France: In 2015, legislation was enacted in the French Parliament to reduce the nuclear share of electricity generation from 75% to 50% by "around" 2025, capping nuclear capacity at 63.2 gigawatts (GW). It's not certain that the legislated shift away from nuclear in favour of renewables and energy efficiency will be retained beyond the 2017 presidential election, but either way the French nuclear industry is in a world of pain.
France has 58 operable reactors and just one under construction ‒ the Flamanville EPR that is many years behind schedule and three times over-budget. The EPR under construction in Finland is also years behind schedule and three times over-budget, and Areva and Finnish utility TVO have been locked in protracted litigation over the cost blowout.1
In 2015, concerns about the integrity of some EPR pressure vessels were revealed, prompting investigations that are still ongoing. Last year, the scandal was magnified when the French Nuclear Safety Authority (ASN) announced that Areva had informed it of "irregularities in components produced at its Creusot Forge plant." The problems concern documents attesting to the quality of parts manufactured at the site. At least 400 of the 10,000 quality documents reviewed by Areva contained anomalies.2
Both Areva and EDF are financially stressed, to put it mildly ‒ hence a taxpayer-funded bailout agreed last year.3 A government-led rescue of Areva and the wider nuclear industry may cost the state as much as €10-billion, Reuters reported in January 2017, and in addition to its "dire financial state, Areva is beset by technical, regulatory and legal problems."4
EDF will need to spend around €100 billion (US$107 billion) upgrading its fleet of 58 reactors by 2030, the country's state audit office has said, to meet new safety requirements and to extend the lives of the units beyond 40 years.5
The French nuclear industry is in its "worst situation ever" according to former EDF director Gérard Magnin, speaking last November.6 He cited the spate of reactor closures in France in late-2016 mandated by the regulator to investigate anomalies; the financial problems facing EDF; and the complexities, costs and risks associated with the UK Hinkley Point EPR project. Magnin called Hinkley Point "very risky" when he resigned from the EDF board in July 2016, adding: "Let's hope that Hinkley Point will not drag EDF into the same abyss as Areva."
Magnin said in November: "A lot of people in EDF have known for a long time the EPR has no future – too sophisticated, too expensive – but they assume their commitments and try to save the face of France." He added: "Renewable energies are becoming competitive with fossil fuels and new nuclear, such as Hinkley Point, where EDF will try to build the most expensive reactors in the world and provide electricity at an unprecedented cost."6
French finance authorities raided the offices of EDF in July 2016 as part of a probe into EDF's disclosure of information to the market regarding domestic nuclear maintenance costs as well as planned reactors in the UK.7
Former Areva chief executive Anne Lauvergeon was placed under formal investigation last year over her role in an acquisition of a number of African uranium mines. Following a hearing in May 2016, Lauvergeon fronted national prosecutors over whether she deliberately submitted misleading annual accounts concealing huge writedowns on Areva's €1.8bn investment in Uramin in 2007. Following the hearing she was placed under formal investigation for the "publication of inaccurate accounts" and the "spreading of false information".8
USA: The pattern of reactor closures continues in the US ‒ the number of operable reactors has shrunk from 104 to 99 over the past five years. The Watts Barr-2 reactor was brought online in 2016, 43 years after construction began ‒ the first reactor start-up in the US since 1996. Four reactors are under construction ‒ all behind schedule and over-budget.
Closures will outstrip grid connections in the coming years ‒ 44 out of 99 reactors have been operating for 40 years or more as of 31 January 2017.9 However there has been some movement to subsidise aging reactors to keep them operating ‒ last year, the states of New York and Illinois agreed to prop up aging reactors with massive subsidies.
There are indications that the Trump administration might do more than the Obama administration to prop up aging reactors.10 But the bill could be up to US$280 billion by 203011 and Congress may baulk at the administration's proposals.
A recent article in Oilprice.com outlines 10 reasons why Trump won't lead a nuclear power renaissance.12 Most revolve around economics ‒ authors Leonard Hyman and Bill Tilles note that producing "a commodity like electricity at a relatively high price in a competitive market is not a winning business strategy." As for subsidies to prop up aging reactors, they write: "New York and Illinois both launched programs best described as Welfare for the Nuclear Elderly. It's heart-warming to see such generosity just prior to the holiday season aimed at aging, uneconomic nuclear plants. This sounds to us like a job creation/preservation program for rural areas (where high paying jobs are scarce) masquerading as an environmentally beneficial, carbon mitigating proposal."
There are also indications that the Trump administration may try to revive the Yucca Mountain high-level waste dump ‒ but any attempt to do so will be protracted and strongly contested.13 Outgoing Energy Secretary Ernest Moniz recently noted that "forcing an unwanted facility on an unwilling population" is no more likely to be successful in the future than it has been in the past.14
Japan: Only two of the country's 42 'operable' reactors are actually operating ‒ Sendai-1 and Ikata-3. Sendai-2 restarted but is offline for routine maintenance. Takahama-3 and -4 were restarted but were taken offline after a court ruling.
The future of Japan's nuclear program remains a guessing game, but projections are being steadily reduced. According to the OECD's Nuclear Energy Agency and the IAEA, installed capacity of 42.4 GW in 2014 could fall to as little as 7.6 GW by 2035 "as reactors are permanently shut down owing to a range of factors including location near active faults, technology, age and local political resistance."15 Before the Fukushima disaster, Tokyo planned to add another 15−20 reactors to the fleet of 55, giving a total of 70−75 reactors (65‒70 GW).
Another reactor was permanently shut down in 2016 (Ikata-1) in addition to five shut-downs in 2015 and the six Fukushima Daiichi reactors shut down in the aftermath of the March 2011 disaster. Japan also decided last year to permanently shut down the troubled Monju fast breeder reactor. As we reported in Nuclear Monitor, for all the rhetoric about Generation IV fast reactors, and the US$100+ billion invested worldwide, only five such reactors are operating worldwide (three of them experimental) and only one is under construction (in India).16
Late last year, Japan's Ministry of Economy, Trade and Industry revised the estimated cost of decommissioning the Fukushima Daiichi nuclear plant, and compensating victims of the disaster, to around ¥21.5 trillion (US$187 bn; €175 bn).17 The latest estimate is four times greater than estimates provided in 2011/12. Indirect costs (e.g. fuel imports, adverse impacts on agriculture and fishing, etc.) are likely to exceed the direct clean-up and compensation costs.
China: With 35 operable power reactors (up from 30 at the start of 2016), 22 under construction, and many more in the pipeline, China remains the only country with significant nuclear expansion plans. There are indications of a slow-down with only two construction starts in 2016. There were 25 construction starts from 2008‒2010 and 15 in the six years since.18
Public opinion may increasingly shape China's nuclear program.19 Thousands participated in protests against a proposed nuclear reprocessing plant in the city of Lianyungang in August 2016, disregarding warnings from the local government and police that they were breaking the law. The Lianyungang local government responded by suspending site selection and preliminary work on the project. In 2013, plans for a nuclear fuel fabrication plant in Guangdong province were shelved after public protests. Plans for inland nuclear power plants are provoking strong public opposition.
Growth could be derailed by a serious accident, which is all the more likely because of China's inadequate nuclear safety standards, inadequate regulation, lack of transparency, repression of whistleblowers, world's worst insurance and liability arrangements, security risks, and widespread corruption. He Zuoxiu, a leading Chinese scientist, said in 2015: "There were internal discussions on upgrading standards in the past four years, but doing so would require a lot more investment which would affect the competitiveness and profitability of nuclear power. Nuclear energy costs are cheap because we lower our standards."20
The nuclear industry never tires of bleating about all the lessons it has learned from the Fukushima disaster. Surely one of those lessons is that it is not a good idea to turn a blind eye to countries with inadequate nuclear safety and regulatory standards?
India has 22 operable reactors (6.2 GW capacity) and five under construction. In early 2015, India claimed to have resolved one of the major obstacles to foreign investment by announcing measures to circumvent a liability law which does not completely absolve suppliers of responsibility for accidents. But that hasn't led to any construction starts; indeed the last construction start was in 2011. Strong public opposition – and the Indian state's aggressive response to that opposition – will likely continue to slow nuclear expansion.
As in China, safety and regulatory standards are clearly inadequate in India.21 The nuclear industry never tires of bleating about all the lessons it has learned from the Fukushima disaster. Surely one of those lessons is that it is not a good idea to turn a blind eye to countries with inadequate nuclear safety and regulatory standards?
Nuclear security is also inadequate in India. The latest assessment by the Nuclear Threat Initiative placed India 21st out of 25 countries with weapons-usable nuclear materials. Improvements are needed in on-site physical protection, control and accounting, mitigating insider threats, ensuring protection of materials during transport, establishing an independent regulator, dealing with high levels of corruption among public officials, and the presence of groups interested in and capable of illicitly acquiring nuclear materials.22
Russia has 35 operable reactors and seven under construction. The Russian government published a decree in August 2016 outlining plans to build 11 new reactors by 2030, in addition to those under construction. But similar plans have been announced previously and reality has fallen well short of governmental decrees.23
Already there is some backsliding from the August 2016 announcement. In December, Alexander Lokshin, first deputy general-director of Rosatom, said the aim is to maintain the nuclear share at around 18% of total electricity production.24 He cited stagnant energy demand as the reason to downwardly revise nuclear plans. In January 2017, Rosatom announced that it is deferring the planned Brest-OD-300 lead-cooled fast reactor ‒ one of the 11 new reactors trumpeted in the August 2016 decree.25
Russia continues to sign nuclear cooperation agreements with other countries, promising billions in loans that it can't afford. Russia's export ambitions faced setbacks last year with Vietnam abandoning its nuclear power plans, and South Africa deferring its plans.
UK: In 2016 the British government approved the Hinkley Point C project to build two EPR reactors. Whether that is a blessing or a curse for the industry remains to be seen. Other EPR projects face mounting problems ‒ long delays; spectacular cost increases; ongoing inquiries into the integrity of EPR pressure vessels; and in the case of the EPR under construction in Finland, litigation.
Eight of the UK's 15 power reactors are scheduled to be shut down over the next decade, and it's unlikely that new reactors will keep pace with closures. The OECD Nuclear Energy Agency and the IAEA are hedging their bets, projecting that the UK will have 0‒12.2 GW of nuclear capacity by 2035, compared to 8.9 GW now.15
Newcomer countries: The World Nuclear Association claims that "over 45 countries are actively considering embarking upon nuclear power programmes."26 There's no truth to the claim. Only two 'newcomer' countries are actually building reactors − Belarus and the United Arab Emirates. Numerous potential newcomers have deferred or abandoned their nuclear plans over the past two years, including Chile, Indonesia, Vietnam and Lithuania (which operated reactors until 2009).
Other countries might join the nuclear club but newcomers will be few and far between. Moreover, some countries ‒ including Germany, Belgium, and Taiwan ‒ are deliberately phasing out nuclear power, while nuclear power faces attritional phase-outs in some other countries (e.g. Switzerland). Last year, Taiwan reaffirmed its plan to phase-out nuclear power by 2025. "There is no room for discussion. When 2025 comes, nuclear power will be abandoned," Economics Minister Lee Shih-guang said in May 2016.27
The July 2016 World Nuclear Industry Status Report noted that over the past two decades, only two countries started power reactors for the first time (Romania in 1996 and Iran in 2011) while two countries closed theirs (Kazakhstan and Lithuania).28
Hollow, pyrrhic victories
Most of the nuclear industry's wins in 2016 may turn out to be hollow and pyrrhic.
The decision to go ahead with EPR reactors at Hinkley Point in the UK may be a blessing or a curse for the industry. Even if construction goes to plan and to budget, the obscene subsidies will turn the British public against nuclear power for decades to come. Most of the British Establishment ‒ and even the Aristocracy ‒ are already opposed to Hinkley Point so they'll be quick to criticize if and when the project faces delays and cost blow-outs.
Russia announced plans for 11 new reactors but there is no likelihood that all will be built and every likelihood that few if any will be built.
In a November 27 referendum, voters in Switzerland rejected a proposal to impose time limits on the operation of the country's five power reactors.29 Nonetheless, pre-Fukushima plans for new reactors have been abandoned. Switzerland is tracking towards a nuclear phase-out by attrition. One of its five reactors is to be closed in 2019, and the others will likely all be closed by the end of the 2020s (or by 2034 according to Nuclear Energy Insider30) ... much the same outcome as that envisaged in the defeated referendum proposal.
The nuclear industry in Sweden certainly had some wins in 2016, but they may not amount to much. There is no longer an end-date for nuclear energy in Sweden other than a non-binding aspiration to exit the industry by mid-century and a (contradictory) aspiration to be 100% renewable-energy powered by 2040; existing reactors can be replaced with new ones (at the same sites); and a nuclear capacity tax will be abolished.31
But there are no plans for new reactors and no likelihood of any in the foreseeable future. Keeping existing reactors operating is proving quite a challenge. One reactor closed in 2015 (leaving Sweden with nine), and three more closures are scheduled by the end of 2020. Magnus Hall, CEO of Vattenfall, Sweden's main nuclear operator, said in June 2016: "Even with the abolishment of the capacity tax, profitability will be a challenge. Low electricity prices put all energy producers under pressure and we will continue to focus on reducing production costs."32
'South Africa formally launches new build programme', Nuclear Engineering International reported in December 2016.33 But in fact, plans to build new reactors have been deferred ‒ the latest projection is 1.4 GW of new nuclear capacity by 2037 followed by more later ‒ and plans for new reactors may be scrapped altogether once President Jacob Zuma is ousted.34
Corruption has undermined South Africa's nuclear new-build program34, and developments in a widespread kick-back and bribery corruption scandal in Brazil's nuclear program was one of the biggest stories of 2016.35 Corruption has claimed numerous scalps ‒ not least Othon Luiz Pinheiro da Silva, considered the father of Brazil's nuclear program, who was sentenced to 43 years in prison in August 2016. The partially-built Angra-3 reactor remains frozen due to the corruption scandal and a lack of funding.
Belgium: 10-year extensions for two of Belgium's seven reactors were approved in late-2015. But all reactors are still scheduled to closed by the end of 2025. There has been ongoing controversy over the safety of Belgium's reactors ‒ in particular Doel-3 and Tihange-2 ‒ including strenuous efforts by politicians and the public in neighboring countries to force the closure of the reactors. Also in the news last year: Belgium's nuclear regulator said utility Engie Electrabel is 'shameless' over lax safety standards36; nuclear security scares37; and all Belgians are to be issued with iodine tablets.38
References:
1. AFP, 16 Nov 2016, 'Finnish client 'alarmed' by French nuclear industry overhaul', http://www.nuclearpowerdaily.com/reports/Finnish_client_alarmed_by_Frenc...
2. Clément Sénéchal, 16 June 2016, 'Anomalies and suspected falsifications in the nuclear industry: a dozen countries affected', www.greenpeace.org/international/en/news/Blogs/nuclear-reaction/anomalie...
3. Paul Brown, 2 Dec 2016, 'Taxpayers face bill for nuclear crisis', http://climatenewsnetwork.net/taxpayers-bill-nuclear-crisis/
4. Geert de Clercq / Reuters, 4 Jan 2017, 'France ready to save nuclear group Areva, regardless of election outcome', www.theglobeandmail.com/report-on-business/international-business/europe...
5. World Nuclear News, 11 Feb 2016, 'EDF faces €100 billion reactor upgrade bill, says audit office', www.world-nuclear-news.org/RS-EDF-faces-EUR100-billion-reactor-upgrade-b...
6. Adam Vaughan, 29 Nov 2016, French nuclear power in 'worst situation ever', says former EDF director, www.theguardian.com/environment/2016/nov/29/french-nuclear-power-worst-s...
7. Jillian Ambrose, 22 July 2016, 'EDF raided by French authorities ahead of Hinkley greenlight', www.telegraph.co.uk/business/2016/07/22/edf-raided-by-french-authorities...
8. Michael Stothard, 14 May 2016, 'Areva ex-chief under formal investigation over UraMin affair', www.ft.com/content/b0800228-1949-11e6-b197-a4af20d5575e
9. www.iaea.org/PRIS/CountryStatistics/CountryDetails.aspx?current=US
10. Catherine Traywick and Jennifer A Dlouhy, 9 Dec 2016, 'Trump Team Memo Hints at Big Shake-Up of U.S. Energy Policy', www.bloomberg.com/news/articles/2016-12-09/trump-team-s-memo-hints-at-br...
11. Tim Judson / Nuclear Information and Resource Service, November 2016, "Too Big to Bail Out: The Economic Costs of a National Nuclear Power Subsidy", http://bit.ly/too-big-to-bail-out-nuclear or https://drive.google.com/file/d/0B2b-a19f3q6ZdnJuajE1ckxKa2c/view
12. Leonard Hyman and Bill Tilles, 28 Dec 2016, '10 Reasons Trump Won't Lead A Nuclear Renaissance', http://oilprice.com/Energy/Energy-General/10-Reasons-Trump-Wont-Lead-A-N...
13. Jennifer A Dlouhy, 15 Nov 2016, 'Trump Advisers Eye Reviving Nevada Yucca Nuclear Waste Dump', www.bloomberg.com/politics/articles/2016-11-14/trump-advisers-eye-revivi...
14. Ernest Moniz, 18 Jan 2017, 'The Way Forward on Nuclear Waste', www.bloomberg.com/view/articles/2017-01-18/the-way-forward-on-nuclear-waste
15. OECD's Nuclear Energy Agency and International Atomic Energy Agency, 2016, 'Uranium 2016: Resources, Production and Demand', www.oecd-nea.org/ndd/pubs/2016/7301-uranium-2016.pdf
16. 5 Oct 2016, 'The slow death of fast reactors', Nuclear Monitor #831, www.wiseinternational.org/nuclear-monitor/831/slow-death-fast-reactors
17. 16 Dec 2016, 'The economic impacts of the Fukushima disaster', Nuclear Monitor #836, www.wiseinternational.org/nuclear-monitor/836/economic-impacts-fukushima...
18. Data compiled from IAEA, www.iaea.org/PRIS/
19. 24 Aug 2016, 'Protests against proposed reprocessing plant in China', Nuclear Monitor #829, www.wiseinternational.org/nuclear-monitor/829/protests-against-proposed-...
20. Emma Graham-Harrison, 25 May 2015, 'China warned over 'insane' plans for new nuclear power plants', www.theguardian.com/world/2015/may/25/china-nuclear-power-plants-expansi...
21. Greenpeace, 6 June 2016, 'Greenpeace Publishes New Report On Nuclear Safety', http://www.greenpeace.org/india/en/Press/Greenpeace-Publishes-New-Report...
22. Nuclear Threat Initiative, 'Nuclear Security Index', Third Edition, p.20, www.ntiindex.org/wp-content/uploads/2016/03/NTI_2016-Index-Report_MAR-25...
See also http://2016.ntiindex.org/countries/india/?index=theft
23. Vladimir Slivyak, 24 Aug 2016, 'Russia plans new reactors but prospects are murky', Nuclear Monitor #829, www.wiseinternational.org/nuclear-monitor/829/russia-planning-new-reacto...
24. NucNet, 27 Dec 2016, 'Russia Reduces Ambitious Targets To Boost Nuclear Share', www.nucnet.org/all-the-news/2016/12/27/russia-reduces-ambitious-targets-...
25. Nuclear Engineering International, 18 Jan 2017, 'Breakthrough project continues as Brest reactor is postponed', www.neimagazine.com/news/newsbreakthrough-project-continues-as-brest-rea...
26. World Nuclear Association, www.world-nuclear.org/info/Country-Profiles/Others/Emerging-Nuclear-Ener...
27. China Post, 26 May 2016, 'Gov't to end nuclear power in 2025: MOEA', www.chinapost.com.tw/taiwan/national/national-news/2016/05/26/467321/Gov...
28. Mycle Schneider, Antony Froggatt et al., 2016, 'World Nuclear Industry Status Report 2016', www.worldnuclearreport.org/IMG/pdf/20160713MSC-WNISR2016V2-HR.pdf
29. 6 Dec 2016, 'Switzerland: Referendum rejects quick exit from nuclear power', Nuclear Monitor #835, www.wiseinternational.org/nuclear-monitor/835/nuclear-news-nuclear-monit...
30. Nuclear Energy Insider, 28 Nov 2016, 'Swiss reject accelerated closure proposal', http://analysis.nuclearenergyinsider.com/south-africa-delays-nuclear-bui...
31. Charly Hultén, 'Sweden: Parliamentary parties put differences on nuclear energy aside', Nuclear Monitor #825, www.wiseinternational.org/nuclear-monitor/825/sweden-parliamentary-parti...
32. 14 June 2016, 'Sweden to allow new nuclear plants; US utility fixes AP1000 build cost', http://analysis.nuclearenergyinsider.com/sweden-allow-new-nuclear-plants...
33. 22 Dec 2016, Nuclear Engineering International, 'South Africa formally launches new build programme', www.neimagazine.com/news/newssouth-africa-formally-launches-new-build-pr...
34. 6 Dec 2016, 'Twists and turns in South Africa's nuclear power program', Nuclear Monitor #835, www.wiseinternational.org/nuclear-monitor/835/twists-and-turns-south-afr...
35. 6 Dec 2016, 'Brazil's nuclear power program undone by corruption, Nuclear Monitor #835, www.wiseinternational.org/nuclear-monitor/835/brazils-nuclear-power-prog...
36. www.wiseinternational.org/nuclear-monitor/834/nuclear-news-nuclear-monit...
37. www.wiseinternational.org/nuclear-monitor/822/belgiums-nuclear-security-...
38. www.wiseinternational.org/nuclear-monitor/823/nuclear-news-nuclear-monit...