07 March 2018

Nuclear energy has faced serious challenges in recent years because of several factors: competition from low gas prices, subsidised renewables and slow growth in electricity demand in certain markets. But because of several powerful forces we are seeing signs that this year nuclear energy will come roaring back, writes Jarret Adams.

Several nuclear plants have closed prematurely in the United States, and other shutdowns have been announced. But in every instance, the nuclear plant closures have led to higher emissions and electricity prices, pointing out a difficult truth.

Experts say it is virtually impossible for a major economy to have a reliable, low-carbon grid without nuclear energy. The Germans are learning this lesson the hard way.

Wave of new plants on the horizon

With more than 50 nuclear plants under construction today and 150 more planned, the pace of construction is faster than at any time since the 1990s. This year we expect to see 14 new plants come online, with some key new-generation plants, such as Westinghouse’s AP1000 and Framatome’s EPR, both in China, expected at or near completion.

The first of four APR1400 reactors in the United Arab Emirates, built by Korea’s Kepco, is nearing completion largely on time and on budget. This clearly demonstrates there is nothing inherent about nuclear that prevents this technology from being built economically and on a predictable timeline.

Nuclear giants reorganising

Meanwhile some of the biggest players in the nuclear sector have reorganised to come out leaner and meaner to tackle the global market.

• The restructuring of the former Areva into Framatome and Orano is complete, with the world’s largest nuclear plant operator EDF taking ownership of Framatome, which focuses on reactors, fuel fabrication and services. With new international partners and French government investment, Orano is in a stronger position to keep its focus on uranium mining, enrichment, recycling and decommissioning.

• Brookfield Asset Partners of Canada has agreed to buy Westinghouse Electric Company, which analysts say will help the company finalise some of the international deals it has been pursuing.

• Meanwhile, the China National Nuclear Company (CNNC), China’s second largest reactor owner, merged with China Nuclear Equipment Company (CNEC) to create another powerhouse with 100,000 employees-strong aimed at the export market.

With the reorganisation of these companies behind them, we can expect to see some major nuclear energy agreements this year.

Nuclear’s climate role becoming impossible to ignore

Another driver is the increasing threat of climate change, which is motivating countries to invest in new nuclear projects or at least keep existing plants operating. Nuclear energy is the largest source of emission-free power in the United States, the European Union, South Korea and other countries.

Why are emissions per capita far lower in France than in neighboring Germany? One word: nuclear. While nuclear supplies about 75% of France’s electricity, Germany has decided to shut down its nuclear plants.

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