The following is mirrored with the permission of Earthlife Africa from its
source at: http://www.earthlife.org.za/campaigns/toxics/pmbr.htm
See Also: PBMR - Earthlife's view
Steve Thomas, a respected objective commentator on energy issues, describes
himself thus:
"I am a senior research fellow with the Energy Policy Programme of SPRU,
University of Sussex, where I have worked since 1979. SPRU (Science and
Technology Policy Research) is an indepepndent research unit employing about
40 researchers of whom 6 work in the Energy Policy Programme.
We are all employed on research contracts and our funds come from a wide
range of sources including research councils, the energy supply industry
companies, government, the European Union and a small amount of consultancy
although all our work is in the public domain.
Apart from nuclear power, I work on the policies of the power plant
equipment supply industry and liberalisation of electricity supply
industries. I have worked on nuclear power since 1979 and I wrote a book
entitled `The Realities of Nuclear Power' published by CUP in 1986. I have
been a consultant to the International Atomic Energy Agency on nuclear plant
performance analysis, the British Government on nuclear decommissioning
policy, the European Bank for Reconstruction and Development on the
economics of nuclear power in Ukraine".
Arguments on the Construction of PBMR Reactors in South Africa
by Steve Thomas
SPRU (University of Sussex)
February 1999
This paper examines the arguments for and against the development
by the nationally owned utility, Eskom, of a small modular nuclear
power reactor, the Pebble Bed Modular Reactor (PBMR), for
construction in South Africa and for export. It examines the case
from five perspectives:
* The Technology;
* Why Electricity Liberalisation
and Nuclear Power Do Not Mix;
* The Economics of Nuclear Power;
* The World Market For Nuclear Power Plants
and the Prospects For Exports From South Africa; and,
* Waste Disposal.
Brief conclusions are provided at the end.
There are other important arguments which should be considered, in
particular those related to safety. However, I am not qualified to
make judgements on this issue and they are referred to only in
passing. Prior to discussing the arguments on the PBMR, it is
useful to explain briefly the main principles of nuclear power.
The Principles of Nuclear Power
* In naturally occurring uranium, 0.7% of uranium is
of a particular type (isotope) of uranium (U235)
which spontaneously splits (fissile material) to
emit a tiny particle (a neutron). If this neutron
hits another U235 atom, it too will split (a
fission) to produce two more neutrons (chain
reaction).
* If the concentration of U235 is sufficient (a
critical mass), the process will be self-sustaining
(the plant is `critical'), producing large
quantities of heat in the `core' of the reactor.
* Two important ingredients are needed to control the
process and to utilise the heat, the moderator and
the coolant. A moderator is a substance which
neutrons collide with but `bounce off' without
absorbing too much energy and without itself being
split. It controls the amount of neutrons escaping
from the core before they have hit another U235
atom. A good moderator is one which absorbs the
least energy and does not absorb the neutrons before
they split another uranium atom. Graphite is an
excellent moderator; ordinary water is a poorer
moderator but is much cheaper. If water is used, the
U235 content must be increased (enrichment) to about
3 per cent to allow a chain reaction to take place.
A rare isotope of hydrogen (deuterium) can be used
to make so-called heavy water (deuterium is twice
the weight of normal hydrogen) and this is also an
excellent moderator.
* In so-called fast (breeder) reactors (as opposed to
the thermal reactors described above), no moderator
is used and some of the neutrons escape the core and
strike a `jacket' of uranium where they convert the
unused part of the uranium, U238, to fissile
material, plutonium, which can be used as a reactor
fuel. The jacket is processed to isolate the
plutonium for use in more fast reactors. The
attraction of this design is obvious, it can use
almost 100 per cent of naturally occurring uranium
instead of the 0.7 per cent thermal reactors
achieve. The disadvantage is equally obvious: it
requires the separation, transport and widespread
use of the material used to make nearly all nuclear
weapons and is regarded as a serious proliferation
risk. The technical attractions of the design have
lead to huge amounts of public money being spent on
this technology. However, in practice, all prototype
plants have proved most unreliable and the
technology is now all but abandoned.
* In order to produce electricity, the heat in the
core has to be transferred to a fluid (a liquid or a
gas), the coolant. The heat will expand the fluid
(boil it if it is water) and the force of the
expanding gas can be used to drive a turbine
generator to produce electricity. This principle of
transferring heat from a `boiler' to a turbine
generator is the same for all types of thermal power
station whether it uses nuclear or fossil fuel. The
coolant can go directly from the core to the turbine
generator or there can be an intermediate stage
where the coolant goes through a heat exchanger to
produce steam in a second circuit. Liquids are much
denser than gases and so a given volume of liquid
can cool much more efficiently than the same volume
of gas, so if the coolant circuit with a liquid
cooled reactor breaks, the plant will only be cooled
by gases, that is, steam and air, and the plant
could over-heat catastrophically.
* Ordinary water is a common, cheap coolant for power
plants of all types, including nuclear power. Its
primary safety disadvantage in a nuclear power plant
is that if it escapes, the reactor will not be
properly cooled (loss of coolant accident, or LOCA).
Water can also be corrosive and will require
expensive materials to prevent damage to the coolant
pipes. However, water coolant requires much less
volume of materials because of its greater
efficiency in cooling than gas. So pressurised water
reactors (PWRs) of the type built at Koeberg in
South Africa, which use water as the coolant, are
much more compact than, for example, the British
designs of gas-cooled reactor. Of the gas coolants
possible, carbon dioxide was used in the British
power plant designs, but while this is cheap, it is
somewhat corrosive. Helium is entirely inert, but is
expensive so leakage has to be avoided.
* Of the many possible technologies, two are of
particular relevance to South Africa, the two
existing civil nuclear power reactors at Koeberg and
the PBMR. The Koeberg plants are each 900 MW (1
megawatt (MW) is 1 million kilowatts (kW)). They are
known as pressurised water reactors (PWRs) because
the coolant is maintained as liquid despite being at
about 300°C by keeping it at very high pressures.
This coolant is passed through a heat exchanger in
which the energy is transferred to a second circuit
in which water is boiled and drives the steam
turbine generator. Ordinary water is used as the
moderator and as a result, uranium enriched to about
3 per cent is required.
* The PWR is the most widely used design of nuclear
reactor in the world and just under half the 430
nuclear power plants in the world are of this
design. The main supplier is Westinghouse and its
design has been adopted by Framatome (the Koeberg
supplier), Siemens and Mitsubishi.
* The PWR is a direct descendant of submarine
propulsion units and, as a result, its operating
schedule is planned around annual stoppages when the
plant is refuelled and maintenance is carried out.
Typically, a quarter of the fuel rods are replaced
each year, because the concentration of U235 is no
longer great enough to maintain full power
operation.
* The PBMR uses helium as the coolant and graphite as
the moderator and is one of a number of designs that
come under the general classification of High
Temperature (Gas-Cooled) Reactors, HTGRs or HTRs.
The use of helium and graphite gives it several
intrinsic safety and technical advantages over, say,
the PWR. As noted above, the use of a gaseous
coolant reduces the risk from loss of coolant
accidents. Being inert, helium can be used at very
high temperatures without concerns about corrosion.
* The use of a good moderator like graphite increases
the efficiency with which the uranium is used. With
HTRs, fuel is made in ceramic pellets (or pebbles)
which can also withstand very high temperatures,
compared to a PWR where the fuel is in the form of
rods of uranium oxide contained in a metal cladding.
With HTRs, the moderator is in the form of a coating
for the fuel and is an integral part of it, unlike
the PWR where the water flows past the fuel. This
gives some safety advantages as the moderator which
controls the reactor cannot be separated from the
fuel.
* This combination of helium coolant, graphite
moderator and ceramic fuel allows the reactor to
operate at very high temperatures, 750ºC compared to
300ºC in a PWR. This in turn means that a much
higher proportion of the energy from the core can be
turned into electricity (the thermal efficiency), 40
per cent compared to 34 per cent for a PWR. It also
means that a much higher proportion of the U235 can
be split, giving high fuel `burn-up'. This means
that the reactors are more economical in their use
of uranium and create a much lower volume of used,
or `spent' fuel.
* All high temperature reactors built to date have
used highly enriched uranium (HEU) - more than 90
per cent U235. While this may lead to good uranium
utilisation, such material is a serious weapons
proliferation risk. South Africa's nuclear bombs
were built using HEU. The use of such a material as
a basis for nuclear power plants to be exported
round the world would raise huge concern on
proliferation grounds and it is unlikely that the
international community would allow South Africa to
go ahead using such material. For its PBMR, Eskom
plans to use 7-8 per cent enriched uranium, very
different to the type of fuel used in HTRs so far.
* Like most purpose-designed reactor types, but unlike
the submarine-derived PWR, the PBMR would avoid the
need for an annual shut-down for re-fuelling, by
re-fuelling while the plant is operating, `on-line'.
In theory, this should mean that extra power can be
produced. In practice, on-line refuelling has not
always worked out well because the machines for
doing it are complex, expensive and prone to
break-down. Also, the time required for maintenance,
which is carried out at the same time as refuelling,
usually exceeds the time required for re-fuelling so
on-line refuelling would not reduce the amount of
time the plant is off-line.
* For example, in Britain, the Advanced Gas-Cooled
Reactor (AGR) was designed to refuel on-line, at
full power. But more than 20 years after the first
plant went into service, the regulatory authorities
still do not allow refuelling at full power because
of safety concerns. Ironically, in 1965 when the AGR
was chosen, it was the extra output that was
expected to be produced because of on-line
refuelling, that swung the economic case in favour
of the AGR over US designs. This reduced the overall
generation cost of the AGR by a small fraction of a
penny. This experience will not necessarily be
repeated in South Africa but it does demonstrate
that refuelling on-line can be a difficult process
and that any projected economic advantages to
on-line refuelling should be treated with some
scepticism.
The Technology
The Track Record of High Temperature Reactors
In nuclear power, as with any other field of technology, design
concepts that look good on paper cannot necessarily be turned into
viable and economic technologies. It is therefore important to
examine attempts by other countries to turn this apparently
attractive concept into a commercial technology. The clear
intrinsic advantages of the HTR, namely (a) high thermal
efficiency, (b) economical use of uranium and (c) better safety,
have meant that from the earliest days of civil nuclear power,
this class of reactors has been examined carefully by almost every
nation that has tried to design nuclear power plants. The first
prototype plants of this type were ordered in the late 1950s. The
USA and Germany have gone as far as building prototype plants of a
commercial size, about 300 MW (a third the size of each Koeberg
unit and three times the size of the proposed South African PBMR).
German experience is particularly relevant to South Africa because
it is German technology which has been sold to South Africa and
forms the basis of the PBMR. The UK and Japan have built
small-scale prototype reactors for research purposes which do not
produce electricity. France seriously considered developing its
own commercial scale design of HTR in the late 1960s as an
alternative to importing PWR technology. Of the countries which
can claim to have nuclear design capability, only Russia and
Canada have shown little or no interest in the HTR.
Today, the USA, Germany, the UK and France have now abandoned all
interest in HTRs, while Japan's development programme is very slow
and there are no plans to build commercial power plants.
The USA: The USA was the first country to build a HTR power plant,
the Peach Bottom 1 plant, ordered in 1958 and completed in 1967,
which produced about 40 MW of electricity. Like all plants of this
design in the USA, it was built by General Atomic (a company owned
by Gulf Oil) and operated until 1974. The operating record of the
plant seems to have been fairly good and the plant has now been
completely decommissioned. None of the US plants is of the pebble
bed design.
Confidence in nuclear technology of all types was then so high
that even before this plant had been completed, a successor, about
8 times as large was ordered. Fort St Vrain was ordered in 1965
and designed to produce 330 MW. It was owned by a utility, Public
Service of Oklahoma but about half the construction cost was paid
by the US government. It went critical in January 1974, but did
not generate its first power until December 1976 and was only
declared commercial (handed over from the supplier to the owner)
in 1979, a good indication that all was not going to plan. For a
commercial nuclear power plant, the time from first criticality to
commercial operation should be less than 6 months (it was four
months at both Koeberg units). However, confidence in nuclear
technology was undiminished and at the time, the USA was
undergoing a huge surge of nuclear orders. In the peak year for
orders, 1974, 41 units were ordered. Ironically, only 9 of these
plants were completed and all subsequent orders in the USA (a
further 41 plants) were cancelled. The plants were cancelled
because the costs were too high or electricity demand was not
sufficient to justify them.
Orders for full-size plants of the HTR design, without any
government subsidy, were first placed in 1971 and by 1974, eight
orders had been placed, four for units of 770 MW and four for
units of 1160 MW. Little or no progress on these plants was made
and with problems at Fort St Vrain becoming apparent, all were
cancelled in 1974-75.
Fort St Vrain continued in service from 1976 until August 1989
when its high costs and appalling reliability finally persuaded
the owner to give up the struggle and retire the plant, which has
now been largely decommissioned. Over its 10 years of commercial
service, its average load factor (power produced as a percentage
the power the plant would have produced had it operated
uninterrupted at full power) was 15 per cent. Typically a plant
owner would expect a load factor of about 80 per cent from a
nuclear power plant. There was no single overwhelming factor that
led to its failure, more a series of different equipment problems.
Despite this bad experience, in 1991, when the US government
decided it needed to put money into new reactor development, it
looked at three or four technologies, one of which was the Gas
Turbine Modular High Temperature Reactor (GT-MHTR). The design was
close to the PBMR because it used a gas turbine rather than a
steam turbine and was planned in modules, but used fuel rods
rather than pellets. This would have been developed partly to
consume plutonium taken from dismantled bombs and partly as a
civil reactor. The technology was developed until 1995, although
it was close to losing funding on several occasions, and in August
1995, the US government finally withdrew support. It used the few
resources it was prepared to spend on nuclear technology to
support advanced PWRs and BWRs (Boiling Water Reactors, a close
relative of the PWR).
At the time, a National Academy of Sciences review revealed that
HTR technology had received US$ 900m of government money over 30
years. It claimed that the GT-MHTR would take a long time to get a
safety licence. It identified fuel as a particular problem because
of the lack of any fuel production facilities. New fuel facilities
would have to be licensed and built adding to the delay and cost.
Germany: Germany also has a long history of HTR development dating
back to the ordering of the Jülich plant, at the government
research centre there, in 1959. This 15 MW plant, financed by the
government, was ordered from a group led by Brown Boveri and Krupp
and went critical in 1966, generating electricity a year later and
continuing in service until 1989. Its reliability seems to have
been good for a prototype and in 1970, its successor, sometimes
known as THTR-300, Uentrop or Schmehausen was ordered. This too
was subsidised by the government but also involved utility
funding. The industrial grouping behind it, HRB, again centred on
Brown Boveri but with General Atomic support. Subsequently Siemens
produced modular designs involving pebble bed reactors but none
were built.
THTR-300 went critical in September 1983, but was not connected to
the electricity grid until November 1985 and was only declared
commercial in June 1987. From June until October of that year, it
operated at about two thirds full power, suffering a range of
problems including difficulties with the fuel circulation system.
It restarted in January 1988 for a couple of months, again running
at about two thirds of its full power rating, until more repairs
were necessary to the fuel circulation and collection system. It
ran for another five months and was shut down due to damage in the
gas ducts. Repairs were completed by February 1989. But the plant
remained closed on the orders of the safety regulator because of
concerns about safety and the unwillingness of the various owners
of the plant, including the federal government, to continue to
provide subsidies to operate the plant. In 1990, the plant was
permanently closed and is being decommissioned.
Siemens and ABB (the new name for Brown Boveri) pooled their
expertise on HTRs to form a new company called HTR Gmbh. Their
strategy appears to have been to license the technology to
countries such as the then Soviet Union, China, Japan and South
Africa.
The UK: The UK was a pioneer of nuclear technology. Its first
nuclear power plants were scaled-up versions of the plants built
to make plutonium for bombs. This used graphite as the moderator
and carbon dioxide gas as the coolant. Nine power stations were
built using this technology, but the technology was only seen as a
stop-gap. Three new technologies were developed to working
prototype scale, including the Dragon HTR. This was ordered in
1957 and completed in 1964. It was a research reactor with no
electricity generation facilities and ran until 1974. Anecdotally,
it was known as a plant that leaked radiation and another design
was chosen in 1964 to form the basis of the civil nuclear power
programme in Britain. Since then, HTRs have not been seriously
considered in Britain.
France: France followed a very similar route to Britain,
developing its first civil nuclear power plants from plutonium
producing reactors. Like Britain, it too had to choose a new
technology route by the mid to late 1960s. The French nuclear
research establishment strongly favoured HTRs, but strongly
influenced by the utility, American PWR technology was chosen and,
as in Britain, HTR technology was abandoned
Japan: Japan has persisted with a wide range of nuclear
technologies for much longer than other countries. It imported
British technology for one commercial plant in the 1960s, but
since then, all commercial orders have been for US designs, PWRs
and BWRs. Nevertheless, it has built a medium size plant of its
own design (165 MW) using heavy water as moderator. This was
completed in 1979 and for many years there was talk about building
a plant of 600 MW of this design. This technology line has now
been abandoned.
A prototype fast reactor, Monju (280 MW), was completed in 1995,
but an incident at the plant in December of that year drained
public and regulatory confidence in the plant and it is highly
unlikely the plant will run again.
A third line of reactor development using HTRs of a Japanese
design has been underway at a slow pace since about 1990. A
prototype reactor producing about 30 MW thermal power but no
electricity was completed in 1998, some 3 years later than
scheduled.
China: For more than 20 years, China has had ambitious plans to
launch a programme of civil nuclear power plants and from 1980
onwards, forecasted that about 20 nuclear power plants would be in
service within 10-15 years in China. There is still little to show
for their efforts. Two imported power plants were completed in
1993-94 (the same design and supplier as Koeberg) and one plant of
a Chinese design was completed in 1992. The potential size of the
Chinese market and the dearth of nuclear orders in the West mean
that nuclear vendors continue to pursue orders in China despite
the political, economic and commercial problems that arise. In
1989, China signed a licensing deal with HTR Gmbh to develop HTRs
in China. There is little to show for these efforts yet.
Development of Nuclear Technologies
The history of nuclear power development has been one of
unfulfilled promises and unexpected technical difficulties. The
ringing promise from 1955, of `power too cheap to meter' is one
that has come back to haunt the nuclear industry.
With most successful new technologies, people confidently expect
that successive designs become cheaper and offer better
performance. This has not been the experience with nuclear power:
costs have consistently gone up in real terms and processes which
were expected to prove easy to master continue to throw up
technical difficulties. The issues surrounding waste processing
and disposal which at first were assumed to be easily dealt with,
remain neglected.
Despite this history of unfulfilled expectations, two factors have
meant that nuclear power continues to be discussed as a major
potential energy source. First, the promise of unlimited power
independent of natural resource limitations and second, the
attraction to engineers and scientists of meeting the
technological challenges that are posed. However, in the developed
world, patience with nuclear technology is running out.
Governments are no longer willing to invest more tax-payers' money
in a technology which has provided such a poor rate of return.
Electric utilities cannot simply pass on development costs to
consumers. Equipment supply companies, which have generally made
little or no money from nuclear technology, are unwilling to risk
more money on developing technologies which might not work well
and which might not have a market.
There is still talk about new nuclear technologies, but a critical
look at the real resources going into them shows that little money
is now being spent.
Other Technological Aspects
In this first section, the track record of the HTR has been
examined and it is clear from this that the world's leading
nuclear countries have all examined HTR technology in some depth,
especially Germany and USA, arguably the two leading nuclear
nations, and none has been able to make a success of it. It is not
impossible that South Africa could succeed where so many others
have failed, but it seems inappropriate that public money should
be gambled on such a risky technology. However, the technological
risk does not end with the reactor.
No facilities exist to manufacture the nuclear fuel and these
would have to be set up in South Africa. The German reactor of
this basic design experienced a number of fuel problems in its
short life, so it cannot be assumed that manufacturing fuel
pellets will be simple.
Even the conventional part of the plant, the gas turbine, would be
a new product developed at Eskom's expense. Eskom's publicity
describes this part of the plant as using the `standard Brayton
cycle' implying a well-proven standard product. No gas turbine
using helium has ever been operated and a number of its features
are substantially novel. Eskom did request the major manufacturers
to tender for a full product with guarantees but it appears that
none of them responded. One supplier suggested that research,
funded by Eskom would be needed before a commercial product could
be designed and produced.
Summary
* The HTR has major intrinsic safety advantages which have led
most countries pursuing nuclear technology to investigate the
HTR.
* Today, the USA, Germany, the UK and France have now abandoned
all interest in HTRs, while Japan's development programme is
very slow and there are no plans to build commercial power
plants.
* The USA and Germany both built a commercial scale plant
subsidised by tax-payers. Neither of these plants worked
satisfactorily and were closed because of economic, technical
and safety problems.
* The history of nuclear power development has been one of
unfulfilled promises and unexpected technical difficulties.
* With most successful new technologies, people confidently
expect that successive designs become cheaper and offer
better performance. This has not been the experience with
nuclear power: costs have consistently gone up in real terms.
* Governments are no longer willing to invest more tax-payers'
money, electric utilities cannot simply pass on development
costs to consumers and equipment supply companies are
unwilling to risk more money on developing technologies.
* There is still talk about new nuclear technologies, but a
critical look at the real resources going into them shows
that little money is now being spent.
* The technological risk is not confined to the design of the
PBMR. No facilities exist to manufacture the nuclear fuel and
these would have to be set up in South Africa. Even the
conventional part of the plant, the gas turbine, would be a
new product developed at Eskom's expense.
Why Electricity Liberalisation and Nuclear Power
do not Mix
Electricity liberalisation, sometimes called privatisation or
re-regulation, is a complicated subject which would not be
appropriate to discuss in detail here. However, there is one
common feature to liberalisation processes of crucial importance
to this debate. In a liberalised system, the activity of
generating electricity ceases to be a monopoly, new generating
companies are allowed in and power stations are operated on
competitive principles. This transforms electricity generation
from being amongst the safest investments available to amongst the
most risky.
The momentum for liberalisation now seems unstoppable and, sooner
or later, even well run monopoly utilities are going to have to
give up their monopoly status and run their business under
competitive pressures. For South Africa, this may mean that Eskom
will be broken up into several competing companies and privatised.
Even if Eskom is not broken up and sold, it will have to accept
the loss of its monopoly and will have to compete with new
companies to supply electricity.
In a monopoly situation, the risk of building new power plants
falls on the consumer. If plant construction costs over-run, if
the plant does not work well or power stations that are not needed
are built, the costs are passed on to consumers. The greatest risk
is that there will be insufficient power stations to meet demand
leading to power cuts and adverse publicity for the utility. There
will therefore be a tendency to over-invest in plant. Thus, in the
1980s when Eskom so over-estimated electricity demand that new
coal-fired plant had to be moth-balled on completion of
construction, the extra costs inevitably fell on consumers or
taxpayers.
In a competitive situation, if utilities make mistakes, they will
either lose market share because their plant is too expensive, or
they will have to sell at a loss and the costs will fall on
share-holders. Utilities choose proven technology for which
construction time and costs can be easily controlled and even
guaranteed, and for which performance can also be guaranteed.
Since the British electricity market was liberalised in 1990, a
large quantity of new plant has been built, all of it using
combined cycle gas turbines (CCGTs). Nuclear power had to be
placed into a separate company which could not be privatised until
six years after the reforms had taken place, when it had completed
the one plant it had under construction and had abandoned all
plans to build more nuclear plants. The British history of nuclear
power is a complex one which cannot be fully covered here.
However, it is clear that investors regarded a company building,
or planning to build nuclear power plants as too risky to invest
in. In the British context, the economics of new nuclear power
plants appeared very poor, but even if they had been good, or
subsidies had been available, the perception of economic risk
would have made privatisation impossible.
The situation with existing plants is rather different. Many
nuclear power plants, if operated efficiently and not requiring
major repairs, can generate enough income from power sales to
cover their running costs. Those that cannot will either be
retired, as has happened with a number of US plants, or will have
their losses met by subsidy, as has been the case with the oldest
British nuclear power plants. However, those that can cover their
operating costs seldom make a proper return on the investment that
was made. Repaying the loans and paying the interest is invariably
the largest cost in any assessment of the cost per kilowatt hour
of electricity generated from nuclear power.
Privately owned plants which cannot meet their full costs,
including capital, are known as `stranded assets'. The owners
argue they built the plants in good faith to meet all demands,
they were subject to regulatory approval and under the old
monopoly system, the owners were allowed to recover the full cost
from consumers. If by changing to competitive markets, plant
owners are no longer able to recover all their costs, they claim
they should be compensated for the income lost through consumer
subsidies. This process of compensating owners of stranded assets
is happening at most nuclear power plants in the USA and the
plants will continue in operation.
For publicly owned utilities which are privatised, stranded assets
are seldom identified and electricity consumers and tax-payers
unknowingly bear these costs. For example, in Britain, Nuclear
Electric completed the Sizewell B PWR in 1995 for a cost in excess
of £3bn. The company was privatised a year later with the Sizewell
B plant and eight other relatively new nuclear power plants of the
same size as Sizewell B for about £1.7bn, little more than a half
the cost of building just one of the nine plants sold. Consumers
who paid for these plants, footed the bill of more than £10bn,
which was lost during liberalisation.
Summary
* The momentum for liberalisation throughout the world now
seems unstoppable and, sooner or later, Eskom is going to
have to give up its monopoly status and run its business
under competitive pressures.
* In a monopoly situation, the risk of building new power
plants falls on the consumer.
* In a competitive situation, if utilities make mistakes, they
will either lose market share because their plant is too
expensive, or they will have to sell at a loss and the costs
will fall on share-holders.
* In a competitive situation, utilities choose technologies
with guaranteed reliable performance and no utility operating
in a competitive environment will choose nuclear power.
* If Eskom invests in PBMRs now, the money invested will either
be lost if Eskom is privatised, because the sale value of
Eskom will fall far short of the money spent on its assets.
If it is not privatised, tax-payers, the owners of Eskom,
will make little or no return on the investment because the
market price of electricity will be too low.
The Economics of Nuclear Power
The economics of nuclear power is a highly contentious area. It is
often difficult to establish independently verified estimates of
the basic construction costs and the operating cost. In addition,
the results are crucially dependent on the accounting and
investment appraisal assumptions such as the rate of return on
capital that is sought (the discount rate) and the life-time of
the plant.
These latter factors are of particular relevance to nuclear power
because the main element in the cost for each unit of electricity
generated is that associated with building the plant, the capital
cost. The shorter the expected life-time and the higher the
discount rate, the higher these fixed costs will be. In a monopoly
system, the assumed life of the plant can be the expected physical
life-time because there will be nothing to stop the owner running
the plant until it is worn out. In a competitive system, the plant
may have to be retired much earlier if it cannot compete with new
plants.
The running costs of nuclear power plants are difficult to
establish because most electric utilities regard this data as
commercially confidential. However, in the USA, utilities are
required to publish fully authenticated running costs. In 1997,
the cheapest to run nuclear plants cost about 1c/kWh (0.6p/kWh),
while the average was about 2.4c/kWh (1.5p/kWh). Of this, about
0.4-0.6c/kWh was fuel cost while the rest, 0.5-1.8c/kWh,
represented the non-fuel cost of operation and maintenance (wages,
spare parts etc.)
Government owned utilities have usually been able to invest money
at very low rates of return on capital partly because new power
stations were seen as a safe investment and partly because, for a
variety of reasons, governments have tended to require a lower
rate of return on capital than private industry. Thus, in Britain
before privatisation, the national utility, the CEGB, could invest
at a 5 per cent real (net of inflation) rate of return and recover
the costs over 35 years. After privatisation, it is known that
private investors are looking for about 12-15 per cent real return
and recover the capital over 15-20 years.
A simplified scheme can be used to estimate the fixed cost of
electricity from nuclear power stations. We can assume that the
capital is repaid in equal annual payments over the life-time of
the plant. For the interest payments, we can assume that the
average amount owed over the life-time of the plant is half the
total construction cost. If we do some simple arithmetic based on
the cost of Sizewell B, the consequences of the change in lifetime
and discount rate are clear.
* Each kilowatt of capacity at Sizewell cost about £3000 to
build and will generate about 6000 kilowatt hour (kWh) per
year.
* If we recover the costs over 35 years and charge 5 per cent
interest, the cost in pence per kWh simply to repay fixed
costs and taking no account of running costs, will be:
(Interest paid + capital / units of = fixed cost
based on the repayment) output per per kWh
average amount owed year
(1500 x 100 x 0.05 + 3000x100/35 / 6000 = 2.7p/kWh
During the process of getting public approval for Sizewell B, the
government, realising that its discount rate was well below
commercial rates, raised the level to 8 per cent. This change
alone raised the fixed cost to 3.4 pence.
If we do the same calculation with an interest rate of 12 per cent
and recover the cost over 20 years, generous assumptions in a
competitive market, the cost per kWh is 5.5p/kWh. With a 15 per
cent discount rate and a 15 year life, the fixed cost is 7.1p/kWh
To put these figures in context, the total cost (fixed and
running) of a new coal plant when Sizewell B was first planned was
about 3.5p/kWh (British coal was then about four times as
expensive as South African coal). So, if the running costs of
nuclear were as low as the best US plants, using the original
assumptions (5 per cent discount), Sizewell B might have been
economic. By the time of privatisation, new gas-fired plants were
being bought and these were expected to generate at about 2.9p/kWh
and so, with an 8 per cent discount rate, the total cost of power
from Sizewell B was perhaps 50 per cent more expensive than
gas-fired generation. By 1996, the cost of gas-fired plants and of
gas had come down and their efficiency had gone up such that the
total generation cost was now about 2.2p/kWh, a quarter of the
cost of nuclear power using the same assumptions on life-time and
discount rate.
The importance of operating performance should also be clear from
these examples. If instead of 6000 kWh per year, the plant had
only produced 3000 kWh, the fixed costs would double. Over its
life, Fort St Vrain averaged about 1300 kWh per year.
It can easily be seen that nuclear power is so far from being
economic in Britain, it is not a serious option for any utility.
In France where large numbers of nuclear power plants have been
built, construction costs appear to be much lower (they are not
independently authenticated). If plants could be built for half
the cost of the British plant and generate 7500 kWh per year, the
cost per kWh would still be 75 per cent higher than gas-fired
plant. So even in the most successful nuclear countries, nuclear
power appears to be uneconomic in a competitive market.
The key economic assumptions that have gone into Eskom's estimate
for the PBMR are, (a) the construction cost is assumed to be about
US$1000 (£625) per kW, (b) the plant life is 40 years, (c) the
discount rate is 6 per cent and (d) the assumed availability is 95
per cent (8300 kWh per year). The expected running cost is not
fully documented, only the fuel cost which is estimated to be
about 0.4c/kWh, equal to the cheapest US nuclear power plants, is
included. The total running cost is therefore likely to be about
1c/kWh (0.6p/kWh).
For comparison, this means Eskom expects the PBMR to be built for
about 20% of the cost of the most recent British nuclear power
plant and they expect it to be able to achieve a reliability
better than any nuclear plant in the world has ever achieved over
several years. At £1=$1.6, this gives a fixed cost, using these
assumptions, of about 0.4p/kWh. If we accept these remarkable
construction costs and availability, but put in commercial
discount rates and life-times, but at the low end of the likely
values, 12 per cent and 20 years, the fixed cost doubles to
0.82p/kWh. If we use the values for discount rate and plant
life-time generally used in Britain now, 15 per cent and 15 years,
the fixed cost increases to 1.1p/kWh. Simply by changing the
investment appraisal parameters to ones more appropriate, much of
the cost advantage of the PBMR over CCGTs has largely disappeared.
The importance of the life-time is clear, but the discount rate
may be seen as a rather esoteric debate which it is hard to relate
to. However, the reality is that the choice of discount rate is at
the heart of the debate about how national resources are
allocated. The amount of investment capital available to a country
is not unlimited. If money is spent on low-return projects, money
will not be available to higher return projects and the economic
growth of the country will suffer. The discount rate is as high as
it is in Britain because that is the rate of return that the
projects can achieve. If the government (and Eskom is owned by the
South African government) spends money on low-return projects,
there could be two effects: first, money will not be available to
the private sector to invest in projects that will generate more
wealth; and second, public sector projects, perhaps even within
Eskom, such as urban and rural electrification, with a much better
rate of return will not be funded.
It is not clear how fully the PBMR has been costed and whether
equipment suppliers have been identified. However, even if
suppliers are known and costs have been quoted, all the history of
nuclear power suggests that these costs will not be an accurate
reflection of the actual costs. Two main factors, uncertainty
about the features that the safety regulator will demand and the
risk that, with an unproven design, unforeseen difficulties will
arise, mean that no credible supplier would quote a guaranteed
fixed cost. Even if such guarantees were given, there must be some
doubt about whether they were worth the paper they were printed
on. Even a small nuclear power plant such as the PBMR would
produce electrical output worth about £20m per year. Eskom plans
these plants in clusters of ten so any design fault would probably
be repeated ten times over before it was discovered. If this
resulted in a delay of only a year to construction, the value of
the lost power would be £200m which the supplier would be liable
for. Few companies have the resources to back such a guarantee and
even fewer would choose to do so.
The HTR has undeniable intrinsic safety advantages which probably
make a catastrophic accident such as occurred at Chernobyl
impossible. However, these intrinsic safety advantages are not
sufficient to guarantee the safety of the plant. A competent
safety regulator would not be prepared to give approval for the
design until the full detailed design was available and the plant
could not get an operating licence until it was built. There is
ample experience in the West of plants of similar basic design to
those already in operation, running into construction cost and
time overruns because detailed design points were not acceptable.
The German experience with the THTR-300 plant, the fore-runner of
the PBMR which had the same intrinsic safety features is relevant
here. This plant was licensed and in service for a year when
problems at the plant led to the withdrawal of the operating
licence, a factor instrumental in its closure soon after.
The British experience with the AGR is particularly salutary in
this respect. When the Dungeness B plant was ordered in 1965, a
prototype plant of this design was operating, apparently
successfully. The plant was ordered under fixed cost terms from a
British supplier. The detailed design proved to contain serious
errors which resulted in constant redesigns throughout the
construction period. The supplier and two successor companies went
bankrupt, so cost guarantees proved worthless. The plant was
finally declared commercial in 1988 after 23 years of continuous
construction and huge cost overruns, all of which were paid for by
electricity consumers. The lengthy construction period (some of
the equipment was obsolete before the plant entered service) and
the numerous design errors mean that the plant will never operate
as designed and in 1998, one of its better years, the load factor
was only 42 per cent.
The reliability levels projected by Eskom are also hard to justify
based on Eskom's track record with the Koeberg plant. In 1996, the
latest year for which there is full data, the average load factor
for the world's nuclear power plants was 77 per cent. Over the 12
years that Koeberg had been in service, the plants averaged a load
factor of 58 per cent. In 1997 and 1998, the plants did rather
better, but neither was in the world's top 50 plants. There is
therefore nothing in Eskom's record to suggest that it is capable
of world-beating performance with nuclear power plants, especially
with a new and unproven design.
If we assume that Eskom's construction cost estimate is half what
costs would really be - this would still make the PBMR the
cheapest nuclear plant in the world to build - and we assume the
load factor achieved is a little above the average of plants in
the rest of the world (7000 kWh per kW per year) and we
recalculate the fixed costs, the equation is as follows, using a
12 per cent discount rate and a 20 year life-time
625 x 100 x 0.12 + 1250 x 100 / 20 / 7000 = 2.0p/kWh
or, using a higher discount rate (15 per cent) and shorter
life-time (15 years),
625 x 100 x 0.15 + 1250 x 100 / 15 / 7000 = 2.5p/kWh
We can compare this with the full cost new gas-fired plant in
Britain of about 2.2p/kWh. It is clear that even if South Africa
could build plants at less than half the cost of Britain, if it
could operate them at above the world average level of
reliability, and if running costs were as low as the best US
plants, gas-fired plants would be much cheaper.
Summary
* Eskom's cost estimates for the PBMR are unrealistic in a
number of respects.
* The rate of return on assets, 6 per cent, is far too low, and
if money is invested in projects with such a poor rate of
return, there will be insufficient capital to go ahead with
some private and public sector projects offering a much
better rate of return.
* The assumed life-time of the plant is too long and does not
reflect the fact that facilities are generally retired, not
when they wear out, but when new plants are available with
better economics.
* Using real data from Britain, it is possible to show that by
putting in more appropriate estimates for these factors,
nuclear power went from being competitive to costing about
three times that of the cheapest alternative.
* Eskom's estimates of construction cost and operating
performance for the PBMR seem hopelessly out of line with
experience of nuclear technology in the rest of the world.
The PBMR could prove to be a world-beater in terms of capital
costs, operating performance and running costs, but it could
still turn out to be more expensive than new gas-fired
plants.
The World Market for Nuclear Power Plants
Eskom's evaluation of the PBMR is based on projections of an
annual market of 30 units, 10 for installation in South Africa and
20 in the rest of the world. It is therefore important to
establish what the world market for nuclear power plants is and
what share South Africa might hope to gain from it.
If we start with Europe, 10 countries have built nuclear power
plants. Austria closed its plant without operating it after a
referendum. Italy closed its three plants after a referendum.
Sweden is committed to closing its plant early after a referendum.
The newly elected German government has committed itself to
phasing out nuclear power. The Netherlands and Switzerland are
also likely to phase out nuclear power, while the Spanish
government ordered the abandonment of work on several unfinished
plants in the 1980s. As argued above, new nuclear orders in
Britain are not feasible, leaving only Finland and France as the
only countries where new orders are possible, although not
inevitable. France has spent huge amounts of money developing its
own nuclear capability and it is inconceivable that, if orders
were placed, it would not use French companies.
For more than 20 years, Turkey has talked about placing nuclear
orders and frequently, deals are said to have been imminent. So
far, these have all come to nothing and it seems unlikely that
Turkey will be a major market for nuclear power in the next
decade.
In North America, no orders not subsequently cancelled have been
placed since 1974. Canada has developed its own technology which
is now running into severe problems on the economics and safety
side with several units shut down for several years as a result.
It is barely conceivable that any new orders would be placed. In
the USA, more than 100 nuclear orders were cancelled, losing
consumers billions of dollars. As in Canada, the electricity
industry is being liberalised and many existing nuclear plants are
being categorised as stranded assets. The two Mexican units took
more than 20 years to build and cost over-runs were huge. Given
this poor record, new orders for nuclear power in any of these
countries are not feasible.
In South America, Brazil and Argentina have built nuclear power
plants. Argentina has two operating plants and has been struggling
to finance completion of a third plant, of Canadian design for
more than 20 years. Brazil has one operating nuclear plant which,
over a 20 year life, has an average availability of about 20 per
cent. It may complete a second plant of German design which
started construction in 1975 and will cost about US$9bn, making it
about the most expensive nuclear plant built. These countries are
unlikely to want to repeat their sad experience with nuclear
power, nor are their neighbours likely to launch new programmes.
In Africa, only South Africa is actively pursuing nuclear power
and the chances of nuclear sales outside South Africa are minimal.
This leaves only Asia as a possible market for nuclear power. The
two giants of the continent are India and China, both with nuclear
power programmes. India and Pakistan both acquired nuclear power
plants in the 1960s but after India exploded a nuclear bomb in
1975, all international nuclear contacts were cut. As a result it
has tried to develop its own designs based on the plant it bought
from Canada. It now has about 10 small (200 MW) plants in service.
All have seriously overrun their construction time and cost
forecasts and have been hopelessly unreliable. India is now trying
to buy a plant from Russia, but it is unlikely that either side
has the cash to carry out this project. Pakistan has recently
bought a small plant from China of Chinese design. Like India, its
poor record on nuclear proliferation makes it largely impossible
for Western countries to do business there with nuclear
technology.
China has, for the past 20 years, had ambitious plans to build
nuclear power plants of imported design and of its own design.
These have resulted in few orders so far: two plants are in
service of French design, two more French plants are on order and
two Canadian plants are on order. One plant of Chinese design, a
300 MW PWR, is in service, but is currently off-line with serious
equipment problems. One plant of this design was sold to Pakistan
and China is planning to build further units of this basic design,
but double the size. All nuclear vendors are active in China
because of the potential size of the market, but it is doubtful
whether China can finance a significant nuclear power programme.
As noted previously, Japan has developed a number of its own
nuclear technologies, but none of these has been ordered for
commercial use. All its operating plants are of US design and
Japanese companies such as Mitsubishi, Hitachi and Toshiba have
spent large sums of money over the past 30 years developing an
understanding of these technologies as well as manufacturing
facilities for them. While Japan now has a large number of
operating plants (53 at the beginning of 1999), public opposition
and problems in finding sites due to seismic activity mean that
further orders are now very difficult. There is no room on
established sites for further plants and, now, only two plants are
under construction. If Japan does order further plants, they will
almost certainly be more units of US design or units using a new
Japanese design.
Of the other Asian countries, South Korea and Taiwan have nuclear
power plants in service. Korea has 14 plants in service and
another 3 under construction. It has expended a large amount of
effort transferring US technology in and has built up full
manufacture facilities. It is highly unlikely that future nuclear
orders would not be supplied using these facilities. Taiwan has
six plants in service and two on order. When these two plants are
complete, there will be little scope for further nuclear plants.
Other Asian countries, such as Thailand and Indonesia have, for 20
years or more, discussed the possibility of ordering nuclear
plants. However, there is little to suggest that these discussions
will soon be turned into nuclear orders.
The Market for South African Nuclear Power Plants
It seems likely that the world market for nuclear power plants may
be no more than one or two units a year. It is not clear whether
South African designed plant could be expected to win any of this
market mainly because of the conservatism of the market.
The accidents at Three Mile Island (USA) and Chernobyl (Ukraine)
have alerted nuclear buyers to the economic risk arising from such
accidents. Following any serious accident, all plants throughout
the world have to demonstrate (if that is possible) that they are
not vulnerable to such a set of events. This can be expensive and
time-consuming. If modifications are required, there is some
comfort in owning a type of plant widely installed elsewhere whose
owners will pool resources to solve the problem quickly and
efficiently.
The record of rivals to the established designs, the PWR and the
BWR, is poor especially for the HTR and the breeder reactor,
designs with many theoretical attractions but which do not seem
able to be translated into a working commercial design. Buyers
therefore have a strong incentive to stick with tried and tested
designs. Buying a new design from a country with no track record
in nuclear reactor technology appears an enormous risk.
Summary
* Eskom's evaluation of the PBMR is based on projections of an
annual market of 30 units, 10 for installation in South
Africa and 20 in the rest of the world.
* It seems likely that the world market for nuclear power
plants may be no more than one or two units a year.
* Buyers have a strong incentive to stick with tried and tested
designs. Buying a new design from a country with no track
record in nuclear reactor technology appears an unjustifiable
risk.
Waste Disposal
When nuclear power plants were first planned and built, there was
little consideration of how waste would be dealt with and worn-out
plants removed. It was assumed that new technologies would emerge
and costs would be small.
In most countries, waste is divided into three categories.
Low-level waste (LLW) is not strongly radioactive and humans would
require significant exposure to suffer any health consequences.
After a few decades, the radioactivity has generally decayed
sufficiently that the material presents little hazard.
Intermediate level waste (ILW) is much more strongly radioactive,
it remains radioactive for much longer and must be dealt with much
more carefully. High level waste (HLW) is not only strongly
radioactive but it also generates large quantities of heat. While
activity does decay to some extent, HLW must be kept away from
human contact indefinitely.
Most countries have had some limited means of dealing with LLW for
several decades. Medical and scientific uses result in small
quantities of LLW, the isotopes themselves, but also everything
they come into contact with, such as gloves and lab coats. At
first, this material was simply bull-dozed into holes in the
ground and covered. Now, greater care is taken and it is placed in
sealed concrete containers and usually buried in shallow ground.
It is assumed that by the time the concrete containers have
failed, the radioactivity is no longer a hazard. These original
dumps are now becoming full: their capacity can be eked out by
compaction techniques, but most countries are now searching for
new sites. This is invariably politically contentious and few
countries have had any success in the last couple of decades in
siting new dumps.
In Britain, it was decided in the mid-80s that all LLW would be
disposed of in a new deep engineered facility, which would also
take all ILW, when the existing facility at Drigg was full. This
would clearly raise the costs by a large amount, probably an order
of magnitude. However, proving that the geology of such a facility
would be stable over a long enough period that it could be assumed
there would be no risk that radioactive material would get into
the ground water, is a difficult task. It was planned that a test
hole be drilled and the geology observed over a decade before the
facility was built. A public inquiry rejected the case in 1997 for
the one site selected in Britain. There is now no investigation
for alternative sites. If the process started tomorrow, an
optimistic time-table might require 5 years to identify another
potential site, a couple of years for public consultations (the
siting would be bitterly resisted), 15 years to build and observe
a test drilling, 5 years to build a commercial facility. Britain
therefore cannot have a new LLW facility until 2025, by which time
LLW will be piling up in temporary stores.
As the standards for LLW disposal have been raised, the costs have
gone up. In the last 10-15 years, LLW disposal costs in the USA
have been rising at about 6-7 per cent per year in real terms,
that is, doubling every 10 years. There is little sign that this
price escalation is falling away and, while waste disposal is
still quite a small part of nuclear generation costs, if this
process is not checked, it could become significant.
ILW is typically material that has been in close contact nuclear
fuel, for example, steel vessels. There are no facilities for
final ILW disposal in Britain or in most other countries - the
only modern facility is a deep repository in Sweden. The material
is presently stored in temporary containers on the surface
awaiting the construction of the facility described above. Most
such material was temporarily packed in containers designed to
last a decade or two. The late completion of the disposal facility
will mean that this material will have to be unpacked and
re-packed at significant expense and will be a hazard over that
period.
HLW represents the most intractable technical problem, although
the volumes of material are much lower than for the other
categories. Essentially, HLW is either spent fuel or the product
of the reprocessing of spent fuel. Disposal facilities must be
designed such that for thousands of years, there can be no risk
that the material can get out of its containers and get into the
ground water where it would come into contact with humans. There
is a difficult philosophical debate about whether the material
should be retrievable or not. If the material is retrievable, if
anything goes wrong with the storage facility, it can be retrieved
and made safe, but the material is accessible and can be
misdirected. If the material is not retrievable, the pros and cons
are reversed. There is no clear winner to this debate yet.
At present, no country in the world has identified a site for the
disposal of HLW and all material is stored in temporary surface
facilities. The technical rationale for this is that the spent
fuel is still generating too much heat for it to be disposed of -
any containers would come under intense strain because of this
heat and would not be able to last the thousands of years
required. Thus, in Britain, a decision was taken in about 1980 not
to even look for sites for 50 years. However, until sites are
identified, the geology proven and the methods of containment
subjected to proper public scrutiny, the costs cannot be predicted
with any confidence, nor can it even be certain that the process
will be politically feasible.
Of particular relevance to the waste debate is the process of
decommissioning plants at the end of their life and removing all
radioactive material for disposal in proper waste disposal sites
so that the land can eventually be released for unrestricted use
('green-field' status). Until this has been done, there is a risk
that radioactivity from the plant will leak into the environment
damaging the ecology. Decommissioning does generate large
quantities of LLW and some ILW.
There is almost no experience in the world of decommissioning a
commercial scale plant that has operated over a full life-time to
green-field status. As with waste disposal, estimated costs are
escalating rapidly. If the costs are accounted for properly from
the beginning of operation of the plant, they do not have a large
impact on the economics of nuclear power. Under the `polluter
pays' principle, this can only be done by setting up a
`segregated' fund (one that cannot be drawn upon by the plant
owner for other purposes) and placing the funds in low risk
investments so that when decommissioning is required, there is
little risk that the funds will have been lost or used for another
purpose.
A possible source of confusion with the spent nuclear fuel is the
role of reprocessing. The rationale for reprocessing was mainly
that it separated out from the spent fuel plutonium, which could
be used to make bombs, or used in fast reactors. It does not
destroy radioactivity, it merely separates out the fuel into its
constituent parts, some of which might have a use, e.g. plutonium,
but most of which still has to be disposed of as HLW. Given that
weapons production from civil nuclear power plants is not
politically acceptable and that fast reactors have now been
abandoned, all the material still has to be disposed of.
Reprocessing creates large quantities of LLW as all the material
involved in reprocessing becomes LLW. It is a very expensive
process which has occasionally resulted in leakage of
radioactivity into the environment. Most countries now acknowledge
that the cheapest and safest way of dealing with spent fuel is to
dispose of it as HLW without any processing.
Overall, the political, technical and economic feasibility of
disposal of all types of waste and of decommissioning plants has
yet to be proven anywhere in the world. A responsible policy would
appear to be to carry out investigations into these processes so
that there is confidence that when these processes are required,
they are technically proven and the resources to carry them out
are available.
Summary
* The issue of waste disposal has been neglected throughout the
world. Few modern facilities exist for even the most easily
handled waste and for the most difficult waste, plans remain
tentative.
* Until modern working facilities for disposal of all types of
waste are demonstrated, it will not be clear whether waste
disposal, and hence nuclear power is a sustainable
technology.
Conclusions
The development of the PBMR by Eskom would represent a highly
risky venture which would be underwritten by tax-payers and
electricity consumers. Despite the investment of millions of
dollars of tax-payers' money, countries with the technological
capability of Japan, Germany, France and the UK have failed to
develop their own independent nuclear technologies. HTR technology
similar to the PBMR has been investigated in depth by most of the
world's major nuclear power design nations, including the USA and
Germany. Despite the technological capabilities of these
countries, commercial scale prototype plants proved failures
costing tax-payers many millions of dollars and Germany and the
USA have abandoned any interest in this technology.
Eskom's justification for the PBMR is based on achieving a
substantial number of export sales (20 units per year). However, a
detailed examination of the world market for nuclear power shows
that very few nations are likely to order new nuclear power
plants. The poor market prospects for nuclear power are the result
of: (a) the poor economics of nuclear power; and (b) the pervasive
moves to liberalise electricity markets, which transfers risk in
building new plants from consumers to share-holders. Those
countries that do order plants are likely to choose well-proven
options which have been developed by the world's leading nuclear
power companies. The issues of waste management have not been
fully addressed anywhere in the world and until it can be proven
that viable methods are available for dealing with waste, pursuing
any nuclear power technology cannot be regarded as a sustainable
policy.
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