Key Points:
- China’s Nuclear Momentum: Despite a delayed start, China’s nuclear sector has surged remarkably. Projections suggest it could become the second-largest global nuclear energy producer by 2030, with nuclear generation nearly quadrupling in a decade.
- Expansion Metrics: China’s evident nuclear expansion includes 23 units under construction and approvals for new reactors. Installed capacity hit 57 GW by June 2023, establishing China as the “world’s fastest expanding nuclear power producer.”
- Innovative Strides: China showcases nuclear innovation through pioneering Generation IV reactors and small-scale nuclear-powered district heating. Despite the promise of Generation IV, Generation III remains the primary choice for China’s extensive nuclear capacity plans.
- Climate Strategy and Exports: China’s nuclear trajectory aligns with its climate strategy, bolstering energy security and decarbonization efforts, and diversifying the energy mix. However, export ambitions encounter challenges due to domestic priorities, technical complexities, and geopolitical factors.
Although China began developing nuclear technology much later than some major economies, such as the US and France, its progress has been astonishing. Predictions suggest that by 2030, China will possess the world’s largest nuclear fleet. Over the last decade, nuclear electricity generation in the country has surged nearly fourfold, propelling China to become the second-largest nuclear energy producer globally, only trailing the US.
China’s Nuclear Growth Trajectory:
- China started constructing its first nuclear plant in 1985, relatively late compared to some counterparts.
- The Oxford Institute for Energy Studies (OIES) anticipates China’s nuclear fleet will be the world’s largest by 2030.
- As of June 2023, China’s installed nuclear capacity reached 57 gigawatts (GW).
- China has outpaced France and is currently second only to the US in nuclear energy production.
- China is characterized by the International Atomic Energy Agency (IAEA) as the “world’s fastest expanding nuclear power producer.”
Rapid Expansion:
- China has 23 nuclear units under construction, with more than 21GW of added capacity.
- In 2022, China greenlit the construction of 10 new reactors, followed by approval for six more in August 2023.
- Notably, China completed two out of the six reactors finished globally in 2022.
- Over the same period, China also initiated the construction of five out of eight units globally, according to the World Nuclear Association (WNA).
Impressive Output Surge:
- China’s nuclear energy output skyrocketed from 98 terawatt hours (TWh) in 2012 to 418TWh in 2022, a more than fourfold increase.
- This exponential growth places China among a select group of nations, including Russia, South Korea, the United Arab Emirates, and Pakistan, that have experienced substantial nuclear expansion.
Despite this impressive growth, nuclear power still constitutes only 5 percent of China’s total electricity generation mix. This falls short of nuclear’s global contribution, accounting for 9 percent of the world’s energy supply in 2022.
China’s Advancements in Nuclear Technology
China has emerged as a frontrunner in nuclear innovation. Notably, it stands as the pioneering nation to construct a Generation IV reactor. This milestone was achieved when a demonstration project was connected to the grid in 2021. Additionally, China has operational small-scale nuclear-powered district heating initiatives in Shandong and Zhejiang provinces.
Dr. Shengke Zhi, Director for Growth and Development at the consulting firm Wood, highlights that China’s Generation IV technology still has a substantial journey ahead. He emphasizes that for China’s extensive deployment of nuclear capacity, Generation III technology remains the primary choice.
Nuclear Power’s Role in China’s Climate Strategy
The trajectory of nuclear power in China sparks questions regarding its significance in the country’s climate initiatives. While China’s nuclear capacity is on the rise, uncertainties linger over the pace of its expansion. Forecasts from the China Nuclear Energy Association, as reported by Bloomberg last year, suggest the possibility of adding up to 10 reactors annually, reaching a 300GW capacity by 2035. However, the Oxford Institute for Energy Studies (OIES) offers a more cautious estimate, proposing a likelier target of 100GW by 2030.
Dr. Philip Andrews-Speed, a senior research fellow at OIES, characterizes nuclear energy as a “convenient resource” for China. He emphasizes its alignment with China’s objectives concerning energy security and decarbonization. Moreover, beyond its net-zero implications, Zhi underscores that nuclear energy serves as a means to diversify the energy mix, stimulate employment, and enhance the supply chain.
China’s Nuclear Prowess and Competitive Advantage
China’s ability to construct new nuclear plants at notably lower costs than many peers stands out. Analysts suggest that the costs per kilowatt of installed nuclear capacity in China are approximately one-third of those in the US or France. China’s adeptness is attributed in part to its “design-one build-many” approach to nuclear construction. A 2018 study in Sustainability even proposed the potential for nuclear power in China to surpass coal in competitiveness by 2030. Zhi concurs with this projection, citing the increasing expense of coal power, particularly due to environmental fees and carbon pricing.
Driving Factors and Policy Levers
Policymakers have harnessed familiar tools to foster nuclear development. Financial subsidies, access to decision-makers, and favorable price-setting have been identified as pivotal advantages. The guaranteed tariff paid to nuclear power producers has consistently exceeded rates for coal-fired or hydroelectric power. This supportive environment has been instrumental in maintaining the momentum of China’s nuclear industry.
Balancing Safety and Ambition
Safety concerns stemming from incidents like the Fukushima Daiichi accident temporarily slowed China’s nuclear ambitions. Following the incident, China suspended approvals for new power plants to address safety and river pollution concerns. Nonetheless, China’s government remains committed to developing nuclear power at a steady pace, aligning with its 2021 action plan to peak CO2 emissions by 2030.
Global Nuclear Ambitions and Challenges
China’s aspirations to export its nuclear technology have been met with mixed outcomes. While a senior industry official once voiced China’s intent to build up to 30 overseas nuclear units by 2030, experts like Andrews-Speed express skepticism. He attributes this skepticism to China’s substantial focus on domestic projects, with numerous units under construction and numerous proposals for future plants. Collaborative efforts in countries like the UK and Argentina have faced setbacks due to security concerns and delays.
In Pakistan, China has played a pivotal role in bolstering the country’s generation capacity through the construction of eight reactors. China envisions its nuclear projects in Pakistan as a stepping stone for broader technology export growth.
However, challenges remain for China’s nuclear technology exports, including Russia’s influence in the sector, China’s non-membership in the IAEA Vienna Convention, and the absence of a system to manage used nuclear fuel.
In conclusion, while China’s nuclear capacity expansion is notable, questions persist about the pace and global implications of this progress. Driven by a mix of energy security, decarbonization imperatives, and economic diversification, China has demonstrated remarkable efficiency in nuclear plant construction. The path ahead, however, requires a careful balance between safety considerations, domestic priorities, and international collaborations.
As China looks to export its nuclear technology and solidify its position as a key player in the nuclear energy landscape, it faces multifaceted challenges that will shape its trajectory in the years to come.