Low-carbon market signals needed to tackle climate change

Fatih Birol, executive director of the International Energy Agency, said today that governments serious about nuclear power should find the right frameworks to attract investors in order to overcome the challenges of large investments in liberalised markets.

Rising, Kerry and Birol speaking in Paris today (Image: WNN)

Speaking at the Energy for Tomorrow conference in Paris, organised by the International New York Times, Birol said a long-term 2050 climate goal was needed to signal to investors that, if they invested in high-carbon technologies they may well lose money, whereas there would be better chances of good returns with investments in clean energy technologies. Without the right signals, said Birol, we are looking at an unsustainable future.

Speaking at the same event, Agneta Rising, director general of the World Nuclear Association, said that governments were taking nuclear energy for granted. The nuclear industry is ready to deliver on climate change, Rising said, and could provide 25% of global electricity with 1000 gigawatts of new build by 2050.

Earlier in the conference US Secretary of State John Kerry said that there were "millions of jobs to be created" in tackling climate change. Addressing climate change and improving air quality would bring better health, better environmental quality and would increase energy independence.

Kerry said that if the right market signals came out of Paris there would be a business-driven transformation. Climate change action was an "extraordinary market opportunity", he said.

Addressing COP21, Birol remarked that the future of energy and climate change could be reshaped if a good agreement was reached.

Birol hoped that the energy sector would be at the heart of a COP21 agreement as more than two-thirds of greenhouse gas emissions came from that sector. Without involving the energy sector there would no chance of meeting climate goals.

On nuclear energy, Birol highlighted progress in China. He said that, by building a lot of reactors, China was getting a good deal of "learning by doing" that was helping bring nuclear generation costs down, thus making it more competitive when exporting nuclear reactor technology.

Birol said that "China doesn't get the credit it deserves" for efforts to reduce coal use and the separation of energy demand from economic growth. China was now using energy much more efficiently.

Rising said that with new nuclear construction at its highest level for 25 years, the industry was growing, but not yet fast enough. To grow faster nuclear would need markets with level playing fields, harmonised regulatory processes and an effective safety paradigm.

Nuclear energy is the second largest source of low-carbon electricity in the world, behind hydropower, Rising noted, and the largest in Europe, supplying 27% of that continent's electricity.

Rising agrees with the IEA scenario that would keep climate change below 2°C with nuclear as the largest low-carbon option, supplying 18% of global electricity in 2050. To reach this nuclear capacity would need to more than double. Sixty-five reactors are currently under construction, the highest number for 25 years, so nuclear is growing, she said, but it is still not enough.

Climate change action is an extraordinary market opportunity, Kerry said, noting that $17 trillion is going to be spent on new energy projects over the next 10 years. The virtue of COP21 is that every country is devising their own plan, everyone is coming to the table with what it can do, he said.

Eight storms in the US, intensified by climate change had caused $165 billion dollars of damage.

"The costs of coal aren't six cents a kilowatt-hour; the costs of coal are a bunch of people who die or are hospitalised because of environmentally-induced asthma ... people need to think more carefully about what real costs are."

Researched and written
by World Nuclear News