Planning for the clean energy transition

Estonia can meet its carbon emission reduction targets with a diversified energy mix that includes nuclear power as a key component, according to a study conducted by researchers at the University of Tartu. The analysis, performed with an IAEA energy modelling tool, has shed light on what the Baltic State’s future clean energy system could look like — and the cost of the different pathways to achieve it. The IAEA supported the project with capacity building and technical guidance through its Atoms4NetZero initiative, as Estonia looks to eliminate its reliance on shale oil by 2050.

At the end of 2023, Estonia’s Nuclear Energy Working Group submitted a report detailing how, with sufficient planning, funding and public approval, nuclear power could contribute to achieving Estonia’s goals for climate change mitigation, energy security and economic growth. In June 2024, after reviewing the report, Estonia’s parliament endorsed preparations for introducing nuclear power and agreed to take steps to establish a legal framework governing its use.

Atoms4NetZero helps countries use a robust suite of analytical tools to consider the full potential of nuclear power in a range of energy planning scenarios. Until recently, nuclear power’s role in achieving climate change mitigation goals had not been reported extensively in published energy modelling studies. However, now that nuclear power is broadly recognized as part of the solution for achieving decarbonization goals, interested countries are aiming to better understand how it can help decarbonize their energy systems. 

The tool used in this study, the Model for Energy Supply Strategy Alternatives and their General Environmental Impact (MESSAGE), is designed for medium to long term energy system planning and can model the full range of thermal generation technologies together with renewable energy and carbon capture and storage, as well as other technologies. MESSAGE uses an algorithm to show how a given objective can be achieved at minimal cost. Estonia’s study incorporated costs associated with investment, operation, fuel, energy imports and carbon constraints, providing a holistic view of the energy system.

“This study shows that if the nuclear industry demonstrates that investment costs and construction schedules can be kept within the projected range, nuclear power is a competitive option for Estonia,” said Mario Tot, an IAEA energy systems analyst. “Assuming that Estonia proceeds on the path to decarbonization and takes the scope of our analysis into account, this study illustrates how, over the long term, nuclear can provide similar outcomes to renewable sources.”

The study, which used both open-source data and data from Estonian Government publications, focused on two power supply scenarios: a ‘reference’ scenario, based solely on expansion of the renewable energy sources, including wind and biomass, currently used in Estonia; and a ‘nuclear’ scenario, which included the deployment of two small modular reactor (SMR) units together with other clean energy technologies such as renewables. The study revealed that both scenarios would allow Estonia to meet its decarbonization goals and become a net energy exporter after 2040. Wind capacity, owing to its cost effectiveness, was identified as the largest component of Estonia’s future clean energy mix in both scenarios.

“The support and flexibility of the IAEA experts was invaluable in accomplishing the study aims in a realistic timeframe. We appreciated the opportunity to interact regularly with IAEA experts, permitting us to quickly advance our modelling capability and benefit from leading know-how in the area,” said Alan Tkaczyk, an Associate Professor at the University of Tartu who led the Estonian modelling team. “We shared our model results with relevant Estonian ministry colleagues who were eager to examine our findings at this important time, as the addition of nuclear power is publicly debated in Estonia.”

The analysis showed that the nuclear scenario, with an assumed investment cost of €6000 per kilowatt for SMRs, would only cost 1.3 per cent more than the reference scenario. However, fully factoring in the cost of upgrades to Estonia’s electrical grid and storage capacities, which would be necessary for a large expansion of wind power, would provide a more refined analysis that better supports the cost competitiveness of nuclear power. An energy system using nuclear power, which can provide baseload energy to the grid 24/7 in all weather conditions, could be more resilient and secure than one built according to the reference scenario with very high shares of wind power. Additional studies are needed to fully assess grid expenses and other related costs for alternative strategies. 

“Our role is to help researchers apply tools to develop energy plans aligned with their clean energy goals. For countries interested in nuclear power, ensuring that it is properly accounted for in these studies is crucial,” said Tot. “Building the clean energy infrastructure of tomorrow requires meticulous planning today.”