Wednesday, August 03, 2005

Competitors To Nuclear: Eat My Dust

Competitors To Nuclear: Eat My Dust

by Amory B. Lovins

Private investors have flatly rejected nuclear power but enthusiastically bought its main supply-side competitors—decentralized cogeneration and renewables.

In a market economy, private investors are the ultimate arbiter of what energy technologies can compete and yield reliable profits, so to understand nuclear power's prospects, just follow the money. Private investors have flatly rejected nuclear power but enthusiastically bought its main supply-side competitors—decentralized cogeneration and renewables. Worldwide, by the end of 2004, these supposedly inadequate alternatives (see graph) had more installed capacity than nuclear, produced 92% as much electricity, and were growing 5.9 times faster and accelerating, while nuclear was fading.

Global Annual Additions of Electrical Generating Capacity
In 2004, decentralized cogeneration and renewables, excluding big hydro dams (any over 10 megawatts), added 5.9 times as much worldwide net capacity as nuclear power added, and raised annual electricity production 2.9 times as much as nuclear power did. By the end of 2004, these decentralized, nonnuclear competitors' global installed capacity totaled ~411 GW*—12% more capacity than global nuclear plants' 366 GW—and produced ~92% as much electricity. Thus the "minor" alternative sources actually overtook nuclear's global capacity in 2003, rivaled its 2004 and will match its 2005 output, and should exceed its 2010 output by 43%. They already dwarf its annual growth. Official and industry forecasts indicate they'll add 177 times as much capacity in 2010 as dwindling nuclear power will. And they're dwarfed in turn by demand-side opportunities, not graphed here because reliable global implementation data aren't available. So the big question about nuclear "revival" isn't just who'd pay for such a turkey, but also...why bother? Why keep on distorting markets and biasing choices to divert scarce resources from the winners to the loser—a far slower, costlier, harder, and riskier niche product—and paying a premium to incur its many problems? Nuclear advocates try to reverse the burden of proof by claiming it's the portfolio of non-nuclear alternatives that has an unacceptably greater risk of non-adoption, but actual market behavior suggests otherwise.

* About 266 GW (billion watts) of mostly gas-fired decentralized cogeneration (emitting ~30–80% less CO2, depending on fuel), 47 GW of wind, 47 small hydro, 37 biomass/waste, 10 geothermal, and 4 photovoltaics

The world's nuclear plant vendors have never made money, and their few billion dollars' dwindling annual revenue hardly qualifies them any more as a serious global business. In contrast, the renewable power industry earns ~$23 billion a year by adding ~12 GW of capacity every year: in 2004, 8 GW of wind, 3 GW of geothermal/small hydro/biomass/wastes, and 1 GW of photovoltaics (69% of nuclear's 2004 new construction starts, which PVs should surpass this year). PV and windpower markets, respectively doubling about every two and three years, are expected to make renewable power a $35-billion business within eight years. And distributed fossil-fueled cogeneration of heat and power added a further 15 GW in 2004; it does release carbon, but ~30% less than the separate boilers and power plants it replaces, or up to ~80% less with fuel-switching.

Windpower's 50+ gigawatts of global capacity, half of U.S. nuclear power capacity, paused in 2004 due to Congressional wrangling, but is expected to triple in the next four years, mainly in Europe, which aims to get 22% of its electricity from renewables by 2010. One-fifth of Denmark's power now comes from wind; German and Spanish windpower are each adding as much capacity each year (2 GW) as the global nuclear industry is annually adding on average during 2000–10. No country has had or expects economic or technical obstacles to further major wind expansion. The International Energy Agency forecast in 2003 that in 2010, wind could add nine times as much capacity as nuclear added in 2004, or 84 times its planned 2010 addition. Eight years hence, just wind plus industry-forecast PVs could surpass installed global nuclear capacity. The market increasingly resembles a 1995 Shell scenario with half of global energy, and virtually all growth, coming from renewables by mid-century—about what it would take, with conservative efficiency gains, to stabilize atmospheric carbon.

Whenever nuclear power's competitors (even just on the supply side) were allowed to compete fairly, they've far outpaced central stations. Just in 1982–85, California utilities acquired and or were firmly offered enough cost-effective savings and decentralized supplies to meet all demand with no central fossil-fueled or nuclear plants. (Alas, before the cheaper alternatives could displace all those plants—and thus avert the 2000 power crisis—state regulators, spooked by success, halted the bidding.)

Today's nonnuclear technologies are far better and cheaper. They're batting 1.000 in the more competitive and transparent processes that have swept most market economies' electricity sectors and are emerging even in China and Russia. A few Stalinist economies like North Korea, Zimbabwe, and Belarus still offer ideal conditions for nuclear sales, but they won't order much, and you wouldn't want to live there.

No wonder the world's universities have dissolved or reorganized nearly all of their departments of nuclear engineering, and none still attracts top students—another portent that the business will continue to fall, as Nobel physicist Hannes Alfvén warned, "into ever less competent hands," buying ever less solution to any unresolved problem than in the days of the pioneers. Their intentions were worthy, their efforts immense, but their hopes of abundant and affordable nuclear energy failed in the marketplace.


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