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Uncertainty about China’s nuclear power future

“……….Uncertainties for Nuclear Power, Carnegie Endowment, Mark Hibbs,  14 MAY 18  

China’s nuclear power wager might not indefinitely pay high dividends. Until now, the state has boosted the nuclear power industry with incentives that, in the future, may come under pressure. The electric power system is subject to reform in the direction of more transparent oversight and pricing that might disadvantage nuclear investments. President Xi Jinping supports state control of strategic economic sectors, but he also advocates market reforms that have helped lead Western nuclear power industries into crises.

The nuclear sector must withstand what Xi calls “new normal” conditions: a gradual slowing down of China’s economy, characterized by diminishing returns on capital goods investments and translating into rising debt and overcapacity. Nuclear investments may be affected by demographics, changes in electricity load profile, and technology innovations including emergence of a countrywide grid system able to wheel bulk power anywhere.

There is also political risk. Public support for nuclear power in China is volatile and may be low. Concerns since the Fukushima Daiichi accident in Japan have prompted Beijing not to proceed with long-established plans to build most of China’s future nuclear plants on inland sites. Should this policy continue into the 2020s, prospects for China’s nuclear construction sector will decline; indefinitely continuing nuclear construction at eastern coastal sites (where nearly all of China’s nuclear power is generated) may encounter resistance on economic, capacity, and political grounds.

Under Xi, China’s globalization continues but the state is assuming ever-greater liability. Political decisionmaking and corporate culture may not support an indefinite increase in the risk presented by more nuclear power investments. Some quasi-official projections before Fukushima that China by 2050 might have 400 or more nuclear power plants have been cut in half. Beijing’s risk calculus may reflect that China’s population would blame the Communist Party and the state for a severe nuclear accident. In a country with a patchy track record for industrial safety, said one Chinese planning expert in 2016, “The more reactors we have, the greater our liability.”

…….. If China merely replicates others’ collective past experience, it will reinforce the view that fast reactors and their fuel cycles are too risky, complex, and expensive to generate large amounts of electricity. 

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May 22, 2018 - Posted by | China, politics

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