From the C2C Journal

By Gwyn Morgan

After decades on the outs with environmentalists and regulators, nuclear power is being heralded as a key component for a “net zero” future of clean, reliable energy. Its promise is likely to fall short, however, due to some hard realities. As North America grapples with the challenge of providing secure, affordable and sustainable energy amidst soaring electricity demand, it is time to accept this fact: natural gas remains the most practical solution for powering our grid and economy.

Nuclear power’s limitations are rooted in its costs, risks and delays. Even under ideal circumstances, building or restarting a nuclear facility is arduous. Consider Microsoft’s much-publicized plan to restart the long-dormant Unit 1 reactor at Three Mile Island in Pennsylvania. This project is lauded as proof of an incipient “nuclear revival”, but despite leveraging existing infrastructure it will cost US$1.6 billion and take four years to bring online.

This is not a unique case. Across North America, nuclear energy projects face monumental lead times. The new generation of small modular reactors (SMRs), often touted as a game-changer, is still largely theoretical. In Canada – Alberta in particular – discussions around SMRs have been ongoing for years, with no concrete progress. The most optimistic projections estimate the first SMR in Western Canada might be operational by 2034.

The reality is that nuclear energy cannot scale quickly enough to meet urgent electricity needs. Canada’s power grid is already strained, and electricity demand is set to grow significantly, driven by electric vehicles and enormous data centres for AI applications. Nuclear power, even if expanded aggressively, cannot fill the gap within the necessary timeframes.

Natural gas, by contrast, is abundant, flexible, low-risk – and highly affordable. It accounts for 40 percent of U.S. electricity generation and plays a critical role in Canada’s energy mix. Unlike nuclear, natural gas infrastructure can be built rapidly, ensuring that new capacity comes online when it’s needed – not decades later. Gas-fired plants are cost-effective and capable of providing consistent, large-scale power while being capable of rapid starts and shut-downs, making them suitable for meeting both base-load and “peaking” power demands.

Climate-related concerns surrounding natural gas need to be put in perspective. Natural gas is the lowest-emission fossil fuel and produces less than half the carbon dioxide of coal per unit of energy output. It is also highly adaptable, supporting renewable energy integration by compensating for the intermittency of wind and solar power.

Nuclear energy advocates frequently highlight its zero-emission credentials, yet they overlook its immense challenges, not just the front-end problems of high cost and long lead times, but ongoing waste disposal and future decommissioning.

Natural gas, by comparison, presents fewer risks. Its production and distribution systems are well-established, and North America is uniquely positioned to benefit from the vast reserves underlying all three countries on the continent. Despite low prices and ever-increasing regulatory obstacles, Canada’s natural gas production has been setting new records.

Streamlining regulatory processes and expanding liquefied natural gas (LNG) export capacity would help revive Canada’s battered economy, with plenty of natural gas left over to help meet growing domestic electricity needs.

Critics argue that investing in natural gas is at odds with the “energy transition” to a glorious net zero future, but this oversimplifies the related challenges and ignores hard realities. By reducing reliance on dirtier fuels like coal, natural gas can help lower a country’s greenhouse gas emissions while providing the reliability needed to support economic growth and renewable energy integration.

Europe’s energy crisis following the recent reduction of Russian gas imports underscores natural gas’s vital role in maintaining reliable electricity supplies. As nations like Germany still phase out nuclear power due to the sheer blind ideology of their left-wing parties, they’re growing more dependent on natural gas to keep the lights (mostly) on and the factories (partially) humming.

Europe is already a destination for LNG exported from the U.S. Gulf Coast, and American LNG exports will soon resume growth under the incoming Trump Administration. Canada has the resources and know-how to similarly scale up its LNG exports; all we need is a supportive federal government.

For all its theoretical benefits, nuclear power remains impractical for meeting immediate and medium-term energy demands. Its high costs, lengthy timelines and significant remaining public opposition make it unlikely to serve as North America’s energy backbone.

Natural gas, on the other hand, is affordable, scalable and reliable. It is the fuel that powers industries, keeps homes warm and provides the stability our electricity grid needs – whether or not we ever transition to “net zero”. By prioritizing investment in natural gas infrastructure and expanding its use, we can meet today’s energy challenges head-on while laying the groundwork for tomorrow’s innovations.

The original, full-length version of this article was recently published in C2C Journal.

Gwyn Morgan is a retired business leader who was a director of five global corporations.

From Resource Works

Until battery technology is an option, there is no real energy transition

Climate campaigners steadily push for clean, renewable energy sources to replace hydrocarbons. However, international consultants Wood Mackenzie view this push as overly simplistic, arguing it does not consider the complexities of energy supply and the uses of oil and gas that extend far beyond power generation.

“Perhaps most striking is the extraordinary contribution that oil and gas have made to energy supply and what a gargantuan task it will be to build a new low-carbon system in its place.”

The latest report from “WoodMac” lists several challenges for a future of low-carbon power.

For one, U.S. demand for electrical power is set to grow at least through the rest of this decade.

“What is exciting about this new growth is that it is a manifestation of the Fourth Industrial Revolution. Central to this is the explosive growth of data centres, the beating heart of the infrastructure supporting artificial intelligence (AI), cloud computing, digitalization, and big data. Second is a new wave of cleantech, including the manufacturing of semiconductors, batteries, and renewable energy equipment. Third is the increasing electrification of the economy.”

Offshore wind’s power output has an energy efficiency of 92% compared with oil and gas, which, in use, deliver only 25% of their original energy content. But “what may impress is how long it will take for the cumulative output of wind to exceed that of oil and gas, despite this disparity in energy efficiency.”

Closer to home, questions have been raised in Canada about climate campaigners’ arguments that the costs of solar and wind power operations have steadily decreased and are now comparatively affordable.

The small-c conservative Fraser Institute notes that the G7 countries (including Canada) have pledged to triple renewable energy sources to ensure an “affordable” energy future.

“But while direct costs for wind and solar are dropping, they remain expensive due in part to the backup energy sources required when renewables are not available.

“Wind and solar energy are intermittent, meaning they aren’t consistently available, so we need an alternative power source when there’s no sunlight or wind, given the current limited ability to store energy from solar and wind.

“So we must maintain enough energy capacity in a parallel system, typically powered by natural gas. Constructing and maintaining a secondary energy source results in higher overall energy costs because two energy systems cost more than one. Therefore, when evaluating the costs of renewables, we must consider the costs of backup energy.

“Often, when proponents claim that wind and solar sources are cheaper than fossil fuels, they ignore these costs.”

The TD Bank adds: “Despite the improvement in the cost-competitiveness of renewable and storage technologies, the growth of low-carbon electricity supply is likely to increase electricity costs.

“According to estimates by the Alberta Electric System Operator, the load-adjusted generation costs in 2035 could be 56–66% higher in net-zero-by-2035 scenarios compared to a technology trajectory based on current policies.

“For Ontario, we estimate that replacing expiring gas-generator contracts with a combination of solar, wind, storage, and small modular reactors could increase the average generation cost by around 20% in 2035 compared to what it would be if the gas contracts were renewed and the current procurement plan for new resources proceeds as planned.”

The Fraser Institute also cites a 2021 study by University of Chicago economists showing that between 1990 and 2015, U.S. states that mandated minimum renewable power sources experienced significant electricity price increases after accounting for backup infrastructure and other costs.

“Specifically, in those states, electricity prices increased by an average of 11 per cent, costing consumers an additional $30 billion annually. The study also found that electricity prices grew more expensive over time, and by the twelfth year, electricity prices were 17 per cent higher (on average).”

“Europe is another case in point. Between 2006 and 2019, solar and wind sources went from representing around 5 per cent of Germany’s electricity generation to almost 30 per cent in 2019. During that same period, German households experienced an increase in electricity prices from 19.46 cents to 30.46 cents per kilowatt hour — a rise of more than 56 per cent. This surge in prices occurred before the war in Ukraine, which led to an unprecedented price spike in 2022.”

Meanwhile, in the U.S., a study published in Energy, a peer-reviewed energy and engineering journal, found that — after accounting for backup, energy storage, and associated indirect costs — solar power costs skyrocket from US$36 per megawatt hour (MWh) to as high as US$1,548, and wind generation costs increase from US$40 to up to US$504 per MWh.

We’re firmly in favour of advancing renewable energy sources, and the sooner, the better. But the cost estimates need to be true