The nuclear renaissance is stone cold dead

There is no nuclear recovery, with the industry last year flailing to stay above water in key markets and its share of global electricity continuing a seemingly inexorable decline.

The figures are in: 2013 was an annus horribilis for the nuclear power industry − its third in a row − and the nuclear renaissance can now be pronounced stone cold dead.

The most that could be said for the 2013 figures − four reactors connected to grids, four permanently shut down − is that they weren't as bad as the previous year. Nuclear power suffered its biggest ever one-year fall in 2012 − nuclear generation fell 7 per cent from the 2011 figure.

Nuclear generation fell in no less than 17 countries, including all of the top five nuclear-generating countries. Nuclear power accounted for 17 per cent of global electricity generation in 1993 and it has steadily declined to 10 per cent now.

The International Atomic Energy Agency has downwardly revised its projections, and now anticipates nuclear capacity growth of 23 per cent to 100 per cent by 2030. Historically, the IAEA's upper projections have been fanciful, while its low projections also tend to be too high (by 13 per cent on average) but provide a reasonable guide nonetheless. So growth of 23 per cent by 2030 − annual growth of a little over 1 per cent − is about as much as the industry can realistically hope for.

The IAEA will further reduce its projections when it factors in last year's annus horribilis. Perhaps the most striking developments were in the United States, where the industry is finding it increasingly difficult to profitably operate existing reactors − especially ageing reactors requiring refurbishments − let alone build new ones. Almost half of the world's reactors have operated for 30 years or more, so the problem of ageing reactors is starting to come into sharp focus.

Peter Bradford, a former member of the US Nuclear Regulatory Commission, notes that by 2009, applications for 31 new reactors in the US were pending. "The 31 proposed reactors are down to four actually being built and a few others lingering on in search of a licence, which is good for 20 years," Bradford writes. "Those four are hopelessly uneconomic but proceed because their state legislatures have committed to finish them as long as a dollar remains to be taken from any electric customer's pocket. Operating reactors are being closed as uneconomic for the first time in 15 years."

Last year alone, US utilities closed or announced plans to close five reactors in addition to cancelled plans for new reactors and cancelled plans to increase the power of existing reactors; Forbes recently listed another six nuclear plants that could be next for the chopping block; and academic Mark Cooper has identified 38 US reactors in a similar situation to those that have recently been shut down.

The UK has finally made some movement towards replacing its fleet of ageing reactors. The capital cost for two planned large reactors (totalling 3.2 gigawatts) at Hinkley Point in Somerset: a staggering $29 billion. Utilities can't find the capital, so the UK government is offering loan guarantees of $18 billion. And the UK government is guaranteeing French utility EDF a staggering 16 cents for every kilowatt-hour generated by the Hinkley Point reactors, fully indexed for inflation, for a staggering 35 years (EDIS: Britain's nuclear cost bombshell, October 30).

Economic consulting firm Liberum Capital said: "We are flabbergasted that the UK government has committed future generations of consumers to the costs that will flow from this deal" and that Hinkley Point will be "both the most expensive power station in the world and also the plant with the longest construction period".

EDF plans to build European Pressurised Reactors, EPRs, at Hinkley Point. Two other EPR projects − in Finland and France − have been disastrous. The estimated capital cost for the EPR in Finland has ballooned from $4.5 billion to $12 billion. The estimated cost for the EPR in France has ballooned from $5 billion to $12.8 billion. Thus we have a rule-of-thumb for estimating the true capital costs of nuclear power: double the initial estimate and add a few billion for good measure.

While the costs of renewables are falling − and in the case of solar PV, plummeting − nuclear power is subject to a 'negative learning curve'. Economic boffins at Citigroup explain: "The capital cost of nuclear build has actually risen in recent decades in some developed markets, partly due to increased safety expenditure, and due to smaller construction programs (i.e. lower economies of scale). Moreover the 'fixed cost' nature of nuclear generation in combination with its relatively high price (when back end liabilities are taken into account) also places the technology at a significant disadvantage; utilities are reluctant to enter into a very long term (20-plus years of operation, and decades of aftercare provisioning) investment with almost no control over costs post commissioning, with the uncertainty and rates of change currently occurring in the energy mix."

Academic Richard Tanter noted that 2012 was a "busy year for nuclear corruption". The same could be said for 2013. South Korea is one of four countries that is supposedly driving the nuclear renaissance (along with China, India and Russia). But plans to expand nuclear power to 41 per cent of electricity supply by 2035 have been reduced to a 29 per cent target in the wake of a major scandal involving bribery and faked safety certificates for thousands of reactor parts, and another scandal involving the cover-up of an accident that sent the temperature of a reactor core soaring. One hundred people have been arrested including a former chief executive of Korea Hydro and Nuclear Power, a vice president of Korea Electric Power Corp, and a former deputy minister in charge of energy.

In September, the chief executive of KHNP issued a public apology, saying "our domestic nuclear project is facing the utmost crisis" and noting that public trust has "hit the ground" because of the Fukushima disaster and the corruption. The proportion of South Koreans who consider nuclear power safe fell from 71 per cent in 2010 to 35 per cent in 2012, while a 2011 survey found 68 per cent opposition to new reactors in South Korea (and 69 per cent opposition across 24 countries).

Belgium, Germany, and Switzerland plan to phase out their existing nuclear power programs. Russia and China have reduced their projections for nuclear power growth (though significant growth in China still has the potential to mask patterns of stagnation and slow decline elsewhere). Public opposition forced the cancellation last year of a planned nuclear fuel processing plant in China and contributed to the cancellation of a planned power reactor near Kaliningrad in Russia − the first time in both countries that public opposition has stopped nuclear projects.

Canada has abandoned plans for new reactors. The French president has pledged to reduce reliance on nuclear power from 75 per cent to 50 per cent of total electricity generation (though his plan faces significant opposition). The government of Brazil, the world's fifth most populous country, recently announced that apart from one reactor already under construction, plans for new reactors have been put on hold indefinitely. The head of Brazil's energy planning agency, Mauricio Tolmasquim, said: "This is wind power's moment. There's been a revolution in terms of cost."

South Africa − the only country in Africa with power reactors − abandoned plans for new reactors in 2008, revived them, then abandoned them again in December 2013. In the Middle East, only Iran has a nuclear power reactor, while Jordan, the United Arab Emirates, Turkey and Saudi Arabia are pursuing nuclear power programs with greater or lesser intent. Meanwhile, a swag of countries in the Middle East and North Africa have put nuclear power on the backburner, including Kuwait, Oman, Qatar, Bahrain, Egypt, Syria, Tunisia, Israel, Morocco, Algeria and Libya.

And on it goes. No reactors are operating in Japan − some will restart in the coming years but plans to add another 25 or so reactors to Japan's fleet of 55 reactors are dead and buried. The Fukushima disaster will be with us for decades and the economic costs are being counted in the hundreds of billions of dollars. Plans for a new nuclear power plant in Taiwan motivated 200,000 people to participate in protests in March last year, led to a physical brawl in parliament in August, and both major parties are promising an eventual phase-out of nuclear power.

Any number of other countries have decided since the Fukushima disaster not to engage or re-engage in nuclear programs, including Singapore, Greece, Italy, Peru, Portugal, Thailand, Venezuela, and many others.

The nuclear renaissance is dead ... stone cold dead. If there is any growth at all, it will fall well short of the significant, sustained growth implied in the term renaissance.

And the prospects for nuclear power in Australia are dead. If nuclear power is economically prohibitive (or nearly so) in nuclear nations such as the UK and the US, it is far more so in Australia given that we have little relevant infrastructure or expertise. The major parties seem to be well aware that nuclear power is a non-starter so the nuclear debate is reduced to the slow, repetitive drum-beat of a small, repetitive nuclear lobby.

Australia's uranium industry is also in a world of pain. Uranium accounted for a lousy 0.19 per cent of Australia's national export revenue in 2011-12. The spot price for uranium has halved since the Fukushima disaster in March 2011. As John Borshoff, head of Australian-based uranium miner Paladin Energy, noted last July, "the uranium industry is definitely in crisis".
Jim Green is the national nuclear campaigner with Friends of the Earth, Australia.

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