The fallout from the Fukushima nuclear disaster in 2011 has forced a global rethink over the future of nuclear energy. Today, some countries have outright rejected any further use of nuclear power, while others continue to pursue the energy source for economic reasons. How has the events at Fukushima affected the development of the nuclear power industry, and what is the global outlook for industry?
The following article is a translated summary provided by the Da Vinci Analytic Group Breaking Report on “The Future Of The Nuclear Power Industry: A Year After The Nuclear Disaster In Japan.” The full report can be downloaded here. (in Russian)
In the wake of the world’s largest nuclear disaster since Chernobyl, many global leaders were forced to relook their energy priorities. Several European leaders for instance ordered the closure of their nuclear power plants (NPPs), while other countries decided on the cessation of further construction to their nuclear power capacities.
Not surprisingly, among the countries that supported the idea of complete or partial refusal of nuclear energy were well-developed European economies – such as Germany, Switzerland, France, Belgium – and Japan. In each of these cases however, political realities, rather than economic reasons, may have influenced their decisions.
Governments of these states for instance are often led by an active civil society and stand to gain, or lose, “voting bonuses” with the public depending on their views on nuclear power. The global public outcry over Fukushima as such undoubtedly played a part in their present policy making decision.
In our opinion however, these “political tactics” are unlikely to represent a long-term strategy. It is not improbable that sometime later, in the case that the world sees no new disasters, that a number of political elites in these countries could adopt a different attitude towards the nuclear issue.
In this scenario, France or Belgium could be the first to waver. In Paris for instance, the state-owned nuclear energy company Areva has proven to be not only highly profitable, but also an important image tool for the country on the external markets. Consequently, France is unlikely to completely reject the nuclear power industry, except in the case of an emergency or if the right-wing political party assumes power.
Economic expediency on the other hand may change the nuclear situation in Brussels. Unlikely Germany and Switzerland, Belgium simply cannot afford the expenses involved to completely go off nuclear energy and seek renewable resources.
Nuclear Power Around The World
The rest of the world also does not appear to be ready to give up on nuclear power any time soon. Increased volatility in the traditional energy market, coupled with growing activity by key nuclear reactor producers across the world, has meant that the nuclear power industry remains on a rapid development path just a year after the Fukushima disaster.
The U.S., Russia, China, India, Canada, South Korea, Great Britain, Brazil, Mexico and South Africa – all countries who already have NPPs on their territories – for instance, are now aggressively expanding their nuclear power capabilities. In these states, the economic rationale behind their decisions can effectively be classified into four groups.
The first of these groups include world leaders who adopt a cost-factor analysis for energy in the development of their economy. This group prioritises lower energy costs and comprises the U.S., China, South Korea, and Russia among others.
The second group on the other hand is represented by rapidly developing economies for which development of NPPs is a necessity for the purpose of achieving set goals. These include South Africa, India, Iran, and Mexico.
Related: Nuclear India: Powering the Future
As for the third group, states such as Great Britain, Spain, and Sweden are unable to abandon the nuclear power industry due to the peculiarities of their internal economy. Correspondingly, the fourth group comprises small countries with a respectively large share of nuclear power industry on the internal market and who do not own sufficient alternative resources – this group includes most countries in Central and Eastern Europe.
But the demand from these countries pale in comparison to states that do not have NPPs currently on their territories. At least 24 other countries have expressed interest in building in NPPs, with 12 located in Asia, five in Africa, four in Europe, and three in South America. These countries’ policies actually did not change after the nuclear disaster in Japan, with some insignificant exceptions.
Generally speaking, all the countries that today do not possess any reactors but intend to build their own nuclear plants may be classified into several main groups. The first group consists of rapidly developing economies in need of the increased power volumes, which would ensure their further development. Turkey, Vietnam and Thailand are among them.
The second group represents the countries with carbon supplies but strive for diversification of energy sources aimed at strategic development. Such countries are Saudi Arabia, UAE, partially Malaysia, Indonesia and Egypt.
The third group comprises the countries with uranium resources wishing to use their raw material capacities. Kazakhstan, Namibia and Niger belong to this group.
The fourth group is represented by countries without significant natural resources on their territories which could be used for the purposes of power industry. However, these states want to get access to cheap electric energy and reduce their import dependency. This group comprises Jordan, Poland, Lithuania, Belarus and Israel.
Finally, the fifth group includes countries with systematic problems with electric energy supply within their regions. Therefore, they are trying to solve this problem with the help of NPPs. This group is represented by Nigeria, partially Indonesia, Venezuela, Bangladesh, and partially Vietnam.
Risks To The Nuclear Power Industry
It should be noted that building of NPPs in some of these countries is accompanied by a number of risks related to both natural and social factors – terrorism in particular. Thus, building of NPPs in Jordan, Israel, Indonesia, Egypt, Turkey, Niger, Nigeria, Namibia, Ghana, Northern Korea, Bangladesh, Malaysia is, in our opinion, full of risks.
We believe that development of nuclear power industry in the nearest future will take place thanks to both world leaders and developing economies. The world leader in the development of nuclear power industry will be the Asian region.
We expect new initiatives in the area of building NPPs in developing countries in the nearest future. This will be facilitated by active position of nuclear companies and states which lobby their own interests on external markets. Russia will be particularly active.
Rapid development of nuclear power industry may be impaired only by new serious NPP accident. This could cause the situation in which most countries with developed democracy could review their strategic plans. This, in its turn, might influence the opinion of developing countries.
It is necessary to take into consideration that development of nuclear power industry increases global risks, or NPP accidents or terrorist attacks on such sites. Security protection should become one of the priority areas of nuclear power industry. In this case, in the nearest future the ‘world atom’ will become one of the most popular ways of increasing the level of power independence and settle global problems related to the processes of economic development.
By Da Vinci Analytic Group
Da Vinci AG is a private intelligence and analytic group founded in 2002. It provides analytic support to government structures, business and investment organizations. Da Vinci AG uses intelligence-based approach to gathering information via open-source monitoring and a global network of human sources to provide precise political and economical analysis & forecasts. Web: www.davinci.org.ua