It gives me a great pleasure to have been given the opportunity to tell to this distinguished audience about plans regarding nuclear power in Finland.
Dependency on external energy sources over 70% in Finland
Finland is the northernmost member of the European Union countries (Figure 1). We have a cold climate, long transportation distances and energy intensive industry. Therefore, energy plays a vital role in our economy and welfare.
Finland is one of the world's leading industrial countries in utilizing renewable energy sources, especially bio energy (Figure 2). Our main raw material is wood, which we process into paper and pulp. Our own energy resources are very limited and we are highly dependent on imported energy. Today, we import more than 70% of the primary energy demand in Finland and more than half of that is imported from one country only, Russia (Figure 3).
Energy consumption has stabilized in Finland but electricity consumption has grown steadily and it is estimated that it will grow in the future, too. Electricity production is diversified and is based on the use of several fuels. The share of nuclear electricity is 27% (Figure 4).
To be too dependent on energy from one country only secures neither predictable nor economic energy supply for industry and society in long term. In this respect, the situation in Finland seems to be very similar in the EU countries as a whole. It is difficult to build more coal-fired power stations because of the need to curb CO2 emissions. Ignoring nuclear the only major source of primary energy for the growing electricity demand would be natural gas. But are we then compromising the security of the energy supply, if the growing needs are met by relying only on Russian gas? This question was raised also in the Green Paper on the security of energy supply recently published by the European Commission.
Nuclear provides safe and lowest-cost base-load electricity
We have four nuclear reactors in operation in Finland. Operational experience has been very good. Production has been reliable, for example at Olkiluoto the average capacity factor over the past 10 years has been about 94% (Figure 5). Safety of the production has not been challenged. Nuclear electricity has proved to be very competitive in the deregulated electricity market which we have in the Nordic countries.
The main reasons for our good experience in the use of nuclear power have been political stability in Finland, progressive nuclear legislation and strict but clear safety requirements. The operating policy, to take good care of the plant units, has proved to be very beneficial, too. Our philosophy is to keep the plant units in good condition, like a new plant. Well educated and trained personnel are also a necessity, asare efforts to continuously improve working methods.
Solution for nuclear waste exist
In Finland, we have solved one politically difficult question concerning nuclear operations - waste management. Our nuclear law demands that spent nuclear fuel, and only Finnish spent fuel, shall be finally disposed of in the Finnish bedrock. Geological studies carried out over two decades show that Finnish bedrock is very suitable for that purpose. We have decided to locate the final repository close to the existing power plant units at Olkiluoto in several hundred meters depth in two billion year old bedrock. The safety authorities have approved the principal plans for the repository. The local municipality has accepted that the repository should be located on its territory. Our government has given approval in principle for our plans, and the Finnish parliament has ratified the government's approval, by a very large majority.
We believe that getting public acceptance for the final repository was possible in particular because of the open and fact-based information TVO has given during the whole process. In fact, TVO has followed an 'open doors' information distribution policy throughout its operation. The neighbours of the power plant and local decision makers know the company and its activities well.
During the coming years, we will excavate a shaft at about 500 meters depth in order to finally verify the properties of the bedrock. The construction of the final repository will start round 2010 and the operation of the repository in 2020. The money needed to construct the repository has already been collected in the fund managed by the Finnish state.
Kyoto obligations unrealistic without nuclear energy
Requirements to prevent climate change will increase in the future. Nuclear power does not create greenhouse gas emissions and therefore plays a vital role in protecting environment. Without the production of our four nuclear units, the CO2 emissions from electricity production would be twice as high as today (Figure 6).
According to the 'business as usual' scenarios for electricity consumption until 2010, the need for reductions in greenhouse gas emissions in Finland is of the magnitude of 20%, one of the highest in the EU. With the extensive use of combined heat and power and the large share of renewable energy sources in the electricity production, Finland has already put to use the methods which are considered essential for reducing CO2 releases. Possibilities for the further use of these methods are limited.
Studies carried out by the Finnish Ministry of Trade and Industry show that using more nuclear power together with renewables is the most efficient and economical way to meet the reduction targets of greenhouse gas emissions set by the Kyoto Protocol. The majority of Finns approve the construction of additional nuclear power plants if that can be considered as a means to reduce greenhouse gas emissions.
Application to construct an additional nuclear unit
Different studies show that the price of new nuclear electricity in Finland is lower than that produced by coal and gas. Based on the price levels spring 2001, the studies indicate that nuclear electricity maintains its position even when the interest rate is varied up to 10% per year.
As a result of the above, and because of the increasing need for safe, economic and environmentally friendly electricity, TVO decided to submit an application to the Finnish government to construct an additional nuclear reactor in Finland. Most probably, this application will be handled by the government in the next few months. If the decision is positive, it will need ratification by our parliament, where discussion is expected next Spring.
It has been said that construction of new nuclear power plants is not possible in the deregulated electricity market due to the large economic and political risks.
The TVO company structure as a pure power producer is very suitable for taking care of big investments, like the construction of nuclear power plants. TVO produces electricity only for its shareholders. TVO's task is to produce electricity as economically as possible, not to make any profit on that electricity. TVO's shareholders in turn can use the electricity in their own production activities or sell it in the open market. Moreover, they are responsible for paying their share of all production costs to TVO, but without any profit. Therefore, the economic risk is divided amongst various shareholders and remains reasonable to any single shareholder.
Conclusion
As a summary, I want to state that I do not see any reason why nuclear power should not have a promising future ahead of it. In Finland we have positive experiences from nuclear power. We see that, without nuclear, it is not possible to guarantee reliable and economic electricity production, and nuclear power also helps us to save environment the and the climate.
But this does not come for nothing, we have to work for it. As regards safety levels and the economy of the production of existing units, they must both be improved. This requires continuous investments in nuclear power and good caretaking of the plants and the personnel. Open information between operators is necessary even as the opening of the electricity markets continues and causes increasing competition between operators.
An important prerequisite is to continue putting efforts into R&D activities to continue the development of safer and more efficient power plants. It is the responsibility of the whole nuclear industry, but especially plant suppliers, to make efforts to decrease investment costs and to shorten construction time of new units. Otherwise, investment decisions will be difficult to make.
So far, the outlook is good. Nuclear technology has evolved as operational experience has accumulated. State-of-the-art nuclear power plants are more efficient and safer than those that we are operating successfully today. We must work for nuclear power and trust in it. If we do not believe in nuclear, who will?