Foreseeable restart

By Liang Fei Source:Global Times Published: 2014-7-28 21:23:01

New nuclear projects to possibly start again in China soon: experts


Dayawan Nuclear Power Plant in Shenzhen, South China's Guangdong Province in June Photo: CFP





Having been suspended for more than three years, there is every indication that new nuclear projects may be approved in China soon.

This is because signals have come right from the very top. During a meeting held in April, Premier Li Keqiang said that China should restart new nuclear power projects in the eastern coastal areas "at a proper time," and he also noted that the highest safety standards should be adopted. 

Two months later, in a meeting of the Central Leading Group on Financial and Economic Affairs, President Xi Jinping said that China should "seize the time" to start new nuclear power projects in the eastern coastal areas in a bid to guarantee energy supply.

Experts and industry insiders believe that the wording used by China's top officials when talking about nuclear projects is a sign that the central government is expected to allow new nuclear power projects soon.

Besides signals from top leadership, major companies in the nuclear sector have also been very active recently, with several in the process of seeking IPOs at present.

"It is very likely that new nuclear power projects would be approved soon," Lin Boqiang, director of the China Center for Energy Economics Research at Xiamen University, told the Global Times Thursday.

Fast lane

China suspended the approval of new nuclear projects and launched a safety review of existing projects in March 2011, when severe leaks happened at the Fukushima nuclear facility in Japan after the magnitude 9.0 earthquake.

However, as a very efficient and clean energy, nuclear power was never left out of China's energy agenda, especially when the country is suffering from severe smog and the environment has become a top concern.

The nation's current installed nuclear power capacity only accounts for some 2 percent of overall installed power generation capacity, but the world average is between 16 percent and 18 percent, Beijing-based newspaper China Times reported on July 23.

As the country is making efforts to reduce reliance on primary energy such as coal and fuel, there is big growth potential in the nuclear sector, experts noted.

In an industry guideline released in October 2012, China set a target of having 58 million kilowatts of installed nuclear power and 30 million kilowatts under construction by 2020. By the end of 2013, installed capacity and capacity under construction combined were over 40 million kilowatts, media reported.

China's nuclear power projects are mainly located in coastal provinces such as Fujian, Guangdong and Hainan at present, but recent media reports said that new inland nuclear power projects may also appear soon.

On July 10, the provincial government of Southwest China's Guizhou Province signed agreements with China General Nuclear Power Group to build two inland nuclear projects worth a total of 38 billion yuan ($6.08 billion). These will still need approval from the central government.

Other provinces such as Liaoning, Hunan and Jiangxi are also mulling nuclear projects, recent media said, though the government has halted the approval for inland projects.

The State Council made it clear in 2012 that no inland nuclear power projects would be approved in the 12th Five-Year Plan period (2011-15), and all new installed capacity should adopt "third generation" technology, which refers to the latest and safest technologies pioneered by firms such as France's Areva NP.

Shen Hongwen, an industry analyst at CIC Industry Research Center, said that local governments are motivated to build nuclear power projects, which involve heavy investment, since maintaining economic growth and environment protection have become their top priority.

Han Xiaoping, chief information officer of Chinese energy website china5e.com, said that China still adopts a very cautious attitude toward inland projects, which are sometimes located in densely populated areas. "It is not very likely we will see inland projects anytime soon," he said.

Calls to the National Energy Administration and China General Nuclear Power Group went unanswered as of press time.

The public's attitude toward nuclear power will be the biggest uncertainty ahead, Lin of Xiamen University noted, as Chinese people are increasingly concerned about safety nowadays.

Lin also said that based on the government's plan to have 58 million kilowatts of installed nuclear power by 2020, there might not be much need to choose any inland nuclear sites.

IPO rush

Besides frequent announcements from top leadership, recent news that major nuclear firms are seeking IPOs is also evidence that the sector might be about to enter a new boom.

China National Nuclear Power Co, a unit under China National Nuclear Corp, is eyeing an IPO on the Shanghai Stock Exchange and hopes to raise 16.25 billion yuan, according to its prospectus on China Securities Regulatory Commission's website in May.

Money raised will be used to fund its nuclear projects in Fujian, Zhejiang and Hainan provinces, the prospectus said.

Another major company China Nuclear Engineering Corp is also planning to get listed on the Shanghai bourse, raising 1.8 billion yuan, according to its prospectus on the commission's website in May.

"To reform business structure and to raise money for their development are the main reasons behind their moves to seek IPOs," Shen said.

At present, China's nuclear sector is dominated by the three leading companies - China National Nuclear Corp (CNNC), China General Nuclear Power Group and China Power Investment Corp, but more players are about to challenge their dominance.

Leading power generator China Huaneng Group is planning to build a nuclear power plant in Rongcheng, East China's Shandong Province, and is applying for the government's approval for the project, according to a China Times report on June 28.

Technology export

Nuclear energy is not only an important part of the government's plan to guarantee power supply, it has become a new front for China's diplomacy.

During President Xi's trip to Europe in March, China General Nuclear Power Group signed a deal with Electricite de France SA to jointly build a nuclear power station in the UK.

In July, during President Xi's visit in Latin America, CNNC signed a deal to help build Argentina's fourth nuclear power station.

"China has adopted the highest safety standards in nuclear technology… and the cost is some 30 percent lower compared with that of other countries, which makes it very competitive," china5e.com's Han noted.

Major companies are also actively seeking international partnerships. CNNC announced Monday that it has signed a cooperative agreement with Canada's SNC-Lavalin to explore both international and domestic markets.

"China is quite strong in 'second-generation' technology," Lin said, but added the nation should still continue to work on "third generation" technology.


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