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A report sponsored by minister Naimski suggests that nuclear power is the best option for Poland. Due to the climate policy, Poles need to be wary of overinvesting in gas. Up to seven reactors could be built using American technology, writes Wojciech Jakóbik, editor-in-chief at BiznesAlert.pl.
An atomic counterattack on renewables
During the “Energy Security – Pillars and Development Perspective” conference in Rzeszów, Piotr Naimski, the Government Plenipotentiary for Strategic Energy Infrastructure, together with representatives of the National Centre for Nuclear Research (NCBJ) and the PSE Group (Poland’s national grid operator – ed.), presented a report, which argues that nuclear power is the cheapest solution from the point of view of system costs in Poland. This is a response to the numerous studies on renewable energy sources being the most cost-effective option economically.
The study was drafted by a team centered around the National Center for Energy Analyses. It is a new government institution that provides independent analytical data for making appropriate decisions. The document analyses alternative scenarios about ensuring the continuity of electricity supply while minimising greenhouse gas emissions. The Centre is a new institution bringing together experts from NCBJ and PSE under the wing of Naimski’s office.
The aim of the study is to find an energy strategy that will make generation capacity permanently available, and simultaneously ensure the highest reduction in CO2 emissions. Four low-carbon and one zero-emission strategies have been developed using different mixtures of conventional, renewable (RES) and nuclear power sources. The Centre has chosen a model that would give optimal differentiation from the perspective of the end user. The study has introduced a new indicator called S-LCOE (System Levelized Cost Of Electricity). This is the average cost of production of a unit of energy determined by taking into account the costs of the system. This stands in contrast to the LCOE model, which does not include system costs, and therefore promotes energy that is cheap and offers a quick return to the private investor, which boils down to primarily advocating for renewables.
The authors of the study calculated that the strategy using nuclear energy is the most cost-effective, because of the lower average cost of energy generation due to the operating time of 60 years. This will yield savings to the tune of about PLN 100 billion over this period in comparison to strategies relying on renewables. “Due to the high investment costs, offshore wind was not generated in any of the scenarios analysed, which indicates that these technologies are less competitive than other kinds of renewables. In the marine strategy the optimizer, minimizing costs, decided to build and produce energy exclusively from reserve sources (gas CCGT),” the summary states.
The planned 6-9 GW of nuclear power is to be stabilized with gas generation. The authors of the study also provided for the possibility of downtime at nuclear power plants, which is why they did not abandon completely investments in gas. However, it is not clear whether they would not have suggested an entirely nuclear mix if it were not for the existing plans of the electricity sector to back gas. The panellists on this issue did not want to answer my question about whether the atom could replace gas in the current plans. Certainly this would be impossible in the 2020s, because reactors will not be built so quickly.
The authors of the report decided that the strategy to develop renewable sources and energy storage is the most expensive, because of the need to re-size renewable installations and storage facilities. Their capacity must be much higher than real demand due to weather-dependent production downtimes. The authors of the study warn against the expectation that Poland will be able to supplement its power downtimes with electricity imports from, e.g. Germany, as our neighbors will be struggling with generating enough power from renewables as well. The system costs calculated together with the reserve necessary to ensure the continuity of supply with an increasing share of renewable sources lead the authors of the report to overestimate the economic assessment of RES. They account for more than half of the total costs of the wind strategies analysed in the study. It is different for stable sources replacing the old, conventional ones (mainly coal). They can be connected to the network in places from which the old units will be removed, reducing network costs and not incurring balancing costs, since they are controllable.
The landmark finding of the report written under the aegis of Piotr Naimski concerns climate policy. “The strategies with gas-assisted wind sources emit 7.5 times more CO2 than nuclear power, even if it is aided by gas generation. This is due to the much greater need for the use of gas reserves,” the document reads. Moreover, the cheapest solution (but without a reserve) is a strategy based solely on the atom. “Achieving a zero balance of CO2 emissions with other strategies in the current and currently foreseeable conditions is very costly,” it says. The authors of the report therefore suggest that the goal should be to replace conventional sources with nuclear power in order to eliminate emissions altogether, in line with the European Union’s objective of climate neutrality by 2050.
This is the reason behind the discussion on expanding the Polish Nuclear Power Programme (PPEJ), which envisages the construction of 6-9 GW of nuclear power. The J0 strategy for new nuclear capacities proposes one gigawatt more than the PPEJ plan. “The analysis assumes the construction of seven nuclear power units of 1 GW of installed capacity,” the study says. PPEJ proposes 6-9 GW in nuclear power. The lower end of the proposal is 6 GW, which could be provided by six or four blocks, depending on the technology that differentiates their power. It is worth noting that the authors of the study assumed that one reactor will produce 1000 MW. This means the APR technology from Korea with a capacity of 1350 MW and the EPR from France with a capacity of 1650 are no longer on the table. So it is apparent that the course is America First. The Americans have not yet been chosen yet, only because the EU law requires that a technological tender takes place.
Cautious about gas
The authors of the study assumed that they want to provide Poland with 6 GW of new generation capacity with the lowest possible system cost and the greatest flexibility of work. This assumption implies a mixture of nuclear and gas generation. However, if climate policy were to take over, an all-nuclear mix would produce the largest reductions in CO2 emissions. This is a particularly important conclusion also in the light of the plans of the US and the European Union, which want to reduce global methane emissions by 30 percent by 2030 compared to 2020 levels. They are to present a global policy proposal on this issue at the COP 26 climate summit in Glasgow.
This means that after coal, gas will be pilloried next. If we add to this the record prices of this fuel, which raise the cost of generating energy and heat, we get a strong warning signal against over-investing in gas in Poland. Poles should not go overboard with gas as a transitional fuel due to climate policy, fuel costs and security of supply. We didn’t invest in diversifying our sources of supply in order to raise demand to a level that will force us to go back to the unreliable Russian supplier.
