Nuclear boasts of availability and claims its competitiveness: "We are very fiscally penalized"

Throughout 2023, the seven Spanish nuclear power plants produced 20.34% of all electricity in the country, which is equivalent to the consumption of 15 million homes, as highlighted by Foro Nuclear in the presentation of its annual results.. The figure consolidates the surprise of wind power, which is now established as the first source of generation, although nuclear power recalled that its availability is much greater, with operation close to 90% of the hours of the year.

“We are very boring,” joked Ignacio Araluce, president of Foro Nuclear, to summarize its operation.. He also contextualized this fall with the increase in installed wind and solar photovoltaic power.. In any case, he insisted on framing nuclear generation closer to renewables, since it does not involve CO2 emissions and recalled that “we continue burning gas.”

Thus, although the numbers are changing due to the penetration of renewables, the difference in the hours of generation stood out. Last year it was “a little low” due to some stops and still reached 7,626 hours, while wind energy reached 2,000 and photovoltaic remained 1,500. That is, for a production similar to the seven nuclear units it is necessary to multiply the installed power by four in the case of wind turbines and “with photovoltaics it is even clearer”, since every day it becomes night. “You need much greater installed power to match what nuclear power can produce.”

This then has its consequences.. If the 7,000 MW nuclear were replaced by photovoltaics, the power would have to be multiplied almost six-fold. “One cannot be replaced by the other,” explained Araluce, precisely because of the production hours.. “This would have to be accompanied by the possibility of storing energy,” the manager continued, so that this production could be stored “in a kind of electric refrigerator” to be able to return energy to the system “when there is no sun or no wind.”.

The problem is that storage is extremely delayed,” he lamented.. Currently there are two technologies that could be used to save electricity, batteries or reversible hydraulics.. However, Araluce considers that the batteries, at the moment, “are neither there nor expected”. “One thing is short-term battery storage, to be able to supply the grid for one or two hours, and another is long-term”. These are the ones that are not available, so their role is covered by reversible hydraulics, for which it is necessary to build dams or adapt existing ones.

This is preventing greater penetration of renewables adapted to a system and consumption that do not always agree. There are hours, normally the power plants of the day, in which prices plummet – they have reached zero or even negative – because there is great generation and not so much demand.. However, there is “tremendous volatility” because demand shifts to other hours when these renewable and inframarginal sources are not available.. To this we must add that consumption is not being electrified. Electro-intensive industries or mobility should act on the demand side, but they are delaying.

“While all this is happening, stable energy is necessary,” explained Araluce.. “In the medium and long term it is necessary to have a firm power that continues to produce in a stable manner, without shocks”, a role that nuclear plays.. And, within the energy transition, “it is desirable that this source does not emit CO2 and is competitive”, in addition to giving “a certain energy independence”, he highlighted, in reference to combined cycle plants that burn gas.. “There are countries that have renounced nuclear energy”, such as Germany, so they are at the mercy of gas – the third source of generation in Spain – and coal – already with a marginal role at the national level -, as well as the countries that provide it.

In the case of nuclear, the supply guarantee “is obviously not the same as photovoltaic”; It depends on uranium, but it is a “much more stable” market than that of fossil fuels because it is more diversified and resolving its “bottleneck” in enrichment. In addition, it does not need a continuous supply, but the load allows production for a year and a half and the load is at the plant for at least two months beforehand.. “It practically gives you a two-year warranty on the fuel.”

“Penalized” by taxes

“In Spain, nuclear technology is highly penalized by the tax system,” lamented the manager during the presentation of the results.. And that, he argued, without taking into account the rate they pay to Enresa, the public company responsible for waste management.. As Araluce explained, they pay “about 17 or 18 euros” for each MWh they produce.. “If it weren't for that, the competitiveness would be even greater,” he lamented.

However, the manager is aware that radioactive waste is a reality from which they cannot escape: “Evidently they are a complication, if we did not have radioactive waste this would be disgraceful”. In any case, he took the opportunity to remember that other technologies also have waste that will begin to become relevant in the future and they are not talked about as much.. “We are practically the only sector that complies with the axiom that the polluter pays,” he explained. And they do so both for radioactive waste and in preparation for the dismantling of nuclear power plants when the blackout arrives, which also covers the rate they pay to Enresa. .

“The citizen is finally not going to have to pay anything, the nuclear power plants themselves pay it,” Araluce boasted.. Every year about 450 million euros enter the fund thanks to the 2019 agreement that expanded the operation of the nuclear park and scheduled the sequential shutdown of the atomic units.. “With this program there is enough money, because every time we produce we make money,” he insisted.. “We have that problem, but we have put a solution to it.”

In reference to the 2019 agreement, in which the closure was agreed, Araluce argues that, in reality, what was agreed was to prolong the useful life of the plants with respect to the “public imagination”, which counted on a closure that will not come, in principle, until 2027. In any case, in the manager's opinion, the situation has changed a lot in these five years with the pandemic or the war in Ukraine as the main exponents: “The situation today has nothing to do with that of 2019”. The proof, he points out, is that the energy future is being debated at a European and global level.. “Virtually all” countries with nuclear energy have decided to prolong their life, if not build new plants, while others choose to create their first reactors. They, he maintains, are willing to extend their useful life if their profitability is guaranteed.

Spain and Germany – which did it before, after the Fukushima accident – are the only countries that have decided to “go back” and continue with the nuclear blackout. Araluce argues that technology is key to combating climate change and, in addition, technological evolutions and small nuclear reactors will help increase the competitiveness of the sector.. “75% or 80% of our variable costs are taxes,” he highlights.. “It is a fallacy to say that we are not competitive,” he continues, and considers it unfair that nuclear is the only technology with which this variable is taken into account.

Araluce thinks that it is “absolutely necessary” to continue with the operation of the nuclear plants, although he remembers that, although the blackout is going to begin in October 2027 with the closure of Almaraz, “reversing a decision of this type is not a question of one or two days”. This 2024 or, at most, the first months of 2025 are set as the point of no return for the nuclear blackout. Largely, due to fuel, but also due to the training of operators.. “The decision must be made well in advance”. During the event he paraphrased the directors of the large electricity companies in which they have mentioned the closure, although he pointed out that if they talk about complying with what was agreed it is because there is no other remedy.. Not doing so would be “an act of rebellion”. “Does that mean I don't want them to continue? No, I want them to continue.”

Every year 200 million euros are invested in nuclear power plants to keep them up to date. Thus, Araluce believes that it is not fair to talk about depreciated plants, since this annual investment is ignored.. For this reason, he believes that a lower tax burden, especially if payment for production were withdrawn, would allow them to be more competitive.. Every year, he explains, they pay between 900 and 1,000 million before producing the energy between taxes on spent fuel, regional taxes, payments to the Nuclear Safety Council or others common to other sources, such as the IBI.. “If they took away our taxes, it would be much more competitive,” said the manager, who illustrated that “we even pay the Civil Guard that protects the nuclear power plants.”

Enresa Rate

Araluce also referred to its current dispute with the Government over the increase in the rate paid to Enresa for the dismantling of the plants.. A few months ago they requested an economic report that justifies the draft decree law in which they appeared, since they believe that it is not well planned, because it changes the rules of the game in the middle of the game.

The key is that the seventh radioactive waste plan contemplates a completely different management model than the sixth.. In 2019, when the closure of the plants was agreed and the rate paid to Enresa was increased, the calculations were made with a plan in which the idea was a single centralized temporary warehouse and not with the current one, which establishes that there will be seven individualized temporary warehouses – one for each reactor – from which the fuel will later (in 2073) be transferred to deep geological storage.

The new plan will have an extra cost of about 2,000 million euros compared to the sixth, which would be paid with an increase of just over two euros per MWh in the rate, up to 10.36 (although an even higher payment, close to at 11 euros). “We shook hands with a plan that Parliament had approved,” recalls Araluce. The change occurred due to a lack of consensus – no one wanted to host the centralized warehouse – and the nuclear companies do not believe that it is fair to “pay for an institutional or social divergence.”

For this reason they made allegations against the draft decree law, which the Government withdrew due to a formal defect (it had not been submitted to a public hearing) and has resubmitted with the current amount of the fee.. Despite this 'reduction', justified by lower inflation and having more money than expected in Enresa's fund, they continue with the dispute. “We deny the biggest reason,” Araluce summarizes, which is that the nuclear companies should be the ones to assume the extra cost.