Nuclear sunset?

Fri, Sep 23, 2011, 01:00

THE NUCLEAR “renaissance” has suffered a serious setback with the decision by Siemens, the giant German conglomerate, to pull out of building any more nuclear-powered electricity-generating plants. After being responsible for developing all 17 of Germany’s nuclear plants Siemens’ chief executive Peter Löscher said bluntly: “The chapter for us is closed”. Instead, its energy division – which accounted for the lion’s share of the conglomerate’s € 4 billion profit last year – will concentrate on “greener” forms of renewable energy, such as wind power, in what Mr Löscher termed “the project of the century”. Only two years ago, he had described nuclear as “an essential part of a sustainable energy mix [for Siemens] in view of global climate change and the increasing power demand worldwide”.

The Fukushima disaster changed everything. Not only did what happened in Japan renew public unease about nuclear safety around the world, but it caused abrupt policy changes. In Germany, Chancellor Angela Merkel announced its nuclear power plants – supplying 23 per cent of its electricity needs – would be shut down by 2022 and replaced by renewable energy sources.

Clearly, Siemens got the message. Mr Löscher also believes that Germany’s target of generating 35 per cent of its energy from renewables by 2020 is achievable – and, in all probability, profitable for Europe’s biggest engineering company. Its “environmental solutions” portfolio, which is firmly focused on renewables, is already generating more than €27 billion a year – 35 per cent of Siemens’ total revenue – and the plan is to grow this to €40 billion by 2015. Ending its involvement in nuclear industry is bound to boost the company’s credibility as a purveyor of “green” technology. Following Fukushima, it is highly unlikely there will be – as Siemens itself recently believed – some 400 new nuclear power stations built throughout the world by 2030. Cost overruns are a big problem, along with concerns about safety and the burden of looking after large quantities of radioactive waste into the future.

The withdrawal of a company with the pedigree of Siemens says something about the future of the nuclear industry that those lobbying for Ireland to plunge into it cannot ignore, notwithstanding its benefits in reducing the impact of climate change. It is not going to be easy to place our reliance on a mix of renewables and natural gas to generate the electricity we need, but the challenge is not insurmountable.