted through from the large power stations that make our electricity, while more power is lost transporting the energy long distances through power lines.

The report argues that a reform of the electricity system is urgently needed to end this environmentally destructive wastage—the power sector is the single greatest contributor to CO2 emissions. The solution is to generate electricity close to where it is needed, or "decentralise" it.

A decentralised energy system would see everyday buildings playing host to devices such as solar panels, small wind turbines and combined heat and power boilers, which generate electricity as well as providing heat and hot water. The electricity created would be used directly by the house or workplace, and the surplus would be fed into a local network. This electricity would then be locally distributed, avoiding the significant loss that occurs when electricity is transported long distances.

The combined contribution of these devices could be enormous. For example, if half the houses in the UK had combined heat and power boilers, this would generate as much electricity as current nuclear power plants. It would also save householders money on their electricity bills.

3. What is the attitude of financial institutions to investment in different forms of generation?

What is the attitude of financial institutions to the risks involved in nuclear new build and the scale of the investment required? How does this compare with attitudes towards investment in CCGT and renewable energy?

At the moment, as far as WWF-UK is aware, there is no realistic prospect of private investors putting money into nuclear power. Despite the many theoretical statements by the pro-nuclear lobbyists that the nuclear industry is economically viable, so far investor confidence in the industry has remained low.

It is argued that financial investors regard nuclear power plants sceptically and cautiously because of the extremely long planning, construction and radioactive waste management times. When Sizewell B nuclear plant was planned, for example, the ensuing public enquiry took almost four years.

Financial institutions also see risks because most of the national power utilities which are highly reliant on nuclear power receive either direct or indirect subsidies from the state governments eg British Energy in the UK[16], EdF in France, and state-owned nuclear reactors in Russia.

No new nuclear reactors (except one in Finland) are presently planned or under construction in any of the industrialised countries until 2010. This is largely a result of huge financial costs and associated risks. Helm (2003) concluded that the UK nuclear programme had proved to be ". . . probably one of the biggest investment mistakes since the Second World War . . . Not once since the first White Paper in 1955 had the nuclear option delivered what was promised." [17]

Financial investors are putting significant money in offshore and onshore windfarms, but inadequate government spend, policies and short-term target setting as well as prohibitive planning processes are stifling industry confidence in the market and preventing the large-scale investment needed. Much more funding and long-term market certainty is urgently needed for these new types of renewables in order to give confidence to investors.

How much Government financial support would be required to facilitate private sector investment in nuclear new build? How would such support be provided? How compatible is such support with liberalised energy markets?

WWF-UK relies on the expertise of the private sector to provide the information needed to answer this question on level of financial support, however WWF-UK fundamentally opposes any government funding to be diverted away from existing safe and reliable renewable and energy efficiency technologies which are currently under-supported, into unsustainable and highly risky technologies such as nuclear power.

What impact would a major programme of investment in nuclear have on investment in renewables and energy efficiency?

In short, new nuclear build and its associated huge financial costs would have a negative impact on the level of investment available for alternative clean, zero-carbon options, such as renewables and energy efficiency.

Nuclear power in the UK warrants vast sums of money in the order of £billions over the next 30-40 years. This will effectively divert the increased funding available and political interest away from the much needed renewables and energy efficiency measures.

C. STRATEGIC BENEFITS

4. If nuclear new build requires Government financial support, on what basis would such support be justified?

WWF-UK would strongly oppose any new build of nuclear power plants due to its costs— environmental, health and financial—and reasons provided in answers above, and believes that Government financial support (ie huge subsidies) for new nuclear build is not justified.

What public good would it deliver?

WWF-UK believes that very little public good, or indeed the reverse would come of a nuclear programme due to the risks associated with construction, operation and decommissioning, and associated costs which could ultimately come from the taxpayer's purse. In addition to the huge financial costs (for investment and liability/insurance) of new nuclear plants, there are significant social and environmental costs to consider, such as the transportation and storage of radioactive waste; leaks of radioactive materials from the nuclear plants/stores; low level radioactive emissions; and the threat posed by terrorism.

By comparison, renewable energy (such as wave, wind and solar) is clean, non-polluting and very well-suited to supporting the public good via new local community-based, decentralised types of new energy networks. These assist in changing peoples' behaviour, reduce energy demand and reducing carbon emissions, in contrast to a number of large unsafe nuclear power plants built on the coast far away from where the main areas of electricity demand are in the UK (and therefore losses occur during transmission along the wires). [18]

Various reports have also highlighted numerous health and environmental implications of radioactive discharges and stock piled wastes from nuclear power plants based in the UK. The 2000 RIFE report[19] indicates that in the UK the highest doses of radioactivity resulting from the consumption of terrestrial foodstuffs and seafood are found around Cumbria. A recent STOA report[20] concludes that more than 15 years of research has established that the excess incidence of childhood leukaemia around Sellafield is statistically significant and is continuing, and that radiation exposure due to releases from Sellafield cannot be excluded as a cause for the observed health effects.

Nuclear power also involves the transportation of thousands of tonnes of radioactive materials and waste around the country by road, rail and sea every year. A serious accident, involving a breach of a full spent fuel flask while it is being transported through a major city, could force the evacuation of hundreds of thousands of people over a large area.

The Nuclear Industry Association (NIA) appears to have tried to downplay the impacts of the 1986 accident in Chernobyl on the environment and on the local population, issuing statements like ". . . it will prove extremely difficult to make definitive statements about the health effects of the Chernobyl accident . . . in the longer term it is likely that some cancers will be induced as a result of the accident." [21]However, the health impacts continue to be horrific. Belarus has shown a 100-fold increase in thyroid cancers. Problems of the nervous and sensory organs have increased by 43%, disorders of bone, muscle and connective tissue by 63% in the affected area. The Republic of Belarus estimated the financial costs/losses over the first 30 years after Chernobyl will amount to US$235 billion. Analysts in the Ukraine estimated financial costs/losses of around US$148 billion in just four years, between 1986 and 2000. [22]

The Nuclear Industry Association also goes to some lengths to emphasise that the Chernobyl accident was a "one-off" that could never happen today. It is undoubtedly true that the accident occurred to an outdated reactor under safety conditions far worse than in the UK today. However, this does not mean that the UK's nuclear industry is safe from accidents. At the beginning of May 2005, a leak of nuclear fuel occurred at Sellafield's Thorp reprocessing plant. The leak was reported as not being a danger to the public, but will cost the taxpayer millions as the £1million a day plant will take months to fix. [23]

There have been many more nuclear accidents since the first one occurred in the UK at Windscale in 1957, including an explosion in 1973 and a series of serious radioactive leaks in 1975, 1979 and 1981. Furthermore, in 1999 it was discovered that data relating to a shipment of MOX fuel to Japan had been falsified, and in 2000 the hazardous storage of liquid high-level waste in tanks was condemned by the Nuclear Installations Inspectorate (NII) for not meeting safety standards.

Nuclear fission would make nuclear power production safer but it is at least 30-50 years away from being commercial and would require billions of pounds of investment. [24]The 10 new nuclear reactors proposed recently for the UK are of Westinghouse's "AP1000" design. This is a "fourth generation" nuclear power station, which are claimed to be safer because the safety systems are "passive"—that is they use natural rather than engineered solutions—gravity rather than valves and pumps. And while the nuclear industry claim that they are "around 100 times safer" than existing stations, it is extremely hard to judge whether this is the case.

In summary, the health & safety risks and environmental impacts associated with nuclear power build are immense, and the risk and impacts of a major nuclear accident are too significant to take when there are realistic alternatives available here and now (ie wave, wind and solar energy) which generate electricity in both a carbon and radiation free way.

To what extent and over what timeframe would nuclear new build reduce carbon emissions?

It wouldn't—although a nuclear power station does not itself emit CO2 emissions during the generation of electricity, the whole life cycle of nuclear power also includes the mining and extraction of uranium ore, fuel enrichment, large amounts of concrete in station and storage facilities and transport of radioactive waste materials. All these steps in the chain also use large amounts of energy, almost all of which is from fossil fuel-based electricity generation. Taking into account a whole life-cycle analysis of nuclear power plants, the conclusion is clear: nuclear power is anything but carbon-free and new build would not reduce overall UK CO2 emissions. Even if we doubled nuclear power in the UK this would reduce greenhouse gas emissions by only around 8%.[25]

To what extent would nuclear new build contribute to security of supply (ie keeping the lights on)?

As explained previously, WWF-UK disputes the presumption of unchecked energy demand and the resulting growth forecasts, which is the premise on which the Inquiry is based. The UK Government can and must take steps to reduce the UK's energy demand and wasteful consumption, through an improved programme of energy efficiency measures, supporting mandatory energy demand reduction targets under the EU Energy End Use Efficiency and Energy Services Directive and encouraging changing practices in our everyday lives.

Energy efficiency measures are by far the most cost-effective way of reducing CO2 emissions, and enhancing security of supply in the UK, and can also lead to significant savings for the UK economy.

Is nuclear new build compatible with the Government's aims on security and terrorism both within the UK and worldwide?

No. The national security dangers associated with nuclear power plants and radioactive wastes are real and significant. One of the by-products of most nuclear reactors is plutonium-239, which can be used in nuclear weapons. The US Department of Energy has stated that: "virtually any combination of plutonium isotopes . . . can be used to make a nuclear weapon". This is not a theoretical risk—in only May of this year North Korea claimed to have diverted nuclear fuel from spent fuel rods in order to make nuclear weapons, and early in June, plans for how to make elements of a nuclear bomb were reported missing by the UN. An official was quoted in media articles as saying, ". . . this is what keeps people awake at night. It's very sensitive. The fact that there are [nuclear] proliferation manuals kicking around is deeply disturbing." [26]

If the UK Government were to start a risky new nuclear-build programme, it would make it much more difficult to resist/prevent nuclear development in other countries around the world such as Iran. This is not a factor which can be sensibly ignored and increased international trade in nuclear material means that there is a real risk that some will go astray.

Furthermore, recent studies in the US have put the health impacts of a terrorist attack on a nuclear reactor at 44,000 immediate fatalities with 500,000 long-term health impacts, including cancers.

5. In respect of these issues [Q 4], how does the nuclear option compare with a major programme of investment in renewable energy, micro-generation, and energy efficiency? How compatible are the various options with each other and with the strategy set out in the Energy White Paper?

As described in previous answers above, the nuclear option doesn't compare well at all with renewables, energy efficiency and decentralised power with regards to the new major programme of investment required to reduce energy demand and carbon emissions. An independent study commissioned by WWF-UK27 last year showed that implementing energy efficiency measures to drive annual reductions in energy demand was key in achieving 60% reductions in carbon dioxide (CO2) emissions from the UK power sector by 2020, without resorting to new nuclear power and with closure of coal stations.

The study also showed that this low-carbon energy supply did not require a radical shift in policy, but an extension and effective implementation of existing policy in order to deliver on the aspirations of the Energy White Paper, which places energy demand reductions at its heart.

The UK Government's Energy White Paper (2003) and "Energy Efficiency: The Government's Plan for Action", (2004) reports were also good first steps to promoting energy efficiency and reducing carbon, but much more can and must be done to improve energy efficiency in the UK's domestic, commercial and industrial sectors.

D. OTHER ISSUES

6. How carbon-free is nuclear energy? What level of carbon emissions would be associated with (a) construction and (b) operation of a new nuclear power station? How carbon-intensive is the mining and processing of uranium ore?

The only truly fair way to compare and assess the CO2 emissions produced by a given type of electricity generator (nuclear, coal or renewable) is to undertake a whole "life cycle" analysis (LCA). For the nuclear power industry this means including the CO2 produced by uranium mining, milling and enrichment, fuel fabrication (using both "fresh" and reprocessed uranium), reactor plant construction, spent fuel and waste storage and disposal options. As indicated in the answers to Questions in part 4 above, while a nuclear power station does not itself emit CO2 emissions during the generation of electricity, the pathway of nuclear power use large amounts of energy, almost all of which comes from fossil fuel-based electricity generation and emit carbon dioxide emissions. Therefore, taking into account the whole life-cycle of nuclear power plants, nuclear power is anything but carbon-free.

Estimates by the nuclear industry regularly ignore these additional CO2 emissions when they are trying to promote nuclear as the solution to climate change. Research examining the overall impact of building and operating reactors found that nuclear power stations would produce over 50% more greenhouse gas emissions than wind power. 27[27]

So, where does nuclear stand on its CO2-emission-factor (grams/kilowatt unit for measuring CO2 emissions)? Depending on the source there is a whole range of figures; from 34 g/kWh to 230 g/kWh. While compared with coal, oil or gas, nuclear power has a favourable CO2-emission-factor, it comes off much worse when compared to the real and clean solutions such as energy efficiency, renewable energy, CHP and decentralised power systems.

7. Should nuclear new build be conditional on the development of scientifically and publicly acceptable solutions to the problems of managing nuclear waste, as recommended in 2000 by the RCEP?

There have not been any past nor recent technological innovations and no adequate solutions proposed yet to solve the nuclear industry's radioactive waste problem. Despite 40 years of assurances from the nuclear industry that radioactive waste is a mere "engineering problem", the fact remains that no one has yet solved it and high-level nuclear waste, produced by the nuclear industry, remains dangerously radioactive for up to 240,000 years.

22 September 2005

http://www.greenpeace.org.uk/climate/climate.cfm?UCIDParam=20050719112356

European Parliament Scientific and Technological Options Assessment (STOA), October 2001.

Comments include:

"Reports of health effects have proved difficult to evaluate."

"It seems that the increase in thyroid cancer is linked to emissions of radioactive iodine during the accident. Although curable, there have been 10 deaths out of 500 cases of this disease owing to poor health care." "It will prove extremely difficult to make definitive statements about the health effects of the Chernobyl accident." "In the longer term it is likely that some cancers will be induced as a result of the accident." "Chernobyl is the worst civil nuclear power accident to ever occur. It killed 31 people directly and it will cause cancer deaths in the long term, though these are unlikely to be detectable compared to cancer deaths from other causes."

http://www.dti.gov.uk/energy/inform/energy_projections/index.shtml

http://www.psiru.org/reports/2005-09-E-Nuclear.pdf

1 "The Power to Save Our Climate" report by Ilex, September 2004 (commissioned by WWF-UK). Back

2 Rocky Mountain Institute. Back

3 The Energy Review-A Performance and Innovation Unit (PIU) Report-February 2002. Back

4 Speech, UK Stabilisation 2005 Conference, Exeter (2005); Beckett's evidence session for EFRA. parliamentary inquiry on climate change (9 February 2005). Back

5 WISE and NIRS Publication (February 2005): A back door comeback-Nuclear energy as a solution for climate change? Back

6 Scheer, H (2004) Nuclear Energy belongs in the Technology Museum. WRCE Update September 2004. Back

7 Scheer, H (2004) Nuclear Energy belongs in the Technology Museum. WRCE Update September 2004. Back

8 Congressional Budget Office Cost Estimate 7 May 2003 S 14 Energy Policy Act of 2003. As introduced on 30 April 2003 The CBO puts the cost of the first reactor at US$2.5 billion. <au0,2>http://www.cbo.gov/showdoc.cfm?index=4206&sequence=0<xu Back

9 Congressional Budget Office Cost Estimate 7 May 2003 S 14 Energy Policy Act of 2003. <au0,2>http://www.cbo.gov/showdoc. cfm?index=4206&sequence=0<xu Back

10 PB Power for the Royal Academy of Engineering (March 2004) "The Cost of Generating Electricity". Back