Nuclear for cheaper electricity
Demand for uranium growing alongside nuclear generation capacity
ACCORDING TO THE International Atomic Energy Agency (IAEA), the more than 430 commercial nuclear reactors in the world generate approximately 16% of global electricity. The IAEA says a kilogram of natural uranium can produce more than 4 000kWh of electricity. The same amount of electricity would need an input of 38t of coal or of 150 barrels of oil. A kilogram of uranium costs about US$150 (R1 080) while 38t of coal cost US$2 850 (R20 520) and 150 barrels of oil would cost US$8 905,50 (R64 098).
South Africa’s only nuclear power station, the 1 800MW Koeberg, has produced more than 81 000m kWh of electricity since 1984 using 7,5 tons of uranium. It supplies up to 6% of South Africa’s electricity. After 22 years of operation, it has a further 30 to 40 years to generate electricity efficiently. Koeberg uses seawater to cool its two nuclear reactors. The water is not consumed, it’s returned to the sea. Compare that to a coal-fired power station of the same size, which would use more than 50m tons of coal and 160bn litres of fresh water – which would be consumed entirely. The cost of a coal-fired station also has to be measured against environmental damages as coal emits more green gases than any other energy source. Nuclear gas emissions amount to 0,1% of the carbon dioxide from equivalent coal-fired electricity generation if modern gas-centrifuge plants are used.
South Africa gets 90% of its electricity from coal. But according to the Government, nuclear generation capacity should increase by 12 000 MW in the coming 20 years.
To get there, SA has to enrich uranium. Uranium leaves the mine as the concentrate of a stable oxide known as U3O8 (uranium oxide). Energy expert Andrew Kenny says the two biggest isotopes of uranium are U235 and U238. Kenny says U235 is the most suitable for electricity generation. In order to increase the level of U235, uranium concentrates must first undergo a chemical conversion process into uranium hexafluoride (UF6).
A number of enrichment processes have been demonstrated in the laboratory but only two are operating on a commercial scale. Kenny says it would only be economical for SA to build its own enrichment plant if it intends building three or more power stations the size of Koeberg. He says to build an enrichment plant to feed a station the size of Koeberg (1800MW) would cost about US$3,6bn (R26bn) and create “many jobs”.
Enrichment accounts for about 5% of the total cost of the electricity generated. That feeds into the lucrative uranium market. Sxr Uranium One CE Neal Froneman told Fin24 in January his company was becoming a uranium producer at “just the right time”. Froneman revealed that the contracts – which only obliged his company to deliver uranium to certain clients at prevailing market rates – had a floor price protection of up to US$70/lb. “What the floor price protection means is that whenever the international price of uranium falls below these levels, we will continue to receive these prices.” The floor price does not in turn give a ceiling at which prices can be capped. Froneman said this was because uranium buyers were not worried about “little things” like the price of uranium, as they had invested billions of dollars in nuclear reactors. “Clients are just desperate to get uranium.”