Nuclear Boss Urges UK Government To Back Small Nuclear Reactor Technology

By City A.M - Jan 09, 2023

• Chief executive of the UK Nuclear Industry Association Tom Greatrex: the UK govt. should pursue small modular reactors with “pace and urgency”.
• 
  
• Currently, the UK’s ageing nuclear fleet makes up around 15 per cent of the country’s energy generation.
• 
  
• Greatrex: the UK could become “a global leader” in SMRs.

The head of the UK’s leading nuclear body has urged the government to pursue small modular reactors (SMRs) with “pace and urgency”, amid reports of a funding delay with ministers squabbling over the cost of the country’s energy ambitions.

Tom Greatrex, chief executive of the Nuclear Industry Association (NIA), told City A.M. that the UK needed to develop a pipeline of projects to ramp up nuclear power in line with the government’s energy security projects.

He said: “Proceeding with pace and urgency will not only make power more reliably and predictably priced, but it will also mean that UK technology will create long term, high quality jobs and export opportunities from which the country will benefit.”

This would mean nuclear power generated 25 per cent of the UK’s energy demand, with former Prime Minister Boris Johnson establishing plans for the UK to build eight new reactors this decade.

Currently, the UK’s ageing nuclear fleet makes up around 15 per cent of the country’s energy generation, but the remaining five power plants are set to be shut down by the middle of the next decade.

With the UK needing to bump up capacity quickly, Greatrex was convinced the UK could become “a global leader” in SMRs.

He believed that they could supplement renewables and a larger nuclear fleet and strengthen the UK’s energy security.

Greatrex said: “There is no doubt that the UK can be a global leader in SMR. Working alongside larger reactors and renewables, they will provide a vital source of reliable, clean power, essential to reducing our reliance on burning volatile fossil gas for power, heat and transport – while simultaneously strengthening UK energy security.”

The industry boss has previously urged the government to speed up announcements for new projects, with Sizewell C still awaiting a final investment decision and Hinkley Point C’s completion delayed two years to 2027.

Nuclear projects stall as Government dithers

The industry chief’s latest comments follow reports – first covered in The Times – that ministers have so far not been able to agree a funding deal for small modular reactors.

The government is now not expected to confirm funding plans for at least another 12 months, with Whitehall concerned about the spiralling costs involved in Britain’s wider nuclear ambitions.

Its concerns come with growing expectations Hinkley Point C will come in over budget at £26bn – orginally projected at £18bn – while the fee for Sizewell C has been estimated between £20-35bn.

The government has previously announced the creation of Great British Nuclear (GBN) to deliver the next generation of reactors and SMRs.Related: Largest U.S. Refinery Back Up and Running

The body will be overseen by experienced nuclear specialist Simon Bowen and launch later this year.

So far, the government has failed to confirm any other future sites for nuclear projects – despite rumours linking to projects at sites in Wales such as Wylfa and Trawsfynydd.

Rolls-Royce, the potential leading player in domestic SMRs, announced its final shortlist its proposed nuclear pipeline of small modular reactors last month.

Its three sites include the International Advanced Manufacturing Park (IAMP) in South Tyneside, Teesworks in Teesside and Gateway in Deeside.

A decision on the location is expected to be made this year following final evaluations.

Its designs are for a 470MW plant at a cost of around £2bn – each site powering one million homes.

SMRs are constructed in factories and are transported to construction sites, making them cheaper and quicker to build.

Rolls-Royce confirmed to City A.M. it is progressing through the regulatory consent process for its designs, and believed it was making “strong progress” with its SMR plans.

A spokesperson said:“We are ready to enter into negotiations with the government and, If we can agree a route forward within a reasonable timeframe, we could start building British factories, commissioning supply chain contracts and agreeing export deals abroad before the next general election.”

Rolls-Royce could face SMR competition

The government is currently supporting the SMRs – which could be built at dozens of locations across the UK – with £210m in funding to back the first project.

However, further resources would be needed to build the 30 SMRs targeted by Rolls-Royce and its consortium of investors.

The Treasury is reportedly not prepared to sign off on any orders or significant funding until the technology had approval from the Office for Nuclear Regulation, which is not expected until 2024.

It is now looking at whether to boost competition by opening the bidding to rival plans from other companies such as GE Hitachi.

There are also proposals for thorium-based SMRs, proposed by Copenhagen Atomics, which has submitted its UK reactor design for approval.

Thomas Steenberg, chief executive, told City A.M.: “We are providing a radical different technology and that enables us to deliver at a price point of £40 MWh levelised cost energy, which is a very strong price for baseload energy supply”

The prospect of more competition has been welcomed by Andy Mayer, energy analyst at free market think tank The Institute for Economic Affairs.

He told City A.M. that if the government is truly concerned about costs – “it needs to remove the regulatory barriers delaying deployment, and encourage competition” rather than “pick winners through bespoke subsidy schemes for individual projects, technologies, and firms.”

Mayer said: “If the government wants a national nuclear champion on the French model, it will need to write vast blank cheques, now and forever, gambling that the investment will deliver a technology others wish to buy. This approach was tried in the 20^th century. It failed, and we are still paying £3bn a year as a result.”

By CityAM

Snowless Winter Could Create Worse Energy Crisis For Europe

By Charles Kennedy - Jan 11, 2023

Demand for liquified natural gas (LNG) vessels has declined due to Europe’s war winter, but natural weather conditions could ground vessels completely, meteorologists warn in a Reuters report, citing lack of snow that will lead to lower river water levels in key waterways. 

While the uncommonly mild winter has reduced heating demand in Europe, saved storage volumes, and paved the way for the continent to avoid a energy crisis as a result of Russia’s war on Ukraine, looking further ahead, the same weather conditions could be disastrous for LNG. 

Meteorologists cited by Reuters warn that the region relying on the Rhine and Danube rivers in particular is at risk of drought, which would make it difficult for vessels to navigate later this year.

Average temperatures in Germany are 25% warmer than normal since September, based on Refinitiv data cited by Reuters. 

The combination of low snow and a drier 2022 has already hit hydro power production, with Refinitiv noting that France saw 41% lower hydro power production last year, based on long-term averages. France is also threatened this year (as it was in 2023) with higher river water temperatures that prevent it from access to cooling water for nuclear reactors–a main source of energy for the country. 

For power producers, the low snow totals come on the back of a drier-than-normal 2022, and leave hydropower production potential sharply below normal in several key countries. For Germany, Switzerland, Italy, Austria and the Danube region, a lack of rainfall is expected to hinder clean energy production this year.

In 2022, the Rhine and the Danube also experienced dry conditions at strategic points that prevented energy vessels from navigating them.  

According to Yale Environment360, last summer,the Danube was flowing at less than half its usual volume, with cargo barges grounded, waiting in line for a single channel that remained deep enough to traverse. 

Sweden Looks To Expand Its Nuclear Power Generation Capacity

By Charles Kennedy - Jan 11, 2023

Sweden’s government is proposing changes in the current legislation to allow the construction and operation of more nuclear reactors as it looks to strengthen its energy security, Swedish Prime Minister Ulf Kristersson said on Wednesday.

“We are now changing the legislation, making it possible to build more reactors in more places than is possible today,” Kristersson said.

Any changes to the current legislation, which limits the number of reactors to ten and doesn’t allow for new places to host nuclear reactors, need to be passed by the Swedish Parliament.  

Expanding nuclear power generation was a key campaign goal for Kristersson last year, and he has said that Sweden’s goal of “100% renewable” electricity generation would change to “100% fossil-free” power generation.   

Currently, Sweden has three nuclear plants with six operational reactors in total, while nuclear power provides around a third of its electricity.

Another 43% of Sweden’s electricity comes from hydropower, 16% from wind power, and around 9% of the power generation comes from combined heat and power (CHP) plants, which are mainly powered by biofuels.

Sweden is an EU leader in renewable power generation. In 2021, around 60% of Sweden’s electricity generation came from renewable sources.

Although Sweden has been much less affected by the turmoil in the energy markets since the Russian invasion of Ukraine than many other EU countries, many Western allies of the U.S. and the EU have stepped up efforts to ensure energy security and depend less on energy commodities.

Even Japan is bringing back nuclear power as a key energy source, looking to protect its energy security in the crisis that has led to surging fossil fuel prices. The Japanese government confirmed in December a new policy for nuclear energy, which the country had mostly abandoned since the Fukushima disaster in 2011.

A panel of experts under the Japanese Ministry of Industry decided that Japan would allow the development of new nuclear reactors and allow available reactors to operate after the current limit of 60 years.  

Full U.S. Energy Independence Could Have Huge Ramifications For The Middle East

By Simon Watkins - Jan 10, 2023

• In 2023, the U.S. could become a net exporter of crude oil for the first time since 1945.
• 
  
• Complete U.S. energy independence could change U.S. foreign policy vis-a-vis the Middle East.
• 
  
• U.S. disengagement in the Middle East leaves a massive hole in the global geopolitical architecture 

Although the U.S. marked an historic shift in 2020 by becoming a net exporter of petroleum, it has remained a net importer of crude oil since the end of the Second World War, according to Energy Information Administration (EIA) data. For the relatively uninitiated, which appears to include Saudi Arabia in its ‘oil output figures’ of anything above its true average crude oil production figure of 8.23 million barrels per day (bpd) from 1973 to the end of last week, petroleum and crude oil are not interchangeable words in global oil market terms. Basically, ‘crude oil’ is just crude oil, but petroleum includes crude oil, refined petroleum products, and other liquids (including gas condensates). This technical but important distinction aside, it is not beyond the realm of possibility that 2023 may see the U.S. finally become a net exporter of crude oil for the first time since 1945 and the ramifications of this for its policy towards the Middle East could be huge. To get the figures out of the way first: the EIA forecasts that the U.S.’s net crude oil imports will fall to 3.4 million bpd in 2023 as domestic crude oil production increases to an annual average close to the all-time monthly high of 13 million bpd in November, all other factors remaining equal. In the run-up from its historic shift in 2020 to become a net exporter of petroleum products, the U.S. was producing an average of just over 11 million bpd of crude oil from the beginning of 2020 to end of 2022. However, in the last few months of 2022, the U.S. produced over 12 million bpd, on a rising trajectory, with the EIA initially forecasting that its crude oil production in 2023 would average at least 12.44 million bpd. On the other side of the supply/demand equation, in recent years, the U.S. has steadily consumed around 20 million bpd of crude oil, leaving a net crude oil import figure of around 7 million bpd. However, according to the EIA, in 2021 the U.S. only imported 6.1 million bpd of crude oil, although this figure rose to 6.3 million bpd in the first half of 2022. Additionally, according to widely circulated U.S. government data, November 2022 saw the U.S. import just 1.1 million bpd of crude oil. 

Partly this was due to sanctions on Russian crude oil and gas exports but in larger part it was due to the rolling releases of crude oil from the U.S.’s Strategic Petroleum Reserve and to the above-mentioned production increases in U.S. crude oil production in the latter part of 2022. Short-term reductions in U.S. crude oil imports can continue to be affected every now and again by such SPR releases. However, the onus for sustained import reductions to allow the U.S. to become a net exporter of crude oil can come from policies announced by U.S. President Joe Biden’s team when oil prices were spiking around the time of Russia’s invasion of Ukraine in February 2022. 

Back in March, U.S. Energy Secretary Jennifer Granholm said that Biden’s administration had started taking steps that should result in a ‘significant increase’ in domestic energy supply by the end of 2022. Progress on those efforts has been slowed by the cascade of other events surrounding Russia’s ongoing war against Ukraine, but Granholm’s comments underlined that the green energy rhetoric of Biden’s early presidency was beginning to make way for action based on the cold hard fact that high oil and gas prices damage the U.S. economically and are catastrophic for the re-election chances of sitting presidents and their parties. According to Granholm in March, the U.S. was working to identify at least 3 million bpd of new global oil supply, with assurances from several high-level oil and gas executives that their companies were set to dramatically increase investments and bring online new rigs. 

Not being dependent on any country for its crude oil or, even more importantly, for its energy requirements as a whole has rightly been a key concern of the U.S.’s since the onset of the 1973 Oil Crisis during which OPEC members plus Egypt, Syria and Tunisia began to block oil exports to the U.S., the UK, Japan, Canada and the Netherlands. This was in response to the U.S. supplying arms to Israel in the Yom Kippur War it was fighting against a coalition of Arab states led by Egypt and Syria. The spiking effect in oil prices was exacerbated by incremental cuts to oil production by OPEC members over the period and by the end of the embargo in March 1974 the price of oil had risen from around US$3 pb to nearly US$11 pb and then it trended higher again. Saudi Arabia’s then-Minister of Oil and Mineral Reserves, Sheikh Ahmed Zaki Yamani – widely credited with formulating the Embargo strategy – highlighted that it marked: “A fundamental shift in the world balance of power between the developing nations that produced oil and the developed industrial nations that consumed it.” 

This shift in power had also been well-noted in the U.S., particularly by Henry Kissinger, the highly influential U.S. geopolitical strategist who served as National Security Advisor from January 1969 to November 1975 and as Secretary of State from September 1973 to January 1977. At that point in the 1970s, the US lacked the crude oil production capability that made its economy immune from the damaging effects of such future oil embargoes by Saudi Arabia, OPEC and the other big oil-producing countries that were mainly situated in the Middle East.

Economic power was the basis of all US power across the globe, as it remains today, so it was evident to Kissinger – and to the presidents he advised – that a strategy be devised urgently that would make it less likely that such embargoes would happen again. The strategy he used was a variant of the ‘triangular diplomacy’ that he advocated in formulating the dealings of the U.S. with the two other major powers of the time, Russia and China. This strategy was, in turn, a variant of the simple ‘divide and rule’ principle that undermines opponents over time by exploiting existing fault lines in individual countries and their relationships with each other. 

This division of Middle Eastern oil producing countries, Kissinger reasoned, could be done across nationalistic lines, as was highlighted by the U.S. sponsorship of the 1979 Egypt-Israel Peace Treaty, which caused chaos in the Arab world, as did the subsequent assassination in 1981 of the Egyptian President who signed the deal, Anwar Sadat. Or it could be done intra-nationally (and intra-regionally) through the stoking of religious sectarian tensions in key target countries, such as Iraq and Syria most notably in recent times. It is interesting to note that this same Kissinger policy of ‘constructive ambiguity’ is now being used by Russia and China with the twin aims of enhancing their hydrocarbons power (through greater access to supply and distribution, and therefore, pricing) and of turning the Middle East against the U.S. and the West. These efforts, particularly toward the latter objective, have been suffused with subtle anti-U.S. messaging connected to the strain of pan-Arabism that saw a previous resurgence across the region in the 1950s and 1960s. 

As the U.S. moves to becoming a net exporter of crude oil and of petroleum and towards complete energy independence it could be that Washington decides to fully commit to the sort of disengagement from the most troublesome spots in the Middle East that was seen under former President Donald Trump. The U.S.’s withdrawal from the Iran ‘nuclear deal’ in 2018, its withdrawal of troops from Syria (2019), its full withdrawal from Afghanistan (2021), and its end of combat mission in Iraq (2021) can all been seen as part of this move away from the sort of ‘world policeman’ role that Trump wanted to end when he spoke of disengaging the U.S. from fighting  ‘endless wars’ (2020). This, of course, leaves a massive hole in the global geopolitical architecture and one that China, with Russia now playing an eager supporting role to it, appears delighted to fill. 

In the Middle East, there remain two key targets for China – the two key power players in the region, Iran and Saudi Arabia – and it is doing very well in both. Iran, over and above the recent civil unrest, was secured as effectively a client state by China with the signing of the Iran-China 25-year Cooperation Program, exclusively broken by me in a feature article on 3 September 2019. Since China made a face-saving, and possibly life-saving offer, to Saudi Crown Prince Mohammed bin Salman in 2017 over his ill-conceived initial public offering plan for Saudi Aramco, as analysed in depth in my new book on the global oil markets, Beijing has been in prime position to decisively move that country into its sphere of influence as well.

By Simon Watkins for Oilprice.com

Mexico, Canada win trade ruling against U.S. on duty free cars

Eric Martin and Brian Platt, Bloomberg News

Mexico and Canada won a trade dispute with the U.S. over cars shipped across regional borders, providing automakers more incentive to make vehicles in those nations.

The decision was included in a final report released Wednesday by a five-member dispute-resolution panel set up under the 2020 U.S.-Mexico-Canada Agreement. The panel made its preliminary ruling in November, but it wasn’t released until this week, after the leaders of the three countries met in Mexico City.  

Arbitrators “concluded that the United States has breached” an article of the USMCA, the panel said.

U.S. Trade Representative Katherine Tai’s office called the ruling “disappointing,” arguing it “could result in less North American content in automobiles, less investment across the region and fewer American jobs.”

Spokesman Adam Hodge added by email that the U.S. is “reviewing the report and considering next steps,” vowing to “engage Mexico and Canada on a possible resolution to the dispute, including the implications of the panel’s findings for investment in the region.”

Mexico sought the panel’s help last January, with Canada joining days later, to resolve a dispute over how to determine the origin a vehicle that comes collectively from the three countries under the USMCA, which replaced the North American Free Trade Agreement, also known as Nafta.

Mexico and Canada argued USMCA stipulates that more regionally produced parts should count toward duty-free shipping than the U.S. wants to allow for motor vehicles, the top manufactured product traded between them.

“This is the understanding that Canada had all the way along,” Canadian Trade Minister Mary Ng told reporters in Mexico City. “It’s what we negotiated.”

The release of the ruling comes a day after the heads of the three nations gathered for the North American Leaders’ Summit, or more informally the “Three Amigos,” which resulted in agreement to cooperate on semiconductor development and climate change.

The countries still have points of friction, particularly energy. The U.S. and Canada have complained about aspects of Mexico’s electricity policy, which they say raises prices for factories that are key to the region’s competitiveness. The U.S. also has complained about Mexico’s plans to ban imports of American genetically modified corn, potentially shutting off the biggest market for America’s farmers.

In the autos dispute, the U.S. had insisted on a strict method to tally the origin of core parts, including engines, in the overall calculation of a car’s content. That U.S. interpretation would have made it harder for plants in Mexico and Canada to meet the new duty-free threshold of 75 per cent  regional content, up from 62.5 per cent  under Nafta.

For example, if a core part uses 75 per cent  regional content, Mexico and Canada argued that the USMCA allows them to round up to 100 per cent  for the purposes of meeting the second, broader requirement for a car’s regional content. The U.S., however, didn’t want to permit rounding up, which would have made it tougher to reach the duty-free threshold.

Flexible workplaces with work-life balance 'win-win' for workers, employers: study

The Canadian Press

A new study on work-life balance says flexible schedules and shorter work weeks can lead to more productive, healthy and loyal workers.

The report by the International Labour Organization says giving workers flexibility in terms of where and when they work can be win-win for both employees and businesses.

The United Nations agency says flexible work schedules can improve workers' job satisfaction, performance and commitment to an organization — reducing recruitment costs and increasing productivity.

Meanwhile, the study found that employers who enforce strict work arrangements or schedules such as a 9-to-5 office workweek, could see productivity and job performance drop, and turnover and absenteeism increase.

The report's lead author, Jon Messenger, says new work arrangements during the COVID-19 crisis and the ensuing so-called Great Resignation has placed work-life balance at the forefront of social and labour market issues.

He says lessons learned during the pandemic can improve both business performance and work-life balance.

"Better work-life balance is associated with a multitude of benefits for employees," the report said, noting that the benefits include improved psychological and physical health of employees, increased job satisfaction and greater feelings of job security.

"A healthy work-life balance among employees is also beneficial for employers and provides a number of positive effects for enterprises," the report said.

"Companies that implement work-life balance policies benefit from increased retention of current employees, improved recruitment, lower rates of absenteeism and higher productivity."

The International Labour Organization report echoes the findings of other recent studies and surveys.

While salary and benefits have historically topped the list of sought-after incentives, multiple post-pandemic polls have found workers prioritizing work-life balance.

A survey by recruitment firm Robert Half conducted in late November asked nearly 800 LinkedIn users about what topped their work goals for new year.

The No. 1 response was work-life balance, with 39 per cent of respondents saying it topped their work wish list, followed by 28 per cent who said remote work options were the most important.

This report by The Canadian Press was first published Jan. 5, 2023.