Yesterday, I blogged about Pakistani plans to have China design and construct two big new nuclear power reactors in Karachi. Today, I am going to write about Chinese ambitions and the global nuclear power industry. China has the biggest nuclear reactor building program in the world. Currently, the program is focused on building reactors for China's domestic needs but China is eager to expand into international sales of its nuclear technology.
China halted its construction of domestic nuclear reactors for a year and a half following the Fukushima disaster in March of 2011. They restarted their nuclear construction at the end of 2012. They are currently constructing almost thirty gigawatts of new electrical generation capacity which accounts for more than forty percent of new reactor construction globally. China has expressed the intention to raise nuclear power from twelve gigawatts at present to fifty eight gigawatts by 2020. The Chinese government has encouraged nuclear firms to develop the industrial capacity to capture major global nuclear business.
China has built reactors for Pakistan and is seeking other contacts in developing nations such as Turkey and Argentina. However, entering the market for new nuclear construction in developed industrial nations is high priority. Hinkley Point in the U.K. is China's first such project. The Chinese General Nuclear Power Group (CGN) and the China National Nuclear Corporation (GNNC) are going to have a forty percent stake in a consortium led by Électricité de France (EDF). Unfortunately, CGN and GNNC have been competitors for nuclear contracts and it has proven difficult to get the two organizations to cooperate.
Studies by the U.K. government indicated that there would be public backlash if China were to hold a majority position in the ownership of the new reactor. The U.K. decided to cap Chinese participation at forty nine percent ownership. China is hoping that the Hinkley Point reactor will boost their visibility and credibility for the international nuclear marketplace.
Critics of the Chinese push into the world nuclear industry point to gaps in the Chinese supply chain, possible political interference from the government and a serious lack of experience in the nuclear power business. A French consulting firm with experience in China says that state-owned enterprises control all business aspects of the Chinese reactors which were built to supply power and not for the purpose of gain profit. The French firm says that the Chinese have "absolutely no clue how to make profit in nuclear."
Chinese firms have depended on nuclear companies such as EDF and Westinghouse for nuclear expertise, technology and reactor design. Given their inexperience in the global nuclear market, it is likely that they will continue to depend on close relationships with existing players in the international nuclear market. An additional concern is that when reactors are sold today, twenty years of nuclear fuel is included in the deal. China will definitely have to rely of external sources of nuclear fuel to satisfy this requirement.
Hinkley Point power plant:
