Energy choices for the future

18

Long Range Planning Vol. 13

December

1980

Energy Choices for the Future l? M. S. Iones, Head of Economics and Programmes, Atomic Energy Authority

The development of modern society has been intimately linked with the expansion of energy supplies. The world has reached a situation where it has become apparent that it cannot continue along the same path on the basis of exploitation of depleting low cost oil and gas reserves. A range of apparent choices is open but only the joint exploitation of coal and nuclear power appear to offer a sure means of providing for energy growth and, in due course, substituting for oil and gas. The full realization of the nuclear contribution is dependent upon the development of the fast reactor, though the timing of its introduction has to be based on judgments on the rate of expansion of electricity demand and the future availability of uranium.

Introduction From earliest times man has sought to improve his lot through the use of energy to augment his own limited physical strength, to provide warmth and to mould materials and landscape to his needs.l In some less well endowed areas, population growth and man’s attack on his environment for timber for fuel and building and his overgrazing of pastures resulted in soil erosion, climatic change and a decline in economic well-being. Processes causing problems in the Mediterranean area in prehistoric times continue to give concern today in India,2 Africa and elsewhere and are contributing to desert&cation on a significant scale.3 The past 200 years, and more particularly the past 40, have witnessed a transformation in man’s expectations. Prior to this each year had been much like its predecessors, with the cycles of famine and plenty stemming from the vagaries of climate. Most people could look forward to a life much like that of their parents, neither better nor worse, and a state of dynamic equilibrium existed with the level of wellbeing dictated by the technology in use and the energy man could deploy. The exhaustion of fuel wood did cause problems in Europe and these were only prevented from reaching a serious stage by the advent of new technologies facilitating the mining and use of cheap coal in large quantities.* This released the barriers to growth and led to the

The author is Head of Economics and Programmes in the Atomic Energy Authority, 11 Charles II Street, London SW1 Y 4QP.

vast increases in productivity and wealth characteristic of the industrial revolution. The upsurge of economic activity in the 1950s and 1960s would also appear to have been due in no small measure to the availability of cheap and plentiful supplies of oil and, to a lesser extent, natural gas. The general relationship between energy consumption and economic activity (Figure 1) is not surprising. The use of energy with suitable machinery enables man to increase his output. Equally the more affluent he becomes the more he is able to afford to use energy to control his domestic and working environment and to employ it for travel, leisure and the provision of general services. There is no doubt that two-thirds of the world’s population in the less developed countries both need and want improved living standards and that these can only be attained through the application ofenergy to agriculture, irrigation, housing and transport. Equally there is little doubt that the vast majority of those in the industrial world are less than satisfied with their current wellbeing. Merely to preserve the status quo would require a doubling of world energy consumption rates by 2025 to take account of projected increases in world population and this will have to be achieved at a time when the irreplaceable cheap resources of oil and gas are approaching exhaustion and past the stage of peak production.

0 ther Energy

Sources

The three principal energy sources that can be exploited to make up for declining liquid and gaseous hydrocarbon supplies and to provide for the growth that appears essential are coal, uranium and the renewables. The latter include biological materials (for burning or conversion) ; hydropower from rivers; wind, wave and tides; sunlight for heating or conversion to electricity; and geothermal sources (which are not strictly renewable). Additionally the world’s resources of thorium could be used to produce fuel for nuclear reactors and the world’s oceans provide an inexhaustible supply of deuterium to fuel thermonuclear fusion reactors. These resources in total are sufficient to support the claim that there need be no physical shortage of energy in the long term. What is in doubt is our ability to develop and exploit these resources in a timely fashion, at acceptable economic cost, and without undue damage to the environment. Problems also arise from the uneven

Energy

Choices

19

for the Future

,.-

Canada

5.0(

1 .O(3rp .t 9 2 P al g 5

I ipain/ Pe!ru,

0.5( 3IBrazi,,’

_ ,

,‘Portugal

1 ,I U.b LR., d i6,:rkeV

SJ & I=

[I India O.l( I-

_,

,

-1 ‘akistan O.Of 5 -per capita Growth

of Energy Usage

Against G.N.P. per capita 1955-1960-

1960-1965

---

G.N.P. per capita . Source: ‘World Energy Outlook’,

W. K. Davis, Bechtel Power Corp.,

Presentation to 7th General Assembly of Engineering Organizations, November 1979

Figure

1. Energy

and GDP

geographical distribution of the available relation to energy requirements.

resources

in

The World Energy Conference5 after detailed examination of each of the potential sources concluded that supplies in 2020 would be constrained to the levels shown in Table 1. The barrier to greater exploitation arose from physical availability, the stage of technical development, the need to develop an international trading infrastructure, and environmental obstacles to full exploitation of, for example, coal resources. The nuclear figures in the table differ in that they were based on demand estimates which are broadly in line with the subsequent considerations of the International Fuel Cycle Evaluation. The WEC conclusion was that coal, oil, nuclear and renewable sources would be making roughly equivalent contributions to world energy supply to. 2020 but that this supply had a significant chance of falling below demand, and that all sources needed to be exploited with vigour therefore. Other studies have reached broadly similar conclusions, and this has been used by some to argue that the implicit

Table 1. World primary (1O’8 J per annum)

energy

supply

and demand

World

WOCA’

Source

2000

2000

2020

2020

Coal Oil Gas Nuclear Renewables

7590 145-170 5070 6585 4555

llO1154515075-

140 160 75 200 115

145-l 90 165-210 70-l 10 85-125 6590

22013570200105-

290 200 120 300 175

Total primary energy supply

420-450

540-

650

580-680

820-l

010

Total primary energy demand (WEC)

370-630

604-1425

500-870

834-l

935

lWOCA-World

outside

the centrally

planned

economies.

growth rates have to be reduced until they are compatible with energy supply scenarios.’ This may be all right but if, as it does, iteration then produces reduced energy ‘demand’ figures which are presented as forecasts which arc used as a planning basis, there is the very real risk of planning into energy constrained growth.

20

Long Range Planning Vol. 13

December

1980

This latter factor is particularly important in the energy industries because the lead times are long. The time from initially deciding to apply for planning permission for a new power station to its eventual commissioning may be as much as 30 years. The time to locate and exploit new mineral resources can be significantly longer. Typically the time for a new energy source to capture a major share of the market has been in the region of 50 years. Whilst energy requirements post 2000 may seem somewhat remote, our ability to meet them will be determined by the actions we take in the next few years. Production X Tons p.a.

The Possible Contribution Power

of Nuclear

Nuclear power supplies are dependent on the availability of uranium. The total quantity distributed in the earth’s crust and oceans is enormous, but the bulk of it is not economically recoverable even though low concentration sources such as granite8 and sea-waters could give a positive net energy gain if the uranium were extracted and burnt in thermal reactors. Concentrated sources of uranium that have been identifled and quantified currently amount to 2.5 million tonnes recoverable at further costs of up to u.s.$~~o/ Kg U. Another 2.5 million tonnes are believed to exist in less well explored deposits and could be exploited at similar further cost.‘O On the basis of the International Fuel Cycle Evaluation projections6 of installed nuclear capacity 2.5 million tonnes would be insufficient to meet the lifetime (30 years) requirements of reactors installed by 2000 if they were operated on a once-through fuel cycle: i.e. the spent fuel was not reprocessed to recover reusable uranium and plutonium. Indeed on the higher projections 5 million tonnes would be barely adequate and would certainly not meet the needs of reactors that are likely to be planned by 2000. It is, of course, unreasonable to suppose that no further uranium will be located and the Nuclear Energy Agency have estimated that up to 6.6-14.8 million tonnes of uranium in the same types of deposit remains to be found,l’ although or political geographical remoteness, environmental considerations may mean that much of this will not be exploited. It is not only absolute resource levels that matter however; the rates at which uranium can be discovered and exploited are important. Estimates of the maximum rates technically achievable have been made by mining experts,s* lo and these show that uranium recovery from the known resources could well prove insufficient before the turn of the century if the once-through thermal reactor cycles were pursued exclusively. Certainly some additional uranium will be recoverable from as yet undiscovered sources on this timescale but quantification can do no more than provide very crude estimates of maximum potential supply based on past experience of discovery and exploitation rates. The picture on uranium supply therefore looks something like that shown in Figure 2. In the near term

Figure 2. Output probability

over time

(curve A) there is high confidence of getting levels of production related to installed or planned plant. In the long term there is good confidence that more could be obtained but the quantities are far less certain (curve B). Figure 3 presents the long term picture as seen by countries with more (curve D) or less (curve C) confidence in the long term prospects, ossibly related to theirdegree of self sufficiency. 0 P the ‘known’ 5 million tonnes 58 per cent is located in North America, and 21 per cent in Africa whereas Europe has only 6 per cent if Swedish shales are excluded and Japan 0.2 per cent.‘O

-7

Production X Tons p.a. C and D represent optimistic and pessimistic expectations about output at some specified date K. L, M represent needed output for selected reactor strategies

Figure 3. Perceptions ments

of output

and strategy require-

K, L and M represent the estimated future uranium requirements in the selected year for nuclear strategies involving reactors and fuel cycles having differing uranium utilization efficiencies. Clearly country C would not be happy with strategies L and M that left it with a high probability that U-supply would fall short of needs. Only strategy K would be sensible. Country D, on the other hand, might view both K and L as acceptable for the selected time horizon. Numerical supply/demand projections from INFCE are given in Figure 4. This is the problem facing the selection of a nuclear strategy. Thermal reactors like the advanced gas reactor or pressurized water reactor operated in the once-through mode require in the region of 150 tonnes of uranium p.a.

Energy Choices for the Future

21

the need to have the technology developed ready for deployment commercially at such time as it may be required. Actual large scale deployment decisions will be made inevitably in the light of the circumstances of the time some 15 or more years hence, but to delay develop ment and demonstration until the need is pressing and abundantly obvious could only mean a prolonged commitment to an uneconomically sub-optimal system vulnerable to external disruption. At the present time nuclear power contributes some 13 per cent of U.K. electricity requirements and this will rise to 20 per cent when the reactors now under construction are commissioned in the next few years. The Secretary of State’s announcement in December last could lead, if fully implemented, to some 50 per cent of our electricity coming from nuclear reactors by the turn of the century and more than this in the longer term future. This is well behind the French who plan for 50 per cent by 1985 and 90 per cent by the year 2000.

I logSO

I 1990

I

I

2000

2010

I I 2020 2025

Years A - Once Through Light Water Reactors Only B - Maximum Fast Reactor Deployment Post 2000 C - Maximum Attainable Production from Known Uranium Resources and Phosphoric Acid Production Upper Level of Production from Speculative Resources Based on IUREP A = High Estimate o = Low Estimate of Upper Supply Level

Nuclear reactors can also be used to provide heat for district heating schemes and industrial processes either directly or through combined heat and power stations. Waste heat has already been exploited in the U.K.la and larger schemes are contemplated by the French and Russians. It is unlikely that these uses could become significant before the year 2000. On a similar timescale some industrial adaptations may begin to take advantage of the low marginal cost supplies of off-peak electricity. This could encourage the use of hydrogen and aluminium, for example, or the widespread introduction of electric road vehicles.

Figure 4. Upper level of uranium demand from INFCE per GW(e) capacity. Fast reactors which can convert the unburnt uranium-238 isotope to plutonium fuel are SO-60 times as efficient. It has been appreciated from the earliest days of nuclear development that fast reactors were essential if nuclear fission power was to make more than a transient contribution (measured in decades) to world energy needs. At the same time the discovery of new uranium resources and the cut back in nuclear expansion as a consequence, primarily, of reduced world economic growth expectations, has led to deferment of the date at which fast reactors are seen to be necessary. Current thinking recognizes that after a glut of uranium in the next decade a tight market could develop in the late 1990s or early 2000s for technical and economic reasons. Political instability or decision could create such a situation at any time. Given a tight market, uranium prices would rise and fast reactors, which have higher capital costs than thermal reactors, would become the preferred nuclear choice. In view of the very considerable uncertainties about both supply of and demand for uranium it is not possible to be definitive about the economically optimum timing of fast reactor introduction. A country with considerable indigenous uranium supplies may feel it can afford to defer any action. This only serves to increase the risks for less well favoured countries however, and underlies

Like all energy suppliers the nuclear industry have problems to face. They have to design and operate reactors and fuel plants with very high margins of safety. The waste products of the industry are highly radioactive and have to be carefully controlled and monitored so that the quantities releasedto the environment are well within limits accepted internationally as safe and so that no member of the public or worker is exposed to significant risk. Policies for the ultimate disposal of radioactive wastes have to be developed and the public satisfied that the confidence of the technical experts in their acceptability is fully justified.

The Nature of the Choices In the near term there is very little the U.K. or any other nation can do about its pattern of energy supply. Conservation, where this is economically sensible, can bring about some short term reductions in demand, principally through improved management and operations. Some gains may also be attainable through any remaining insulation improvements. More ambitious schemes involving improved design and efficiency ofhouses, process plant or transport, even if they need no development, can penetrate the existing market only s10wly.~~ Conservation can help to defer the problems that we face but can not remove them.

22

Long Range Planning Vol. 13

December

Fuel switching, where feasible, can also help to reduce dependence on oil and a switch from oil to gas or coal has taken place to some extent following the 1973 OPEC crisis. More radical changes in fuel use patterns however do need new plant; new power stations, new process technology, new industrial or domestic boilers, etc. The rate at which such change can be introduced depends on the economic climate. It is far easier to build new plant in times of growth than in times of recession. The principal task facing the U.K. is one of ensuring that any growth in energy use is met from sources other than gas and oil and developing to the stage where these fuels can be replaced as they become relatively scarcer. In the post 2ooO period synthetic fuels for transport use will have to be produced on an increasing scale and synthetic natural gas could become an attractive means of carrying energy to the user. The alternative of using hydrogen generated from water using off-peak electricity from the national grid may also find some application, although the relative economics are uncertain at this time. It is generally accepted that the renewable technologies can only make a limited contribution in the U.K. before the turn of the century, perhaps 10 million tonnes df coal equivalent.” There is little potential for further develop ment of cheap hydropower in the U.K. and the costs and difficulties of major tidal barrage schemes or 1000 mile strings of wave devices have to be set against the relatively small contribution these could make to total U.K. supplies.

1980 no one doubts that the further proliferation of nuclear weapons is one of the major problems of our time. However it is becoming less and less linked with the peaceful development of nuclear power . . . If we were to shut down and dismantle every nuclear plant throughout the world . . . the problem would still be with us and we would hardly have reduced its dimension by one inch.

The general conclusions of the International Fuel Cycle Evaluation15 supported this view and lay stress on the need for political control and the continued improvement of international supply assurances and safeguards. History teaches us that wars have been brought about by a nation’s desire to expand the resources at its own command at the expense of others. Shortage of energy supplies could lead to just such pressures, arising from or in addition to the internal stresses resulting from declining living standards in an energy starved world. Are not these threats more real than those associated with the more widespread adoption of nuclear power? The best means of avoiding conflict over oil supplies would appear to be the speedy expansion of the world’s energy base through exploitation of coal and nuclear energy. The world faces a considerable challenge over the coming decades and choices made now can affect our ability to meet that challenge. The real choices are distinctly limited since the alternative to vigorous pursuit of all possible supply sources that offer a real prospect of providing significant contributions economically, would appear to be an acceptance of energy constraints on economic growth and the inherent risks associated with such a future.

References

Solar heating of water for domestic use is practiced widely already in sunny countries like Greece, Turkey and Israel and is being applied to a limited extent in the U.K. The extent to which solar heating will be exploited will depend in the end on its costs of installation and maintenance. It is a fuel saving rather than a capital saving approach since back up provisions are needed most in the winter months. Windmills too may have some role as fuel saving devices and there is potential for the exploitation of geothermal heat from hot water basins or hot rock in some areas of the U.K. Overall however, coal and nuclear power are the only sources that can be expanded sufficiently rapidly to take up the demand growth and meet the likely replacement needs in the first half of the next century. The exploitation of both carries risks. Those for the nuclear option have to be set against the risks to miners, the subsidence and the air pollution arising from coal use. The long term concern about radioactive wastes is paralleled by long term concern about atmospheric carbon dioxide accumulation from fossil fuel combustion. The question of nuclear weapons proliferation may seem at first sight to be a unique problem. It is essentially a political problem and, as stated recently by Dr. Fisher, Assistant Director of the IAEA,

(1) G. F. Ray, A random walk in history, Energy Economics, p. 149 (1979).

(2)

I. Gandhi, Taking an all round attitude to science, Nature 285, p. 129 (1980).

(3)

J. E. M. Arnold and J. Jongma, Fuelwood Developing Countries, FAO, Rome.

(4)

P. M. S. Jones, The case for industrial growth, Atom, p. 2, January (1979).

(5)

World Energy Resources 1985-2020, Conservation mission of the World Energy Conference (1977).

(6)

Report of International Fuel Cycle Evaluation Working Group 1, Fuel and Heavy Water Availability, International Atomic Energy Agency, Vienna (1980).

(7)

Studies by the International Institute of Applied Systems Analysis, Laxenberg, Austria, have adopted this approach.

and Charcoal in

Com-

(8)

Ref. 6, p. 170.

(9)

K. Taylor, Uranium from Seawater, Programmes Analysis Unit Report R 14174.

(10)

Uranium Resources, OECD, Paris, February (1980).

(11)

K. Main, Combined heat and power, Atom, in press.

(12)

H. Inston, K. Main and G. V. Day, An analysis of the low energy strategy for the U.K. as proposed by the IIED, UKAEA Energy Discussion Papers (1980).

(13)

Energy Projections. (1979).

(14)

International Fuel Cycle Evaluation, Summary and Overview Report, International Atomic Energy Agency, Vienna (1980).

1979,

Department

of Energy, London