Currently there are 26 nuclear power reactors in China which are on-line, 24 are under construction and more are planned to get their construction started. The power plants which are being planned for construction, are to be equipped with state-of-the-art technology which can give more than 3 times the current nuclear capacity, i.e., the power production will jump to 58 GWe in 2020-21, then to 150 GWe by 2030 and much larger in 2050.

Definition / Scope

1. Currently the ‘Mainland China’ consists of 26 nuclear power reactors which are on-line, 24 are under construction and more are planned to get their construction started.
2. The power plants which are being planned for construction, are to be equipped with state-of-the-art technology which can give more than 3 times the current nuclear capacity, i.e., the power production will jump to 58 GWe in 2020-21, then to 150 GWe by 2030 and much larger in 2050.
3. China is being forced to use nuclear power. Why? Because of air pollution from coal-fired plants.
4. China has its own rule that it will not go for fuel cycle.
   1. A fuel cycle is the progressive nuclear fuel through a series of different stages.
5. China is self-sufficient to make reactor designs and do the construction, also of the fuel cycle, but the nuclear idea is using all of their western technology, i.e., they are able to apply their knowledge while adapting and upgrading the nuclear reactors, which is not the case in fuel cycles.
6. China aims to go global by exporting nuclear technology including the heavy parts in the supply chain.

Market Overview

1. Till September 2014, the People’s Republic of China had 21 nuclear power reactors which are operating on 8 separate sites and 28 are under construction. More reactors are also planned which will be producing 58 GWe of capacity to the China by 2020. China’s National Development and Reform Commission (NDRC) has shown the intention to increase the electricity production by nuclear plants from the present 2% to 6% by 2020 (compared to 20% in the USA and a huge 74% in France). But, the instantaneous growth in this field might result into the shortage of fuel, trained workers, instruments and health and safety personnel.
2. Due to the continuous news about increasing air-pollution, climate change and shortage of fossil fuels, China is looking eager to adopt nuclear power as its alternative source. China has two major nuclear power producers, China National Nuclear Corporation which is operating mainly in the North-East part of the country and China Guangdong Nuclear Power Group which currently operates in the South-East part of the country.
3. Even the People’s Republic of China is participating with their heart and soul in the development of nuclear fusion reactors through their ITER project. The experimental nuclear fusion reactor whose construction is completed is named as EAST located in ‘Hefei’. They have also participated in the research and development for the thorium fuel cycle as a potential substitute for the nuclear fission.
4. In the upcoming future, pressurized water reactors like a CPR1000 and the AP1000 (Generation II+ pressurized water reactors) will be the technologies in demand. By the middle of the century, fast neutron reactors will be seen as the major technology advancement. Fast neutron reactors are designed in a way to produce 1400 GWe by 2100. China is expected to become a reactor exporter, with the development of the CPR-1000.

Market Drivers

Nuclear Power! Can it be controlled?

1. In the locations where the economy is increasing on daily basis like coastal areas remote from the coal fields, nuclear power is an important aspect. Usually the nuclear plants are built where the resources are available nearby which saves the country’s transportation cost. Decisions about building nuclear plants commenced from 1970 and while 2005 arrived, the industry moved into the rapid development phase.
2. Technology and knowledge from France, Canada and Russia was pooled under one roof in China with local development largely based on the French element.
3. National Energy Administration (NEA) in December 2011 said that China will make the nuclear energy the basic source of power in the next 10 to 20 years. They are planning to produce as much as 300 GWe of nuclear capacity over that period. But at the same time, some questions arise. Can they control that much of power? Will the amount of radiation produced during such energy production be controlled? Do they have the manpower to manufacture such power?
4. China Daily, in September 2010 announced that China National Nuclear Corporation (CNNC) was planning to invest CNY 800 billion ($120 billion) on solo basis to the nuclear energy assignments by 2020. In order to support the financial problems for the expansion in this energy industry, CNNC planned to list its subsidiary. It became CNNC Nuclear Power Co Ltd in 2011 to attract investors, but alas, this did not happen. The NDRC set a wholesale power price of CNY 0.43/kWh in July 2013 for all nuclear power plant projects. This step was also taken to promote healthy development of nuclear power and guide the investment in this sector safely.

The old-is-gold days

February 8, 1970, the first nuclear power plan of China goes under construction. Along with it, Shanghai Nuclear Engineering Research and Design Institute, formerly known as 728 Institute was founded. 15 December, 1991, China’s first ever nuclear reactor with the capacity of 288 MWe PWR at the Qinshan Nuclear Power Plant was connected to the grid.

Layout

Many of the nuclear reactors in China are situated on the coast and use seawater for cooling a direct once-through cycle. The New York Time printed that the China is locating many of its reactors near towns, and there is a huge concern regarding the safety of tens of millions of people which can be exposed to radiation. China’s nearby reactors located in ‘Guangdong’ and ‘Lingao’ have around 28 million residents within a 75-km radius that covers even ‘Hong Kong’.

Regulatory Trends

Safety First

1. The National Nuclear Safety Administration (NNSA) which comes under the China Atomic Energy Authority maintains international agreements regarding safety. It was setup in 1984 and it reports to the State Council.
2. China requested and hosted 12 Operational Safety Review Team (OSRT) missions from IAEA teams to October 2011, and each and every plant has one external safety review every year, which is done by either OSART, WANO peer review or CNEA peer review (with the Research Institute for Nuclear Power Operations).
3. After the Fukushima Daiichi nuclear disaster, China announced that all nuclear plant approvals will be cancelled and complete safety checks will take place. Although, Zhang Lijun, ‘Vice Minister of Environmental Protection’ has indicated that China’s overall energy strategy would continue.
4. The safety inspections were due to be finished by October 2011 and the current status of the projects in still unclear. In April 2012, ‘Reuter’ reported that the China was supposed to approve the nuclear plant approvals which was frozen.

Market Outlook

1. Right now, this is one the most important and dangerous project to have over 80 GWe (6%) of installed capacity by 2020, and an increment to more than 200 GWe (16%) by 2030. This is in agreement with the 22 March 2006 Government as Long term development plan for nuclear power industry from 2005 to 2020. Recommendations have been sent by The State Council Research Office (SCRO) to China to aim no more than 100 GWe before 2020 (complete construction) in order to avoid the shortage of fuel, equipment and trained workers.
2. A concern has been raised regarding the building of more than dozen Generation II reactors and their up gradation to Generation III designs such as AP1000.
3. After the Fukushima Daiichi nuclear disaster in Japan, China came into a halt regarding acceptance of new reactor projects and their approvals. In 2015, the EPR and AP1000’s construction was reported to be behind schedule by 2 years+, mainly because of the equipment delays and management issues. However, these delays are not coming in the path of 2030’s programme.

Competitive Landscape

Competition World Wide

1. Total, over 160 power reactors have the capacity to produce 186.00 MWe, and 300 more reactors are proposed.
2. USA: Plans for 5 new reactors, instead of 5 being under construction
3. Finland: 5th plant is almost completed, a very large reactor to come on-line in 2017
4. France: 1600 MWe plant under construction which will go on-line from 2016
5. UK:4 1600 MWe plants are planned, 6000 MWe plant is proposed
6. Romania: 2nd reactor started in 2007, 2 plans are implemented
7. Slovakia: 2 470 MWe plants almost completed, to come on-line from 2017
8. Bulgaria: planning to build a large new reactor
9. Russia: 6 reactors and 2 small ones are under construction, 1 large being the fast neutron reactor. 30 plants further are planned. Increment of power capacity by 50% by 2030. 5 GWe plant is planned too.
10. Poland: planning 2 300 MW plants
11. South Korea: plans for 4 reactors to come into operation by 2018, another 8 by 2030. Total capacity of 17,200 MWe.
12. Japan: 2 reactors under construction, 3 were likely to get started with their construction, but were cancelled.
13. India: 21 plants under operation, 6 under construction. It includes 2 large Russian reactors and a fast breeder reactor as a part of its strategy to develop a fuel cycle which can utilize thorium. Over 20 are planned, further 18 are planned.
14. Pakistan: 3rd and 4th 300 MW reactors are under construction
15. Kazakhstan: 300 MW Russian design under construction
16. Iran: 1000 MW PWR came on-line in 2011
17. UAE: 4 1400MW reactors are planned
18. Turkey: 4 1200MW Russian reactors are almost completed
19. Vietnam: 2 2000MW reactors’ plans are approved

Key Market Players

Independent Power Producers

1. The very first successful and profitable commercial project was the Daya Bay Nuclear Plant. 25% of this plant is owned by CLP Group of Hong Kong which exports 70% of its electricity to Hong Kong. Such imports supply 20% of the exports to Hong Kong’s electricity consumption.
2. In order to meet the needs of 2020’s target of 80 GWe, China has begun to finance the nuclear projects for BIG FIVE power corporations:
   1. Huaneng Group
   2. Huadian Group – Fujjan Fuquing Nuclear power project II and III
   3. Datang Group
   4. China Power Investment Group – Jiangxi Pengze Nuclear
   5. Guodian Group
3. Just like the two nuclear firms CNNC and China Guangdong Nuclear Power Group (CGNPG), the BIG FIVE are State-owned Central Enterprises administered by SAAC.

References

• http://en.wikipedia.org/wiki/Nuclear_power_in_China
• http://www.world-nuclear.org/info/Facts-and-Figures/Nuclear-generation-by-country/BusinessAsiaone
• http://www.world-nuclear.org/info/Facts-and-Figures/World-Nuclear-Power-Reactors-and-Uranium-Requirements/
• http://business.asiaone.com/news/2015-crucial-year-chinas-nuclear-energy-sector
• http://www.world-nuclear.org/info/Current-and-Future-Generation/Nuclear-Power-in-the-World-Today/