Global nu­clear power in­dus­try is fac­ing ma­jor hur­dles as bank­ruptcy of two lead­ing groups halts pro­gramme

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Nu­clear power fi­nanc­ing is em­broiled in a global bank­ruptcy with the top two, Toshiba-west­ing­house, US sub­sidiary of Toshiba of Ja­pan and its French equiv­a­lent, the state-owned AREVA fac­ing a fi­nan­cial de­ba­cle. Toshiba West­ing­house, af­flicted with tech­ni­cal prob­lems, time and mas­sive cost over­runs at con­struc­tion projects V C Sum­mer and Vog­tle in the USA, filed for bank­ruptcy pro­tec­tion of its Amer­i­can sub­sidiary. AREVA went tech­ni­cally bank­rupt as a se­quel to a cu­mu­la­tive six-year loss of US$ 12.3 bil­lion. The French govern­ment came out with a bailout for US$ 5.3 bil­lion, al­low­ing the process of a break-up of the state util­ity EDF. The res­cue scheme was through by the Euro­pean Com­mis­sion, although AREVA re­mains delisted from the Paris stock mar­ket since Au­gust 2017.

The French ma­jor has to strug­gle fac­ing ac­cu­sa­tion of ‘a vast qual­ity-con­trol scan­dal that led to the pro­vi­sional shut­down of a dozen re­ac­tors in France. Thou­sands of fab­ri­ca­tion dossiers have to be ex­am­ined for ir­reg­u­lar­i­ties or fal­si­fi­ca­tions. The safety im­pli­ca­tions re­main to be as­sessed', re­vealed the Nu­clear In­dus­try Sta­tus Re­port 2017 (WNISR2017), just re­leased in Paris. The pre­sen­ter was My­cle Sch­nei­der, international con­sul­tant, lead au­thor and pub­lisher, along­side co-au­thors Juan C Ro­driguez, eq­uity an­a­lyst at Al­pha Value and An­dreas Rüdinger, in­de­pen­dent con­sul­tant and as­so­ci­ated re­searcher at the In­sti­tute for Sus­tain­able De­vel­op­ment and International Re­la­tions (IDDRI).

The spread of the fall­out is un­prece­dent­edly wide. In Europe, en­ergy util­i­ties Cen­trica (UK), EDF, Engie (France), E ON, and RWE (Ger­many) were down­graded by credit rating agen­cies last year. As of early July 2017, com­pared to their peak val­ues dur­ing the past decade, the loss of share val­ues by ma­jor util­i­ties were RWE of –82 per cent, E ON of Ger­many –87 per cent, EDF –89 per cent and Engie –75 per cent (both of France). In Asia, the share value of Ja­panese util­ity TEPCO, de facto na­tion­alised af­ter the Fukushima dis­as­ter, fell by 89 per cent in July this year from the peak value in 2007. The Chi­nese util­ity CGN, listed on the Hong Kong stock ex­change since De­cem­ber 2014, has been reel­ing in cri­sis as dur­ing last year and a half, it failed to re­cover from the 60 per cent loss of share value com­pared to the peak in June 2015.The Korean util­ity KEPCO, the only ma­jor nu­clear util­ity to reach its peak share value in 2016, too in­curred a loss of 37 per cent in value over the past year fol­low­ing tar­iff cuts, in­creased op­er­at­ing ex­penses and the tem­po­rary shut­down of four re­ac­tors.

“The nu­clear share of the world's power gen­er­a­tion re­mained sta­ble over the past five years, with 10.5 per cent in 2016 af­ter de­clin­ing steadily from a his­toric peak of 17.6 per cent. In 1996, nu­clear power's share of global com­mer­cial pri­mary en­ergy con­sump­tion also re­mained sta­ble at 4.5 per cent — prior to 2014 the low­est level since 1984,” states WNISR2017. In con­trast, re­new­ables are firmly on the up­grade as “wind power out­put grew by 16 per cent, so­lar by 30 per cent.” Against nu­clear by 1.4 per cent in 2016. “Wind power in­creased gen­er­a­tion by 132 ter­awatt hours (TWH), so­lar by 77 TWH, re­spec­tively 3.8 times and 2.2 times more than nu­clear's 35 TWH.”

The pa­thetic sta­tus of nu­clear power util­i­ties is re­flected in the startup shut­down mis­match dis­closed by the 267-page re­port , “In 2016, ten re­ac­tors started up, five in China, one each was com­mis­sioned in In­dia (Ku­danku­lam-2), Pakistan (Chas­nupp-3), Rus­sia (Novovoronezh-2-1), South Korea (Shin-kori-3) and the US (Watts Bar-2, af­ter 43 years of con­struc­tion). Two re­ac­tors were closed in 2016, Novovoronezh-3 in Rus­sia and Fort Cal­houn-1 in the US. In the first half of 2017, two re­ac­tors started up in the world, one each in China (Yangjiang) and Pakistan (Chas­nupp-4, built by a Chi­nese com­pany), while two were shut down, the old­est units re­spec­tively in South Korea (Kori-1, af­ter 40 years of op­er­a­tion) and in Swe­den (Oskar­shamn-1, af­ter close to 46 years of op­er­a­tion).”

De­fend­ing re­new­able al­ter­na­tives out of the con­tem­po­rary ex­pe­ri­ence, WNISR2017, notes, “New re­new­ables beat ex­ist­ing nu­clear. Re­new­able en­ergy auc­tions achieved record low prices at and be­low US$ 30/megawatt hours in Chile, Mex­ico, Morocco, United Arab Emi­rates, and the United States. Av­er­age gen­er­at­ing costs of amor­tised nu­clear power plants in the US were US$ 35.5 in 2015.” In In­dia too, Pro­fes­sor Su­jay Basu, the first direc­tor of School of En­ergy Stud­ies, Ja­davpur Univer­sity, who since the early 1970s has been warn­ing against nu­clear elec­tric­ity, hav­ing pre­dicted years ago that even if one leaves aside the health and eco­log­i­cal con­traindi­ca­tions, it won't be eco­nom­i­cally vi­able at all, as­serts that so­lar en­ergy (in­clud­ing wind) is now cheaper.

The doc­u­ment is his­toric for the se­vere in­dict­ment of Fukushima tragedy. “Ac­cord­ing to govern­ment fig­ures, the num­ber of evac­uees from Fukushima Pre­fec­ture as of March 2017 was about 79,000 or less than half of al­most 165,000 in May 2012. On March 31/ April 1, the govern­ment lifted re­stric­tion or­ders for 32,000 peo­ple. Ac­cord­ing to a sur­vey of res­i­dents' in­ten­tions con­ducted by the Re­con­struc­tion Agency, at the max­i­mum, only 18 per cent of the house­holds de­sired to re­turn in each of three of the five mu­nic­i­pal­i­ties lo­cated in the evac­u­a­tion zones. The govern­ment has de­cided to ter­mi­nate the monthly com­pen­sa­tion of about US$900 per per­son by March 2018 for all evac­uees, ex­cept for those from the so­called dif­fi­cult-to-re­turn ar­eas for which there is no plan to lift the evac­u­a­tion or­der.

“Com­pen­sa­tion for some 12,400 Fukushima-pre­fec­ture house­holds that evac­u­ated vol­un­tar­ily was ter­mi­nated in March 2017. The so­cial ef­fects of this ter­mi­na­tion are se­vere.” This apart, health ef­fects, al­beit con­fi­den­tial, mainly on thy­roid can­cer, are deep­en­ing. The num­ber of can­cer cases found in chil­dren is about 30 times that of the na­tional av­er­age. The of­fi­cial sur­vey con­sis­tently stated that “It can­not be con­cluded whether or not the in­ci­dences of thy­roid can­cer found in the ex­am­i­na­tion are due to ex­po­sure from the Fukushima ac­ci­dent.”

A dis­turb­ing fea­ture of state au­thor­i­ties in most of the coun­tries (in­clud­ing In­dia) is in­dif­fer­ence to dis­man­tle nu­clear power util­i­ties even af­ter it be­comes over­due. Dr M V Ra­mana, an em­i­nent nu­clear physi­cist and Pro­fes­sor and Si­mons Chair in Dis­ar­ma­ment, Global and Hu­man Se­cu­rity, Liu In­sti­tute for Global Is­sues, Univer­sity of Bri­tish Columbia and one of the con­sul­tants to WNISR2017, is of the view “One con­tem­po­rary rea­son for this dis­in­ter­est is that the eco­nomic land­scape for nu­clear power is so poor that few want to con­struct new nu­clear re­ac­tors. As a re­sult, there is a lot of pres­sure to keep old nu­clear plants run­ning. There has been rel­a­tively less in­ter­est in wor­ry­ing about dis­man­tling old plants.” Fur­ther, the re­al­ity is that nine of the 31 nu­clear power pro­duc­ing coun­tries gen­er­ated more elec­tric­ity from non-hy­dro re­new­ables rather than from nu­clear power.

(The views ex­pressed are strictly per­sonal.)

One con­tem­po­rary rea­son for this dis­in­ter­est is that the eco­nomic land­scape for nu­clear power is so poor that few want to con­struct new nu­clear re­ac­tors. As a re­sult there is a lot of pres­sure to keep run­ning old nu­clear plants

Representational Im­age

The ef­fects of the Fukushima nu­clear dis­as­ter are ev­i­dent in dis­eases af­flict­ing the res­i­dent pop­u­la­tion


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