Staggering rise of clean energy in China a wake-up call to Australia – including on nuclear

Given the implications for Australian taxpayers of the massive capital, time and LCOE blowouts of A$50-60bn per nuclear plant, it’s time to call the nuclear debate here for what it is – a politically motivated furphy designed to derail the renewables transition.

Taxpayers have already funded six government nuclear inquiries since 2015 which all concluded nuclear is too slow and too costly. 

Nuclear works at scale in China. Here, it is a deliberate distraction by fossil fuel incumbents and politicians on their payroll.

Tim Buckley, Apr 30, 2024,  https://reneweconomy.com.au/staggering-rise-of-clean-energy-in-china-a-wake-up-call-to-australia-including-on-nuclear/

China is undergoing a monumental power shift, with the staggering rise of zero-emissions energy positioning the green powerhouse to end new coal power before 2030. This has massive implications for global and Australian decarbonisation.

Climate Energy Finance’s latest report, released this week, modelled China’s electricity system nationally at the annual level through to 2040, evaluating its likely GDP growth trajectory and the resulting energy demand growth, as well as the increased share and hence demand for electricity in the energy mix as China continues to pursue its ‘electrification of everything’ strategy of the last two decades.

CEF forecasts that through to 2040, China will install a world-leading 323GW per annum of solar capacity, 80GW of wind, 1GW of hydropower and 3GW of nuclear. 

Sustaining this rate of installation of >400GW pa of zero-emissions additions a year – over six times the total capacity of Australia’s National Electricity Market (NEM) – would see China achieve its ‘dual carbon’ targets, to peak carbon emissions by 2030 and reach carbon neutrality by 2060, ahead of time.

This in turn opens up the potential for it to revise its emissions reduction pledge to net zero by 2050 or 2055, bringing the behemoth in line with the rest of the developed world. 

While China’s total electricity demand will continue to rise through 2040 due to sustained strong economic growth and economy-wide electrification, CEF forecasts that the share of thermal power in total generation will progressively decline, from 70% in 2023 to just 50% by 2030 and potentially to just 30% by 2040. A staggering transformation in under two decades.

This astonishing acceleration of the nation’s energy pivot is reflected in its energy investment trend. China Invested US$890bn in cleantech in 2023, more than double the US as the second largest investor.

China installed 63GW of zero-emissions electricity capacity in the first three months of 2024, as much as the entire NEM of Australia. That represented growth of 35% year-on-year (yoy), building on the 301GW of new zero emissions capacity installed in 2023, which was in turn double the rate of new capacity installs of 2022. 

This rate of expansion is both world leading and global energy system-transforming.

Nuclear in China 

China also leads the world in deployment of new nuclear energy. The levelised cost of energy (LCOE) of nuclear, at US$70 per megawatt hour (MWh), is half the cost of the US$160/MWh in Europe and US$105/MWh in the US. 

This is a key point that Australia’s nuclear proponents fail to appreciate: There are demonstrable financial benefits to the technology in a super-large-scale, centrally-planned economy with a well-entrenched record of deploying complex, dangerous, massively capital-intensive nuclear power plants every year. These conditions do not apply in western economies and are completely out of the question for Australia. 

The IEA estimates China can build nuclear power plants at half the capital cost of the US and Europe, and in almost half the time. Australia, on the other hand, has never built a commercial nuclear power plant, as confirmed by the World Nuclear Association.

China currently has 54GW of operable nuclear power reactors, with 31GW of nuclear power reactors under construction, another 45GW in planning and 98GW proposed as of February 2024, with more proposals for new nuclear reactors awaiting approval.

CEF’s Chinese electricity model forecasts China will double its nuclear power plant fleet to 108GW by 2040 to be #1 in the world in terms of total installed capacity, overtaking the US at 100GW. 

December 2023 saw the world’s first 4^th generation nuclear power plant go into commercial operation, operated by Huaneng Shandong Shidao Bay Nuclear Power. The facility has a modest net capacity of 150MW, but still took a lengthy 11 years to construct after approval in 2012. 

In 2011  the National Energy Administration (NEA) announced that China would make nuclear energy the foundation of its electricity generation system in the next “10 to 20 years,” adding as much as 300GW of nuclear capacity over that period. 

China has delivered less than a sixth of this target. Post Fukushima China wanted to only install the most modern facilities deploying the latest technology, which they developed themselves, becoming the world leader in this technology as in all zero-emissions technologies of industries of the future..

We forecast China will add 3GW annually of new capacity as part of its all-of-the-above strategy for domestic power generation. We estimate nuclear will rise to 790TWh of annual generation by 2040, representing a national share of 5.0% (vs 433TWh and a 4.9% share in 2023), just a fraction of the 20-25% share targeted a decade ago.

With the massive scaling up of nuclear power capacity in China, the IEA models the real LCOE will fall 10% to US$65/MWh by 2050, vs the 50% decline in solar LCOE to US$25/MWh. 

By comparison, the IEA models Chinese coal with carbon capture and storage will rise to US$220/MWh, ten times the cost of solar, and three times the 2050 cost of nuclear, making coal increasingly uneconomic. 

In short, nuclear makes sense as part of the zero-emissions energy mix in China given the need to decarbonise at speed.

As for its viability in Australia, there is not a single small scale nuclear reactor (SMR) – the Federal Coalition’s preferred nuclear technology – approved for construction anywhere in the world outside of Russia and China.

This begs the question of whether Opposition Leader and chief nuclear spruiker Peter Dutton is proposing to deploy 4^th generation Chinese developed technologies, or antiquated 2^nd generation Russian technology, here.  

Given the implications for Australian taxpayers of the massive capital, time and LCOE blowouts of A$50-60bn per nuclear plant, it’s time to call the nuclear debate here for what it is – a politically motivated furphy designed to derail the renewables transition.

Taxpayers have already funded six government nuclear inquiries since 2015 which all concluded nuclear is too slow and too costly. 

Nuclear works at scale in China. Here, it is a deliberate distraction by fossil fuel incumbents and politicians on their payroll.

Let’s wait till at least one plant is commissioned and the cost of nuclear power plants built somewhere in the west is remotely affordable and proven, and timeframes for deployment make sense as the imperative to decarbonise escalates, and then have a debate about its merits. 

Opportunities for Australia

The critical shift in the energy landscape in China that we map toward zero-emissions technology, with coal playing a diminishing back-up role, also has profound significance for Australia – including the inevitable decline in demand for coal in China. 

This is a wakeup call for Australia to accelerate the transition of its economy from its historic overdependence on coal exports and diversify its economic base. We should be pivoting now to deploy our natural advantages – our world-leading wealth of critical minerals and strategic metals – to produce value-added energy transition materials for export. 

Key to this is enhancing cleantech supply chain partnerships and bi- and multilateral agreements in the Asian region – a central premise of the new Future Made in Australia Act – including with China, the world’s green economic powerhouse. 

And while they do nuclear, alongside their accelerating VRE capacity additions, we can be “embodying decarbonisation” in our exports by value-adding our lithium and other critical minerals, producing green iron, and manufacturing energy transition materials such as cleantech using the boundless potential of our superabundant renewable energy.

For this, we also need to be boosting the ambition, speed and scale of our utility and distributed wind and solar rollout, a critical enabler of Australia’s opportunity to reposition the domestic economy as a zero-emissions trade and investment leader in a rapidly transitioning world. 

Nuclear has no viable part in this picture.

April 30, 2024 Posted by Christina Macpherson | energy | Leave a comment

China’s quiet energy revolution: the switch from nuclear to renewable energy

By Derek Woolner and David Glynne Jones, Apr 6, 2024  https://johnmenadue.com/chinas-quiet-energy-revolution-the-switch-from-nuclear-to-renewable-energy/

There is now a policy dispute about the roles of nuclear and renewable energy in future Australian low emission energy systems. The experience of China over more than a decade provides compelling evidence on how this debate will be resolved. In December 2011 China’s National Energy Administration announced that China would make nuclear energy the foundation of its electricity generation system in the next “10 to 20 years”. Just over a decade later China has wound back those ambitious targets and reoriented its low emission energy strategy around the rapid deployment of renewable solar and wind energy at unprecedented rates.

Australia has seen a campaign against the use of renewable energy technologies and for the benefits of nuclear energy in developing Australia’s future low emission energy systems. The Federal Opposition has now adopted this position as their policy. The recent experience of China provides a compelling commentary on this decision.

In December 2011 China’s National Energy Administration (NEA) announced that China would make nuclear energy the foundation of its electricity generation system in the next “10 to 20 years”, adding as much as 300 gigawatts (GWe) of nuclear capacity over that period.

This was followed by a period of delay as China undertook a comprehensive review of nuclear safety in the aftermath of the Fukushima nuclear disaster.

Subsequently, moderated nuclear energy targets were established, aiming for a nuclear energy contribution of 15% of China’s total electricity generation by 2035, 20-25% by 2050 and 45% in the second half of the century.

However by 2023 it was becoming clear that China’s nuclear construction program was well behind schedule. The target for 2020 had not been achieved, and targets for subsequent 5-year plans were unlikely to be achieved.

In September 2023 the China Nuclear Energy Association (CNEA) reported that China was now aiming to achieve a nuclear energy contribution of 10% by 2035, increasing to around 18% by 2060.

The CNEA also indicated that ‘greenlighting’ of new construction would now be at the rate of 6-8 large nuclear power reactors per year – not the 10 per year previously targeted for 2020-2035 and beyond. This will result in new nuclear generation increasing by 60-80 terawatt-hours (TWh) annually.

Meanwhile the deployment of renewable energy (primarily solar and wind energy) was dramatically accelerated in 2023, with the installation of 217GWe of new solar capacity and 70GWe of new wind capacity.

This represents an increase of around 400TWh in annual low emission generation – the quantitative equivalent of 40 large nuclear power reactors, or four times the average annual output of the Three Gorges Dam hydroelectric system (the world’s largest power station).

In 2023 energy analysts started reporting that China was now expected to achieve or exceed its 2030 target of 1200GWe for the total installed capacity of solar and wind energy by 2025, and was now planning to triple the 2030 objective, to reach 3900GWe.

Previously China expected that its energy emissions would peak in 2030, but revised forecasts are now indicating that this could happen as early as 2024, 5-6 years ahead of target.

By the end of 2023 it was clear that nuclear energy was no longer going to be the foundation of China’s future electricity generation system, and that this task had shifted to renewable energy.

So what has happened? There’s no single answer, but two key factors appear to be at play.

The first is the emergence of renewable energy technologies at competitive scale and cost since 2011.

Between 2011 and 2022, the cost of solar PV modules declined by 85%, wind energy costs by 60-70%, and battery costs by 90%.

China now dominates the global production of solar PV panels, wind turbines and batteries, with costs expected to continue to decline significantly for the foreseeable future while performance improves.

The consequence is that renewable energy generation can now be deployed economically at rates five to eight times faster than nuclear energy, which is constrained by logistical and regulatory capability, safety, site availability and other factors.

The second is the slow delivery of new nuclear generation which contributed to continued ‘greenlighting’ of new coal-fired generation to underwrite energy security, as it became clear that deployment rates for new low emission electricity generation were insufficient to blunt demand from provincial governments for new coal-fired generators, even though many existing plants are operating at uneconomically low capacity factors

By 2035, under the original plan, combined nuclear, solar and wind generation would have been comparable to current coal generation but insufficient to meet significantly increased new electricity demand.

Under the new plans, combined solar, wind and nuclear generation is likely to match current coal generation and meet new demand, with solar and wind energy contributing around 85% of this low emission generation.

By 2030 another factor will come into play, with China’s battery giant CATL developing long duration utility battery systems that will provide dispatchable electricity from renewable sources at competitive or lower costs than either coal or nuclear generated electricity.

The central message here is that even in China – the world’s largest industrial economy and preeminent builder of advanced civil infrastructure in the 21st century – nuclear energy cannot compete with renewable energy to deliver low emission electricity generation at the deployment rates needed to meet mid-century emission targets.

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April 7, 2024 Posted by Christina Macpherson | energy | Leave a comment

CSIRO says wind and solar much cheaper than nuclear, even with added integration costs

The big mover – and one that is significant in the context of the Australian debate on the energy transition, and the federal Coalition’s insistence that nuclear is the answer to most questions – is the cost of nuclear and small modular reactors.

Giles Parkinson 21 December 2023 ReNewEconomy

The CSIRO has published the latest edition of its important GenCost report, and responded to critics by dialling in near term integration costs for wind, solar and storage. But the result is just the same – renewables are clearly Australia’s cheapest energy option, and the story for nuclear just got a whole ot worse.

The annual GenCost report, prepared in collaboration with the Australian Energy Market Operator since 2018, is an important guide to where Australia’s energy transition is at and where it should be heading, but over the past has become the target of attack from conservative naysayers and the pro-nuclear lobby.

CSIRO has defended its methodology, but to satisfy the critics has added in pre-2030 integration costs – including the new transmission lines being built to connect new generation – and finds that the story is much the same.

“While this change leads to higher cost estimates, variable renewables (wind and solar) were still found to have the lowest cost range of any new-build technology,” the CSIRO says, noting that this includes all integration costs up to and including 90 per cent renewables.

In the past year, cost of solar and offshore wind has fallen, the cost of battery storage has remained steady, but the cost of other technologies such as onshore wind and pumped hydro has increased.

The big mover – and one that is significant in the context of the Australian debate on the energy transition, and the federal Coalition’s insistence that nuclear is the answer to most questions – is the cost of nuclear and small modular reactors.

The CSIRO has been attacked by the pro-nuclear lobby, including conservative media and right wing think tanks,  for what the lobby claims are inflated cost estimates, but the CSIRO says recent events have backed its numbers. In fact, they make clear that nuclear SMR costs are worse than thought.

CSIRO economist Paul Graham points to the collapse of a major deal this year involving the most advanced SMR projects in the US, the NucScale projects in Utah, which were withdrawn because of soaring costs.

Graham says it is significant because, as NuScale was listed and had to abide by strict regulatory disclosure rules, it had to be “honest” about the anticipated costs of SMRs.

And these were nearly double what was previously thought. In fact they ended up at the equivalent of $A31,000/MW, according to NuScale filings, and much higher than the $A19,000/MW estimated by the CSIRO in its previous report, and for which it was accused of inflating.

“The UAMPS (Utah utility) estimate implies nuclear SMR has been hit by a 70 per cent cost increase which is much larger than the average 20% observed in other technologies,” the CSIRO writes.

“The cancellation of this project is significant because it was the only SMR project in the US that had received design certification from the Nuclear Regulatory Commission which is an essential step before construction can commence.” Graham says that all other claims on nuclear SMR costs are just marketing and sales talk.

The reality, however, is that talk of nuclear SMRs as a solution for Australia’s energy transition and near term emissions targets are a distraction, given that the SMR technology is simply not available, and unlikely to be so for two decades.

The CSIRO report says some interesting things about the costs of wind and solar, technologies which are available and which do work. It says the costs of these technologies will continue to fall in coming years after the various price shocks that have affected the technologies over the last couple of years.

By including the costs of transmission and storage that is underway now and committed out to 2030 adds 40 to 60 per cent to the 2023 cost of deploying high shares of wind and solar, although that also ignores the technologies cost falls that will occur over time……………………………………………………………………………………….more https://reneweconomy.com.au/csiro-says-wind-and-solar-much-cheaper-than-nuclear-even-with-added-integration-costs/

December 22, 2023 Posted by Christina Macpherson | energy | Leave a comment

Build renewables, not nuclear’: energy execs reject reactors.

Australia must focus on developing a huge pipeline of renewable energy as it can’t afford to wait for small modular nuclear reactors to become cost-competitive.

THE AUSTRALIAN Colin Packham Energy reporter

Australia must concentrate on developing a massive pipeline of renewable energy as it can’t afford to wait for small modular nuclear reactors to mature and become cost-competitive, energy executives have urged.

“The economics are clear: we need to act now to build wind, solar and batteries, not wait for a more expensive solution that won’t be available for more than a decade, at the earliest,” said Jason Willoughby, the chief executive of Andrew Forrest-owned renewables developer Squadron Energy.

“Renewables are the cheapest form of new-build electricity, including with the investment ­required in transmission infra­struc­ture.

“The consequences and costs are too great not to act.

“Australia simply can’t afford to wait.”

Australia is struggling to meet its ambitious plans to replace its ageing coal power stations with renewable energy, and the federal opposition has proposed converting coal-fired power sites into small modular nuclear reactors to ease the transition.

Federal Energy Minister Chris Bowen recently released modelling showing that 71 small modular reactors would cost $387bn.

He said each megawatt of nuclear-generated electricity would have a capital cost of $18.1m – about $5.4bn per reactor – much higher than $1m for large-scale solar and $2m for onshore wind.

Energy experts said estimates for developing nuclear in Australia matched recent modelling internationally, although some expect costs to fall.

Robin Batterham, chair of the Net Zero Australia Steering Committee and emeritus professor at the University of Melbourne, said that if costs fell nuclear power could become a viable and cost-effective alternative………………………………………………………… ‘Build renewables, not nuclear’: energy execs reject reactors

September 19, 2023 Posted by Christina Macpherson | energy | Leave a comment