The technical and economic conflicts

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At first sight, the concept of a nuclear and wind-powered electricity system seems an attractive way of minimising carbon emissions. But it is unlikely to be an attractive option economically. There are two issues: the inflexibility of nuclear plant and the fact that both nuclear and wind are capital-intensive.

The older nuclear stations tend to be inherently inflexible. They prefer to operate at constant output -- usually full load -- covering so-called "base load" electricity requirements. Most electricity systems have similar characteristics and the minimum, or base load, is around 35% of the peak demand. A system with a peak load of 10,000 MW would have a base load requirement of 3500 MW.

Nuclear plant tend to operate at fairly high load factors and so such a system would be able to accommodate about 4000 MW of nuclear plant. If more nuclear were added, then some of the output would need to be constrained on occasions -- to the detriment of nuclear's economics. Although the latest designs of reactor are more flexible, doubts remain about their ability to continually adjust output.

Technical issues apart, the last thing a nuclear power plant operator wants to do is curtail its output. The high capital costs of nuclear mean that every unit of electricity possible needs to be squeezed out of the plant to keep up with debt repayments. If the load factor of a nuclear power station is reduced by 10%, then either the operator must increases electricity charges to the customer by about 10%, or suffer 10% loss of income. If, on the other hand, the operator of a gas-fired power station needs to operate at 80% load factor instead of 90%, then his electricity charges only need to rise by about 4%.

Like nuclear, the economics of wind are also dictated by its capital intensive nature: much more of the cost of wind and nuclear lies in the initial capital outlay than it does for fossil fuel plant. Loss of output for wind means significant financial losses. Most electricity networks recognise this and allow wind to have "must run" status. It is able to operate whenever it is available, saving on purchases of fossil fuel.

The problem with operating nuclear and wind in the same electricity network is that they are "competing" to supply the base load. Experience from western Denmark, which during a year gets 20% of its electricity from wind, reveals that on occasion wind power covers 100% of consumer demand. As wind output rises above 20%, there will be occasions when surplus electricity will need to be exported, or diverted to new markets, as system operator Energinet has demonstrated. The surpluses are fairly small and do not occur often, so the extra costs are not huge. Indeed, the extra costs of operating with 100% wind are not huge as long as gas is the complementary technology providing reserves as and when needed.

The Danish experience provides a useful benchmark: with 20% or more wind energy in a system, any nuclear would be competing with wind power for the base load. One of the technologies would need to be constrained. Furthermore, if there is 40% or more nuclear in a system, wind power can only be added if the cost of constraining wind or nuclear is covered by the consumer. The banks win and the consumers lose. With 20% nuclear on a system, only 10% wind power can be accommodated without an economic downside.

These benchmarks are not absolutely rigid and will vary slightly between networks. The principle, however, cannot be denied. If two capital-intensive technologies are competing for the same market, the efficiency of either or both is reduced. The environment may benefit, but at high cost to consumers compared with the benefits derived from operating wind in conjunction with gas and coal, without adding nuclear to the mix.

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