Hao Jia (Dr.), Researcher, APERC Takashi Otsuki (Mr.), Researcher, APERC* Kazutomo Irie (Dr.), General Manager, APERC. *Corresponding author

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1 Hao Jia (Dr.), Researcher, APERC Takashi Otsuki (Mr.), Researcher, APERC* Kazutomo Irie (Dr.), General Manager, APERC *Corresponding author

2 Contents Introduction / project overview Nuclear power in the APEC region Future scenarios and analysis Economic modelling and analysis toward 2040 We discuss three cases: the, -nuclear and Low-nuclear scenarios Conclusion 2

3 Asia-Pacific Economic Cooperation (APEC): 21 economies, accounting for 60% of global generation Share of APEC in global generation 41% 5% TWh 27% 40% 9% TWh 26% Rest of the world (37%) TWh China (23%) 63% in global generation in % 25% Other APEC (22%) United States (18%) APEC Economies (total 21) Australia Canada China Indonesia Republic of Korea Mexico Papua New Guinea Philippines Singapore Thailand Viet Nam Brunei Darussalam Chile Hong Kong, China Japan Malaysia New Zealand Peru Russia Chinese Taipei United States Sources: IEA statistics, APEC Energy Working Group. Fossil vs non-fossil in APEC TWh TWh TWh Non-fossil Other renewables Hydro Nuclear Other Oil renewables Hydro Gas FossilNuclear Coal Oil Gas Coal Fossil fuels dominate the power mix 3

4 1. Introduction / project overview Major nuclear utilizing/expanding economies are in APEC US France 1 Japan China Russia Korea India Canada UK Ukraine Sweden Germany Spain Belgium Chinese Taipei Czech Switzerland Slovakia Pakistan Hungary Finland Argentina South Africa Romania Mexico Bulgaria Brazil Slovenia Netherlands Iran Armenia UAE Belarus Number of reactors in operation (as of Nov 2016) APEC: 265 World: Under construction (as of Nov 2016) 1. We refer to IAEA PRIS database. We adjusted data in several economies; for example, in Japan, Ikata unit 1 is excluded from the figure in operation, and the number of reactors under construction is revised from 2 to APEC: 39 World: 61 4

5 1. Introduction / project overview However, future direction varies by economy and uncertainties exist Nuclear plans and targets, selected economies China Target by 2020: 58GW in operation and 30GW under construction Japan Korea 1 Amended reactor regulation act to limit lifetime of reactors, yet the government aims a share of 20-22% in generation by FY2030. Planned addition by 2029: 18.2GW and retirements of KORI-I in 2017, according to 7 th Basic Plan for Long-term Electricity Supply published by MOTIE. Chinese Taipei Nuclear phase out policy by 2025 Russia United States Rosatom plans to expand nuclear mainly in the west part of Russia NRC is preparing guidance for an 80-year lifetime (Subsequent License Renewal) Newcomers Thailand: PDP2015 plans to install 2GW by Viet Nam: Halt to Ninh Thuan project. 1. Korea s long-term plan may face uncertainties as New president pledges Nuclear Phase Out in June 2017; this updates are not included in the scenario analysis in this study, Source: Nuclear Street, South Korean President Pledges Nuclear Phase Out, 19 th June

6 1. Introduction Project overview In April 2016, we launched a project on nuclear power in the Asia-Pacific region Main research agenda Survey on current nuclear policy Future scenario analysis, Low-nuclear and -nuclear Workshop on Nuclear Power Development in the APEC region, November 13-15, Tokyo Final report to be published in mid-2017 (after peer-review process) 6

7 Contents Introduction / project overview Future scenarios and analysis Economic modelling and analysis toward 2040 We discuss three cases: the, -nuclear and Low-nuclear scenarios Conclusion 7

8 Scenario analysis Three scenarios to discuss the future of nuclear in Asia-Pacific Business-As-Usual () Current policy exists over the projection period ( ). Recent nuclear construction/retirement trends considered. Proposed projects are not included in most of the economies. -nuclear () Proposed projects are included in addition to projects driven by energy security, environmental and economic reasons. License extensions applied to most of the existing reactors. Nuclear GW capacity in APEC [GW] Scenario 477GW 330GW Low 214GW Low-nuclear (Low) Slow down of nuclear developments and accelerated retirements of existing reactors due to various concerns, including safety and waste management Low Note: The figure shows the year-end capacity. The scenarios and results are preliminary. Please do not cite. Source: APERC. 8

9 Example of economy assumption China projected to be the largest nuclear economy in APEC GW Current status (as of 1 st Nov 2016) 200 Scenario 176GW 36 reactors in operation 20 reactors under construction 150 IEA WEO2016 NPS: 155GW CPS: 136GW Target: 58GW in operation and 30GW under construction by 2020 ( Energy Development Strategy Action Plan ( ) and The 13 th Five-Year Plan) GW Scenario assumptions 2020 operation target (58GW) New additions after Achieved 5-6 reactors/year (projected trend in the late 2010s continues) 0 Low Achieved 3-4 reactors/year (The annual average number of reactors installed in Sep.: 4 reactors/year) Low Achieved 1-3 reactors/year Note: The figure shows the year-end capacity. The scenarios and results are preliminary. Please do not cite. Sources: IAEA, State Council. 9

10 Example of economy assumption Japan license expiration of existing reactors has significant impacts GW Scenario Current status (as of 1 st Nov 2016) 42 reactors in operation 3 reactors under construction (Shimane-3, Oma-1, and Higashidori-1) Lifetime: 40 years, and an extension of maximum 20 years allowed under nuclear reactor regulation act Strategic Energy Plan (published in April 2014): Dependency on nuclear power generation will be lowered to the extent possible Scenario assumptions 20 Lifetime of existing reactors New reactor additions 10 0 Low 60 years 3 units currently under construction 40 years (except for the reactors approved/examined for extension) 3 units currently under construction Low Same as No new reactors Note: The figure shows the year-end capacity. The scenarios and results are preliminary. Please do not cite. Sources: OCCTO and METI. 10

11 2. Scenario analysis China s increasing presence in APEC nuclear generation APEC nuclear capacity [GW] Low US Russia Korea Japan China Canada 1GW (rounded) 21 VietNam 20 US 19 Thailand 18 ChineseTaipei 16 Russia 15 Philippines 11 Mexico 10 Malaysia 9 Korea 8 Japan 7 Indonesia 5 China 3 Canada Note: Nuclear capacity in each economy is rounded. The number of block does not necessarily means the exact installed capacity. Source: APERC. 11

12 2. Scenario analysis APERC uses a long-term power supply model based on cost-optimization Electricity supply model structure Modelled technologies Demand models Yearly demand Load curves Prices and costs Energy and CO2 prices Initial/O&M costs Existing capacity Operational info. Plant availability Capacity credit Efficiencies Minimum output level Reserve margin target Policy information Power development plans/policies Renewables/nuclear policies Electricity Supply Model Least cost approach Capacity addition and generation volume is determined based on costs (initial, O&M, fuel and carbon costs) under various technical and political constraints. Capacity additions Investment needs Generation by plant type Plant dispatch and capacity factor Fuel consumption Emissions and emission intensity Total and average power generation costs Generation Nuclear Coal-fired (sub-critical) Coal-fired (super / ultrasuper critical) Gas turbine Gas combined cycle Oil-fired Solar PV & solar thermal Wind (onshore, offshore) Geothermal Biomass and others Storage Pumped hydro Battery Future nuclear capacity is given as the scenarios (not based on optimization) The model determines fossil fuel-fired capacity and operation of all technologies, considering policy directions Source: APERC. 12

13 2. Scenario analysis China and Southeast Asian economies drive demand growth Assumed electricity demand, regional grouping 1 TWh Projection Southeast Asian economies Southeast Asia Oceania Other Americas Other Northeast Asia Russia United States China China Electricity demand in APEC grows by 70% over the outlook period China and Southeast Asian economies more than double their demand 1 Source: APERC (2016) APEC Energy Demand and Supply Outlook 6 th Edition 13

14 2. Scenario analysis Cost assumptions Fossil fuel prices 1 Capital costs of nuclear plant, selected region 2 Crude oil [USD/bbl] Natural gas in Japan [USD/Mmbtu] Natural gas in the US [USD/Mmbtu] Steam coal [USD/tonne] Unit: USD/kW China 2000 Japan 3500 Southeast Asia 2000 Russia 3500 US The Outlook energy price assumptions are based on IEEJ s 2015 AWEO reference case and converted to USD 2012 PPP using World Bank PPP conversion factors; bbl = barrels; and Mmbtu = million British thermal units. 2 Sources are as follows: EIA for US and IEA WEIO for other economies. 14

15 2. Scenario analysis Fossil fuels dominate in the and even in -nuclear, but APEC electricity generation, TWh Other renewables Hydro Oil Gas Coal Nuclear scenario Other renewables Hydro Gas Generation share, 2040 Other renewables 12% Hydro 12% Nuclear 10% 12% Gas 24% 12% Nuclear 14% Coal 38% Gas 25% Coal 41% Low 12% Nuclear 6% Coal Nuclear % Gas 28% Coal 42% Fossil fuel dominate in the scenario, and even in the nuclear scenario, although accelerated nuclear development contribute to reducing fossil fuel generation. Source: APERC. 15

16 2. Scenario analysis but, nuclear contributes to APEC from the 3E perspective APEC Annual emissions 1 APEC Energy self-sufficiency rate APEC Average cost, GtCO2 Low nuclear 100% USD/MWh nuclear 95% 79 Low 8 Emissions in 2040 (changes from the ) Low: +5% : -7% 90% Low Low % Low Low 1 Emissions from electricity generation in APEC Source: APERC. 16

17 Low Economic impacts vary by economy, reflecting cost-competitiveness of the technology Generation cost changes relative to, 2040, selected economies 10% 5% Cost increase in Low Scenario from Korea: +6% Japan: +3% China Japan Korea US 0% -5% -10% In general, larger impacts on energy importing economies, such as Japan and Korea (+3% and 6% in Low, respectively) Changes in China and US are relatively small, resulting in the modest impacts on APEC overall Source: APERC. 17

18 2. Scenario analysis A sub-model to estimate uranium consumption and spent fuel Front-end model (LWR 1 model as an example) Uranium Mine Uranium ore Uranium Mill U3O8 Conversion plant Losses: 0.5% UF6 (natural) Enrichment plant UF6 (enriched) Product assay: 4wt-% U235 (BWR/PWR/ABWR/APWR), 2.4% (LWGR) Tail assay: 0.3wt-% U235 (all LWR reactors) Fuel fabrication plant Losses: 1% UO2 Nuclear power plant Electricity Fuel burnup: 45MWd/tU (BWR/PWR/ABWR/APWR), 15MWd/tU (LWGR) Efficiency: 34.5% (BWR/PWR/ABWR/APWR), 33.3% (LWGR) 1 LWR=Light Water Reactors. APERC also developed another model for heavy water reactors. Source: World Information Service on Energy and APERC, 18

19 2. Scenario analysis Waste management : headache for nuclear utilizing economies Spent fuel (cumulative from 2013, APEC) 1 thousand-tu 200 (Reference: the capacity of Onkalo is 9 thousand t-u) Low Estimated amount of spent fuel reaches thousand tons of Uranium; even Lownuclear scenario reaches 70% of the level in scenario Economies need to construct sufficient intermediate storage and final disposal facilities 1 This estimation assumes a once-through fuel cycle for all economies. Source: APERC. 19

20 Conclusion This study examined the impacts of three nuclear scenarios on APEC s generation mix Future nuclear development in the APEC region is driven mainly by China, increasing its presence in nuclear generation in Asia-Pacific Nuclear power contributes to the APEC region from the 3E perspectives, especially in terms of Environment Despite the capacity growth in the, the share of nuclear remains around the current level due to increasing demand; further accelerated installation and license extension are important to increase the share A large amount of spent fuel is estimated even in the Low Scenario. Economies need to implement policies to construct sufficient facilities for storage and/or disposal 20

21 Thank you for your kind attention!