Investigating the economic value of nuclear-hydrogen

As the generation mix in energy systems is characterised by an increasing penetration of generation from renewable energy sources (RES) energy imbalances are becoming more prevalent and potentially more costly to mitigate in the absence of flexible and cost-effective forms of storage. Natural gas and other fossil fuels have traditionally provided the necessary level of flexibility over different timescales (overnight to seasonal) to the system even as the system has become increasingly subject to the variability of generation from RES. However, the pursuit of Net Zero objectives requires a reduction in the use of natural gas and the need to consider other technologies or mechanisms that can guarantee the resilience and flexibility required to underpin the effective operation of Britain's energy system.
In order to address these technological and economic challenges the project will build from an existing time-series comparison model which calculates energy imbalances in the GB system under a range of scenarios and considers the role and characteristics of various conditions required to mitigate these imbalances, e.g., the level of overnight storage required. This model was developed by the Energy Informatics Group at the University of Birmingham and will be suitable to be extended to include additional electrical generation technologies (in addition to wind, solar and nuclear) and potential storage technologies including hydrogen and interconnectors. Economic modelling will also be used in order to assess the value provided by the different generation and storage technologies to the system and the wider costs associated with different types of generation mixes able to address the simulated system imbalances at different time horizons (short term, seasonal and long term). The economic analysis will also involve an evaluation of the net present value (NPV) of investment required for different technological options.
In this project nuclear power will be considered as a potential source of both power and flexibility. The reasons for considering nuclear with hydrogen as a possible alternative to natural gas are numerous.
These include nuclear power's lower associated CO2 emissions and its ability to generate predictable amount of power (unlike RES), albeit in a less flexible way than with natural gas. Furthermore, the consideration of nuclear power and its interface with the hydrogen economy will allow for the possibility to store baseload power when not needed by the system or, for example, to be used for seasonal heating via injection into the gas network and storage over seasonal timeframes, increasing the flexibility options for this fuel. Thus, this project's potential domain extends to consideration of balancing not only within the electricity system, but across an emergent net zero energy system. As such, the project would potentially consider how conversion of nuclear based electricity into hydrogen not only provides storage and balancing opportunities but may also increase the return to and value of nuclear investments, by providing alternative vectors for storing and consuming energy derived from nuclear power. In essence, the project will explore the role, costs and potential value of nuclear to the wider energy system in its transition to net-zero and beyond.
Deliverables
-A tool for assessing economic costs and benefits of nuclear power with hydrogen to the GB energy system
-A model of energy imbalances in the GB energy system which includes nuclear plants with access to hydrogen conversion facilities