## Resurgence: The energy security case for nuclear power ## Source details **Canonical URL:** [Resurgence: The energy security case for nuclear power](https://www.imf.org/-/media/files/publications/fandd/article/2022/december/nordhaus.pdf) ## Other formats - [Markdown version](/-/media/files/publications/fandd/article/2022/december/nordhaus.pdf.md) - [Structured JSON version](/-/media/files/publications/fandd/article/2022/december/nordhaus.pdf.json) --- ### Recent shift in policy and geopolitics - Post-pandemic energy shortages and the Russian invasion of Ukraine triggered a renewed global turn toward nuclear energy. - Specific policy reversals and plans cited: - Japan plans to restart many reactors idle since Fukushima Daiichi. - France now plans to build six new reactors and a dozen more small modular reactors. - The UK plans to build eight new reactors and 16 small modular reactors. - Germany extended the life of the nation’s last three operating nuclear power plants. - Consequences of the energy crisis: - Europe scrambled to replace Russian oil and gas via imports of liquefied natural gas, new pipelines from North Africa, and reactivating coal plants. - In developing countries, soaring energy prices produced shortages, blackouts, protests, pushed hundreds of millions back into extreme poverty, and raised fertilizer prices threatening harvests and possible famine. ### Key findings on energy dependency and nuclear’s role - The power sector accounts for only about 20 percent of energy use and emissions globally. - Wind and solar have limits: - No economy has succeeded in getting much more than about a third of its electricity from wind and solar combined. - Denmark generates about 50 percent of its electricity from wind but is integrated into a Scandinavian grid dominated by hydroelectric power and nuclear energy; Denmark’s wind accounts for only about 4 percent of total electricity generation annually across the Scandinavian grid. - Nuclear contributes firm, carbon-free electricity and can also produce carbon-free heat for industrial uses (refining, fertilizer manufacturing, steel, hydrogen) that are difficult to fully electrify. ### Limits of existing nuclear technology and required evolution ### Constraints of large light-water reactors - Strengths: - Can be remarkably effective under the right economic and institutional circumstances (examples: France gets 75 percent of its electricity from nuclear; Sweden and several other advanced economies get about 50 percent). - Limitations: - Complex technologies requiring highly trained personnel. - Large amounts of fissile material in their core and dependence on multiple active safety systems, requiring sophisticated regulatory capabilities. - Require refueling regularly, every 18 months or so, complicating decoupling from the nuclear fuel cycle and raising proliferation concerns. - Operating at lower temperatures, they cannot meet heat requirements for many industrial uses and have limited ability to ramp up and down, reducing compatibility with grids that have significant variable wind and solar generation. ### Advanced and smaller reactors under development - Advanced reactor projects and goals: - China connected its first high-temperature gas reactor to the grid; aims to be a drop-in replacement for coal-fired power plants and used for hydrogen and chemical production. - The United States committed to building two advanced demonstration reactors this decade: - One by X-energy designed to provide industrial heat and power. - One by TerraPower planned as a coal plant replacement with an integrated molten salt energy storage system to back up variable wind and solar. - Very small reactors: - Examples such as Oklo’s Aurora are applying for licenses in the United States and Canada. - Characteristics: sealed, do not require regular refueling, can operate for years without refueling, suitable for plugging into grids or remote off-grid locations, can be factory-refueled and refurbished. ### Systemic changes needed beyond technology - New business models. - New and more flexible regulatory, licensing, and export rules. - A revised global nonproliferation framework. - These changes are necessary to enable nuclear technologies to provide low-carbon heat and power and displace fossil energy at global scale. ### Climate finance, development banks, and policy recommendations ### Critique of current climate development financing - Many development banks exclude nuclear and hydropower, largely because of environmental objections from donor nations. - Result: climate development financing effectively limits poorest countries’ energy options to renewables. - Consequence: poorest countries, with far fewer resources, infrastructure, and technological capabilities, are expected to achieve low-carbon development without the significant additional fossil fuel development that richer countries currently undertake. ### Policy implications and recommendations - Reconsider long-running restrictions that exclude nuclear from development financing to put more low-carbon options on the table for developing countries. - Allow inclusion of nuclear (and hydropower) in climate development financing to enable: - Industrialization activities that require heat and reliable power (roads, steel, fertilizer, modern housing, infrastructure). - Broader energy strategies beyond small-scale renewables in low-income countries. ### Powering Africa: demand, constraints, and prospects ### Current African energy and development gaps - Sub-Saharan Africa uses about the same amount of electricity as Spain despite having 18 times its population. - More than 600 million lack access to electricity, clean cooking fuels, and modern transportation. - The entire continent has only two factories capable of producing ammonia, the critical precursor of synthetic fertilizers. - Small farmers’ yields are five times lower than US or European farmers’ yields. ### Role for nuclear in Africa’s future - New nuclear technologies suitable and scaled to Africa’s needs are at least a decade away. - Numerous African nations (Ghana, Kenya, Namibia, Nigeria, South Africa, Sudan, Tanzania, Uganda, and Zambia) have expressed interest in developing new nuclear plants. - Africa’s population is expected to double by 2050, increasing energy and industrial demand. - Nuclear is not a panacea but is likely to be part of any long-term pathway toward a prosperous and modern African future, alongside other energy options. - Accelerating a global transition away from fossil fuels requires putting new low-carbon options, including nuclear, on the table rather than excluding them. *Ted Nordhaus and Juzel Lloyd, FINANCE & DEVELOPMENT, December 2022.* --- _Source: https://www.imf.org/-/media/files/publications/fandd/article/2022/december/nordhaus.pdf_