such as the Inflation Reduction Act in the United States, 7 are showing a willingness to offer incentives to accelerate the role of nuclear. These developments indicate that nuclear power is emerging as a key component of decarbonization plans, but a big question remains: Can the industry reverse the trend of exceeding budgets and timelines while scaling up fast enough to rise to the climate challenge? In this article, we explore how much nuclear power could be essential in meeting net-zero targets, the current challenges in scaling nuclear, the promise of new technologies, and eight key actions for industry stakeholders. Up to 800 GW of new nuclear could be necessary to meet net-zero targets In estimating the nuclear power needed to support the energy transition, we used techno-economic grid modeling 8 to project the overall power mix by 2050. Our scenario—based on “Further Acceleration” estimates from McKinsey’s Global Energy Perspective 2022 for global energy mix, as well as anticipated supply and demand for power 9 — accounts for potential constraints on scale-up in renewables, such as scarcity of land, raw materials, and transmission limitations. Although our scenario does not rely on a full analysis of grid models and energy-transition scenarios, it does estimate roughly how much additional dispatchable, low-carbon generation will be needed to meet net-zero targets. 10
Nuclear power—a proven, zero-carbon electricity source—currently contributes about 10 percent of global electricity generation. 1 As a firming, resilient, and dispatchable energy source, nuclear power can be generated at any time. It can also complement nondispatchable 2 power sources, such as wind and solar, to ensure that the total power supply meets grid demand. After construction of new nuclear power plants surged in Europe and North America in the 1960s and 1970s, it has been relatively stagnant globally, outside of China, Russia, and South Korea. The stagnation stems from construction challenges in the West, political and social perceptions of nuclear power in some regions, 3 and the overall transition to other clean technologies. However, new developments suggest this period of stagnation may be ending. Factors such as energy security and resiliency, scarcity of top-quality land for renewables, 4 interconnection and new-build transmission timelines, and the ability to scale up the renewables and storage industries fast enough 5 have propelled nuclear power back into the energy transition discussion, while decades of progress in safety and waste-management practices 6 have helped to allay historical concerns. Recently, multiple countries have announced intentions to either slow the phaseout of their nuclear fleets or begin exploring construction of new plants. Advancing reactor technologies offer the promise of plants that will be more cost-effective to both build and operate. And policy makers, through legislation
1 Nuclear power and secure energy transitions , IEA, June 2022. (The supply percentage reflects energy [TWh], not capacity [TW].) 2 Wind and solar are considered to be nondispatchable because they rely on external variables (wind or sun). 3 Environmental and safety concerns may affect public perceptions of nuclear power, but today’s plants operate safely and reliably. A 2010 OECD report, Comparing nuclear accident risks with those from other energy sources , showed that releases of radioactivity are rare and that fatality risks related to nuclear power are low. After the 2011 accident in Fukushima, Japan, the United Nations Scientific Committee on the Effects of Atomic Radiation found that local residents did not experience radiation-related health effects (see Sources, effects and risks of ionizing radiation: UNSCEAR 2020/2021 report ), even though displacement away from the Fukushima facility disrupted lives and livelihoods. Safety remains paramount when building and operating any nuclear facility. 4 “Renewable-energy development in a net-zero world,” McKinsey, October 28, 2022. 5 Hauke Engel, Geoff Olynyk, and Daan Walter, “Failure is not an option: Increasing the chances of achieving net zero,” McKinsey, June 2, 2022. 6 Management and disposal of high-level radioactive waste: Global progress and solutions , Nuclear Energy Agency and OECD, 2020. 7 Kathryn Huff, “Inflation Reduction Act keeps momentum building for nuclear power,” Office of Nuclear Energy, US Department of Energy, September 8, 2022. 8 Techno-economic grid modeling is a tool that researchers and energy planners can use to determine the optimal mix of zero-carbon technologies in a given geography. 9 The scenario also incorporates middle-of-the-road assumptions in cost evolutions of key energy technologies, including solar, wind, and energy storage. 10 The existing nuclear fleet is also assumed to continue, but given that overall electrical generation globally roughly triples in net-zero scenarios, the newly required generation is projected to be substantially larger than that of the existing global fleet.
Accelerating the journey to net zero
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