The Crisis in Japan has had a knock on effect on the price of carbon in the EUETS. It is estimated that the Japanese nuclear catastrophe will necessitate the Japanese Government to acquire an extra 70 million permits to meet their Kyoto obligations. This is due to the fact that the nuclear output will have to be replaced by more conventional sources of power as it is likely that the nuclear facility at Fukushima will be entombed and never used again. President Merckel also reversed her unpopular decision of last year to run Germany's 17 nuclear facilities until 2035. She has placed a 3 month moratorium on nuclear decisions and has assured the electorate that a return to policy pre-Fukushima is not tenable anymore. The European Union also announced that European facilities will be tested to ensure their safety in the event of a earthquake. Switzerland has also announced that they will review their nuclear energy policy. This is likely to create a bullish move for the carbon price. There will be a higher demand for carbon credits when the nuclear capacity is replaced by gas power generation. The nuclear solution has been a large part of the zero carbon economy for many Nations. The policy makers may now have to return to the drawing board.

Many are predicting the end of nuclear energy in the zero carbon economies of the future but the nuclear debate has been gaining speed recently pre-Fukushima. Nuclear accounts for a 14% segment of the energy mix worldwide. This energy is derived from 411 operating nuclear facilities worldwide. France has 75% nuclear, Germany 22%,     Japan 29% and the US 20%. Another school of thought sees nuclear energy adapting rather than being phased out. A new breed of small modular plants is currently in development and could emerge as early as 2020. Companies such as Nuscale have designed plants capable of generating a dozen 45 megawatt reactors, with an upper limit of 540 MW. These plants are much smaller than conventional Nuclear plants. They contain about 5% of the nuclear fuel, it only takes 3 years to build the plant compared with 6 years for existing Nuclear plants. An estimated price of 6 to 9 cents a kilowatt hour can be achieved from this technology which falls into the category of low cost energy.

An additional safety measure of this new generation of nuclear facilities will be the containment pools will be placed underground, using natural circulation to provide cooling. This allows cooling to take place without the aid of pumps which was the primary breach in Japan. The system can also run for 30 days without power. The new plants also have a design specification to withstand seismic activity of 0.5g, a measurement that means it can withstand forces and acceleration that are half that of gravity. Typical plants in the U.S are currently designed to a specification of 0.25g. Other benefits includes maintenance can be carried out while the plant reduces its capacity by 45MW. The Nuclear plants that we live with today have to be completely closed every 18 months for a complete maintenance overhaul. A schematic of a typical modular plant is shown below:

  Other News:

• UN announces the sale of 120 million Phase 3 EUA's in 2012.
• Carbon analysts increase price forecasts for year end 2011 by 17%. Long term forecasts remain unchanged.
• Airline Lufthansa indicate a 10% increase in their airline emissions for 2010.
• The New Zealand cap and trade scheme considers a ban on Industrial gas CER's.

The Crisis in Japan has had a knock on effect on the price of carbon in the EUETS. It is estimated that the Japanese nuclear catastrophe will necessitate the Japanese Government to acquire an extra 70 million permits to meet their Kyoto obligations. This is due to the fact that the nuclear output will have to be replaced by more conventional sources of power as it is likely that the nuclear facility at Fukushima will be entombed and never used again. President Merckel also reversed her unpopular decision of last year to run Germany's 17 nuclear facilities until 2035. She has placed a 3 month moratorium on nuclear decisions and has assured the electorate that a return to policy pre-Fukushima is not tenable anymore. The European Union also announced that European facilities will be tested to ensure their safety in the event of a earthquake. Switzerland has also announced that they will review their nuclear energy policy. This is likely to create a bullish move for the carbon price. There will be a higher demand for carbon credits when the nuclear capacity is replaced by gas power generation. The nuclear solution has been a large part of the zero carbon economy for many Nations. The policy makers may now have to return to the drawing board.

Many are predicting the end of nuclear energy in the zero carbon economies of the future but the nuclear debate has been gaining speed recently pre-Fukushima. Nuclear accounts for a 14% segment of the energy mix worldwide. This energy is derived from 411 operating nuclear facilities worldwide. France has 75% nuclear, Germany 22%,     Japan 29% and the US 20%. Another school of thought sees nuclear energy adapting rather than being phased out. A new breed of small modular plants is currently in development and could emerge as early as 2020. Companies such as Nuscale have designed plants capable of generating a dozen 45 megawatt reactors, with an upper limit of 540 MW. These plants are much smaller than conventional Nuclear plants. They contain about 5% of the nuclear fuel, it only takes 3 years to build the plant compared with 6 years for existing Nuclear plants. An estimated price of 6 to 9 cents a kilowatt hour can be achieved from this technology which falls into the category of low cost energy.

An additional safety measure of this new generation of nuclear facilities will be the containment pools will be placed underground, using natural circulation to provide cooling. This allows cooling to take place without the aid of pumps which was the primary breach in Japan. The system can also run for 30 days without power. The new plants also have a design specification to withstand seismic activity of 0.5g, a measurement that means it can withstand forces and acceleration that are half that of gravity. Typical plants in the U.S are currently designed to a specification of 0.25g. Other benefits includes maintenance can be carried out while the plant reduces its capacity by 45MW. The Nuclear plants that we live with today have to be completely closed every 18 months for a complete maintenance overhaul. A schematic of a typical modular plant is shown below:

  Other News:

• UN announces the sale of 120 million Phase 3 EUA's in 2012.
• Carbon analysts increase price forecasts for year end 2011 by 17%. Long term forecasts remain unchanged.
• Airline Lufthansa indicate a 10% increase in their airline emissions for 2010.
• The New Zealand cap and trade scheme considers a ban on Industrial gas CER's.