Sweden Leads on Energy Action

nuclear3aSweden just scored a victory for nuclear decommissioning – without lifting a finger. Dominic Hinde investigates.

It was a decision that took the government that controlled them by surprise, but on Tuesday Sweden’s publicly owned energy giant Vattenfall made a decision to accelerate decommissioning of two nuclear reactors.

To the delight of the co-governing Swedish Green party, Vattenfall’s directors issued a statement saying that two of the nation’s nuclear reactors are due to go offline five years early. Reactors in the nuclear power plant at Ringhals, on Sweden’s North Sea coast, were due to be decommissioned in 2025, but could now come offline as early as 2018.

Sweden was a pioneer in nuclear energy, pursuing an independent nuclear program throughout the 1950s and 1960s. Since the 1980s however it has shown a reluctance to build new nuclear and the current Social Democrat and Green coalition government has ambitious renewables targets.

At first glance this looks like a simple case of a green-minded government changing energy policy, but the situation is more complex, and has a great many lessons for the UK. The first thing I did when I heard the news was ring a contact in the Swedish government to ask when the decision had been made. The answer was surprising. “We had nothing to do with it, at least not directly”, came the reply.

This is not an executive decision, but an example of how nuclear energy and its associated costs can quickly become unprofitable when the market is adjusted to favour other types of production. Although owned by the Swedish state, Vattenfall operates on a commercial basis and decides itself which investments to make. Its primary obligation is to make a profit for its shareholders, the Swedish taxpayer.
In its latest budget the new government, elected last September, has increased tax in a number of areas. Alongside a range of green taxes to incentivise sustainable behaviour, the Greens pushed for the introduction of an increased nuclear tax. Although the increased levy on nuclear energy will bring in little income, it tips the balance further in favour of renewable energy transition for both consumers and power generators.

In Britain the situation is made more complex by the fact that governments have only indirect control of energy policy through setting market terms and – in Scotland’s case – planning permission for new nuclear plants. Nowhere is this better seen than in the decision by the Tories and Liberal Democrats to go ahead with a new nuclear plant at Hinkley Point in Somerset. To make it work the UK was forced to ask the EU for special permission to provide a £17.6bn subsidy. This tax money is being paid to French energy giant EDF and Chinese construction firms to make the new plant a reality. As its critics have pointed out, without such huge state aid the project would simply be unviable. Whereas Vattenfall pays money into the Swedish treasury, in Britain the government is providing direct tax subsidy to run economically unviable nuclear projects.

With Labour, the Liberal Democrats and Tories all in favour of new nuclear it is hard to envisage a point at which UK energy policy as a whole changes along the same lines. The decision to construct new nuclear plants in England ties the UK energy market to the technology for decades to come. The SNP meanwhile are unlikely to push for a change in Westminster, and at a European level there is still a nuclear consensus due to the impressive upfront figures it can guarantee in reducing carbon emissions.
A large part of Sweden’s ability to decommission nuclear reactors depends on energy efficiency reducing demand. Sweden has a policy of reducing energy use by 20 per cent on 2008 levels by 2020 – the same year the reactors are due to be taken out of service. The EU as a whole has targets of increasing energy efficiency by 30 per cent by 2030, but this is related to overall efficiency rather than total use. This means that countries can increase both efficiency and capacity, with new nuclear sucking up that demand. Sweden’s gamble is that it can grow its economy but keep or reduce the same number of nuclear stations through efficiency savings, all the while moving towards increasingly large renewable shares. This can be contrasted to the double capacity strategy taken by the SNP which envisages exporting energy to the rest of the UK on the top of its own 100 per cent renewables target.

Considering the love of markets in almost all UK political parties, they seem reluctant to use them when the market says that nuclear does not pay. Sweden may not quite be there yet, and its environmental record is less stellar than many might believe, but the latest news shows one thing – if you move the goalposts in the right direction you need never kick the ball yourself.



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12 replies

  1. Very interesting. Will Vattenfall now drop its attempt to sue the German government for 4.7 billion Euro in compensation (for lost expected profits) after the Germans decided to phase out nuclear power in the wake of Fukushima? Vattenfall holds the operating licence for two nuclear stations in Germany. The case is being dealt with by the same kind of secret investor-state dispute mechanism that is part of the TTIP and TPP deals.

  2. But aren’t Sweden nuclear energy company suing ?Germany for doing this exact thing?
    So not so good

  3. Every time news comes out of Sweden about their steps in building a civilised society it throws into focus how grim things are here and fact we are going backwards into further market chaos, environmental meltdown and a very broken society. Imagine feeling of liberation and hope if Scotland can bin off London government and start to follow a similar path to Sweden. For first time in long time this feels like a very realistic hope.

  4. Just to reiterate above. Will vattenfall drop their case against Germany?

  5. I’d have to dispute the ‘the impressive upfront figures it [nuclear] can guarantee in reducing carbon emissions.’ It takes at least ten years to construct a new nuclear plant and a couple of years after that before the carbon used in its construction is paid back. The fossil fuels used in the mining and processing of uranium are also not accounted for in the ‘carbon free’ claims of nuclear generation. If we haven’t gone a long way to reducing carbon emissions within the next ten years, we will almost certainly have caused irreversible climate change beyond acceptable levels.

    Contract that with the immediate carbon reduction from energy saving measures or the two year (or less) construction period for wind and solar farms. It should also be noted that new nuclear makes no contribution towards decarbonising transport or heating, two of the major sources of carbon emissions.

    • According to the IPCC, nuclear power is equivalent to onshore wind in terms of lifecycle CO2 emmisions

      • Could believe that, I think it takes an onshore wind farm about two years to ‘pay back’ the carbon used in its construction. However, Uranium mining has a lot of other environmental consequences beyond the CO2 produced inform operations, not to mention the consequences of producing large quantities of radioactive waste from the operation and decommissioning of reactors.

  6. most nuclear power plants are i believe gas cooled.for shut-down/maintenance the gas has to be blown off.how many guesses do you want to pick which gas that is

    • Most nuclear reactors are water cooler Pressurised Water Reactors, hence the name. Many British reactors are gas cooled Advanced Gas Cooled Reactors AGRs and use carbon dioxide for cooling. As I understand it, this is quite a safe design as the gas will cool the core by natural circulation in the event of a power failure. Some of the gas is converted to C-14, but this occurs in nature too anyway.

  7. To those who ask about Vattenfall and what their plan is for Germany. Sweden operates quite a bit differently than the UK in that minister are constitutionally barred from interfering in things like this where they don’t have the actual competence. They make broad strokes framework decisions, but can’t decide on details.

    Most Swedish state owned companies, like Statens Järnvägar (the railway company) and Vattenfall (the energy company) operate purely on commercial grounds. The only way the state can interfere is through normal shareholder activities at board meetings. They don’t control detailed action.

    This is why the Swedish government is in a bind about Vattenfall v Germany. They can’t tell the company to back off because they are constitutionally barred from doing so. It’s a purely commercial decision which will be taken by the executives. If they do interfere, the courts will probably convict them of constitutional crimes.

  8. This is a bit of an odd article because the Swedish parliament has a policy of replacing decommissioned reactors with new ones.

    Do people know that the privatisation reforms made in Sweden over the last 20 years forms the UK Conservative’s general model?

  9. “This can be contrasted to the double capacity strategy taken by the SNP which envisages exporting energy to the rest of the UK on the top of its own 100 per cent renewables target.”

    As is common in these articles, there is rather loose use of energy and electricity.

    The SNP target is for the equivalent of 100% of Scottish electricity use to come from renewables. Electricity is only one element of energy demand, heating and transport are both larger and at the moment both come largely from fossil fuels.

    Scotland already exports electricity, as well as imports it, but is still a net exporter. Scotland will need to import more electricity in the future as the coal and nuclear plants close down.

    Sweden’s target is for 50% of all energy use to come from renewables – with 60% in electricity, 60% in heating and 12% in transport. Sweden’s renewables are mostly hydro, they’re more fortunate than Scotland in having higher mountains so can generate greater force to turn the turbines.

    Scotland’s hydro is now mostly complete (maybe a third left to capture, with a large number of smaller dams) but I imagine Sweden still has some way to go.

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