Nuclear energy. The atomic elephant

Britain is being softened up for a revival of nuclear power

NUCLEAR power has long been the ugly sister of the British electricity industry. The country's last nuclear power station was built, amid fierce opposition, in 1994. When Labour came to power in 1997, it claimed it saw no need for any more. But that may be changing. Ministers, MPs and advisers have been dropping hints that new nuclear power stations may be on the cards. It was recently reported that Tony Blair wanted a public debate on the idea as soon as the general election was out of the way.

Oddly for an industry with such a poor environmental image, it is greenery that lies behind this revival in interest. Despite environmentally-friendly pledges by the government, greenhouse gas emissions have risen by 2.1% since 2002. Nobody believes that the government will meet its self-imposed targets, and the problem is going to get worse. Britain currently generates about a fifth of its electricity from carbon-free nuclear power plants. The government reckons that reduces emissions by 12m-24m tonnes a year, or 7-14% of the total. But the nuclear plants are old, and by 2023 there will be only one left. If they are replaced with fossil fuel plants, emissions will rise dramatically.

The government's current policy on power generation is to provide subsidies for renewable energy, which in practice has meant building wind farms. But they are expensive, unreliable and, increasingly, unpopular with the locals. All of which makes new nuclear plants look like a good idea.

Not everybody is convinced. Nuclear power has always been expensive, say the doubters, pointing to the industry's lamentable record of cost overruns, public bailouts and bad management. Liberalised energy markets have made firms reluctant to invest in expensive and risky nuclear plants, especially after the near-collapse of British Energy two years ago. Gas-fired generation has much lower capital costs and build time, and is therefore a more attractive investment.

But, says Malcolm Grimston of the Royal Institute of International Affairs, that may be changing. Consolidation in energy markets is one reason, since bigger companies are better able to tolerate risk. Unlike nuclear stations, fossil plants are sensitive to changes in fuel prices, which have risen sharply in recent years. And, says Mr Grimston, the introduction of carbon-trading schemes should make fossil fuel generation more expensive, since companies will be forced to internalise the cost of their waste, something the nuclear industry already does - at least in theory.

In any case, the nuclear industry says technology has made things much cheaper: the latest reactors, it says, generate only a tenth as much waste as the old ones, are cheaper to build and run, and safer to boot. The Royal Academy of Engineering (RAE) reckons that the new designs could generate energy for as little as 2.3p per kilowatt-hour (including construction and decommissioning costs), compared with 2.2-3.2p for fossil fuels and 3.7p for wind power. Research from OXERA, a consultancy, suggests that it would cost £4.4 billion ($8.4 billion) of public money to meet Britain's emissions targets with nuclear power, and £12 billion with wind. Doubters point out that the RAE's figures are based on a design that has never been built, and that there is still no agreement on how to deal with waste.

Yet some countries are enthusiastic. The Finns approved construction of a reactor in 2002, the first in western Europe for over a decade. The noises from the government suggest that Britain may follow.

Britain is being softened up for a revival of nuclear power.