Benedek Jávor and Jean-Pol Poncelet cannot agree if nuclear energy or renewables are more cost-efficient.
Although United Kingdom eventually approved the new nuclear power plant, the debate on the competitiveness of nuclear energy goes on. Advocates and opponents of the fission take positions as they expect the European Commission to propose the new market design in December.
“Nuclear energy is competitive even for the new-build,” believes Director General of Foratom Jean-Pol Poncelet. Green Member of the European Parliament and Vice-Chair of the Environment Committee Benedek Jávor disagrees. “Nuclear energy has to face the fact it is not competitive on the market,” the MEP argues.
The lobbyist and the policy-maker spoke to SETPlan2016.sk on the margins of the European Nuclear Energy Forum in Bratislava.
Cost and competitiveness
Foratom’s Poncelet points out that the British new-build Hinkley Point C is not the only energy project to benefit from the contract for difference. UK agreed, he says, also on contracts with guaranteed price for renewable energies.
“They contracted £ 92,5 per MWh for Hinkley Point,” he explains. “And the last one for offshore windmills was 120 to 130, which is significantly more.” Poncelet says this proves nuclear can be more competitive that renewable energies.
Jávor from the European Parliament believes, however, nuclear energy and renewables are two completely different cases.
“Subsidies for the renewables have been ensured, because decision-makers thought they are a non-mature technology. They needed an initial help to be on the market and become competitive,” the MEP says.
Subsidies and conditions
Jávor blames nuclear energy for enjoying “hidden subsidies” and “special treatment”. According to the MEP, governments blessed it with state funds as well as exceptions in capacity allocation and transparency rules.
Poncelet sees it differently. He accuses renewables of receiving subsidies with no strings attached. “If you compare the price of electricity produced by a reactor at that time (60 years ago) and now, it was a significant improvement in efficiency, competitiveness and safety,” the Foratom.
As for the renewables, “the guaranteed price is not linked to any other constraints,” like cost or technology improvements, according to Poncelet.
Both Jávor and Poncelet might actually agree on subsidies for energy sources under conditions linked to technology development and competitiveness. The problem: They disagree on the technology and cost evolution of nuclear energy.
Backend of the cycle
The debate on cost actually goes beyond the price of electricity to reach the backend of the cycle.
“In most cases, they never paid the real cost of nuclear waste. Decommissioning costs are highly underestimated,” says the Green MEP.
The nuclear lobbyist defends the industry’s savings system, which covers both decommissioning and waste management. “That is a system, which has normally been applicable everywhere in Europe. We can discuss at length the status of this money, if it is on the account of the company or the government, but that money exists,” Poncelet argues.
And he considers this a major advantage of nuclear energy compared to other sources. “The consumers pay at the very start of the process for the cost of dismantling and waste management.”
New market design
The European Commission is working on the new market design, which may determine future subsidies and the conditions attached. What do the two men expect?
“Clear, predictable electricity market rules without exemptions,” Jávor responds without hesitation. The Vice-Chair of the Environment Committee underlines the message by saying the freedom to determine their energy mix cannot allow Member States to “exempt some energy sources from the internal market rules.”
Poncelet wants, on the other hand, “open books”. The Commission has to “look at the actual cost of all technologies. So far, many new technologies are not charged for the cost they produce in the system,” he argues referring to electricity transport and distribution.
Jávor and Poncelet cannot disagree more on nuclear energy. But they do agree on one issue: European energy markets need more predictability to favour investment, whatever the energy source.