THE ROLE OF NUCLEAR ENERGY
IN A NET-ZERO FUTURE
Diane Cameron
Head of Division
Nuclear Technology Development and Economics
16th IEEJ Global Energy Webinar
November 26, 2021

© 2021 Organisation for Economic Co-operation and Development

1Outline
1.

Context – Pathways to net zero emissions

2.

The Role of Nuclear Energy

3.

Challenges and Recommendations

4.

Understanding the cost of electricity

Charting a path towards an achievable and affordable
electricity mix for a net-zero future…

© 2021 Organisation for Economic Co-operation and Development21. Context – Pathways to net-zero emissions© 2021 Organisation for Economic Co-operation and Development

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Global Action Is Urgently Needed• The magnitude of the challengeshould not be underestimatedTemperature outcomes for various emissions futures• The planet has a “carbonbudget” of 420 gigatonnes ofcarbon dioxide emissions for the1.5°C scenario• At current levels of emissions,the entire carbon budget would
be consumed within 8 years• Emissions must go to net zero,but the world is not on track
Source: Carbon Brief (2019).

© 2021 Organisation for Economic Co-operation and Development

4Pathways to Net Zero Emissions• Pathways based on the world’s
carbon budget, emissions reductions
targets and timelines have beenmodelled and published by variousorganisations• None of the published pathways
project aspirational scenarios fornuclear innovation• All published pathways include levelsof nuclear energy deployment basedon currently available commercial
technologies• Nuclear innovation does not featureprominently because of a lack of
specialised expertise in nuclear
technologies among modelling teams

Samples of ambitious and aspirational pathways to net zero
Organisation

ScenarioParameter

2020

2050

Growth rate(2020-50)

IIASA (2021)

Divergent Net
Zero Scenario(1.5°C)

Cost of carbon(USD per tCO2)

0

1 647

-Wind (in GWe)

600

9 371

1461%

Solar (in GWe)

620

11 4281743%

Hydrogen (MtH2)

90

530

490%

CCUS (GtCO2)<0.1

7.6-Energy intensity(MJ per USD)

4.6

1.7-63%

Wind (in GWe)

603

25 0004045%

Solar (in GWe)

623

20 0003110%

IEA (2021c)

Bloomberg
NEF (2021)

Net ZeroScenario(1.5°C)New EnergyOutlook
GreenScenario(1.5°C)© 2021 Organisation for Economic Co-operation and Development5Nuclear in Emissions Reduction Pathways
Organisation

Scenario

Climatetarget

Nuclear innovation

Description

IAEA (2021b)

HighScenario

2°C

Not included

792

98%

IEA (2021c)

Net ZeroScenario
(NZE)

1.5°C

Not included but HTGR Conservative nuclear capacity estimates. NZE 812
and nuclear heatprojects 100 gigawatts more nuclear energy
potential arethan the IEA sustainable development scenario.
acknowledged.

103%

Shell (2021)

Sky 1.5
Scenario

1.5°C

Not specified

Ambitious estimates based on massive
investments to boost economic recovery andbuild resilient energy systems.

1 043

160%

IIASA (2021)

DivergentNet ZeroScenario

1.5°C

Not specified

Ambitious projections required to compensate
for delayed actions and divergent climatepolicies.

1 232

208%

1.5°C

Explicit focus on SMRs
and nuclear hydrogen

Highly ambitious nuclear pathway with large
scale deployment of nuclear innovation.

7 080

1670%

Bloomberg NEF New Energy
Outlook(2021)
Red Scenario

Conservative projections based on current
plans and industry announcements.

Role of nuclear energy by 2050
Nuclear growth
Capacity (GW)
(2020-50)

All pathways require global installed nuclear capacity to grow significantly, often more than doubling by 2050.
© 2021 Organisation for Economic Co-operation and Development

62. The Role of Nuclear Energy© 2021 Organisation for Economic Co-operation and Development

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The Full Potential of Nuclear Energy to Contribute to Emissions Reductions

H2
Long TermOperation

Gen-III
Reactors

Small ModularReactors© 2021 Organisation for Economic Co-operation and Development

Non-Electricalapplications

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Long-term Operation
Installed Capacity And Cumulative Emissions Avoided• Presently, the average age of nuclear
power plants in OECD countries is 36years• The technical potential exists in mostcases for long-term operation forseveral more decades• Long-term operation is one of themost cost-competitive sources oflow-carbon electricity• Beyond technical feasibility, adequate
policy and market are key conditionsof success of long-term operation• Long-term operation could save up to49 gigatonnes of cumulativeemissions between 2020 and 2050

Source: NEA (forthcoming).

© 2021 Organisation for Economic Co-operation and Development

9Full Potential of Nuclear Contributions to Net Zero
• The contributions from long-term
operation, new builds of large-scale
Generation III nuclear technologies,
small modular reactors, nuclear
hybrid energy and hydrogen systems
project the full potential of nuclear
energy to contribute to net-zero• Reaching the target of 1160 gigawattsof nuclear by 2050 would avoid 87
gigatonnes of cumulative emissions
between 2020 and 2050, positioning
nuclear energy’s contribution topreserve 20% of the world’s carbon
budget most likely de to be consistent
with a 1.5°C scenario
Source: NEA (forthcoming).

© 2021 Organisation for Economic Co-operation and Development

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Global Installed Nuclear Capacity Gap• Under current policy trends, nuclear
capacity in 2050 is expected to reach479 gigawatts – well below the targetof 1160 gigawatts of electricity• There is a projected gap between theminimum required global installed
nuclear capacity and planned global
nuclear capacity of nearly 300
gigawatts by 2050
• Owing to the timelines for nuclear
projects, there is an urgency to action
now to close the gap in 2030-2050

Source: NEA (forthcoming).

© 2021 Organisation for Economic Co-operation and Development

113. Challenges and Recommendations© 2021 Organisation for Economic Co-operation and Development

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Nuclear Energy Faces Many Challenges• The nuclear sector must move quickly to demonstrate and deploy near-term and medium-term innovations
including advanced and small modular reactors, as well as nuclear hybrid energy systems including hydrogen• There are key enabling conditions for success that the nuclear sector and energy policy-makers more broadly
should address in the areas of system costs, project timelines, public confidence and clean energy financing• A systems approach is required to understand the full costs of electricity provision, and to ensure that markets
value desired outcomes: low carbon baseload, dispatchability, and reliability• Rapid build-out of new nuclear power is possible, but requires a clear vision and plan
• Building trust is central to building public confidence and requires sustained investments in open andtransparent engagement as well as science communication. A common mistake is to assume that publicconfidence is primarily a communication issue• Governments have a role to play in all capital intensive infrastructure projects – including nuclear energyprojects. This role can include direct funding, but also enabling policy frameworks that allow an efficient
allocation of risks and for nuclear energy projects to compete on their merits on equal footing with otheremitting energy projects© 2021 Organisation for Economic Co-operation and Development

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4. Understanding the Costs of Electricity© 2021 Organisation for Economic Co-operation and Development

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Understanding the System Costs of Electricity

Grid-level costs of theelectricity system© 2021 Organisation for Economic Co-operation and Development

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Comparing Electricity Generation Options
Plant-level costs of electricity generation options
300

LCOE (USD/MWh)250

Long term operation ofnuclear power isthe lowest cost option for nonemitting electricity
generation.

200

150

100

500Source: IEA/NEA (2020) with costof capital of 7% and CO2 price @30 USD/tCO2© 2021 Organisation for Economic Co-operation and Development

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Comparing Electricity Mix Options
Grid-level costs of electricity mix options
Profile Costs

Connection Costs

Balancing Costs

System costs of electricity mix options

T&D Costs

60

System costs (USD/MWh VRE)

5040

30

20100Reference
10% VRE

30% VRENo Intc
50% VRENo Intc, no hydro75% VREAs the share of variable renewables grows, electricity system costs increases significantly© 2021 Organisation for Economic Co-operation and Development

1717

Charting a Path to Net-Zero Electricity
The System Costs Cliff

The system costs of electricity
depend on the composition ofthe electricity mix (ie. Low vs.
high shares of variablerenewables) and carbon
emission constraints.

Source: N. Sepulveda, MIT© 2021 Organisation for Economic Co-operation and Development

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Charting a Path to Net-Zero Electricity
2050

The System Costs CliffTARGET

2030
TARGET

2021
TODAY•The blue star indicateswhere we are today•

The green line corresponds
to 2030 targets•

The red line corresponds tonet-zero 2050 targets

Source: N. Sepulveda, MIT© 2021 Organisation for Economic Co-operation and Development

1919

Charting a Path to Net-Zero Electricity
The System Costs Cliff

2030
TARGET

2021
TODAY

•

Many different pathways
are possible to reach 2030
targets•

System costs increase on
pathways to 2030 targets
with higher shares ofvariable renewables

Source: N. Sepulveda, MIT© 2021 Organisation for Economic Co-operation and Development

2020

Charting a Path to Net-Zero Electricity
2050

The System Costs CliffTARGET

2030
TARGET•
2030 PRICEPREMIUMWe may be able to reduce
emissions to meet 2030
targets by growing the shareof variable renewables tovery high levels in the mix

2021
TODAY

Source: N. Sepulveda, MIT© 2021 Organisation for Economic Co-operation and Development

2121

Charting a Path to Net-Zero Electricity
2050

The System Costs CliffTARGET

2050 PRICEPREMIUM•But the costs of reaching
2050 targets of net-zerowith very high shares ofvariable renewables arelikely prohibitive

2021
TODAY

Source: N. Sepulveda, MIT© 2021 Organisation for Economic Co-operation and Development

2222

Charting a Path to Net-Zero Electricity
2050

The System Costs CliffTARGET

2030
TARGET

2030 PRICEPREMIUM•By thinking one step aheadand planning TODAY for NETZERO

2021
TODAY

Source: N. Sepulveda, MIT© 2021 Organisation for Economic Co-operation and Development

2323

Charting a Path to Net-Zero Electricity
2050

The System Costs CliffTARGET•
2050 PRICEPREMIUM

We can chart an affordable
path to net-zero electricity
generation, with a balanced
mix of variable renewables
and nuclear energy

2021
TODAYSource: N. Sepulveda, MIT© 2021 Organisation for Economic Co-operation and Development

2424Charting a Path to Net-Zero Electricity
The System Costs Cliff

Which path do you chose?

2021TODAY

Source: N. Sepulveda, MIT© 2021 Organisation for Economic Co-operation and Development

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New NEA brochures on nuclear innovation, climate change and economics

https://www.oecd-nea.org/jcms/pl_61714/nea-at-cop26© 2021 Organisation for Economic Co-operation and Development

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Thank you!

Contact:report@tky.ieej.or.jp© 2021 Organisation for Economic Co-operation and Development

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