Nuclear Development ISBN 978-92-64-09634-9 The Security of Energy Supply and the Contribution of Nuclear Energy © OECD 2010 NEA No. 6358 NUCLEAR ENERGY AGENCY ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT – – Foreword A commonly asked question is what contribution can nuclear energy make to improve the security of energy supply. This study, which examines a selection of OECD member countries, validates the often intuitive assumption that, as a largely domestic source of electricity with stable costs and no greenhouse gas emissions during production, nuclear energy is well-placed to make a significant, positive contribution. With the help of a series of transparent and policy-relevant indicators, the study shows in particular that nuclear energy has indeed contributed to improving energy supply security in OECD countries in a significant manner during the past 40 years. It achieved this result by diversifying the energy mix, and in particular the electricity mix, as well as by reducing the overall share of fossil fuels imported from outside the OECD area. The study first discusses the notion of energy supply security and presents the various definitions and approaches that experts have formulated in order to examine this issue, considering both an ―internal dimension‖ concentrating on the features of the electricity sector, and an ―external dimension‖ focused on geopolitical issues. Consistent with the mandate of the Ad hoc Expert Group on Nuclear Energy and Security of Supply ―to identify a relevant quantitative approach to measuring the contribution of nuclear energy to security of supply‖, the study then presents a broad range of indicators and models that quantitatively assess a country’s level of security of energy supply. It subsequently develops a specific composite indicator that allows the measurement of the level of security of energy supply as well as the contribution of nuclear energy over the past 40 years, for those OECD countries for which a consistent data set was available. Finally, the study seeks to identify the implications of these findings for broader processes of public opinion formation and attitudes towards nuclear energy and security of supply in OECD countries. It shows that nuclear energy is viewed more dispassionately when seen as a solution to the combined issues of supply security, cost stability and greenhouse gas emissions. Acknowledgements The study on The Security of Energy Supply and the Contribution of Nuclear Energy was initiated by an ad hoc group of experts under the guidance of the NEA Committee on Technical and Economic Studies on Nuclear Energy Development and the Fuel Cycle (NDC). The members of the Expert Group nominated by NEA member countries are listed in Annex 1. The original project was part of the 2007-2008 NDC Programme of Work under the heading ―Nuclear Energy and Security of Supply‖. Mr. Ronald Hagen (United States) and Dr. Henk Wels (Netherlands) were respectively Chair and Vice-Chair of the Expert Group. Two smaller break-out groups on ―Definitions‖ and ―Models‖ were moderated respectively by Professor William D’haeseleer (Belgium) and Dr. Koji Nagano (Japan). The study was initiated under Mr. Stan Gordelier, Head of the NEA Nuclear Development Division until July 2009, with the support of Mr. Pal Kovacs, responsible Administrator. Dr. Ron Cameron, as the new Head of the NEA Nuclear Development Division, took up the study in spring 2010. The project drafting team consisted of Dr. Jan Horst Keppler, Principal Economist, 3 Dr. Alexey Lokhov, Nuclear Energy Analyst and Ms. Lucie Liversain, Intern. Chapter 1, “The Security of Energy Supply and the Contribution of Nuclear Energy – Concepts and Issues”, was written by Dr. Jan Horst Keppler integrating material provided by the Expert Group and, in particular, by Professor William D’haeseleer. Chapter 2, “Indicators and Models for Measuring Security of Energy Supply Risks”, was written by external contributors, Mr. Jaap Jansen and Mr. Adriaan van der Welle of the Energy Research Centre of the Netherlands (ECN), integrating material provided by the Expert Group and, in particular, by Dr. Henk Wels and Dr. Koji Nagano. Chapter 3, “Evolution of the Security of Energy Supply in OECD Countries”, was written by Dr. Alexey Lokhov. Chapter 4, “Public Attitudes towards Nuclear Energy and Security of Energy Supply” was written by Ms. Lucie Liversain, based on material provided by the Expert Group and a group of students from the Institut d’études politiques (IEP), Paris, co-ordinated by Ms. Alena Pukhova. Chapter 5, “Conclusions”, was written by the project team. 4 TABLE OF CONTENTS FOREWORD .................................................................................................................................. 3 EXECUTIVE SUMMARY ............................................................................................................. 9 1. THE SECURITY OF ENERGY SUPPLY AND THE CONTRIBUTION OF NUCLEAR ENERGY – CONCEPTS AND ISSUES ................................................................................. 19 1.1 Energy supply security: An introduction .................................................................... 19 1.2 Why security of energy supply remains a policy issue in OECD countries ............... 24 1.3 The external dimension: import dependence, resource exhaustion and carbon policy .......................................................................................................................... 30 1.4 The internal dimension: economic, financial and technical conditions for energy supply security ................................................................................................ 40 1.5 Orientations for government policies to enhance the security of energy supply ........ 53 1.6 Conclusions ................................................................................................................ 60 2. INDICATORS AND MODELS FOR MEASURING SECURITY OF ENERGY SUPPLY RISKS ...................................................................................................................... 65 2.1 Introduction................................................................................................................. 65 2.2 Different approaches towards designing the Supply/Demand Index .......................... 65 2.3 A detailed review of selected security of supply indicators ....................................... 67 2.4 Comprehensive models for assessing the security of energy supply .......................... 89 2.5 The Supply/Demand Index ......................................................................................... 108 2.6 Concluding observations ............................................................................................ 112 3. EVOLUTION OF THE SECURITY OF ENERGY SUPPLY IN OECD COUNTRIES ....... 119 3.1 Time-dependent quantification of the security of energy supply ............................... 119 3.2 Changes in security of supply in selected OECD countries ....................................... 127 3.3 Electricity generation and the security of energy supply ............................................ 131 3.4 The contribution of nuclear energy and energy intensity to the security of energy supply .............................................................................................................. 134 3.5 The geographical distribution of SSDI values ............................................................ 135 3.6 Conclusions ................................................................................................................ 137 4. PUBLIC ATTITUDES TOWARDS NUCLEAR ENERGY AND SECURITY OF ENERGY SUPPLY ................................................................................................................. 139 4.1 Public interest in energy supply security and related issues in the European Union .. 139 4.2 What kind of indicators do consumers use to evaluate their security of energy supply? ............................................................................................................ 143 4.3 Awareness of the importance of security of supply and public support for nuclear energy ....................................................................................................... 149 4.4 Conclusions ................................................................................................................ 156 5. CONCLUSIONS ..................................................................................................................... 159 5 ANNEXES 1. List of Experts ....................................................................................................................... 163 2. Acronyms .............................................................................................................................. 165 Figures E.1 Dimensions of energy supply security and the potential contributions of nuclear energy .... 10 E.2 Evolution of the SSDI for selected OECD countries ............................................................ 13 E.3 The contribution of nuclear power to progress in the SSDI .................................................. 15 1.1 Dimensions of energy supply security and the potential contributions of nuclear energy .... 21 1.2 Regional shares of key energy resources .............................................................................. 36 1.3 Reserve/production ratios of key energy resources .............................................................