Oslo – This week’s decision by the German government to place a three-month moratorium on planned nuclear plant life extensions, in order to re-evaluate plant safety after events in Japan, would increase CO2 emissions by an estimated 8 Mt, if, as Thomson Reuters Point Carbon predicts, fossil fuels are used to fill this immediate generation gap. The plants in question, 8 in total, include 7 which were built before 1980 and whose lives were due to be extended by an average of 12 years and the Krümmel facility which is currently closed for maintenance but was due to reopen in January next year.
“If these 8 were to remain closed after the three-month period, the original phase-out law were restored for the remaining German nuclear plants and fossil fuels, namely coal and gas-fired generation, were used to fill this generation gap, we estimate that emissions would increase by 64 Mt in the remainder of Phase 2, and by 435 Mt between now and 2020,” according to Stefan Wächter, an analyst at Thomson Reuters Point Carbon, the leading provider of market intelligence, news, analysis, forecasting and advisory services for the energy and environmental markets.
Wächter adds that in the event that the seven oldest nuclear plants and the Krümmel facility do indeed remain closed, causing emissions to rise accordingly, then the price of carbon would increase by €5/t to €35/t on average for Phase 3.
Whilst over the next three months, increased coal and gas-fired generation offer the only realistic alternative to nuclear generation, in the longer-term, the impact of nuclear closures on German emissions will depend on the energy mix that Germany opts for.
According to Sebastian Mankowski, a carbon analyst at Thomson Reuters Point Carbon and a former energy trader, “As far as impact on the energy mix, it is not clear what would fill the energy generation gap in the longer term. What is most likely is that the planned closure of coal-fired generation capacity by several German utility companies over the next 5 years will be altered to accommodate the reductions from the nuclear sector. It is because of this alteration to coal-fired generation that we foresee higher than expected emissions.”
He added, however, that “In a situation with less nuclear capacity, we might see more new build of gas power plants than we currently assume, which would counteract a part of the increase in emissions. Or, indeed, there might be some increase in renewable energy but it is not clear which particular renewable energy source might benefit over another from a reduction in nuclear generation. In addition, extra renewable generation could only be mobilized over a longer period; it cannot be brought on line immediately.”
According to Kai Arne Triphaus, an energy analyst at Thomson Reuters Point Carbon, “The announcement from the German government does suggest a change in policy in favour of a shorter prolongation of the plants, more investment into renewables and most likely a permanent shut-down of the plants Bilbis A, Neckar I, Brunsbüttel, Isar I and Krümmel. There is also a high chance that the other boiling water reactor Philipsburg 1 will also be taken offline after the moratorium period.”
Triphaus concludes that “Whatever the security inspection in the next 3 months will bring, it seems that politically an extension of the life spans of Germany’s nuclear plants is not sustainable; meaning the revision of last year’s decision will lead to less nuclear power availability in the future.”
It is thought that during the three-month period, all nuclear plants built before 1980 will be closed as well as the Krümmel reactor. This amounts to eight plants, three of which were already temporarily closed. Biblis B (1240 MW), Krümmel (1346 MW) and Brunsbüttel (771 MW) are currently offline anyway and were scheduled to resume operation on 22 May 2011, 1 January 2012 and 1 July 2011 respectively. The net loss of the 5 additional reactors is 5.1GW, which represents about a quarter of the overall nuclear capacity in Germany. German Chancellor Angela Merkel has announced that the federal and state governments will agree details of the moratorium on 22 March.
Source: Point Carbon Press Release dated March 16, 2011.
