Uncertain times for nuclear after Fukushima
With the rise of cheaper and safer alternatives, in addition to the Fukushima Dai'ichi disaster in 2011, is this the end of the line for nuclear power?
Nuclear power has the low-carbon credentials to give it a larger stake in the global energy mix over the next few decades, but its future will depend on government financing and public acceptance that the fuel is safe.
The International Energy Agency (IEA) says demand for nuclear power could reach 1.119 billion tonnes of oil equivalent (toe) by 2035, up from 674 million toe in 2011. This will vary regionally, with non-OECD countries expected to provide the bulk of growth in the sector.
The IEA expects China to account for around half of the global increase in nuclear capacity between now and to 2035, followed by South Korea, India and Russia. In Europe, by contrast, more capacity will be decommissioned than built, because of high costs and safety concerns.
The industry remains optimistic. Luis Echávarri, director-general of the OECD Nuclear Energy Agency (NEA), reckons nuclear power could make up a fifth of total global electricity production by 2050, up from around 12% today.
Whether this happens will depend on future nuclear power developers having access to government funding, the public's perception of whether it is a safe form of energy production and whether it can compete on a cost basis with other available fuels. "The main problem for developing significant nuclear power in the future is that it requires a large amount of financing for the long-term and in a context where many countries, especially in Europe, have economies and electricity demand which are not growing significantly," Echávarri says. "When we recover from the financial crisis I think we're going to see much more interest in developing nuclear power."
Countries began turning to nuclear power in the 1950s because it produces much less carbon dioxide (CO2) than other fossil fuels. Today nuclear power development is a polarising issue, with some countries - most notably Germany - trying to phase the fuel out of its energy mix completely.
The radioactive waste produced by nuclear power generation remains an intolerable health risk for some critics. Disposing of the waste safely is another issue, as groups such as the World Wildlife Fund have pointed out. "We're living on limited time because we have created hundreds of thousands of tonnes of radioactive waste, most of which is being deposited close to the power stations," says its director of global energy policy, Stephan Singer. "We need to have that buried and treated so that it doesn't harm people and nature. It's very important to talk about how to treat and deal with that waste."
Nuclear power generation produces around 10,000 cubic metres of highly toxic waste every year, according to World Nuclear Association data. At present about 270,000 tonnes of used fuel is in storage at reactor sites. Around 90% of this waste is in storage ponds, with the rest in dry storage.
The waste has to be stored for 40-50 years. When the heat and radioactivity in high-level waste has fallen to around 0.1% of its original level it can then be put into storage or permanently disposed of underground.
The 2011 disaster at Fukushima Dai'ichi also raises questions about where nuclear plants are built. For earthquake-prone countries, such as Japan, this is a particular problem. It shut down its 50 plants, which supply 30% of the country's energy, after the accident at Fukushima. Even Japan, though, is now planning to restart some of its fleet of nuclear power stations. The country's prime minister, Shinzo Abe, is behind this change in tack. Faced with the soaring cost of securing enough liquefied natural gas (LNG) to meet domestic demand, he wants to see nuclear fuel reintroduced into Japan's energy mix.
The now-idled Fukushima Dai'ichi plant won't be back. It remains plagued by safety and pollution issues. In February, operator Tepco said around 100 tonnes of highly radioactive water had leaked from a storage tank at the site. This follows the leak of 300 tonnes of radioactive water from the site in August last year. Total decommissioning of the facility is expected to take around 40 years.
The Japanese economy has been hit by the meltdown. In January, Japan recorded its widest ever trade deficit of 11.5 trillion yen ($112 billion) - with most of the deficit due to the LNG imports needed to offset the loss of nuclear power generation capacity.
A number of nuclear facilities in the country's west are expected to restart by the middle of this year, according to data from Argus Media. Fitch Ratings expects around a dozen of Japan's nuclear reactors to be restarted by the end of 2015.
Globally, it is difficult to see a future that doesn't have more nuclear capacity in it. "Given how global energy demand is set to grow and that climate change is not going to disappear any time soon it will start to grow again," says Matt Brown, senior director at Pöyry Management Consulting. "Given what nuclear power offers and given where we are with energy demand and climate change, I can't see that we can do what we need to do without it."
Public acceptance will be a problem in some regions, but analysts believe the main constraining factor will be the cost of new facilities. Although producing nuclear power is cost-competitive per unit of power produced, building the facilities remains hugely expensive.
EDF's plans for a plant in the UK offer a good example. Its plant will cost £16bn ($26.6bn), and a deal was only agreed after the UK government guaranteed EDF a price of up to £92.50 per megawatt hour of electricity over a 35-year period.
According to US government figures, the construction costs for a nuclear power station are around $5,530 per kilowatt of power, compared with around $3,200/kW for a coal facility and $917/kW for a gas-fired power station.
Nuclear power will also have to face competition from other, cheaper, fuels such as coal and natural gas. Christoph Frei, secretary general of the World Energy Council, says nuclear power is struggling to compete. "The market attractiveness of nuclear energy has now been undermined by the availability of cheap natural gas, collapsing solar prices, uncertainty of CO2 prices, along with nuclear energy's rising safety-related costs," Frei said recently. "This will have significant consequences for our ability to deliver a diverse fuel mix for a secure, affordable and environmentally sustainable energy future."
The US is the world's largest nuclear power producer, providing 30% of total electricity generated worldwide. The country is developing new small modular reactors - nuclear power plants which are around 300 MW or less compared with current generation base load plants of around 1,000 MW or higher. The government said these smaller, compact designs are made in factories and can be transported by truck or rail to a nuclear power site.
This makes them cheaper more easily located at sites that can't accommodate larger reactors. The government also thinks they are safer. The US expects some of these designs to ready for commercial use by the end of the next decade, while others are expected to be available after 2020.