• Japan: The largest producer of nuclear-generated electricity in Asia, is rated third-largest in the World in nuclear capacity (behind the United States and France). As an island nation with few domestic fuel resources, Japan has been forced to rely on fuel imports for most of the 20 th century. The government views nuclear power as essential to economic growth. A series of nuclear accidents has raised concerns about public safety and forced cancellation of plans to build at one site. The government has worked hard to address those concerns, but with new studies indicating Japan might soon have more electricity capacity than it needs, the pace of capacity growth is likely to weaken.
• India: India's nuclear industry also benefits from government support. The first commercial reactors built in the country were CANDUs, a Canadian-designed heavy water pressurized reactor (PHWR). Canada withdrew its workforce, but India completed construction. Then, India built PHWRs on its own without Canadian participation or permission. Thus far, the Indian reactors have been small, many of them 200 net MW(e) or less in capacity. By comparison, one fourth of the world's reactors (including many of the newer ones) are 1,000 net MW(e), or more in capacity. Larger units are planned, included a pair of Russian units rated at 905 net MW(e) each. The Energy Information Administration, however, projects that China will pass India in nuclear output by 2010 and double India's nuclear generation by 2025.
• Taiwan: Taiwan, has few domestic fuel resources. For Taiwan, however, energy security is viewed as not only essential to economic growth but to survival. With a large and very powerful neighbor to the north, there is concern that the sea-lanes to Taiwan might not always be open. The current Taiwanese government, however, has been cool to nuclear growth. This has caused construction delays for the last of Tawain's nuclear power plants to date, Lungmen. When Lungmen is completed, there are no known plans to build any more.
• South Korea: Eight of Korea's first 11 nuclear generators were built by non-Korean companies. The Westinghouse corporation built the earliest ones, but Framatome, a French company, had been catching up. Korea is now designing and building its own reactors and the pace has not slackened. Will China's nuclear growth follow a similar pattern (i.e., significant foreign construction and investment in the beginning, followed by self reliance?

Potential customers include (but are not necessarily limited to) the following: North Korea, which continues to ask “when” about the reactor that supposedly will be built by KEDO, a South Korean consortium; Vietnam, which insists it will build one in this century, and Indonesia—which has neither built a commercial reactor nor planned one, but has often discussed it.

Even in China, nuclear power has a relatively modest impact on the electricity market. According to the International Atomic Energy Agency, nuclear power plants provided 1.4 percent of the nation's electricity in 2002. In both China and the United States, the largest share of the electricity market belongs not to nuclear power, but to the coal industry. Because these two countries are the leading sources of carbon, sulfur dioxide, and nitrous oxide emissions, the heavy reliance on coal has raised the concern of environmentalists. Part of the U.S. strategy has been to reduce coal emissions by utilizing clean coal technologies (such as scrubbers) and increasing the output of low sulfur coals. In China, an abundance of high sulfur coals and less funding available for new technology makes this strategy much more difficult. For China, the discovery of new natural gas fields has offered new hope. Unlike nuclear power or renewable technologies (solar, hydropower, wind, and other), all fossil fuels contribute to airborne emissions, but natural gas emits less than petroleum or coal. The Energy Information Administration had projected that natural gas would rapidly expand its share of the U.S. market, but rising costs and disruptions in supply are already having an impact on the rate of growth. Will China encounter the same problems?

The preceding paragraph does not mean that emphasizing nuclear power is the only solution (or either superior or inferior to other options) in addressing energy and environmental concerns. Current U.S. policy stresses diversity in the fuel market, thereby securing energy supply and holding prices down. Nuclear power is viewed by the current Administration as important, perhaps essential, to maintaining that diversity. In China, where coal is the dominant fuel, it’s only recently that the push has been made for fuel diversity. For China, the need to reduce airborne emissions has also aroused interest in nuclear power. A recent paper on green house gases examines the environmental issues in more detail.

More than three fourths of the World's reactors went on line before 1990, but China's nuclear industry is relatively young. Qinshan 1, the country's oldest unit, went on line in 1991. Although the aging of the world's nuclear fleet has raised concerns about safety, it is difficult to gage the impact of age on performance or safety. Some reactors have operated for over four decades without substantial problems. The relative newness of the reactor involved in the Chernobyl disaster could not compensate for a faulty design. It seems reasonable to assume that, conversely, a well-designed, well-built reactor can not compensate for slipshod maintenance and lack of experience. The reactors in China are not just new, but the Chinese government has selected from the best technology the world has to offer. For the companies producing this technology, the consequences of a reactor or supporting equipment failing to perform to standards can be significant. Failure is likely to have impact not only on attaining future construction contracts in China, but in any other market. With so much at stake, it can be assumed that foreign companies are as anxious as the Chinese government to ensure that the reactors are well maintained.

The government has been very careful to ensure that Chinese workers and engineers participate in all the nuclear projects. As a result, they are building not just nuclear plants, but a highly trained, very knowledgeable work force. Government support, new technology, and a workforce benefiting from the experience of technical experts in dozens of countries are advantages that any country interested in nuclear technology would envy.

Is there a down side? Probably not, but there are certainly some problems on the horizon. Local bureaucracies are sometimes inefficient, sometimes corrupt. The central government is working to get things in hand, but how will this all work out if there is ever an emergency at one of the nuclear plants? Since China's nuclear industry is relatively new, nuclear waste is not a major concern. But, as in the United States or any other country, nuclear waste accumulates over time. How will China handle the problem? Even if China manages to generate enough power to supply future needs, does it have the infrastructure to distribute it where needed?

If the Energy Information Administration's (EIA) projections prove accurate, China will be among the world's leading nuclear industries by 2025 (see Table). In 2010, its nuclear capacity will exceed that of India. By 2015, China will have more nuclear capacity than Canada. By 2020, it will have more than Russia.

Greater capacity means more electricity, but it also means more concerns to be addressed. There will be more nuclear waste to deal with. More people will need to be trained, not just to work in the power plants but to regulate them. But for nuclear power to make a substantially difference in China—financially, environmentally, politically, and even socially—the projected rapid pace might not be rapid enough. If implemented, the government's new plan will emphasize building reactors four at a time instead of the current practice of building pairs. And although many countries have expressed interest in building new reactors, China's proven track record of building them and paying for them will attract even more suppliers, each encouraging the government to build even more reactors (and providing attractive incentives to do so).

The impact of China's nuclear growth on the world economy is widespread. View the international role strictly in terms of reactor construction and you leave out a number of major contracts. The broad scope of the international role was evident even before this feature first appeared. In the original feature, we noted the following highlights from the year 1998:

• "Finland's IVO is negotiating to expand its design work for the twin VVER-1000 (units)…to be built near Lianyungang…" ¹³
  
• Japan's Mitsubishi Corporation supplied the reactor pressure vessel for Qinshan-1.
  
• Germany's KSB supplied the main cooling pumps and two injection pumps for Qinshan-1.
• Spain's Equipos Nucleares is providing Westinghouse-type steam generators for Qinshan 2 and 3.
• Various pumps and valves" are being provided for Qinshan 2 and 3 by Weir (a Scottish company), Hopkinsons (an English company, and Atwood & Morrill (an American company) for Qinshan 2 and 3.¹⁴

This was still early in the industry's history, but the preceding list represents only a handful of the contacts in place. As we noted in 2002, the American Embassy in Beijing believes “about 300 enterprises are engaged in the development and production of nuclear technology in China.”

Westinghouse. “The initial installment of four reactors, costing $1.5 billion apiece, would also help narrow the huge U.S. trade deficit with China.”²

China’s economy is expected to grow rapidly. The Gross Domestic Product
(see Figure 2) is projected by the Energy Information Administration (EIA) to increase by 6.1 percent between 2001 and 2025. This compares with a projected world rate of GDP growth of 3.0 percent. EIA’s projected nuclear electricity consumption estimates were made prior to China’s announcement of its new energy plan, but even the new plan would not enable China to match the nuclear capacity of Japan, Asia’s leading nuclear supplier. However, nuclear consumption tapers off in Japan by 2025 and hits its peak in India before that (see Figure 3). In China, however, the trend is always upward.

Source: Energy Information Administration, International Energy Outlook, Table A9

Data for Figure 2. Gross Domestic Product in Asia
(Excel format)

Figure 3. Nuclear Electricity Consumption in Asia, 1990 to 2025
(Excel format)

¹ Associated Press, “Cheney to promote American-made nuclear reactors to China,” by H. Josef Herbert, as contained in The Detroit Business News, April 10, 2004, Detroit, Michigan.
²  Ibid
¹² Energy Information Administration, International Energy Outlook 2002, March 2002, Washington, DC, page 4.
¹³ Nuclear Europe Worldspan 3-4, page 24, 1998.
¹⁴ Ibid.
¹⁵ editors@worldnuclear.org, NucNet News No. 157, "Fifth Chinese Reactor Reaches Full Power," April 26, 2002.