Nuclear City: how to help China choose to build new nuclear instead of coal power

Carbon emissions increase 3% per year

Fig. 4. (a) Energy intensity, defined as energy consumption (Gt of oil equivalent) divided by real gross domestic product (trillions of 2005 U.S. $), and (b) carbon intensity, defined as fossil fuel carbon emissions (GtC) divided by energy consumption (Gt of oil equivalent). Energy intensity of China is normalized to 1.56 that of the United States in 2005. — James Hansen 2014

How are we doing on transitioning off fossil fuels? Renewables activists would have us think we are making more progress every year. In truth, we are making less, not more, progress towards zero-carbon emissions. The global production from non-hydro renewables is about equal to one years growth in energy consumption. At the end I’ll offer further evidence on just how serious our situation is.

As a thought experiment, imagine that less developed regions (LDRs) such as Brazil, China, India, Indonesia were building 100% new nuclear plants instead of coal plants. In this imaginary future, we would be close to stabilizing the GHG concentration of our atmosphere. I say “close to”, because if the LDRs are willing to choose nuclear over coal, there is no-problem-whatever with USA, UK, EU accomplishing the same.

Can you imagine China and other fast-growing LDRs giving up coal? I absolutely can imagine it.

Rich country politicians and media spend most of their time talking about what rich countries should do. Not about what China will decide to do based on self-interest. For now, let’s stop talking about rich countries. Instead, let’s talk about what we can do that makes China decide to grow their energy supply using only low-carbon options.

To keep it simple, let’s just talk about China – as a proxy for all the less developed nations (LDRs). China has already demonstrated that:

  • The leadership wants to decarbonize their economy.
  • They will not sacrifice significant economic growth to build zero-carbon power.
  • China will do whatever it takes to avoid a shortfall of energy supply relative to demand.

If we could deliver to Beijing the whole technology package for low-cost, fast-build nuclear the leaders would be very interested. I do not think that political motivation to decarbonize is the main problem in China.

Alternatively, we can keep doing what we are doing. In the absence of any serious political leadership, dedicated scientists and engineers in the national labs, universities and a few startups are working hard to innovate. They are developing new nuclear designs that are walk-away safe, fast to mass-manufacture, mass/volume efficient and fast to deploy. None have enough funding to innovate at any reasonable speed.

Worse is that to actually bring their new design to the market is effectively impossible – both in cost and elapsed time. The innovators must pay the entire cost of teaching the NRC staff about their new technology, then pay to the NRC the entire cost of certification, then pay the cost of building first of a kind commercial scale plant, while creating a complex supply chain that suits the new technology. And so forth. Such institutional barriers also mean that nuclear innovation does not suit venture capital funding, where most funds would expire long before the product began to earn a return.

To make this innovation remotely feasible requires a complete reform of the regulatory framework, and a top level commitment by the national leadership to actually decarbonize. What do you think is the chance that this is going to happen in America? At least before such time as Norwegian beachfront becomes a hot vacation property market.

OK, so it isn’t going to happen in America. Not in Germany. Not even in France. Keep in mind that among the western nations there are powerful, entrenched political and economic interests who are quite happy with the status quo. And extremely unhappy with the prospect that the old hydrocarbon economy would be uncompetitive against carbon free nuclear energy.

These institutional impediments are similar to that faced by low-performance political systems. You can easily name many such nations just in South America and Africa. China had a similar problem coming out from under the curse of Mao. Deng Xiaoping knew he had to liberate the Chinese economy, including attracting foreign direct investment from the “running dog capitalists.” If Deng had tried to reform the entire Chinese nation at once, well he would have had his legs cut off in a heartbeat. The Army and the wealthy who controlled the SOEs would make sure that the status quo was not destabilized.

Deng wondered whether the Hong Kong model could be replicated in new locations that would not threaten the entrenched interests? Maybe in a place like Shenzhen (one of the first four Special Economic Zones). If that worked, then politically it would be much easier to progressively extend the new successful rules to the rest of China. That is roughly the path that Deng Xiaoping set for China.

Oversimplifying, Deng’s SEZ initiative is similar to the concept that prof. Paul Romer has been evolving around the term “Charter Cities“. These are new development zones “chartered” with proven-successful rules. These charters allow families to opt-in to live and work there; allow investors to opt-in to build infrastructure and factories. Therefore creating a competition of cities: competing for residents, investors and markets.

Why can’t we adapt the Charter City concept to create a Nuclear City SEZ? A place where:

  • Taxes and rule-of-law are attractive to investors.
  • Efficient, suitable regulations can be developed.
  • Ample sites are available for constructing new reactors, from demonstration to commercial scale.
  • The new nuclear supply chain can be grown.
  • Factories and skilled labor can be developed to produce as many designs as can compete.

Where would be the ideal place to locate your Nuclear City? China is the obvious place because they have:

  • An almost insatiable need for enormous amounts of carbon-free energy.
  • The political commitment to economic decarbonization.
  • Ample low-cost capital to invest in new plants whose costs are front-loaded.

To progress from imagining to reality we need two things:

  1. Nuclear life-cycle cost to be comparable to coal.
  2. Nuclear deployment rate at least as fast as coal.

How can we accomplish this? Particularly in a climate where America is having to shut down paid-for, nearly zero-carbon nuclear plants? Where Germany is closing ALL of their paid-for, nearly zero-carbon nuclear plants? And Japan? The MDRs (more developed regions) are setting a shockingly awful decarbonization example for the LDRs.

I believe that nuclear fission can be built out at the cost, scale, and rate required to substitute nuclear for coal. This is a decision for China, not a decision for Western politicians. That means developing and deploying low-carbon energy that is dispatchable, scalable, and “cheaper than coal” in terms of System LCOE (including intermittency costs, not just LCOE).

Serious people talk about the expense of new nuclear. In fact the challenge is even bigger than achieving cost parity – a necessary but not sufficient condition. Aside from low cost, we need to make rapid progress on many human fronts. We can thoroughly simulate new reactors on our super-computers, yet this kind of fast-paced effort depends on real people:

  • Growing the nuclear people skills.
  • Growing the safety culture.
  • Growing a sensible regulatory capability.
  • Creating a new high volume supply chain.

Now, imagine that China has committed to creating such a Nuclear City. How can the old nuclear powers marshal their resources to dramatically accelerate the day when nuclear deployment is so attractive to China that they substitute nuclear for coal. Here’s a sketch:

  • The nuclear-technology nations (US, UK, France, et al) offer a nuclear cooperation and technology sharing agreement with China. The idea is to put your best ideas, your best people and your capital into this project — for the long term (decades).
  • Reform the legal framework that prohibits exporting peaceful nuclear power technology.
  • Lose the popular political idea that “We are competing with China”. Substitute the idea that “We are working together to save the planet while we get rich together”.
  • Lose the idea that dirty energy must be expensive. Substitute the idea that clean energy must be cheaper.
  • Invest national R&D funding into the Nuclear City cooperation.

So, why would the various players be motivated to cooperate? Let’s summarize some perspectives:

Update — James Hansen proposes nuclear cooperation  2/24/14 I’m reading Jim’s latest letter this morning Renewable Energy, Nuclear Power and Galileo: Do Scientists Have a Duty to Expose Popular Misconceptions? I just came to the part of his letter where he addresses the topic of this post. Here’s a fragment:

Second, the United States and China should agree to cooperate in rapid deployment to scale in China of advanced, safe nuclear power for peaceful purposes, specifically to provide clean electricity replacing aging and planned coal-fired power plants, as well as averting the need for extensive planned coal gasification in China, the most carbon-intensive source of electricity. China has an urgent need to reduce air pollution and recognizes that renewable energies cannot rapidly provide needed base-load electricity at large scale. The sheer size of China’s electricity needs demands massive mobilization to construct modern, safe nuclear power plants, educate more nuclear scientists and engineers, and train operators of the power plants.

The United States nuclear industry and universities have much to offer, and in turn they have much to gain by cooperating in development of modern safe nuclear power in China. Opposition to nuclear power in the U.S. has slowed but not stopped progress in nuclear technology. However, the realistic size of the market in the U.S. for improved nuclear designs, as well as for evolving still more advanced designs, is limited, at least in the near-term. Furthermore, for reasons that do not need to be debated here, construction time for a nuclear power plant in the U.S. is of the order of a decade, while it is as short as 3-4 years in China. Thus deep nuclear cooperation between the China and the U.S. over the next 1-2 decades could produce both (1) base-load electricity in China that allows China’s carbon emissions to peak within a decade and then decline, as is essential if climate is to be stabilized, (2) an opportunity for both countries to achieve progress in nuclear technology and thus a basis for comparing the merits of the most advanced renewable and nuclear technologies.

Jim has a lot more to say, a whole page on this general topic — I highly recommend that you read his new letter.

What is in it for “China”?

  • Manufacturing, deployment and operations capabilities will be developed locally (as with AP1000 deal).
  • Chinese human resources can be developed faster when working alongside western scientists, and when taught by the western experts (many of whom are retiring, their deep knowledge soon to be lost to society).
  • Chinese leaders do have to live in their high-pollution cities, a daily reminder of the priority to transition away from coal.
  • Fundamentally this is a very large scale engineering and project-management undertaking — China’s politicians are comfortable with that kind of approach.

What is in it for the existing IP stakeholders?

  • Long term profits. Instead of going out of the nuclear business (like Siemens), they have a chance to be part of the biggest revolution since the beginning of the industrial age.
  • A chance to be shareholders in the new energy infrastructure – to be part-owners in the new utilities and infrastructure.
  • The IP to be contributed is now owned by governments and shareholder companies. A necessary condition is that the existing IP owners must be satisfied that this cooperation will allow them to protect their share of the return on existing IP, as well as the return on the future IP. That’s a negotiation – Silicon Valley law firms can help with options.
  • In this planet-scale effort, it is better to be cooperating than competing.
  • Scientists at the national labs, at experienced suppliers like B&W, these people know that China et al can contribute many very capable engineers and scientists. The scale of the Chinese contribution is being demonstrated already by such as the well-funded MSR development program at the Shanghai Institute of Applied Physics (CAS/SINAP). In 2012 the project had a $350 million budget and a staff off 334 that was supposed to grow to 750 by 2015.

What is in it for the investors?

  • The scale of this planet-wide market opportunity is easily big enough to attract private investors if the political risk is covered.
  • Building the first large scale deployments in China, by itself, eliminates much of the political risk.
  • The nation-partners will have to put up enough risk insurance to lubricate a public-private partnership. I think that means largely insurance against political risk. Against the risks of the familiar Greenpeace lawyering and demonstrating, but also the Rule of Law risk in the non-western jurisdictions. It’s an interesting question: how far will Greenpeace get demonstrating in front of new Chinese nuclear plants?
  • China has demonstrated the political capability to generate MUCH larger amounts of capital than needed to get this going. So DFI (Direct Foreign Investment) may be a case of the outsiders knocking on the door, asking to be let in.

What is in it for Western politicians?

  • I don’t know, because there isn’t much reward here within their motivational framework of about two years. Suggestions?

This challenge is not really technical — it is almost entirely political. The Western institutional structure makes it effectively impossible to achieve rapid progress. France could not rapidly convert from zero to 80% zero-carbon nuclear today. Politically France-could-not-do-it-today. It’s difficult to put into words how large this challenge is. Two charts help me to visualize what is happening on the ground, first Robert Wilson’s recent essay Renewables Growth: Ignoring The Whole Equation shows how insignificant are the 2011 contributions from all hydrocarbon sources + nuclear. In other woods, renewables are detectable but insignificant . Jeff Terry summarized Robert’s essay as “…fossil fuels dominate for decades”.

2011 Everything Else swamps Renewables

Second, this chart is completely self explanatory. Nevertheless I highly recommend that you read the source: Roger Pielke Jr.’s Clean Energy Stagnation.

4 thoughts on “Nuclear City: how to help China choose to build new nuclear instead of coal power

    • Thanks Martin, that is very encouraging. Hopefully China’s progress at Haiyan Nuclear City will make it easier for the US to apply the whip to their burro and get over there with help. From that article I noted that France is already over there.

      While I didn’t know about Haiyan Nuclear City, I’m sure it’s obvious that what I am proposing is a level above a physical place (Haiyan). I want to offer nuclear cooperation and technology sharing. Most importantly, to focus on doing everything that we non-Chinese can do to accelerate the date of “The Last Coal Plant”. Knowhow, money, and people contributed to a joint R&D program, plus the infrastructure, supply-chain buildout.

  1. I think China already has got’er done with its 2017 in service date of its HTGR. While other developments such as IFR and MSR technology should be and are being pursued in China, the modular constructed HTGR starting at half the price of coal imports and projected at a cost of a penny a kwh is the singularity needed. Synfuel production using the HTGR will likely be far cheaper than petroleum as Shell’s GTL plant in Qatar demonstrates.

    The west can then sit back and kiss its economy goodbye as China shows our Big Oil corrupted politicians how it is done.

    • As I’ve been thinking through “what can we do before it is too late?” the easy out is to leave our fate in the hands of China. If the west continues “fiddling while Rome burns”, China will eventually offer to sell us the machines that will allow us to escape from our folly.

      So, I can’t think of any better news than that China has already covered our collective frivolous bums.

      But do we really want to just give up, and leave the innovation, engineering, production challenges all to China? Surely the west still has something of value to offer? If we do have useful knowhow, then we would be smart to make the best deals we can before the price of our decaying skills drops any further.

      Anyhow, I think there is a big gap between HTR-10 and HTR-PM to what we want installed at the rate of tens/day around the world. If we can create a joint-venture cooperative fast-track with China everybody wins, and westerners can make big piles of money. Maybe even get to create some nuclear jobs and skills on our home turf.

      Deploying all of IFR, MSR, LFTR, PB-AHTR etc. is the best way I know to select out the best tools to end energy poverty and protect the planet. When I read that short list of innovations – it is so obvious that USA can’t deploy even one of them. Politically cannot do it.

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