Innovation under Uncertainty

Innovation under Uncertainty

The Future of Carbon-free Energy Technologies

The Fondazione Eni Enrico Mattei series on Economics, the Environment and Sustainable Development

Edited by Valentina Bosetti and Michela Catenacci

Innovation under Uncertainty presents original research and insights on innovation in carbon-free energy technologies. Valentina Bosetti and Michela Catenacci provide a complete and informative assessment of the current potentials and limits and offer a detailed analysis of what could, or should, be the drivers to support their success and large-scale diffusion. The results provided in this book offer important and concrete insights and recommendations concerning the development and the deployment of more efficient generation technologies, the demand for which will undoubtedly increase alongside the growing concern for environmental issues and global warming.

Chapter 4: Expert Judgments about RD & D and the Future of Nuclear Energy

Laura Anadon Diaz, Valentina Bosetti, Matthew Bunn, Michela Catenacci and Audrey Lee

Subjects: economics and finance, economics of innovation, energy economics, environmental economics, environment, climate change, energy economics, environmental economics, innovation and technology, economics of innovation

Extract

Nuclear power may prove to be one of the key technologies the world uses to respond to climate change, but it faces many challenges. Integrated assessment models of future energy and climate paths vary widely in their projections of future nuclear energy growth (Clarke et al., 2009; Edenhofer et al., 2009; Goldston, 2011). Studies that place no constraints on nuclear energy tend to project very large-scale growth, with nuclear energy providing a significant fraction of future carbon reductions (Goldston, 2011). But nuclear energy’s growth in recent years has been very modest, with roughly four reactors per year connected to the grid worldwide on average in the last decade (IAEA, 2011). Growth has been constrained by high costs and a variety of political, regulatory and public acceptance challenges – which are likely to be exacerbated by the reaction to the Fukushima accident in Japan. For nuclear power to displace a billion tons of carbon a year by 2050, roughly a tenth of what is likely to be needed to meet the internationally agreed goal of limiting global average temperature increases to 2°C above pre-industrial levels, would require adding 25 large nuclear plants to the grid every year from now until 2050 (Bunn and Malin, 2009) – meaning that nuclear energy would have to become much more attractive to those making decisions about what types of power plants to build than it was in the decade before the Fukushima disaster.

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