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Andrey Gubin

PhD in Political Science, Associate Professor at International Relations Department, Far Eastern Federal University, Adjunct Professor at the North-East Asia Research Center, Jilin University

China is becoming a world leader in the rapid construction of large-scale civilian nuclear facilities, which has effects for both domestic developments and the global market for energy-related technologies. The situation is further complicated by insufficient practical experience, foreign partners' mistrust largely due to unlicensed imitation, and the possible transfer of technologies to the third parties.

China is becoming a world leader in the rapid construction of large-scale civilian nuclear facilities, which has effects for both domestic developments and the global market for energy-related technologies.

The “Energy Vampire” of Global Economy

China is without a doubt the world’s fastest growing actor in the peaceful atomic energy sector, and for good reason.

First, Chinese energy needs are skyrocketing. During the first nine months of 2012, overall power consumption reached 3.688 trillion kWh, i.e. 4.8 percent more than that recorded for the same period in 2011. According to the International Energy Agency, China in 2009 guzzled 2.252 billion tons in oil equivalents – four percent more than the U.S.A for the same year.

Second, more expensive hydrocarbons on the world market and increasing domestic requirements are raising the costs of domestic goods and strengthening Chinese dependence on imports, with the former reducing its international competitiveness and the latter generating a political need for alternative fuels.

Photo: visual.ly
Energy in China

Third, traditional thermal, mainly coal-based, power generation is in deep trouble. According to China’s State Energy Agency, fuel-burning power plants that were commissioned in 2012 have a total capacity of 25.82 million kWh, i.e. over 60 percent of the entire generation structure. Beijing is seriously concerned about the low efficiency of its thermal power production and the devastating impact on the environment. According to Jianbin, head of development and planning office at the State Energy Agency, during the next five years, China will level strict controls on the consumption of non-renewable energy and set ceilings for regional administrations. The Agency will also establish a mechanism for the assessment and coordination of power consumption in the provinces, as well as fiscal measures to stimulate the use of renewable sources, including hydro, wind, solar and power utilization.

A 2011 report by the EURAC Institute for Renewable Power states that China accounts for over a quarter of all atmospheric emissions, in fact twice more than the U.S.A. Moreover, Beijing is not part of the Kyoto Protocol, which prescribes a reduction of emissions both for industrialized and developing nations. Independent experts observe that railways in certain Chinese regions, especially in the northeast, are overloaded with enormous coal and oil product shipments, which has consequences for the entire economy.

China Works Towards Imitation

Currently, China operates 16 reactors and is preparing 23 more for commissioning (26, according to some data), coming in first place in the total number of facilities under construction and the ninth in the number of active stations. Nuclear generation accounts for 2.2 percent of total produced power, with plans to increase the figure to a minimum of five percent by 2020.

In 2007, Beijing adopted the “Action Plan on Sustainable Development in Early 21st Century” that prioritizes a transition to clean and renewable energy sources, including peaceful nuclear sources.

Currently, China operates 16 reactors and is preparing 23 more for commissioning (26, according to some data), coming in first place in the total number of facilities under construction and the ninth in the number of active stations. Nuclear generation accounts for 2.2 percent of total produced power, with plans to increase the figure to a minimum of five percent by 2020 [1].

Beijing is also known to be working on augmenting the output of nuclear stations and dramatically raising their share in the energy sector. The five-year plan of 2011-2015 allocates 121 billion dollars to the construction of mega-reactors. Chinese experts insist that the Fukushima disaster should not put an end to their national nuclear program.

Nowadays, Beijing largely draws on the gradual localization of foreign technologies obtained through international cooperation, mostly with France, the U.S.A., Russia and Canada.

Photo: buinguyenhoang.com
Lifting of reactor building liner, Taishan nuclear
power plant

The main reactor currently under construction is CPR-1000 (the licensed version of French M-310). The agreement prohibits exporting the model, so China is creating its own ACPR-1000, with relevant research to be completed by late 2013. However, construction may be discontinued for safety reasons. Beijing is also acquiring the state-of-the-art EPR-1600 French reactor whose earliest units are to be used at the Taishan nuclear plant, while plans exist to develop a purely Chinese CPR-1700 version.

The State Nuclear Power Technology Corporation has been tasked to localize and develop the Westinghouse AP-1000 third-generation design, gradually raising its output to 1,700 MW. With the reactor localization level rising, production costs and dependence on imported components will go down. The Chinese aim to bring the cost of one kW down to 1,600 USD and the construction time to 40 months. American personnel should remain at the facilities to supervise construction until the commissioning in order to minimize the dangers of technology drain [2].

While previously dependent on imports, today Beijing is adapting foreign technologies and acquiring self-sufficiency across the entire nuclear power plant construction cycle. With technology transfers being a prerequisite for foreign participation in nuclear projects, China seems willing to fully give up foreign assistance in the future and organize its own export of nuclear technologies.

Under the 1992 agreement, Russia has supplied two VVER-1000 reactors to the Tanvan power plant at 3.2 billion dollars. Commissioning was postponed for eight years and took place only in 2007. Currently, Moscow and Beijing are discussing the construction of another 5-8 units. China also is considering purchasing offshore nuclear plants for powering remote provinces.

The Jinshan station uses two Canadian CANDU-6 728-MW heavy-water reactors. According to earlier reports, cooperation with Ottawa was suspended because China focused on light-water reactors. As of the present day, the sides are attempting to convert the plant to work on restored plutonium brought in from other facilities by 2014 and use thorium for fuel to significantly improve the environmental impact of the Chinese nuclear sector.

Chinese Quality Goods Go Nuclear

While previously dependent on imports, today Beijing is adapting foreign technologies and acquiring self-sufficiency across the entire nuclear power plant construction cycle. With technology transfers being a prerequisite for foreign participation in nuclear projects, China seems willing to fully give up foreign assistance in the future and organize its own export of nuclear technologies.

Photo: www.atomic-energy.ru
Chashma Nuclear Power Plant

Russia stands firmly unwilling to make concessions, since its designs will drop in priority and force bilateral nuclear cooperation into decline.

Notably, China may soon be able to compete effectively with Russia in reactor construction: (1) Chinese corporations have access to advanced Western technologies; (2) Chinese designs are cheaper; (3) China is experienced in building many units in a short period of time; and (4) China has acquired a diverse manufacturing sector.

Making its first steps into the international market, China is only Pakistan's partner in the nuclear field. Two CNP-300 reactors (Chashma-1 and Chashma-2 launched in 2000 and 2011) operate near Karachi. A bilateral agreement was signed in 2011 to erect units 3, 4 and 5. In fact, Beijing offers Islamabad direct economic aid, since the projects are financed through easy loans and are not profitable. At the same time, Chinese authorities see the reactors as not threatening to their exports. The IAEA is also in the game, insisting on Chashma's independent examination.

Western analysts believe that thanks to access to U.S. and French technologies, its vast construction experience, and low production costs, Beijing is likely to begin exporting nuclear facilities in 2014 and offer third-generation reactors at discount prices by 2020, first to Pakistan and then to countries in Southeast Asia, Middle East and Africa.

The Nuclear Trap

However, the prospects of the Chinese nuclear sector are not too bright. As a matter of fact, the industry is growing faster than the ability of authorities to regulate it. Beijing is energetically building and operating reactors from different generations and constructed according to different safety standards. Thus, Chinese units would fail certification tests for operation and construction in the EU and the U.S. Newer third-generation designs are highly localized and their adjustment is likely to cause emergency situations due to insufficient experience and a low level of corporate culture.

Photo: world-nuclear.org
CGNPC Nuclear Projects

According to the Chinese State Energy Agency, by 2020, reasonably limited aggregate output of the nuclear park should reach 58 GW against the current 11 GW. Above this threshold, China will run short of specialists and nuclear fuel. Therefore, experts recommend "not building too many too fast" as China had been expected to reach 80-100 GW by 2020 with its the current technological capacity.

Chinese power plants are regulated by the State Nuclear Safety Authority, an independent body controlling operations of the civilian nuclear sector and directly subordinated to the State Council. Today, the Authority is updating nuclear safety standards to IAEA requirements with a focus on natural disaster prevention and timely responses to relevant services.

Following the Fukushima accident, the Chinese State Council has adopted its nuclear safety plan until 2015 and developed long-term goals to cover the period up to 2020. As a result, the Chinese have suspended permits for the construction of new units, finalized the choice of third-generation reactors, given up completion of older plants, and started to move towards constructing of nuclear plants farther from the shore. At the same time, economic needs are forcing Beijing to restart station construction, with the Shanghai Electric Group, Dongfang Electric Corp. and Harbin Electric expected to sign contracts for constructing units with an aggregate output of 5 GW in 2013.

* * *

As a matter of fact, the industry is growing faster than the ability of authorities to regulate it. Beijing is energetically building and operating reactors from different generations and constructed according to different safety standards. Thus, Chinese units would fail certification tests for operation and construction in the EU and the U.S.

Chinese nuclear sector dynamics seem to be driven by several different trends. On the one hand, technological advancements are improving through the borrowing of foreign designs. On the other, Beijing is wary of manmade disasters and the excessive dependence of national economy on the still imperfect nuclear industry. The situation is further complicated by insufficient practical experience, foreign partners' mistrust largely due to unlicensed imitation, and the possible transfer of technologies to the third parties.

Facing a need to abruptly increase energy production in order to sustain economic growth, China is expected to diversify energy sources in the aim of achieving energy security. Beijing may step up efforts to develop its own powerful high-tech reactors. Under this scenario, China cannot afford dropping cooperation programs with key partners, i.e. Russia, the U.S.A. and France, due to demand for advanced technologies.

China's export potential is still low, since the offer is outdated and substandard in safety, whereas manufacture of the state-of-the-art reactors would take at least 15 years. Besides, Russia, the U.S.A. and France are likely to toughen the cooperation framework to prevent unlicensed imitation.

At the same time, the share of nuclear energy in the overall generation structure is growing sluggishly, and Beijing is likely to hold onto traditional energy resources like oil and natural gas. Further struggle for resource control and the protection of transportation routes, primarily by military force, is likely to exacerbate the situation in Asia-Pacific and Central Asia. Hence, developing the Chinese nuclear sector might relieve potential tensions.

1. Wieninger W. Splitting the Atom and Enhanced Cooperation in Asia: Considering Nuclear Energy in the APEC Region // From APEC 2011 to APEC 2012: American and Russian Perspectives on Asian-Pacific Security and Cooperation. Vladivostok, Honolulu, 2012. P. 59.

2. Wieninger W. Splitting the Atom and Enhanced Cooperation in Asia: Considering Nuclear Energy in the APEC Region. P. 64.

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