OPINION | DAVID HESS
Left versus right brain
There are two types of people inside the nuclear community – those that think the greatest challenge facing the industry is economics, and those who believe it is public acceptance
David Hess, Senior VP DeepGeo
E CAN ALL AGREE THAT the nuclear industry faces serious challenges. Here we are, decades into the climate crisis and a couple of years past a global energy shock yet at the moment nuclear’s
share of global electricity continues to trend down, not up. There are signs of better times ahead as countries review their energy mixes and start planning in earnest for a zero-carbon future, but the elder nuclear industry hands have seen this kind of excitement before. They know that momentum for new nuclear can fade as external factors change and as the ‘issues’ come sharply into focus. Even where the industry enjoys strong political support,
if there’s no way to overcome the obstacles that stand in the way of development then few projects will actually
emerge as a physical reality. With this in mind, the apparent lack of progress on roadblocks over the years is troubling and may prevent the industry from making the most of the favourable winds that are currently blowing. The issues facing nuclear expansion are no mystery. While they may come in different forms, with varying levels of sophistication depending on who is articulating them, these days they almost always boil down to two things – public acceptance and economics. Which leads to an interesting thought experiment.
©Alexy Kovynev
Granted, both have to be addressed, but if you could magically fix only one of these issues with a snap of your fingers, which would it be, which issue has done most to diminish industry prospects over the years, and what is acting as a hand-brake on it now? Perhaps surprisingly, there is no definitive answer and industry experts seem to be split evenly into two camps. Anecdotal evidence suggests that people are biased by their education, experience and work areas. For example, if you have a business background or regularly talk to the finance community then of course it’s economics that is the fundamental problem! The thinking here goes that if the nuclear industry could
“I’m sick of all this talk about the greatest challenges facing the nuclear industry”
14 | October 2024 |
www.neimagazine.com
consistently demonstrate on time on budget construction then the orders would come streaming in. Public acceptance issues would melt-away in the face of lower energy bills. Reluctance from important stakeholders in government and the finance community would be steam-rolled by profitable returns. The mountain-sized challenge of securing project financing from banks and investors would shrink down to a much more manageable boulder – or in the case of SMRs, a pebble. For those in this camp, the failure of the nuclear industry to expand (in Western countries at least) is due overwhelmingly to high capital costs, or even more so the well-documented failure to control construction risk at project after project. This view is essentially an implicit mea culpa. It is tacit acknowledgment that the industry has none other than itself to blame for the situation that it now finds itself in.
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