Business comment: Nuclear's role in Scotland’s energy future

Much has been written and discussed in relation to Scotland’s future energy strategy, but the discourse has hitherto lacked a factual review of how nuclear power can contribute. If we are to be able to deliver clean, secure energy infrastructure, openness to scientific evidence and factual reality is critically urgent.

Five years ago, the Scottish Government’s revised energy strategy set out milestones to reach by the year 2050. So far, this strategy has consistently missed key milestones.

In 2020 the target was for 100 per cent of Scotland’s electricity consumption to be generated from renewables but the actual amount achieved fell short. This target underpinned a much larger milestone: the equivalent of 30 per cent of Scotland's heat, transport and electricity consumption powered by renewable sources. These targets were not met and the closure of Hunterston B power station in 2022, leaves Scotland highly dependent on intermittent generation and imported electricity.

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Heating accounts for a much larger proportion: 51.5 per cent of all energy consumption in 2020, largely from burning gas. Another target was missed in 2020: 11 per cent of heating that isn’t produced by electricity should have been from renewable sources such as biomass and heat pumps. This target was missed by a long way: just 6.4 per cent of Scotland’s non-electrical heat demand was supplied by renewable sources in 2020. The vast majority of heating is still from fossil fuels.

The target for 2030, just eight years away, is to have “50 per cent of the energy for Scotland's heat, transport and electricity consumption to be supplied from renewable sources”. The most ambitious target is 100 per cent renewable sources by 2050.

Decarbonising the energy sector means that, even with energy efficiency measures, electricity demand will increase and so generating capacity must also increase. Holyrood is putting its stock in renewables and a future for hydrogen but given that it’s fallen short of target so far, it seems to be relying on importing electricity as a back-up through interconnectors. The recent warnings about the reliance on intermittent forms of power production and the risks of power outages and the negative impact on inward investment should be taken seriously.

Interconnectors work well during stable economic periods, but early in 2022 we saw that we can’t assume interconnectors will be stable, or that renewable electricity will be available to import. A recent estimate from Whitehall shows how dependent the UK still is on external supplies and, if events with Russia become extreme, six million homes across the UK might be forced to ration electricity use. There is also talk of keeping coal-fired power stations online in England.

If targets for renewables are falling short, what more can be done?

Andy Renton, principal, Castletown Law. Picture: Jo Hanley

Holyrood opposes current nuclear technology but does not rule out new and developing nuclear technologies. The energy strategy states that government is “duty bound to assess new technologies and low carbon energy solutions”.

Scotland has world-class engineering capability. There is symmetry between nuclear decommissioning and offshore oil and gas installation decommissioning; there is the capability in Scotland’s technology campuses to deliver automated and robotic systems for these activities. Capabilities like this can be applied to the production of energy from new technologies too. Investment in new nuclear technology like small and advanced modular reactors could supply more than enough energy to meet Scotland’s needs when part of a well-considered and structured energy generation mix.

Critics of the current new nuclear build in the south of England, Hinkley Point C, are too quick to state that it is “risky, expensive, and a bad outcome for UK consumers”. In this context, risk relates to a bad investment rather than safety. Although Hinkley Point C costs are in excess of £23 billion, approximately 60 per cent of that is down to the financing model. Whitehall lacked a coherent government policy to support nuclear power, mistakenly believing new nuclear power could be privately financed without a government-underwritten commitment.

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When the price for the build was decided in 2012 the associated uncertainty implied an investment risk which was balanced by an increased price. Had Whitehall underwritten the construction of a new power station, the build cost would have been dramatically reduced.

Even though this seemed expensive at the time, today’s predicted energy prices combined with the ability of Hinkley Point C to produce electricity for potentially 100 years make this project look like a good deal now. Indeed, in today’s context Hinkley Point C seems like a very good way of ensuring energy security, generating low-carbon energy and reducing reliance on other nations.

If Scotland’s energy needs for heating and transport are to be decarbonised this most likely means switching to electrical sources. Diverse sources of electricity are needed that don’t all rely on the weather. Even if we were to rely on hydrogen as an alternative to fossil fuels, this technology isn’t in use yet; it seems foolish to rely on a technology that may not mature in time. And if this technology does become part of our future, electricity is still required to produce the hydrogen.

By leveraging Scotland’s existing engineering capability, investment from the private sector will be attracted to advanced nuclear technology that does not produce greenhouse gas emissions, and produces a low amount of hazardous waste that is responsibly managed and regulated nationally and internationally. It will secure long-term jobs and an investment in plant workers. Future nuclear plants can also come with other benefits such as the supply of district heating, and the ability to produce hydrogen. It has the potential to put Scotland once again at the forefront of advanced engineering and provide export opportunities for the whole industry supply chain.

- Andy Renton, principal, Castletown Law

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