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ATOMS FOR PEACE, ATOMS FOR WAR, ATOMS FOR PROFIT

Paper prepared for:


Energy Research Group
International Development Research Centre
Ottawa, CANADA.

November 1984

Nikhil Desai
5308 MacArthur Blvd. NW
Washington, DC 20016
USA

ERG REVIEW PAPER NO. 091


FIRST DRAFT
PRELIMINARY AND CONFIDENTIAL
NOT TO BE CITED, REPRODUCED
OR CIRCULATED

- i -

CONTENTS
I.

The Context .......................................................... I

II.

The Promise and the Premise ......................................... 15

III.

Nuclear Energy Experience ........................................... 26

IV.

Uncertain Economics . ........................................ .

Annexes
A 1.

Recommendations for Research

A 2.

List of Experts

B.

Bibliography

. .... 91

(d) The proportion of primary energy, and in particular, fossil energy


consumption devoted to the production of electricity is projected to increase
substantially.
Indeed, electricity consumption is projected to increase at
more than twice as fast as the non-electricity consumption. Associated with
this trend towards electrification of the energy economy, it is seen that (i)

(c) In absolute quantities, the oil importing developing countries would have
a higher burden of oil imports in 1995 than in 1980, despite the fact that
their oil production is projected to increase much faster than in the past
(5.5% versus 0.3%) and that their oil consumption is projected to grow much
slower than in the past (2.6% vs. 4.9%) and, also, at a much slower rate
relative to those of the other fuels.
The share of i::he -oil importing
developing countries in the total world traded oil will also significantly
increase;

(b) Although as a group the developing countries remained in an energy-surplus


situation in 1980, such margin was sharply lower than in 1970 and will remain
about the same in 1995, despite faster production growth projected for the
1980-95 period.
(The ratio of total primary energy consumption to total
primary energy production was 64% in 1970, 84% in 1980 and is projected at
about 84% in 1995.)
The same pattern is found in the case of oil (the
corresponding ratios being 44%, 71% and 68%). At the same time, oil's share
in the total energy consumption remained the same in 1980 as in 1970 in both
the developing countries as a group and in the oil importing developing
countries as a group, while projected to decline sharply by 1995 in both
cases;

(a) Consumption of each of the four major primary energy sources (hence total
primary energy as well) in the developing countries grew faster than the world
average or than in the industrialized countries (the IMEs, in Table 1) for the
1970-80 period and will continue to do so over the projected period. As a
consequence, the energy consumption of the developing countries is
increasingly more important in the global energy balances;

Last year the World Bank (1983a,b; see Tables 1 to 3) presented


historical statistics for the period 1970-80 and projections for the period
1980-95 for primary energy and electricity production and consumption among
the developing countries. These show, among other things,

I. The Context:

ATOMS FOR PEACE, ATOMS FOR WAR, ATOMS FOR PROFIT

- 1 -

- 2 -

primary electricity accounts for a larger share of the total electricity


generation in 1995 as compared to that in 1980; (ii) coal becomes increasingly
specialized in its use for power generation; and, (iii) although oil use in
power generation gradually decreases, overall reliance upon the so-called
exhaustible fossil fuels for electricity generation continues up to 1995;
(e) Nuclear energy
1.4% of the total
energy consumption
the corresponding
respectively.

- specifically, nuclear electricity - accounted for a mere


electricity generation and but 0 .3% of the total primary
in 1980. Despite a rapid projected increase through 1995,
proportions in 1995 will be no more than 7 .5% and 2 .5%

Of course, there are the customary qualifications to be attached to any


such projections: (i) country-group totals hide important variations and even
contrary patterns at the sub-group and individual-country level, particularly
in the case of oil and nuclear energy; and ( 11) energy projections tend to
become rapidly outdated as circumstances change and the judgements about
plausible assumptions change. However, in as much as nuclear energy was or is
accorded the privilege of being a global energy option of considerable promise
to the 'developing countries', and in as much as in any broad analysis of such
promise one needs to have some credible benchmark projections upon which
quantitative work can be performed, such aggregate projections may suffice.
(1)
It then appears as if nuclear energy - measured by the absolute size of
the nuclear-electric sector or by its penetration in the electricity markets has not yet and will not even by 1995 become a major energy resource for the
developing countries. This is a disappointing fact, if viewed in the light of
the optimism and the enthusiasm expressed in the past about the role of
nuclear energy in the developing countries. At the same time, the World Bank
projections are not particularly pessimistic; if at all, they are cautiously
optimistic. The World Bank does not provide an estimate of installed nuclear
capacity; however, the total nuclear generation of 262 TWh in 1995 projected
for 1995 translates to an implied capacity of between 40 and 50 GW, depending
upon the average capacity factor assumed (between 60 and 75 percent, in
reverse order). Differences in country classification make it difficult to
compare the Bank projections with other recent projections, but a detailed
scrutiny suggests that these are comparable to a recent USDOE projection
(DOE/EIA, 1983d) and to IAEA projections (IAEA, 1983a) made at about the same
time. The IAEA projections for 1990 and 2000, intrapolated to 1995, suggest a
----------~----~-------------------------------------------------

1. Whereas the observations noted above have been extracted from the World
BS'nk (1983a,b) it is largely a matter of the convenience of obtaining
consistent data sets and because the projections are of the most recent
vintage. As far as the author can tell, the overall thrust of the World Bank
projections is in line with those from other sources. See DOE/EIA (1984 ) or
OECD/IEA (1982).
For what now appear to be 'focredible' projections, see
Choucri (1982) or IIASA (1981). Whether these latter projections could have
been considered 'credible' even at the time they were published is a matter of
the reader's discretion and tolerance.

- 3 Table 1 - Primarl Commercial Energl ConsumEtion - Major Countrl GrouEs


(Unit: mtoe)
1970

1973

1976 1979
---

1980

1982

1995

165
204
15
22
406

343
306
50
55
754

463
357
64
70
953

542
405
77
93
1119

641
500
103
121
1365

653
502
109
131
1396

667
545
121
147
1480

935
940
324
396
2595

772
654
308
139
1872

1623
685
606
228
3142

1936
657
715
276
3584

1887
669
691
335
3582

1995
712
734
408
3850

1804
760
724
427
3714

1578
762
674
467
3480

1705
1185
875
835
4600

1090
1274
379
176
2918

2326
1495
848
319
4987

2848
1537
1024
385
5793

2947
1629
1083
477
6135

3223
1786
1213
595
6817

3054
1835
1232
632
6752

2840
1881
1249
691
6661

3355
2821
1930
1423
9525

DCs

A.

Oil

Coal
Gas
P.E.
Total
IMEs

B.

Oil

Coal
Gas
P.E.
Total

c.

1960

World
Oil

Coal
Gas
P.E.
Total

DCs: Developing Countries


IMEs: Industrialized Market Economies

Table

1.

Sources and Notes:

Historical data from the World Bank (private communication);


these are based upon the U.N. data on computer tape, with application of
the World Bank's definitions and conversion factors. Country
classification is as in World Bank (1983b), pp 4 and the Annex - World
Development Indicators. Conversion factors are as in World Bank
(1983a), pp. xvi. Certain remarks in the text are based upon other
historical data available to the author from the same source. Projected
data from World Bank (1983b), pp. 5 and World Bank (1983b), pp. 30,
using the multiple of 50 barrels to 1 mtoe. By some juggling of the
published information it is possible to derive projections for China
. separately and then examine the consumption patterns in other developing
countries; this may be important since China alone accounted for about
30% of the total developing countries' primary commercial energy
consumption in 1980 and as projected will account for about 25%
accordingly in 1995.

- 4 -

Table 2 : Structure of Primar y Fuel Consumpt i on for Electricit y


Generation, Develop in g Countries, 198 0 and 1995

1980

Growth Rate, % Ea.

1995

TWh

TWh

1980-95

Fossil-thermal
of which, oil
gas
coal
Subtotal

342
64
393
799

25.9
4.9
29.8
60.5

257
321
1346
1925

7.3
9.2
38.4
54.8

-1.9
11.4
8,6
6.0

Primary electricity
of which, hydro
nuclear
geothermal
Subtotal

500
18
3
521

37.9
1.4
Neg.
39.5

1289
262
34
1585

36.7
7.5
1.0
45.2

6.5
19.6
17.6
7.7

Total

1320

100.0

3509

100.0

6.7

Source: World Bank (1983a)

- 5 -

Table 3 : Electricit y in the Total Energy Consumption, Developing


countries, 1980 and 1995.

A.

Shares
1980
Total, mtoe
of which,
Power, %
Non-power,%

Oil

Coal

653

502

13.1
86.9

19.6
80.4

TPE

Oil

109

1396

935

14.7
85.3

23.6
76.4

6.9
93.1

1995
Gas
Coal

TPE

940

324

2595

35.8
64.2

24.8
75. 2

33 . 8
66.2

1995

1980

Memo:
Nuclear/TPE, %
Total primary electricity/TPE

B.

Gas

o-:3

2:5

9.3

15.3

Growth rates,% p.a., 1980-95


Power

Oil
Coal
Gas
Total fossil
Total primary

Source: Tables

Non power
2.9
2.7
6.6

8.6
11. 4
6.0
6.7

l and

3.2
3.2

2.

Total

2:4
4.3
7.5
3.8
4.2

TPE: Total Primary (Commercial) Energy.

- 6 -

figure of 32.5 to 54.5 GW for the developing countries.


44 to 85 GW.)

(Those for 2000 are

Currently eight developing countries (Argentina, Brazil, India, South


Korea, Pakistan, South Africa, Taiwan and Yugoslavia) have installed - though
not all of which is routinely operating - nuclear capacity of about 9 GW;
these countries also have plants under construction adding 11 GW more by 1990
and about 2 GW beyond 1990.
Four more developing countries (China, Cuba,
Mexico, the Philippines) are building their first nuclear power plants (NPPs)
totalling some 2 GW, and have firm plans for about 3 GW more. Up to three
more developing countries (Egypt, Portugal, Turkey) might place their first
NPP orders by 1986 and one developing country (Iran) which has had its nuclear
program halted may revive it to complete one or two units.
In effect, both the IAEA and the World Bank are suggesting that roughly
10 - 30 GW of new nuclear capacity would be ordered and completed by 1995 in
the developing countries. Considering that NPPs in the developing countries
have taken at least 6 years in construction - i.e., from the 'concretepouring' to 'grid connection' - and that at least 1 - 2 years of preconstruction work is required for a NPP, such orders must be placed by 1987 at
the latest. If this happens, it would mark a sharp reversal of the trend in
recent years; ordering rates in the developing countries (from both domestic
and foreign suppliers) have averaged less than 1 GW per year since 1980. In
the current context of uncertainties about financing of NPP imports and
exchange rate fluctuations, it is highly uncertain that such a reversal would
come about. If the additional orders are not forthcoming, or if the current
construction programs are seriously delayed, the total installed nuclear
capacity in the developing countries could be as low as 30 GW in 1995.
Compared to some outlandish projections about ten years ago - the IAEA in
1974 projected nuclear capacity in the developing countries by 1990 at 167 GW
and by 2000 at 530 GW - or some less so about five years ago (2), the
experience so far has been disappointing, particularly to the foreign
suppliers from whom most developing countries purchase their NPPs as well as
fuel and services. Except in some minor cases, the purchase of NPPs by the
developing countries over the last ten years has not been subject to any
international political restrictions; hence the explanations have to be found
elsewhere.
While small grid sizes, availability of cheaper alternatives,
large investment costs - and particularly the foreign exchange component in
it , and technological complexity of nuclear energy systems may have inhibited
and continue to inhibit many more developing countries from acquiring NPPs,
nearly all those which did announce ambitious nuclear plans about ten (for
example, Iran, Brazil, South Korea, India, Pakistan) ar even five (for
ettample, Mexico) years ago hav!! also reduced the scale of such plans or
extended their horizons. Announcements around 1974/75 of nuclear plans of the
developing countries which either already had an operating nuclear power plant
by then or did start building one by that time (Argentina, Brazil, India,
South Korea, Taiwan, Iran, Pakistan, Mexico, Yugoslavia) were to have a total

----------------------------------------------------------------2. See INFCE (1980) and various OECD/NEA or USDOE/EIA publications over the
period 1980 - 82.

- 7 -

of about 100 to 120 GW capacity by 1995. Achievements of such objectives is


now seriously in doubt. No developing country has even ten NPPs committed as
yet.
The reasons for the slowdown in reactor ordering rates among the
developing countries are diverse - these include the slower growth in
electricity demand than anticipated originally (as indeed slower growth now
projected than was the case in the past), availability of cheaper alternatives
(hydro, gas, coal or lignite), and the difficulties in obtaining financing for
the construction of nuclear power plants, particularly in the more difficult
macroeconomic situations of several developing countries.
Continuing
difficulties in completing the reactors under construction may also in some
(though clearly not all) cases have discouraged further orders. The reasons
for the reactor completion rates being much slower than originally anticipated
appear to be somewhat more complex and situation-specific - technical
difficulties with particular sites (Brazil, Philippines), difficulties in
obtaining construction funds (Argentina, Brazil and Mexico), various
infrastructural bottlenecks (India) and political instability (Iran).
It is
far less important how many reactors are planned for and ordered than how many
are completed, in what time, at what costs, in what manner, and how many are
operated safely and reliably.
The experience with the construction and operation of NPPs has been
limited in and uneven among the developing countries. A total of 18 NPPs have
been completed as of mid-1984, or less than the number in three U.S. states
(New York, Illinois, and Pennsylvania).
The oldest two NPPs are about 15
years old now; total operating experience has been about 80 reactoryears
(nearly three-fourths of which is accounted for by five older plants in three
countries and is of little practical relevance for the future). Construction
or operating experience with the current generation of NPPs - about 1 GW LWRs
or 0.6 - 0.9 GW CANDUs - is too small and spotty.
Overall plant leadtimes - from the date of order to commercial operation
- have ranged from eight to fifteen years for NPPs completed in the last five
or so years and are expected to range from eight to nearly twenty years for
the plants under construction if the current schedules are kept (which in some
cases might not happen).
There are currently nine NPPs unduly delayed (in
Argentina, Brazil, Mexico, India). Total delays in NPP start-ups between end1973 and end-1983 - including only those plants which were expected to start
during this period, and excluding further delays in such plants which have not
yet started - alone resulted in the 'loss' in electricity generation
equivalent to between 233 and 333 TWh, depending upon capacity factors
assumed.
Put another way, the developing countries in the last ten years
'iost' nearly twice as much nuclear energy contribution to their economies as
they have ever obtained (which is about 146 Tilh).
If the loss due to the
lower. realized capacity factors than the theoretical maximum (80 % to 90 %,
depending on reactor types) achievable, as indeed planned for, is taken into
account, the total 'loss' of nuclear energy obtainable and originally planned
for increases appreciably higher.

- 8 -

Nearly all the developing countries have so far depended upon the
industrialized countries for imports of nuclear technology, equipment and
materials and will continue to do so - to varying extents - for many years to
come. (3)
In this respect, the developments relating to nuclear energy among
the IMEs and their export policies have had and will continue to have a
decisive influence upon the nuclear power plans of the developing countries.
Again, it is the lMEs whose nuclear programs figure most prominently at the
global level - roughly 85% of nuclear electricity ever generated by end-1983
has been so in the IMEs, which also had roughly 83% of the world total nuclear
capacity and will have more than 70% of such total in 1995 according to the
author's projections.
The IMEs also remain the most important markets for
NPPs and materials over the foreseeable period.
And yet, the developments in the IMEs in the last ten years have also
been mixed and uneven.
Their nuclear capacity grew from about 37 GW to some
149 GW from end-1973 to end-1983 and will further grow to about 291 GW (next
of retirements) by 1995.
At the same time, more nuclear capacity has been
cancelled or indefinitely postponed than was added during this period, and
nearly a half of the capacity to be added between 1984 and 1990 is what has
been delayed from their scheduled starts in the 1974-83 period rather than
from new orders during that period. Average net NPP ordering rate since 1979
has been about ~ and will probably average 4 - 5 GW per year over 1985 1988.
Plant leadtimes have varied from eight to over sixteen years; national
average lifetime capacity factors range from the low of 37% to in excess of
80%.
Again, the measure of 'loss' in gener.ation due to construction delays
shows that in the 1974-83 period these countries also 'lost' an amount of
electricity (4211.5 TWh to 6016.5 TWh, depending upon the capacity factors
assumed) comparable to what they did get during this period (about 5200 TWh)
or what they ever got (about 5800 TWh).
The difficulties - NPP ordering and completion rates, construction costs,
operating performance - have been the most severe in the US, the birthplace of
nuclear energy in both its forms, where every plant ordered since end-1973 has
been cancelled; there have been no new orders since 1978 nor are any expected
until the very late 1980's or the early 1990's depending upon whose judgement
one subscribes to.
Recently, even the Atomic Industrial Forum of the US
concluded that, "Nuclear power cannot at this time be considered a viable
option on which to base new electrical capacity in the U.S." (AIF, 1984)
However, NPP ordering rates have also slowed down dramatically in the
other IME~. Even in France, where 26 net new NPPs were added during this
period (next only to the US, where l18 units were added) and 26 more are
expected to be added by 1990 (again, next only to the US, which would add 43),
ordering rates have declined from about 6 units per year during the 1970's to
2 units per year since 1982 and would remain so or drop to one unit per year

----------------------------------------------------------------3. Exports from the USSR to the developing countries have been small and
limited to a few countries - NPPs to Cuba and DzO (heavy water) to India and
Argentina.

- 9 -

at least until 1987 /8, while the state-owned utility, EdF, carries on its
massive nuclear construction program - currently spending about 40 billion FF
a year - with the long-term debt of some 188 billion FF and interest charges
in excess of operating income. (The figures are for 1983, when EdF also made
a loss of over S billion FF; its accumulated deficit is now about 23 billion
FF.)
Of course, for the developing countries or the IMEs, i t can be thought
that the recent trends are of little significance over the long term; if a
plant takes fifteen instead of five years to build, well, it will generate
electricity five years later; if a plant costs two, three, or five times as
much as was originally esimated, well, it might still be cheaper over the long
term than the alternatives; if few plants are ordered recently, well, some day
many more will be ordered. The atom - to borrow the popular characterization
of nuclear energy - is commonly thought the necessary and inevitable energy
resource to which the world must turn to, sooner or later.
Nuclear energy has long - at least since the day a nuclear weapon was
used, and in fiction since 1914 - been considered the energy resource of the
future.
And the promise of a new source of energy - based first on the
available uranium resources of the world into the converter reactors, then
reprocessing the spent fuel to get plutonium and using it with uranium-238 or
thorium-232 to get more plutonium or uranium-233, providing a virtually
inexhaustible energy resource - has been so great that the considerable
success so far - some 180 GW of nuclear capacity by end-1983, projected to
increase to more than 400 GW by 1995, worldwide - is not only disappointing in
terms of earlier expectations but also of lowered expectations and receding of
the horizons.
By end-1983, the atom had produced about 6800 TWh (equivalent to 1700
mtoe) of electricity worldwidej this was about a quarter of the total primary
energy consumption of the world in a single year of 1980.(4) By 1995, nuclear
electricity production might be about 600 mtoe-equivalent (per year), or
between 6 and 8 percent of the total primary energy supplies of the world.
In 197 S, the IAEA projected total worldwide nuclear capacity of some
2600-5300 GW by 2000; by 1983, the projection was reduced to 576-851 GW.
(IAEA, 197Sa and 1983b respectively.) Fo-r WOCA (S), INFCE in 1980 projected
4. Of course, about 1700 mtoe-equivalent of atomic energy also lies buried in
the nuclear weapons aresenals of the world. (Assuming that the nuclear weapon
arsenals of the US and the USSR have an aggregate yield of about l 5000
megatons of TNT-equivalent as cited in Sagan (1984), pp. 260, that the other
weapon arsenals total about 2000 megatons, and using the conversion factor of
l mtoe to 10 megatons TNT-equivalent. SE~e SIPRI (1984) for the US and the USSR
strategic nuclear weapons stockpile data. By the late 1980's, the US and the
USSR nuclear weapons stockpile could grow to more than 20000 megatons.
Of
course, not all of the energy in the nuclear weapons is from uranium or
plutonium, which have a yield of about 17 kilotons per kg; the fusion fuels deuterium, tritium, and lithium-6 - have yields of about SO to 150 kilotons
per kg. See Morrison (1983)).
(continued)

- 10 -

Table
4: Growth of Nuclear Power - Number of Power Reactors and Their
Aggregate Capacity (Net MW)

Additions,
197~3

Errl-1973
No.

K.J

No.

Developing

727

IMEs

104

37,236

IDMEs

18

\.XED

126

Additions,
1984-90

Errl-1983
MV

00.

Mo]

1995

No.

M.]

00.

Mo]

6652

15

7379

20

14,371

49

32,349

' 137

114,066

228

149,075

123

124,306

344

290,927

3,561

29

18,883

46

22,224

38

31,173

117

89,216

41,524

177

139,601

289

178,678

181

169,850

510

412,490

Source: Table
8: author's calculations based upon data in
Nuclear News (1984) and estimates based upon other general information
(such as from news articles in trade journals) country-by-country.
Further,
(a)

Reactors smaller than 30 MW excluded.

(b)

Shutdown reactors excluded: a simple rule of maximum thirty-year


lifetime has been applied for projection purposes.

(c)

Some of the reactors reportedly beginning commercial operation in


1983 may not have done so. Hence the 1983 numbers here are
approximate; all but one of these reactors, however, did begin full
operation by mid-1984.
Desai (forthcoming) will provide detailed notes and justifications
behind these projections.

- 11 -

Table

5: Growth of Nuclear Power- Generation (TWh.net)

1973

1974-83
cumulative

1983

Lifetime
to end-1983

1995

Developing

2.2

137.6

35.7

145.3

170-198

IMEs

177.0

5165.7

807.5

5938.8

1514-1766

EENMEs

11. 7

637.0

109.4

735.4

469-547

World

190.8

5940.3

952.6

6819.5

2153-2511

Sources: 1973 to 1983 data from DOE/EIA (1983b) and Nucleonics Week
(Jan. 26 1984). with 5% deduction to convert gross to net. Lifetime
generation data-author's calculations. Projections for 1995 are based
on aggregate capacity projections in Table
4; in the case of
developing countries. these projections differ from those of the World
Bank in Table
2.

- 12 -

850-1200 GW nuclear capacity by 2000 and 1800-3900 GW by 2025; the OECD/NEA


now projects 504-558 GW capacity by 2000 and 1209-2370 GW by 2025. (INFCE,
1980; OECD/NEA, 1983c). The latter projection (mid-point of the range), under
certain reasonable assumptions about retirements and leadtimes implies
ordering rates of nearly 125 GW/yr. around the turn of the century. (By way
of comparison, the total worldwide electrical capacity at end-1983 was about
2250 GW; net addition rates - for all types of plants - have averaged about 86
GW/yr between 1970 and 1982 and might rise to about 100-125 GW/yr. in the
remainder of the 1980's.)
It is difficult to fault optimism; it is equally difficult to accept
fantasy.
A mixture of optimism - quite moderate - and fantasy is also seen
among the views in the developing countries. Table 6 lists some of the plans
for nuclear power in the developing countries. It is worthy of note that some
of the plans are scaled significantly downwards as compared to five or ten
years ago.
But the Table does show that despite the mixed and uneven
experience with constructing and operating NPPs among them, 'nuclear energy'
continues to be a matter of serious interest - it is not possible to judge to
what extent these plans are expressions of desire and to what extent of intent
- among the developing countries.
The biggest - and, should one say, the
fastest, as they are also of the most recent vintage (unlike Brazil's) - plans
are those of China and India, one which has so far had no experience in
building and operating NPPs and the other whose such experience has been far
from satisfactory
Statements about the necessity - and at. that, on a grandiose scale - of
nuclear energy continue to be made. Thus, for example, India's Prime Minister
has said, "(N)uclear energy is the only power source to meet India's demands
and, unless we have something positive to take its place, we cannot talk of
replacing it."( 6)
It may well be so, but it is useful to note that at the
5. This term, intended for World Outside Communist Areas - covering the IMEs
and the developing countries generally considered to have 'market economies' is going to be used in a rather different fashion for the purposes of this
paper - covering the IMEs and the developing countries (including China and
Cuba, the relevant nuclear countries) according to the World Bank (l 983a ,b)
classification, i.e., for World Outside the EENMEs.
For comparisons with
other sources that use the term in the usual sense, such a difference is
immaterial until around 1983 since neither China nor Cuba had announced their
nuclear energy plans until then.
6. The quote is fr.om IAEA Bulletin, September 1982, pp.1, in reference to the
front-:cover photograph of Kota heavy water plant; it was accompanied by a
comment from the IAEA, "As this photograph shows, India is taking advantage of
the benefits of nuclear power". It is amusing to note that that the plant in
the picture had yet to begin operation, indeed was not to begin operation
until mid-1984 and even if it were to take advantage of the nuclear power from
nearby two NPPs, it would have failed miserably since one of them has been in
a state of prolonged shutdown since March 1982, while the other had operated
at about 22. 5 % capacity factor in 1982 (with some 24 breakdowns during the
year). The IAEA could not have afforded to picture the other two major heavy
water plants completed by then in India, because neither of them have operated
(continued)

- 13 -

Table
6: Specific Long-term Nuclear Power Plans of Developing
Countries (excluding plants under construction). Installed capacity
(net or gross MW).

Country
Algeria
Argentina
Bangladesh
Brazil
China

Rector Type
PWR
PHWR
N.A.
PWR
PWR
II

Cuba
Egypt
India
Iraq
Israel
S. Korea
Libya
Pakistan
S. Africa
Taiwan

Pt-.'R
PWR
PHWR
PHWR
PWR
LWR
PWR
PWR
PWR
LWR
PWR
II

Thailand
Turkey
Yugoslavia
Total

N.A.
N.A.
PWR

1990-95
1 x 600
2 x 600
1 x 300
2 x 1245
2 x 450
1 x 900
3 x 440
4 x 950
3 x 235

600
1200
300
2490
900

1 x 600
1 x 950
4 x 900
2 x 440
2 x 900
l x 1000
2 x 950
2 x 1200
1 x 900
1 x 1000
l x 1000

600
950
3600
880
1800
1000
1900
2400
900
1000
1000
26,345

1320
1900
705

1995-2000
l x 600
l x 600

600
600

4 x 1245

4980
6100

N.A.
4 x 1200
7 x 235
10-12 x 500

4800
1645
5000-6000

3 x 900
l x 1000
2 x 1000

2700
1000
2000

l x 1000
3 x 1000

1000
3000
32,82533,825

Sources: IAEA (1983b) and DOE (1983a). In case of China and India, use
has been made of some recent announcements. Overall only such
information as has been reported in the sources has been used;
occasionally, press announcements are made declaring much higher target
than the specific plans here may suggest. It is assumed that Mexico at
this time has no specific plan and its aborted 1981/2 program will not
be revived in the near future. Indonesia and Portugal have also been
. planning nuclear programs, the exact status of which is 'unclear. In the
case of China, Qinshan (Project 728 - 300 MW) and Guangdong (2 x 900 MW)
are excluded from here. The plants under construction have been
excluded. N.A. ~ Not Available.

- 14 -

time of this statement India had but four small NPP s which, taken together,
have been down for a longer period than they have operated. In an even more
optimistic tone, the Chairman of the Indian Atomic Energy Commission has said
that a target of 350 GW FBR capacity in the next century has been set for
India. ( 7)
Assuming that atomic energy organizations are not, strictly speaking,
government-subsidized organs to provide humor, such projections ought to be
taken seriously.
They reveal a stronger belief in the promise of nuclear
energy as the "salvation resource" - to expand energy supplies, to provide a
substitute for reliance upon alternative fuels, and to do so cheaply - as
compared to other possible alternatives. Concerns over future energy supplies
and their costs or over security needs are legitimate, but one needs to ask
which strategies might be appropriate, in what contexts, and at what costs.
Specifically, the question to be asked is, in the foreseeable period, which in
the current contexts of uncertainties cannot be in excess of ten to fifteen
years, what strategies in regard of nuclear power are likely to be followed by
the developing countries, under what conditions they might be appropriate, and
what costs they might involve.
Energy/economic questions are only a part of the story of the history and
the probable futures of the nuclear power programs in the developing
countries.
Considering that by the time many of the developing countries
started their nuclear energy programs (in the case of India, as far back as
1948), the energy/economic basis of such programs was at best doubtful, and
that - apart from the acquisition of technologies and materials for nuclear
power plant construction and operation - there are other aspects of their
nuclear programs (relating to the fuel cycle activities) which have a larger
international political connection, it is useful to examine the international
political influences on the nuclear energy programs of the developing
countries.

at close to a half of their capacity either!


The aggregate capacity
utilization rate of India's three heavy water plants - at Nangal, Baroda, and
Tuticorin - during the (Indian) Fiscal Year 1982-83 was about 15 %.
7. Article by Dr. Raja Ramanna in the The Hindu (Madras) Survey of Indian
Industry 1983 as reported in JPRS-TND-84-008.

- 15 -

II. The Promise and the Premise:


The origins of such forceful beliefs in the promise of nuclear energy go
back about thirty years.
(In the case of the potential use of nuclear
technology for nuclear weapons, the origins of course go back to August,
1945.) December 8, 1953 the US President Eisenhower, in the Atoms for Speech
before the UN General Assembly delclared, "The capability (to produce peaceful
power from atomic energy) is already here, now, today", and "to hasten the day
when fear of the atom will begin to disappear from the minds of the people,
and the goveenments of the East and the West", proposed the "formation of an
international atomic energy agency" and "contributions of natural uranium and
fissionable materials"
to it, "a special purpose (of which) would be to
provide abundant electrical energy in the power-starved areas of the world",
and pledged the US "to help resolve the fearful atomic dilemma, to devote its
entire heart and mind".
Then followed the USAEC 's Atoms for Peace Program
(along with the US State Department) which laid the basis for almost all the
developing countries' (8) nuclear programs, the formation of the IAEA and, in
the US, a series of activities which resulted in the industrial development of
the world's dominant reactor type - the LWR.(9)
The phrase 'peaceful uses of nuclear energy' - or the slogan 'atoms for
peace' - involved a broad promise and a premise. The premise was that (a) the
atoms for peace would remain just that; the promise, on the other hand, was
that by such uses the causes of world prosperity and peace will themselves be
served. (10, 11)
8. The exceptions among our list of nuclear countries being China and Cuba.
9. The first, and continuing, use of LWRs (PWRs) has been for the US Navy
nuclear submarines as also lately for aircraft carriers.
10.
The promise of atomic energy for world prosperity was evident in the
minds of the US scientists and policymak-ers as far back as 1945/6, i f not
earlier. See US Department of State (1946) or the Symposium (1945). See also
Allardice, ed. (1956); incidentally, this last reference includes the earliest
hypothetical estimates of comparative costs of nuclear power in the developing
countries. (The study was prepared for the World Bank, which soon after made
its first and so far the only loan for a nuclear power plant - in Italy.)
.i1. Originally, the Atoms for Peace speech had the stated intent that ( i)
atomic energy be diverted from military to peaceful uses, and (ii) the further
potential use of atomic energy for military purposes be prohibited and thus
prevented. The mechanism proposed by Eisenhower to achieve these objectives
was the creation of a bank of fissionable materials under multinational
control and the gradual transfer of military fissionable material to this
bank. This 'disarmament' aspect of the speech was quickly forgotten, however,
It is probable that the speech was primarily
and never seriously pursued.
designed as the basis for subsequent expansion and US dominance of
international nuclear markets for its own diplomatic and commercial
(continued)

- 16 -

Atoms for Peace - the speech, the ensuing programs - also established
international transfers of nuclear technology and materials for peaceful
uses. Exactly ten years later, in 1963 - the same year a US utility made the
decision to purchase a NPP solely on the basis of estimates of comparative
eco~omic advantage - the first NPP to a developing country (India) was sold.
The era of 'commercial' nuclear thus began at the same time both in the US
domestically (12) as well as for the developing countries.
Other developing countries also began NPP construction in the subsequent
ten years - Brazil, Mexico, South Korea, Taiwan, and Yugoslavia, which
accepted the US LWRs, as also Argentina, Pakistan and India (subsequent to the
two US BWRs), which accepted the PHWR designs of German or Canadian variety.
The reasons behind reactor-type and supplier choice appear to be political
(including the desire to be independent of US enrichment services) and
strategic (for a subsequent potential use for military purposes) as well as
energy/economic (India planning to build its extensive nuclear energy program
on the basis of domestic thorium to be used in Th-232/U-233 breeders, for
example).
For about twenty years after the Atoms for Peace speech, the world
transfers of nuclear technology and materials were gradually and to a large
extent liberalized.
The US had by then acquired great commercial and
political leverage in the nuclear power programs of other countries - because
of the success of its LWR technology, its near-monopoly in the uranium
enrichment services market, and at a broader scale, its position and role in
the world economy and polity.
As for its position on the issue of weapon
proliferation, the US policy had been based on a belief in its ability - as
also of the other supplier nations, among whom only Canada had until 1974/5
been commercially successful - to keep the 'atoms for peace' separate from
'atoms for war' by reliance upon a set of multinational agreements (the most
important of which was the Nuclear Non-Proliferation Treaty or NPT, entered
into force in 1970) and related bilateral agreements. The implicit assumption
was that inspection of safeguarded facilities would provide sufficient timely
warnings about potential diversion to proscribed uses and that the US unilaterally or in concert with other nations - would have sufficient capacity
advantages.
12.
A historical note - the first application to electricity generation
occurred on December 20, 1951 at a small, experimental breeder reactor (thus
establishing for .the first time the feasibility of breeding) in Idaho, US; the
fir~t regular nuclear power station (5MW size) started in the USSR on June 20,
1954; the first such station (50 MW size) in WOCA began in the UK in 1956; the
first in the US was the Shippingport plant (60 MW), which began in 1957. The
USSR and the UK plants were used apparently for military purposes, at least
partially, as was the first research reactor in a developing country (India)
which began in 1956. (It is useless to argue whether the Indian explosive was
a bomb or a 'peaceful' nuclear explosive.) The Shippingport plant in the US,
while apparently not used for military purposes, was under the ownership of
the USAEC (and its successors), not of civilian entities.

- 17 -

to threaten and/or apply sanctions against such diversion.


After twenty-odd years of aggressive salesmanship on the part of the US
(and, to a lesser extent, Canada), the basic, inherent conflict between the
internationalization of nuclear energy
technology and the political
ramifications of such a spread - particularly among the developing countries came to the fore. This occurred in two respects - (i) the Indian nuclear bomb
test of May, 1974; and, ( 11) the Brazilian purchases of NPPs and other fuel
cycle facilities from West Germany; the Iranian purchases of NPPs from France,
and participation in the European enrichment project; and, the prospective
sales of reprocessing plants by France to Pakistan and South Korea - taken
together, not only the first NPP sales to developing countries from other than
the two North American suppliers, but also the first sales of enrichment and
reprocessing plants ever.
Several other historical factors precipitated the emergence of this
conflict at the time - (i) the world oil price increases of 1973/74, prompting
accelerations in the nuclear power programs worldwide, including the plans for
non-US enrichment capacities (13) and for the reprocessing of nuclear spent
fuel and commercialization of the breeder reactor; and (ii) the plans of other
Non-Nuclear-Weapons-States (NNWS), in the language of the NPT, to acquire
remarkably dual-purpose nuclear technology.(14)
The public policy debate over the issue of the links between
international nuclear trade and transfer (of equipment, technology, and
materials) on the one hand and the spread of nuclear weapons - the so-called
'horizontal proliferation' - on the other was probably the most intense in the
us. There, it was linked to the debates over the future directions of nuclear
energy programs in the US (15) - whether and when civilian spent fuel
13.
Planning for Eurodif and Urenco actually began around 1970/71.
As of
late 1970's, Canada also had plans for about 17 to 20 million SWUs enrichment
capacity by 1990; South Africa was to build about 7 million SWUs capacity by.
mid-1980's and Brazil about 5 million SWUs capacity by 1989. (SIPRI, 1979,
pp. 392). None of these plans are currently active.
14. The term "remarkably" is used with deliberation here; in theory, all
reactors can and do produce weapons-usable material, although there is a
debate about how good such material from power reactors actually is for
weapons.
However, enrichment plants and reprocessing plants specifically
allow such production for the directed purpose of explosive use, as most such
plants have done so far (in the US, France, the USSR, the UK, and China, for
.both types of plants; in India, as well as probably Israel, for reprocessing
plants; and 1 in South Africa 1 for an enrichment plant.)
In the current
generation of converter reactors, it is not possible to obtain weapons-usable
material without either of the two types of plants.
15. The US does not really have nuclear energy programs in the sense that
some other countries - particularly those with a central state utility or a
small number of utilities - do, for coaunercial nuclear power plant
construction and operation. However, in as much as most of the nuclear R & D
work in the US is funded by the government - as in other countries - and the
development of major new technologies such as the breeder was to be (as it
(continued)

- 18 -

reprocessing should begin and at what pace the 'transition' towards the
'plutonium economy' involving the use of breeders should be pursued.
The
debate was also linked to those over the role of the US in international
nuclear trade and safeguard regimes, as also - in this case in many other
countries as well - to the debates over global energy options, over regional
security/strategic considerations, and over the future of 'north-south'
relations.
The changes in US policy in the 1976-78 period - whereby it sought to
define proliferation as the capability to manufacture a nuclear explosive
rather than actual manufacture or testing of it, to impose restrictions on the
'sensitive' dual-purpose technologies even when they were covered by
safeguards, and, finally, to restrict further US nuclear exports only to the
NPT-signatory countries (16) were remarkable not only in that they signified
reversal of the past policies but also the very image of nuclear energy - for
which, after all, the US had been the most prominent and the most successful!
salesman.
(There were similar changes during that period in the nuclear
export policies of Canada - the other, somewhat less successful - salesman.)
They appeared to recognize the basic conflict - some may say, incompatability
between 'atoms for peace' and 'atoms for war'.
As such, they also
essentially admitted that 'partial' safeguards - such as applied to specific
facilities which may use equipment or material supplied by the exporting
nations, unlike the 'full-scope' safeguards, which cover all nuclear
facilities, as required by the NPT - were of little value.
In as much as only the US (and Canadian)" policies (17) prohibited nuclear
exports to countries which had not signed the NPT or otherwise accepted 'fullscope' safeguards, they should not have caused any substantial impact on the
nuclear power programs of the developing countries, whether they had signed
the NPT or not, and indeed there is little evidence that any formal exercise
of the export control policies of supplier nations has done so so far. (18)
still is) undertaken largely at the government expense, there are questions of
'government programs' relating to specific nuclear energy issues.
16.
For a description of the US export policies as defined by the NNPA
(Nuclear Non-Proliferation Act of 1978), see Warren H. Donnelly's article in
SIPRI (1979) or Potter (1982). At the meetings of the London Supplier Group,
the supplier countries have also agreed on a set of 'guidelines' they may
choose to follow in nuclear exports. However, the range of products that may
be 'dual-purpose' is very wide - ranging from special metals to apparently
common inqustrial computers - and it is not possible to even know what exactly
(s being controlled, what is being exported, by whom and to whom. See US GAO
(1983c), where paragraphs after paragrphs are 'deleted' or 'classified'.
17.
The US policy is based on - though it sometimes conflicts with legislative requirements; it is not clear to the author whether the Canadian
policies have such requirements.
18. A country wanting to purchase a nuclear power plant and, where necessary,
fuel in the international market - without accepting full-scope safeguards could do so from any country other than the US, Canada or the USSR.
(The
USSR, while not requiring full-scope safeguards, does require that the spent
fuel be returned.) Australia also requires full-scope safeguards. There are
(continued)

- 19 -

However, in the volatile environment of the 1974/7 5 period - as also


until around 1980/1, when the fortunes of the world nuclear industries took a
sharp, downwards turn - the promise of nuclear energy seemed so strong and
necessary that changes in the export controls by the US and Canada seemed to
some
to
be
counterproductive and fundamentally against
the
'world
interests' .(19)
Nuclear energy development was indeed no longer seen as a
promise, a matter of probabilities and choice, but one of a necessity and an
inevitability. Atoms for peace - atoms for energy, atomic energy for profits,
and energy and profits for peace and security, all became intertwined.
The chain of arguments generally went as follows - nuclear electricity is
a cheaper and more reliable source of energy, worldwide and particularly for
the developing countries who were burdened by enormous oil import bills; the
nuclear option brings profits for the user country as well as the supplier of
nuclear equipment and materials and increases security of energy supplies;
with such economic advantages as well as the political advantages - via the
nuclear trade relations - and with the pressures on world non-nuclear fuel
markets being reduced, but enhanced prosperity and global peace should follow.
Thus in 1978, David Rose and Richard Lester advanced "the heretical
proposition that the supposed (positive) correlation - between the worldwide
spread of nuclear power plants and their associated technology on the one
hand, and the proliferation of nuclear weapons and the risk of nuclear war on
the other - may go the other way", argued t~at, "If the US were to forgo the
option of expanding its nuclear-energy supply, the global scarcity of usable
energy resources would force other countries to opt even more vigorously for
nuclear power, and moreover to do so in ways that would tend to be
internationally destabilizing," and further, that, "any policy that seeks to
divide the world into nuclear 'have' and 'have not' nations will lead to
neither a just nor a sustainable society but the inverse." (Rose and Lester,
1978) (20, 21)
In 1981, Gerard Smith and George Rathjens similarly argued,
only two cases where a developing country has not been able to obtain desired
nuclear power plant or fuel for what might be primarily political factors Pakistan, which is not a signatory to the NPT, and Libya, which is.
19. The issues of technology denials and the controversies about them, again,
go back to the origins of nuclear energy when during the Second World War the
partners in the US Army Manhattan Project - the US, the UK, Canada, and France
- tried to keep it secret from their enemy countries as well as from the USSR,
their. wartime ally and to a later period when, following the end of the War,
the US prohibited the sharing of nuclear technologies even with its wartime
partners. Later, there may also have existed, beginning in the early 1950's,
a secret group among the major Western nuclear countries of the time which
controlled the world trade in uranium. See Pringle and Spigelman (1981).
20. Notice the sleight of hand in lumping together "nuclear power plants" and
"associated technology", on the one hand, and "the proliferation of nuclear
weapons" and "the risks of nuclear war" on the other. From what the author
can tell, the US position has never been against exports of nuclear power
plants but only of 'associated technologies' such as enrichment and
reprocessing plants; also, it is quite legitimate for the US to perceive that
(continued)

- 20 -

"(A)ggregate demand for oil, not to mention its price and the seriousness of
interruptions in international commerce, including the likelihood of war over
oil, may well depend to a substantial extent on the development of nuclear
power." (Smith and Rathjens, 1981, pp. 891)
Seen from today's vantage point, such contentions appear to be
untenable. Not just the temporary ban on domestic civilian reprocessing and
the temporary postponement of the Clinch River Breeder Reactor Project but
even the massive cancellations of nuclear power plants in the US have made but
a slight and marginal impact on the US oil consumption; in any case, after the
decisions of 1976/7 were reversed, the reprocessing plant was mothballed and
the breeder project abandoned. For the OECD countries as a group, the share
of oil in electricity generation has dropped from over 25 % in 1973 to about
13 % in 1982, while some of it due to displacement by nuclear power, but not
due to any new projects begun after 1978. By 1990, it would fall to about 10
% and by 2000 to about 5 % depending upon the overall growth of electricity
generation and upon the pace of current plans for non-oil capacity additions
which, as noted before, has if anything been dramatically slower than in the
past in the case of nuclear.
At the aggregate primary energy consumption
level, oil use in electricity generation was about 7 %- in 1973, about 4 % in
1982, and may fall to about 3 % in 1990. (22)
Although there is room for
qualifications and arguments, it seems reasonable to judge that if the price
and availability of oil are the main strategic concern, and in as much as
nuclear electricity can only displace relatively very small quantities of oil
used in power generation, such a role for nuclear power is essentially absent
- beyond the current plans - over the foreseeable period. (23) In fact, even
if the nuclear plans implicit in such projections - such as the OECD's nuclear
projections for Italy - were to be only partially met, the effect on aggregate
oil consumption and on the world oil markets would be practically nil. And
all this, while the breeder commercialization programs are being postponed
worldwide and the reprocessing activities delayed or sharply curtailed.
proliferation of nuclear weapons is against its interests, whether or not it
were to lead to increased risks of nuclear warfare.
Notice also the
implication that by forgoing nuclear fuel reprocessing - whose need for
expanding energy supplies can only be in the very long term - the US may be
forgoing the option of expanding its nuclear energy supplies; the cheaper way
to expand the nuclear energy supplies would be to simply build more nuclear
power plants, against which no US government has ever argued, rather than to
go the rou~e of reprocessing and the breeder.
21.
Another variant of such an argument is "the industrialized countries
shou1d use more nuclear power so as to free up oil for the developing
countries".
22.
The projected values here are based on OECD/IEA (l 984c) with some
adjustments for and rough assumptions about the OECD countries which are not
members of the IEA (France, Iceland, and Finland). The historical values are
from OECD/IEA (1984a).
23.
Whether the nuclear capacity recently installed and planned to be
installed by 1995 would have overall displaced substantial amounts of oil and
if so, economically, can only be answered when this capacity has run its
lifetime.

- 21 -

In the author's view, the oil supply and price changes of 1973/74 played
only an indirect and perhaps 'rationalizing' role for the decisions about
nuclear power. It is plausible to believe that oil price increases in 1973/74
- f~llowed by increases in the price of coal as well - changed the generation
economics; however, it is less plausible to believe that these increases were
thought to be of permanent nature around that time. Given the rapid increases
in the use of oil in power generation over the preceding ten or so years - in
some cases (such as France) the result of the decisions of the governments
which later made a massive commitment to nuclear power - some of the countries
were indeed bearing a high burden of oil price increases via their effects on
electricity generation costs (but in this respect, the proportionate final
cost increases being smaller than, say, in the case of direct use of petroleum
products such as gasoline, diesel or fuel oil for heating).
However, in as much as NPPs took - even by 1974 - six to eight years to
build, the perceived economic benefits could have been realized only that much
later.
What is more plausible is that some of the decision-makers - in
governments and in utilities - saw the drastic changes in generation economics
as a way to push for ambitious nuclear power programs; After all, despite the
high hopes of rapidly commercializing nuclear power and of acquiring a large
share of the electricity generation markets, nuclear power had progressed very
slowly in all countries except the US by 1974. (In the US, all the NPPs that
are built or still under construction were ordered before 1974). Comparative
generation economics were only a part of the reasons for such a slow growth;
however, the changes in generation economics, combined with the fears of
directed supply cutbacks (such as embargos, which could not and cannot work
effectively), in the period after 1974 lowered the barriers against nuclear
power expansion. (Such was probably the case in Western Europe and Japan, but
also in some of the developing countries such as Brazil or Iran). This is not
to say that comparative economics played no part in the spurt of NPP ordering
that occurred after 1974 - indeed they did, and may have been a more dominant
factor in some countries than in some others; what may also be true is that
even without the oil price increases of that magnitude, some of the countries
would have pushed forward with nuclear power in any case. The projections for
nuclear capacity by 1990 or 2000 were, further, probably as much guided by the
need to rationalize the breeder commer.cialization programs as by careful
analysis of electricity demand growth rates and nuclear penetration rates of
the electricity generating markets.
(Such hypotheses cannot be proved;
indeed, to paraphrase a Dr. Herbert Taylor, there is no need to ascribe to
conspiracy . that ~hich stupidity would suffice to explain.) (24)
Since one of the primary rationale about nuclear power programs was the
concern over oil consumption growth rates, availability, and price, let us see
what has happened over the ten years.
Total world primary energy consumption has for the first time in post-war
history declined for three consecutive years, 1979 annually to 1982, and has
remained practically unchanged in 1983; world oil consumption has for the
24.

Quoted by US Congressman Al Swift (D-WA) in US Congress (1984a).

- 22 -

first time declined for four consecutive years. Dividing the 1970-82 period
in four convenient three-year slices, total primary energy (TPE) consumption
as well as oil consumption grew at (average annual growth rates of) 5.1 % and
7 .O % respectively between 1970 and 1973 (only slightly slower than in the
preceding ten years); at 1.9 % and 1.1 % respectively between 1973 and 1976;
at 3.6 % and 3.0 % respectively between 1976 and 1979; and, at -0.8 % and -2.4
% respecively between 1979 and 1982.
(From Table 1.1; the growth rates are
even lower if only 'WOCA' - i.e., developing countries and the IMEs - is
considered; inclusion of China in this definition is unlikely to affect the
aggregate WOCA rates very much.) Except for the year 1976, when the world TPE
consumption and oil consumption grew 5. 7 % and 7 % respectively over the
preceding year (though after two years of virtual stagnation), neither has
achieved a year-to-year growth rate of 4 percent in any year in nearly ten
years now.
For all the oil produced between 1974 and 1983 (about 210-215 billion
barrels), which was about 40 % higher than in the preceding ten-year period
(about 150 billion barrels between 1964 and 1973) or 70 % of the oil ever
produced up to 1974 (about 300 billion barrels), and about 34 % of the (known
proved) reserves of some 620 billion barrels at end-1973, world reserves of
oil stood higher at the end-1983 (about 678 billion barrels) than at end-1973,
as they were for every year since 1973.
Indeed, in 1982 (or for that matter 1983, since the change from 1982 to
1983 was very small) the world oil consump-tion was neatly equal to that in
1973 and its total primary energy consumption only about 15 % higher.
The
share of oil in the total primary energy consumption, which had been
increasing right up to 1973, was about 13 % lower in 1982 (as compared to
1973), continuing the declining trend since 1973 where for every year except
1976 (over 1975) this share has been lower than in the preceding year. OPEC's
share in world oil production was down to 35.4 % on 1982 (and further down to
less than a third as of mid-1984) as compared to 54 % in 1973, again
continuing the year-to-year trend since 1973 with the exception of 1976. Its
share in world oil exports, which was as high as 73.9 % in 1974 was down to
52.1 % in 1982 and rough estimates put it at about a half or less as of mid1984. The real price of oil has been falling (though the extent of such fall
in non-US currencies has been smaller due to the appreciation of the dollar)
for about four years now, and might still fall further. (25)
There are various explanations for the slower - or in some cases,
.negative - growth rates for primary energy consumption and oil consumption
over the last ten years, among them lower economic growth rates, shifts in the
structure of aggregate and sectoral output, increased end-use efficiency, and
substitution away from oil.
It is this last factor, particularly in power
generation, which interests us here. Table 7 provides selective data on the
composition of primary fuel input in some IMEs and developing countries. It
is seen that only Japan and Italy among the major IMEs
(in 1982) and
Argentina, Mexico and South Korea among the major developing countries (in

----------------------------------------------------------------25. The numbers here are based on primary data from the World Bank, BP (1984)
and deGolyer and McNaughton (1983).

- 22a. -

Table 'Y .: Composition of Electricity Production, Selected Countries and Years.

Total (TWh)
Coal
IMEs:
USA
Japan

FRG
France
Canada
UK

Itlay

Percentage Distribution
Fossil Thermal
Primary
Nuclear Geothermal
oh
Gas
Total
Hydro

Year: 1982
2419.4
581.1
366.9
278.6
390.2
272.2
184.4

Develo~:

Year: 1980

Argentina
Brazil
China
India
S. Korea
Mexico

37.0
137.0
300.4
110.9
36.8
64.0

52.7
11.0
62.5
23.9
18.3
71.8
13.5

6.5
43.2
4.7
9.3
2.6
9.5
50.9

15.3
13.6
10.1
1.9
2.4
0.5
6.5

74.5
67.8
77 .3
35.I
23.3
81.8
70.9

13.1
14.6
5.4
25.8
67.7
2.1
25.4

4
3
64
50
7

36
7
17

20

60
10
81
53
86
59

34
90
19
42
5
39

79
50

12.4
17.6
17.3
39.0
9.0
16.2
3.7

N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.

5
9

Sources: For the IMEs, OECD/IEA (1984a): for the developing countries,
World Bank (1983a).

- 23 -

1980; data for Taiwan are not available) had a high share of oil in
electricity generation.
In the case of Italy, Japan, Argentina, and South
Korea, this share would decline as the non-oil capacity (a large part of it
nuclear in the case of Japan and South Korea) under construction is brought on
line.
Unless electricity demand were to rise unexpectedly and rapidly, in
which case oil-based capacity might need to be used more heaviliy or extra
oil-based capacity may need to be revived or built anew, there is little
competition between oil and nuclear generation over and above the current
plans.
(Even in the countries which do remain substantially dependent upon
oil-fired generation over the next ten to twenty years, it is not generally
obvious that nuclear power would be the most economical choice.) In fact, as
electricity demand in many cases has failed to grow as rapidly as anticipated
earlier,
nuclear
power
is
substituting
coal-fired
capacity
already
installed.
Whether over the long term, such would have been economically
advantageous remains to be seen. (26)
The experience on the other side of the issue, particularly relating to
the developing countries - whether controls on nuclear exports - particularly
of enrichment or reprocessing technology - have curbed nuclear weapon
proliferation is mixed, and this is because of the inherent limitations of the
export control regimes.
On the one hand, neither technology has spread via
authorized commercial channels beyond the countries which had them or had
contracted to have them by 1974; on the other hand, many of the countries
which in the Anglo-American jargon were called 'proliferation-risk' have
achieved nuclear weapon capability via such technologies or may do so within
five years.
(Argentina and Pakistan, with their recent announcements of
enrichment plants under construction, without safeguards; Brazil, with its
recent announcement to build a larger enrichment plant, with safeguards; South
Africa, whose enrichment plant is not under safeguards; and Israel, with a
reprocessing plant, not under safeguards. The latter two countries are widely
suspected to have manufactured nuclear weapons already.)
The experience of the connections between civilian and military nuclear
energy programs is also mixed.
No other nation since 1974 has made an
official weapon test (though it is alleged that South Africa made one or two
secret tests), no terrorist has gained access to special nuclear material or
nuclear facilities with the intention of sabotage (though in 1981 Israel did
26.
The situation is that with both nuclear and coal-fired capacity
originally built for base-load generation, it is still cheaper to operate the
nuclear power plants at a higher load factor - if possible - than the coalfired plants; this drives up the generation costs from coal-fired power plants
and also for the utility as a whole. Had a smaller volume of nuclear capacity
had been built, the overall costs would have been lower.
(This argument
applies in as much as a large part of the recent additions have been nuclear,
as has been the case in France, for example.
France has the option of
exporting its electricity surplus; however, in a situation such as Brazil's where the overcapacity involves hydro - there are no choices but to push for
increasing sales and bear the high capital costs if the plants are not
operated at an economic load factor.

- 24 -

destroy an Iraqi research reactor near completion), no confirmed thefts of


sensitive nuclear technologies has taken place (though a foreign scientist has
been indicted and convincted in absentia with stealing centrifuge enrichment
technology from the Netherlands), no civilian power facility has directly
contributed to weapons capability of any more countries (though in fact the
inching towards weapon-capability has been made possible not by dedicated
facilities but by the use of nominally civilian facilities), and no civilian
power reactor has contributed to the expansion of the nuclear weapon
stockpiles (though in fact dual-use reactors and fuel-cycle facilities are
used by the US, the UK, France and the USSR). (27)
Given this experience, it is necessary to take a look at the worldwide
experience with nuclear energy over the last ten years, and examine its
probable or desirable futures over the next ten or so years. In the hysteria
- or, in some cases, the mania - of the mid- to late-1970's, it may have been
'plausible' to regard nuclear power as a 'salvation fuel', to regard nuclear
power for the developing countries - and, more importantly, the promotion and
the spread of fuel cycle technologies - as desirable or even necessary.
However, the contexts in which the debates about nuclear energy, economics and
politics were conducted have changed and are likely to undergo further changes
in the future, and i t is necessary to recast the debates in the changed
contexts. Once again, in the author's opinion, the timing and the scale of
the nuclear energy programs, particularly for the developing countries have a
strong influence on the subject of nuclear economics and politics.
In the
subsequent sections, we will look at ( 1) worldwide experience with nuclear
energy programs; (ii) interpretations of the experience and their effects on
the probable outlook for nuclear energy programs and their implications for
the international nuclear proliferation regime( s); (iii) issues in nuclear
economics over the next ten or so years; and, finally, (iv) lessons of such
experience for the developing countries.
We will use 1973/74, the current period (mid-1984) and 1995 as the
benchmark years.
The current vantage point is advantageous in that it is.
situated roughly in the middle of the two end-points, ten years apart in both
directions.
ln most countries, the likely picture for the maximum nuclear
capacity installed by 1995 is more or less certain now. Unless severe delays
are experienced in construction plans and/ or some nuclear plants are prematurely retired because of accidents or other reasons, the plants currently
operating (net of expected retirements on the basis of a simple rule of
thirty-year lifetime) combined with those under construction (net of likely

----------------------------------------------------------------27.
All but one of the 'production reactors' in the US are not for
electricity generation and hence 'dedicated' to the weapons program. There is
one reactor, however, which is dual-purpose; it is owned by the USDOE and
hence not 'civilian'.
In the UK and France, power reactors which do
contribute to the weapons program are owned and operated by the national
atomic energy authorities and are hence not 'civilian'. The last production
reactor in France was shutdown earlier this year; the French have not ruled
out the possible use of some of the plutonium produced in the new breeder
reactor - the SuperPhenix - which is indeed 'civilian'. As mentioned in an
earlier footnote, most enrichment and reprocessing plants are 'dual-purpose'.

- 25 -

further cancellations) give a relatively firm picture of operating capacity in


1995; when estimates of additional orders over the next three or four years
(i.e., by 1988) which can be completed by 1995 are added, we get the maximum
capacity for 1995. As a result (combined with information on specific plans),
it is also possible to make some relatively firm judgements about the extent
of the fuel-cycle activities up to around 1995. By 1995, the first generation
of power reactors completing their full life-time (taken to be thirty years,
which no power reactor has yet completed (28)) would be ready for
decommissioning.
Further, while the pace of reactor completion rates would
slow down considerably - hence yielding progressively smaller sample of
construction experience the recently added generation of reactors
(particularly the LWRs of about 900 MW and above), which have borne the brunt
of the nuclear industries' troubles in recent years, will have provided an
impressive amount of operating experience. The first demonstration of a highlevel waste geologic disposal program - in the US, the only country which has
any specific time-table (though it may get stretched out) for the disposal of
high-level wastes, in the form of spent fuel from its civilian reactors and of
liquid reprocessing-wastes from its military program - may begin around 1998
or 2000 but by 1995, some experience with the procedures of site selection and
with program costs will also become available. (It is possible that if the
HLW repository program were to be delayed, a Monitored Retrievable Storage MRS - facility will be built, which could also provide significant, useful
experience). Finally, 1995 will mark the fiftieth anniversary of the two, and
hopefully the only, military uses of nuclear energy as also the date for the
expiry of the current term of the NPT.

----------------------------------------------------------------28.

Except the Soviet Obininsk reactor of about 5 MW size.

- 26 -

III. Nuclear Energy Experience


It is useful to get some idea of the size and nature of the world nuclear
energy industries before looking at the current status of the industry both
from the 'demand' side, i.e., in terms of power reactors built, electricity
generated, and from the 'supply side', Le., in terms of the vendors who
supply power reactors, the architect/ engineer/ construction contracto rs, the
fuel supply industry, and so on.
Like other energy industries, the nuclear energy industry is a big
business, involving substantial amount of government participation and
control, and characterized by a small number of companies.
The degree of
market concentration, politicization and political control is greater on the
'supply side' of the industries - i.e., that involving nuclear steam supply
system (NSSS) design and construction, uranium production and sales,
management of spent fuel, including reprocessing and use of the breeder. (On
the 'demand' side, there are many utilities of course, but in each country or
a region, an electric utility is usually a regulated monopoly; in this
respect, the government control of the 'demand' side is characteristic of the
entire electricity generating industry.) A sense of the financial magnitudes
of the nuclear power industry can be given in some rough estimates of the
author: the book value of the investments in nuclear power plants worldwide
now may be about $90-100 billion dollars (about $400 billion 1984 dollars in
replacement-value terms); recent capital expenditures have run around $20-30
billion a year; fuel and 0 & M expenditures are currently about $14 billion a
year(enrichment business alone is about $2.5-3 billion a year currently); R &
D and other expenditures are about $8-10 billion a year (including research on
nuclear fusion).
Total investment in the supply industries - from NSSS
design, manufacture and construction to fuel supply and enrichment as well as
reprocessing - is about $ 30-40 billion in book value terms and about $60-100
billion (1984 dollars) in replacement-value terms.
Cumulative R D & D
expenditures to date on all nuclear energ~ technolgies (including fusion) are
probably around $50-100 billion (in 1984 $). By 1995, the total investment in
the nuclear power plants alone would have risen to about 1 trillion 1984
dollars; cumulative O&M/fuel expenditures would have risen to about 0.5
trillion 1984 dollars; and, cumulative R&D expenditures and and fuel-cycle
investments about another 0.3 trillion.
The term 'nuclear energy industries'
because of

is somewhat vague and misleading

a considerable degree of overlap between what are generally termed as


'industries' - i.e., mining, manufacturing, construction and the like - and
'organizations', such as government departmen ts and agencies.
This is
particularly the case when the military side of the nuclear business is
considere~, since in nearly all countries a distinction between 'civilian' and
'military' nuclear industries is nearly impossible to make (except in the case
(i)

- 27 -

of the 'demand' side, i.e., the utilities); (29)


(ii)
existence of a certain degree of vertical integration among various
parts of the industry - such as utility or state-agency ownership of uranium
companies
or
of
enrichment plants and of interlocking horizontal
relationships such as signified by partial ownership, licensing agreements,
and other contractual agreements;
(iii)
a sizeable degree of overlap between the nuclear industries and the
rest of the electrotechnical industries - NSSS (Nuclear Steam Supply System)
manufactures' business ranging from consumer electronics to conventional
boilers, turbines and generators - as indeed many other parts of the 'heavy
industry' business in general; a similar overlap between uranium mining and
processing companies and those involved in the mining of other fuels as well
as non-fuel minerals; further, between architecture/engineering/construction
business for NPPs and that for any other type of power plants or for that
matter other big projects.
Government policies or tradition also make different countries' domestic
nuclear markets 'open' or 'closed' to particular companies with particular
host countries. Thus there is no uniform world nuclear market; in some cases,
such as uranium ore or enrichment services, the markets are relatively open,
whereas in some other cases, such as construction, they are not.
By and
large, the extent of trade between the EENMEs - mainly, the USSR - and WOCA
(in the definition employed here) has been small. (30) Even within WOCA,

29. Thus in some countries, the Atomic Energy Commissions own and operate all
the nuclear facilities (including the power plants) directly; or partly own
the supply industries such as the fuel industries, the NSSS (Nuclear Steam
Supply System) manufactureres or transport companies specializing in nuclear
materials; or in some other countries, the utilities own such businesses and
the utilities themselves are in turn owned by the government. In France, for
example, the CEA owns COGEMA, which owns the reprocessing plants and partly
owns the Eurodif enrichment plant; the CEA and the EdF both have shares in
Framatome, the NSSS vendor, which in turn owns Fragema, along with COGEMA. In
the US, the DOE is in charge of both the civilian nuclear energy policy and
research work as well as of the production of nuclear weapons.
(At least
recently, the 'defense' part of the DOE budget has been higher than the
'civilian' part.)
The USDOE also owns the uranium enrichment plants and
undertakes the program of disposal of nuclear wastes from both civilian and
military activities.
Most of the operational work of the DOE is done by
private :f..ndustry contractors, which operate the dual-purpose facilities as
well as the military facilities and are again the leaders in the civilian
nuclear markets.
The same companies that build the civilian power reactors
also build the military production reactors or the naval propulsion reactors.
Uranium companies sold and sell uranium to both the civilian industries as
well as to the weapons programs.
30.
The exceptions are (1) Soviet supplies of power reactors and fuel to
Finland; of research reactors or fuel to Egypt, Iraq, Yugoslavia, Argentina
(small quantities of research-grade enriched uranium), Indonesia, China, and
Libya; of heavy water to India and Argentina; and, sales of enrichment
(continued)

- 28 -

nuclear trade - apart from the restrictions of the non-proliferation regimes


and supplier countLies' additional controls - has been influenced by
strategic/ diplomatic considerations to a considerable extent. Further, most
countries with a significant base in the electrotechnical industries have
sought their own capacity to not only build nuclear plants but also to attain
as much fuel-cycle independence as possible, the reasons for the latter not
always being military. Many countries which in the past have relied upon the
US NSSS vendors have gradually limited their domestic market to domestic
suppliers only. One consequence of the victory of the US LWR technology - at
the expense of the Canadian GANDUs and the British CCR.sf AGRs - in the
industrialized world has thus been that by now, most IME markets are closed to
the foreign IME vendors individually (with the exception of the potential
Westinghouse sale to the UK and the cooperative agreements in Europe) and the
developing countries are the only export market available. So far, the spread
of cotmnercial nuclear reactor technology has been limited to LWRs and to among
the IMEs, though India has also developed its own version of CANDUs and China
may develop its own version of a PWR.
Experience 1974-83
Now we can turn to Tables 8 to 16 to examine some data on nuclear power
programs and their experience.
Unfortunately, quite a bit of information
relating to operating experience - such as reactor scram frequencies,
distribution of reasons for outage - is not available, nor is detailed
economic information per plant (except in the case of the US; see DOE/EIA 1984
f, g); hence, we will have to be satisfied with the 'physical' quantities such
as numbers, sizes, and types of reactors; their capacity factors, and the
like.
Table 8 shows the total number of reactors and their electrical capacity
in MW (net) by country (a) as of end-1973; (b) additions during 1974-83; (c)
as of end-1983; (d) likely additions during 1984-90 from plants under
construction; (e) likely further additions during 1990-95 from plants under
construction and from new orders which,-- in the author's opinion, can be
completed by 1995; and (f) a single, reference projection for 1995. (No other
countries other than those in Table 8 are likely to complete a NPP by 1995.)
The end-1983 numbers and the end-1995 numbers are lower than can be obtained
by addition of increments to existing capacities; this is because of the
plants shut down during 1974-83 or expected to shut down by 1995
respectively. Summary data on shutdowns - actual and assumed - are given in
T-able 9.
Note, however, that 'I;able 9 includes reactors smaller than 30 MW,
which have been excluded from Table 8.

services to some Western European utilities; and (2) Canadian sales of power
reactors to Romania. The extent of trade in uranium between EENMEs and WOCA
is not known.
India and Pakistan have both been recently mentioned as
potential customers for Soviet power reactors and fuel. Finland may purchase
one more plant from the USSR.

- 29 -

Table 10 and 11 show the distribution of reactors operating or under


construction as of end-1983 among the reactor types - PWRs, BWRs, PHWR.s, and
'all other' - amd among four major size groups. Table 10 has been based on
only thos e plants which had actually began construction as of end-1983, so
that ~he totals do not match with those in Table 8. Reasonable assumptions
can be made about reactor type and size choices for the units still to be
ordered (and have been included in Table 8), but this was not possible in all
cases.
Also, Table 11 is based on gross size, rather than net size as in
Table 8, for the reason that the former correctly reflects the capacity for
which the plant as a whole has been designed. (31) . Any class'ification of
reactor sizes is bound to be somewhat arbitrary; that chosen in Table 11 is,
in the author's opinion, most useful in terms of reflecting the vintages of
various plants worldwide.
Table 12 gives the data on operating experience in terms of reactor-years
for particular sizegroups of reactors; these numbers are in some cases
sign ific antly lower than those provided, for example, by IAEA (1983b) because
reactors smaller than 200 MW have been excluded from Table 12. Some of the
shutdown reactors as well as a few others which, in the author's opinion, do
not represent any significant 'learning' for a country's nuclear power program
have also been excluded.
Table 13 gives data on nuclear electricity
generation; Table 14 on nuclear power plant leadtimes; and, Tables 15 and 16
on the capacity factors of nuclear power plants - in the case of the IMEs,
aggregate cumulative capacity factors by reactor type and in the case of the
developing countries, by every unit connected to the grid as of end-1983.
Several points need to be noted in relation to these data:
(a).
The growth over the last ten years in worldwide nuclear capacity and
annual nuclear electricity generation has indeed been impressive, representing
average annual growth rates of about 16 and 17 % respectively.
In absolute
quantities, this growth . has been far more pronounced among the IMEs,
accounting for more than 80 % of the worldwide gross capacity additions and
about 87 % of the cumulative worldwide generation over this period. (The US
alone accounted for more than 30 % and 34 % respectively.)
( b).
Most of the experience so far with NPPs was obtained during this
period. About 77 % of the installed capacity worldwide at end-1983 was thus
less than 10 years old; if we exclude power reactors smaller than 500 MW which are no longer commercially available, nearly all of which were installed
before 1973 and are considered to be qualitatively very different from the
large reactors that followed - this figure rises to about 87 % In other
words, while Table 12 gives an impression of extensive power reactor operating
experience in WOCA (since plant-wise operating data were not available for
EENMEs, they have been excluded from Table 12) so far, it hides the fact that
for the power reactors of types and sizes generally relevant for planning
purposes, the experience has been only about ten years long. The US is the
31. The definitions of 'gross' and 'net' are not clear-cut, however, and the
allowable ratings of the plants often differ from the quoted 'net' ratings.
Further, even for a given plant, the allowable ratings can change over time.

- 30 -

only country where such experience is substantially longer than ten years; the
developing countries, which in any case account for less than 5 % of the total
WOCA experience in Table 12 have had but three reactor-years of operating
experience with the 'current generation' reactors (all of which is in Taiwan).
( c).
Almost 90 % of the nuclear electricity ever generated was obtained
during the last ten years. In fact, if only the electricity consumption of
uranium enrichment activities is taken into account, it was only after end1973, and probably around 1976, that the world began to obtain first 'net'
amounts of electricity from the atom. (32) As mentioned earlier in section
(I), i f we regard that construction de!lays result in a 'loss' of generation
which has to be made up by non-nuclear generation (or worse still, result in
supply interruptions) and chat unplanned outages (or an accident such as at
Three Mile lsland-2 plant in March, 1979 or, in some minor cases, deratings of
capacity) result in similar loss, more electricity has been 'lost' than ever
gained from the atom. Apart from the energy impact of such losses, the two
factors - long construction leadtimes and lower than anticipated capacity
factors - have also played a major role in reversing or lowering the economic
advantage of nuclear power plants. (The TMI-2 accident has had a considerable
role in reducing the PWR capacity factors in recent years; exact details for
the US are not available up to the date.
For an earlier calculation of
worldwide effects, see Evans (1982)).
(d). Most of the reactors completed in the 1974-83 period have been LWRs only 18 out of the 148 units in WOCA were non-LWRs, including 6 AGRs in the UK
and 7 CANDUs in Canada. This is a reflection both of the US domestic market all but one of the reactors completed in the US during this period were LWRs as well as the dominance of the LWR technology elsewhere in the world. Such
dominance was not pre-ordained; as late as the late 1960's - when the nuclear
bandwagons started in the US - or the early 1970's - when elsewhere - the US
salesmanship played a major role in such victory. This dominance is by now
firmly established as can .be seen from the reactors under construction.
(e).
Sizes of power reactors of all types have been increasing nearly
everywhere.
More than a half of the total installed capacity in WOCA is in
the reactors 901 MW (gross) or larger. Most of the reactors in the 201-500 MW
size, or in the 501-900 MW size are relatively older than the later generation
of reactors; reactors completed in the last five years and those under
32. This observation is based on the data on electricity consumption of the
US enrichment plan.ts over 1943-83 made available to the author by Mr. David
Reist~r
of the Institute for Energy Analysis (Oak Ridge Associated
Universities) and on some assumptions about the non-US enrichment activity. If
these assumptions turn out to be invalid - though it appears unlikely that
data on electricity consumption of enrichment plants in the USSR or China can
be obtained - the date of first 'net' electricity mentioned here may need to
be changed.
However, the US enrichment plants alone had consumed more
electricity by end-1973 than that generated by all the nuclear power plants
worldwide up to that time. The fact that quite a bit of enrichment work was
done for weapons programs or for building up inventories does not matter, if
it was only useful energy output one was concerned with.

- 31 -

construction are overwhelmingly larger than 900 MW. The US and West Germany
were the first countries to start builiding reactors of more than 1200 MW
size; by 1983, one such reactor had entered operation in the US and four had
in West Germany.
France has recently decided to increase the size for
additional PWRs to 1400 MW. Among the reactors under construction, there are
12 units in the 200-500 MW size range; 2 FBRs, 1 HTR, 6 Lndian CANDUs, 2 Cuban
PWRs and 1 Chinese PWR. With the possible exception of the Cuban reactors,
none are produced from an established product line (i.e., the rest are
'custo!Ir'built'). There are 31 reactors under construction in the 501-900 MW
range; most of those close to the lower end of the range are units ordered
several years ago; with the possible exception of the Canadian CANDUs, this
product line is also essentially closed.
Product lines can be retooled to
offer different sizes, but at a considerably higher cost.
There is by now
neither the market, nor any willing supplier, for reactors smaller than 800900 MW.
As the outstanding orders are filled, i t is doubtful whether the
suppliers will long be able to offer even 900 MW LWRs or 600 MW PHWRs. It is
quite likely that within a few years - if i t is not already the case - the
only commercially available reactors will be LWRs of 1-1.3 GW and PHWRs of
800-900 MW.
As we shall see later, such sizes may make a revival of the
nuclear markets in times of uncertainty more difficult and the nuclear
industries may have to rethink their technological options.
(f). NPP lead times have been longer than planned for and in many cases have
been increasing over time.
Total leadtimes - defined as the difference
between year of order and commercial startup - have varied from 6 to 15
years.
If we exclude countries which built less than 3 plants in either of
the periods January 1974 to December 1978 and January 1979 to December 1983
(33), average total leadtimes have varied between 6 and 9 years in the first
period and between 7 and 12 years in the second period. For the plants under
construction (and which were originally scheduled to enter commercial
operation by December 1983), they would have varied between 9 and 16 years.
Average construction leadtimes - defined as the difference between month of
construction and of commercial startup - have varied between 60 and 122 months
and between 72 and 120 months for the two time periods respectively; for the
plants under construction, they would have varied between 57 and 160 months.
As a result, average delays - defined as the difference between commercial
startup date originally planned for and actually attained or currently planned
for - ranged from 0 to 49 months and from 15 to 72 months in the past and
would have ranged 21 to 89 months for the plants under construction.(34)
(g).
NPP capacity factors have been generally lower than the theoretical
maximums (about 85-90 % for LWRs, about 90-9 5 % for CANDU s) and lower than
those. generally planned for (7 5-85%). Comparison of capacity factors across
countries and over the years is complicated by the variety of influences on
33. The distinction is made so that the effect of the Three Mile Island - 2
accident in the US as well as some other countries does not confuse the
aggregate data.
34. The figures for delays are not capacity-weighted. All the numbers cited
are national averages for countries which built or would have built 3 or more
NPPs in the corresponding periods; plant-level variation is much greater.

- 32 -

operating performance - reactor type, size, vintage, vendor, regulatory


practices, utility practices, and reactor-specific as well as systeurspecific
characteristics - whose analysis is not possible here.
(See Surrey and
Thomas, 1980; Thomas and Surrey, 1981; Thomas, 1983; Komanoff, 1981 and 1982b;
and various issues of Nuclear Engineering International over the last three or
four years.)
Projections to 1995:
The installed capacity at the end of 1983 was much lower than anticipated
earlier, even as late as four or five years ago. The principal reasons are
that many reactors ordered and under construction have been cancelled at
various - zero to nearly 100 percent - stages of construction, and that many
other reactors planned to have come onstream by end-1983 have been delayed by
various lengths of time - from a few months to as much as 12 years. Indeed a
majority of the plants now scheduled to come into operation during the 1984-90
period - representing a much faster rate of capacity addition than in the last
ten years - are those which have been delayed beyond end-1983.
If curr_e nt schedules are maintained adequately, the years 1984-86 will
see a peaking of reactor completions (35) - as many as 120 units, representing
about 110 GW of capacity - af~er which there will be a sharp decline in the
annual addition rate.
Beyond 1987, reactor completion rates will average
between 12 and 18 units a year through 1995, depending upon further delays for
the plants already under construction, upon ordering rates in the 1984,...88
period and upon the latter's construction schedules.

The stretchouts in NPP leadtimes make it possible to make a relatively


firm projection of installed nuclear capacity worldwide by 1995. For most of
the countries, it can be safely assumed that if construction on a NPP has not
started by the end of 1984, it will not be ready for commercial operation by
1995.
For some others, it can be assumed that i f a NPP order has not been
placed by now, the plant will not be completed by 1995. These two types of
plants are covered under the 'committed' category in Table 8. For the sake of
optimism, it is allowed that in some countries indefinitely postponed units
may be reactivated, that more orders can be placed over the 1984-88 period,
35. In a way, these are the best of times, and these are the worst of times,
particularly for the US NSSS industry.
In terms of the value of shipments
(SIC 34436), its business in 1984 was expected to be at an all-time high ($
1336 million, as compared to $ 1071 million in 1983, $ 351 million in 1982,
and about$ 700 million in 1977, 1979, or 1981). It is not clear whether this
includes the military side of the busi.ness (which can be fairly significant,
although not enough to compensate for the declining civilian market at home or
abroad).
If only the civilian business is considered, by 1986 the business
would have shrunk to about a fourth or a fifth of the 1984 level, and
according to current projections even less by say, 1988, unless the Chinese
orders come in.
(For historical data, see US Department of Commerce, 1984;
the projected values are the author's estimates.)

- 33 -

On the other hand, a single


and that these may be completed by 1995.
projection for 1995 installed nuclear capacity has been presented in Table 8,
reflecting the author's best judgement upon review of situations in all
countries except the USSR for which the number presented is purely
speculative. (36)
Overall, the 1995 capacity in WOCA can thus be expected to be about 320
GW, within a 10 percent margin of error. Including the EENMEs, the worldwide
total of 410 GW is judged to have a slightly higher margin of error. (37) It
is seen that the share of IMEs - and particularly that of the US - would have
declined substantially; however, the IMEs would still account for about 70
percent of the worldwide capacity, and the US would still have more capacity
than any other country. In as much as the decisions around the early 1990's the . soonest a return to the ordering rates of early- to mid-1970' s can occur about the role of nuclear power will be increasingly influenced by the
operating performance of the plants already built - which, as mentioned
before, is limited and short so far and will increase gradually , the bulk of
such experience will continue to come from the IMEs and in particular the US.
Overall, the 1995 projections for the developing countries in Table 8
assume the following: (a) no further orders (for completion by 1995) in
Argentina, Brazil, Mexico, Pakistan, the Philippines, South Africa and
Yugoslavia; ( b) while there is still some outside chance that Egypt would
order two NPPs and complete them by 1995, other nev customers such as Turkey
or Portugal will not have completed a NPP by 1995, nor will the Iranian
nuclear program have been reactivated; (c) only two to four more NPPs - beyond
those currently under construction - would have been completed by 1995 in
South Korea and Taiwan; (d) China would have completed both the Qinshan plant
and the two units at Guangdong; and (e) given the record so far, India would
at best complete two more 235 MW (gross; 220 MW net) units beyond those
36.
Several reports have suggested recently that the USSR may have serious
problems in construction quality and schedule management. Particularly, there
have been reports that the Atommash plant for NSSS construction has suffered a
delay because the plant was found to be gradually 'sinking' into the ground a situation also reported for one or two NPPs in WOCA as well. It is said
that the Atommash plant has now been firmed up by additional support; however,
it is not clear what effect these delays may already have had and may further
have on the Soviet NSSS construction activities. Schedule delays for NPPs in
the USSR are difficult to evaluate.
37. Implicit in the thinking behind the margins of error is the notion that a
greater volume of new orders in one country may be balanced by a smaller
volume of orders or by cancellations elsewhere; that, similarly, faster
completions in one country may be balanced by delays in some others. Other
uncertainties regarding projected capacity include - (a) early retirement of
some plants; (b) very lengthy shutdowns in the event of a serious accident or
near-accident or discovery of a major safety problem at some plant, possibly
leading to shutdowns for other plants of similar type as well as stretchouts
in construction for such others (the 'TM! effect'); and (c) some sudden
technological breakthrough which makes different types of reactors available
sooner and built cheaper and faster than has been the case so far.

- 34 -

currently under construction.


As compared to some of the other 'credible'
projections, these are somewhat conservative in the case of some countries and
somewhat liberal in the case of some others. The aggregate figure of 32.4 GW
for the develop ing countries, however, is unlikely to be exceeded by more than
3-5 GW.
The working assumption in most cases of a 10-year minimum leadtime
between announcement of order and entry into commercial operation appears
reasonable in the light of recent experience in most countries.
It is
possible that such lead times may be as short as 8 or 7 years in the future,
but no convincing reason could be found to assume a span of less than 10
years.
Note that the 1995 projections in Table 8 for WOCA as a whole are also
considerably lower than those expected only a few years ago. Lest it may be
suspected that these projections are unduly pessimistic, Table 17 presents a
comparison with two other recent projections.
It is seen that the Table 8
projections are less optimistic, but not severely so.
Indeed, the author's
hunch is that within a year or so, the OECD/NEA or USDOE/EIA projections would
have come fairly in line with the Table 8 estimates. (38)
Projections for installed nuclear capacity upto 1995 take into account
only those probable orders over the next three or four years which may have a
reasonable chance of completion by 1995, and not the entire volume of probable
orders.
Considering the various uncertainties that influence the ordering
rates, precise estimates of ordering rates over this period are, simply put,
meaningless. However, in one respect such estimates are terribly important discussing the future of the 'supply' industries, including the NSSS industry
(as the electrotechnical industry as a whole, for a given level of electricity
generating market) and the nuclear fuel cycle (including the breeder)
industries, to which we now turn.(39, 40) Since, as mentioned earlier, most of
38. Some of the difference between the author's projections and the other two
projections arises from the author's subtraction of the plants more than 30
years old or otherwise (officially) planned to shut down.
The author's
projections for the US are based on the ~nformation available as of August,
1984. The OECD/NEA projections are a mixture of country submissions and the
NEA Secretariat's own estimates.
The USDOE/EIA estimates are based upon a
mixture of plant-by-plant analysis of the 'construction pipe-line' and an
algebraic model of electricity demand and nuclear penetration of the total
electricity generation.
It is not clear if the latter specifically assumes
plant size characteristics and lead times for individual countries.
The US
Atomic Industrial Forum is of course bullish in its projections - by 2000,
Brazil will have 10.6 GW of nuclear capacity, China 16 GW, Egypt '8.4 GW, India
10 GW, Israel 4.8 GW, Portugal 2.7 GW, Spain 27 GW, Japan 90 GW, and West
Germany 37 GW.
(US Atomic Industrial Forum, INFO - Nuclear Power Facts and
Figures, March 1984.)
It is also not clear to the author whether the AIF
estimates are based solely on country announcements or whether they have been
inflated in order to help the US nuclear industry's posturing that the US may
be 'falling behind' while many other countries 'push forward'.
39.
Estimates of breeder reactor capacity are of course included in Table
8. The point of including the breeder programs with the 'supply' industries
(continued)

602

951

654

2-4 2. 000-4 ,<XXl

727
7

Yugoslavia

Total

Taiwan

3,867

615
4

2,785

7,379

615
l
15

3,llO
4

15

14,371

1,814

2,999

IO16

8,04013,840

49

32,349

615

6,924

1,844

620

I ,:JJS

9.266

2,124

1,800

l!80

2,100

3,116

l,627

115

1995

11

2-4 2,IXX>-4,000

654

IO

440
2

l,844

125

5,476

660

l,790

S. Africa
I

l,234

660

2,159

I ,l!00-3,600

l,IKX>

2-4

620

125

556

004

440

1,245

~1995

202

Committed

MlftfOM.1
for ~letim

19'-95

Philippines

Pald.<1t.an

Hex:l.co

S. Korea

India

F~t

440

Q1ha

935

JOO

Argentina

Chim

600

1984--90

1,871

lhl-1983

335

1983

Brazil

1974-82

of lrdt!l; GlJVlclty in net H.Te)

692

~.

l.lm-1973

: Growth of l'luc.Je.;ir

l'level~

Table 8

Vl

8
1

495

1,073

440

1,020

19,073

37,236

37,963

29

35

104

JOO

Netherl.ards

Spa:fn

!>Wrlen

Switzerland

U.K.

U.S.

Total

Total llXJ\

Range

20

1,728

Japan

127

120

45

560

Italy

5,344

2,170

900

103,685

99,818

40,350

2,750

920

21

17

17,033

14,248

2,927

600

900

5,935

9
43

1,940
8,648
60,848

149,075

156,454

4
33

77
228

243

138

123

7,305

IO

2,890

887

930

495

12

16,600

1,285

25

II

9,806

26,188
26

7,410
2,210

3,450

14,872

12

35

13

~1983

6,240

1,794

1983

875

8,156

17,170

19

2,210

4
7

3,100

m;

2,817

2,516

10

197~

2,550

France

F:lnland

Canada

Belg11111

Austria

I>s

~1973

l,000

138,677

124,306

47,690

5,740

942

2,100

4,629

I0,880

2,004

11,941

~0.700

5,00511,605

~12

15-24

25-40

10,688

13,687

II

17

(2

388

24,14540,745

(3704!0

344

119

26

342,000)

312.~

320,294

290,927

109,858

11,542

2,882

9,405

12
5

7,519

495

36,368

2,879

22,925

64,)68

2,2!0

1,506

5,450

1995

IO

16,10526,905

1,100

1,800)

2,000
2

48

23

6,255)
(5

62

7,CXXl11,200

5R

1,213

3,883

l,230

2,6(X)

22

6,310

1,762

AdcUtimal
for c~lettro
by 1995

7
2

CommJ.~t" ed

1990 - 95

2,000

1984--90

'

23

121,178

154

41,524

126

World

17.493

27

18

Total

3.561

13,533

2,640

181

178,678

289

18.423

J8

22,224

46

15

32

31,173

169,850

23,827

24

17.424

1,390

1,040

2
34

440

950

1,320
3

1.906

800-

505

49,03267.623
66

4~

25,058

ll7

24,87826,878

2426

1,640
3

11,371

l,760
4

400.605

89,216

71.374

1. 7fJJ

81

1,830
5

5,280

12

23.998

2.880

5,572

1995

22

24

____Ey 1995

Addit:l.roal
for ~letiro

1990-95

6,665

(JJO

l,320

880

1,906

Cq~!tted

1984-90

440

440

18

2.941

15

IBSR

Ralllnia

l\>Lanl

Hur~ry

1.830

l,320

510

(DR

880

880

IIO

1. 7fJJ

F.rd-1983

1.760

1983

1974-82

Czechoslovalda

&lgaria

mw.s

&d-1973

"

- 38 -

Table

9 : Power Reactors Shutdown - WOCA

CountrI_

Bl: Dec. 1973


No.

Belgium
Canada
France

FRG
Italy
Japan
Netherlands
Spain
Sweden
Switzerland

CaEacitl'.
(NW)

No.

1
3

109
543
150
10

4
1
1

-1

10

-2
-

USA
India
Total

Bl: 2000
(Incremental)
No.
ca2acitl'.

(MW)

2
2

10
478
1490
67
410

(MW)

341

3
1
1

819
50
153

11

89
679

20
6

2846
2205

1
5
9
2

350
1272
4739
420

22

1590

40

7506

24

8144

UK

Bz: 1995
(Incremental)
CaEacitz:

Source: Author's calculations.

- 39 -

Table

io: Distribution of Reactor Tr.ees, end-1983

PWRs
EENMEs
WOCA
Installed
Under construction
Total

BWRs
WOCA
EE't-l'MEs

'!:_/
PHWRs ll
Other
WOCA
EENMEs WOCA
EENMEs

115

24

62

19

47

21

96

39

32

18

14

211

53

94

37

61

29

Source: Authors's calculations

1/

II

All but two of these are CANDUs.


Most (49) of these are the graphite moderated, gas cooled reactors in the U.K.,
France, Italy, Spain and Japan, and the graphite moderated, water-cooled
reactors in USSR (27) Others are FBRs (7), HTGRs (2), HWLWRs (3), one
LGR in the U.S., and one HWGCR in France.

- 40 -

Table 11: Distr.ihutioo of Reactors by Size Y: (Gross Mole)


M-1
EillMEs

2~500

l-lX:A

Installed
c.apacity

Under C:OOStruction
c.apacity

Total
c.apacity

501-900 Mol
:a:A

1201 +MY

901-1200 Mol

EEN1Es

VlX'A

EF1Es

\.rrA

EFl-M'.s

46

22

89

76

12

16091

9255

62756

600

74890

12000

6324

65

29

51

66465

4500

121!

15 !:.!

31 ~

2 21

3415

6670

21870

1320

67641

2900)

58

37

120

141

41

19506

15925

84626

1920

142531

41000

SS
72789

4500

Source: Author's calculations

Jj

Gross capacity data are taken from IAEA; in a few cases where gross
capacity datum is not available, net capacity datum is used. IAEA
data in some cases differ significant ly fro m those i n Nuclear News,
Nuclear Engineering International, or Nucleonics Week, and
sometimes even the IAEA 1 gross' number is smaller than the
Nuclear News 'net' number. Varying definitions probably account
for such differences.

:f_/

Reactors smaller than 200 MW (gross) have been excluded; many of


them are experimental or prototype reactors and most are old.
Thirty-eight reactors installed at ~end-1983 were smaller than
200 MW (gross) and distributed as follows: the U.K. (15), the
USSR (10), the U.S. (3), Japan and France (2 each), and GDR, Italy,
FRG, Netherlands, Pakistan, and Spain (1 each). Only one,
experimental reactor smaller than 200 MW (gross) was under
construction (in Italy).

3/

Of which 2 are FBRs, 1 HTR, 6 PHWRs in India, 2 PWRs in Cuba, and 1


PWR in China.

!:_/

All are Soviet PWRS of about 440 MW size.

~./

../

Of which 9 are British AGRs, 7 Canadian PHWRs, 7 Japanese PWRs, 1


Argentine PHWR (from KWU), l Brazilian PWR (now completed), 1
Japanese BWR, 1 U.S. BWR, 1 U.S. PWR, l Philippine PWR, and 2
Mexican BWRs.
Romanian PHWRs from Canada.

- 41 -

Table 12 : Power Reactor Operating Experience up to end-1983 - WOCA.


plants with size greater than 200 MW)

Country/Size

Argentina
India
s. Korea
Taiwan
Yugoslavia
Total
Belgium
Canada
Finland
France
FRG
Italy
Japan
Netherlands
Spain
Sweden
Switzerland
U.K.
U.S.
Total
Grand Total

201-500 MW
No.
ReactorYears
1
4

49

3
10
5

16
15
8
16
14
18
68
10
12
11
37
172
62

36
41

--

901+ MW
No. ReactorYears

Total
Reactor Years

9
40

5
1
2
1
1
1
7
1
1

501-900 MW
No.
ReactorYears

(Operating power

1
2

5
9

1
4

15

78
5
27
42
2
53

2
8

6
1
9

11
4

30
19

13

25
93
13
73
75
20
134
10
14
56

6
45

.45
1
49
404

19

115

459

96

714

41

183

1356

508

100

..729,.. 43....

186

142 3

===

====

==z

9
40
5
11
1
67

Source: Author's cal~ulations; full calendar-years after the year of


commercial start-up has been counted.

221
581

- 42 -

Table 13 : Nuclear Electricity Generation (net TWh)

DeveloE..!!!S.
Argentina
Brazil
India
Pakistan
S. Korea
Taiwan
Yugoslavia
Total

1973

1983

1974-83
(inclusive)

Lifetime
to end-1983

2.4
0.2
2.7
0.2
8.5
18.0
3.7

21.9
0.3
25.9
2.7
23.5
56.9
6.4

21.9
0.3
33.2
3.4
23.5
56.9
6.4

2.2

35.7

137.6

145.6

11.0
11. 3
3.0
9.0
1.1
6.2
2.0
5.9
26.6
83.5

22.9
50.4
16.6
137.0
61.5
5.5
101. 2
3.4
10.2
38.5
14.8
47.5
298.0

111.8
307.8
64.5
528.7
377.4
37.0
466.7
35.3
73.6
226.2
105.4
365.5
2364.7

111. 8
336.0
64.5
587.5
419.6
67.1
602.1
38.3
88.8
229.8
120.2
615.7
2657.3

177.0

807.5

5165.7

5938.7

11.1

10.4
5.8
10.9
2.3
80.0

60.3
23.4
74.3
2.3
476.9

60.3
23.4
81.0
2.3
568.4

11. 7

109.4

637.2

735.4

1.8
0.4

--

IMEs
Belgium
Canada
Finland
France
FRG
Italy
Japan
Netherlands
Spain
Sweden
Switzerland
UK

USA
Total
EENMEs
Bulgaria
Czechoslovakia
GDR
Hungary
USSR
Total

17.4

0.2
0.3

Sources: DOE/EIA (1983b), IAEA (1983c), and Nucleonics Week (various


late January issues) plus other sources for Cia'ta on shutdown reactors.

- 43 -

Table 14 : Nuclear Power Plant Leadtimes - WOCA


(a)

Plants entering commercial operation between Jan. 1974 and Dec.


1978

(b)

Plants entering commercial operation between Jan. 1979 and Dec.


1983 (including some plants that entered operation in early 1984).

(c)

Plants originally scheduled to start commercial operation by Dec.


83 but have been delayed, excluding plants which have been
cancelled or indefinitely postponed.
No. of Units

Total
lead time
(years)

Construction
length
(months)

Delays
in Comm. op.
start up (months)

Average

Average

Avera ge

7. 0
13.0

114 .o

13.0

148.0

1
4

14.0
15.5

154.0
159.5

88.0
88.3

9.0
9.5

94.0

80.5

28.0
10.0

18.0

132.0

114.0

11.0

110.0

30.0

8.5

100.00

17.0

3
2

9.0
9.3
9.0

78.0
80.7
72.0

36.0
36.7
37 . 0

10.0

98.0

49.0

Developing
Argentina
(a)
(b)

72.0

24.0
46.0

Brazil
(c)

73.5

India
(b)
(c)

S. Korea
(a)
(b)

Mexico
(c)

Philippines
(c)

S. Africa
( c)

Taiwan
(a)
(b)
(c)

Yugoslavia
(b)

Table 14 (continued)
IMEs

- 44 -

Belgium
(a)
(b)
(c)

3
2
2

7.0
8.5
10.0

63.3
94.5
84.0

12.3
35.0
34.0

Canda
(a) (b)
(c)

3
4
5

9.3
11.5
12.6

69.7
92.5
106.6

0
29.3
31.8

Finland
(a)
(b)

1
3

8.0
8.3

71.0
83.3

11.0
23.3

France
(a)
(b)
(c)

2
24
5

7.5
7. 1
9.2

77.0
72 .4
85.0

23.0
15.5
20.8

FRG
(a)
(b)
(c)

3
4
9

6.3
8.5
12.9

70.3
93.3
129.8

15.7
46.0
80.2

Japan
(a)
(b)
(c)

13
7
2

6.8
8.1
10.5

59.8
74.4
57.0

9.2
19.1
54.0

2
4

11.0
12.3

111.0
107.0

72.0
69.5

5
4
2

6.8
10.3
10.5

69.2
97.8
69.5

9.2
33.3
27.5

1
1

6.0
11.0

71.0
129.0

24.0
72.0

(a)

(b) .

1
7

12.8
19.0
16.3

121. 8
210.0
155.9

49.0
170.0
88.9

8.4
12.1
15.0

84.7
120.2
139.0

35.9
71. 7
88.0

Spain
(b)

(c)
Sweden
(a)
(b)

(c)
Switzerland
(b)

(c)

U.K.
. ( c)

U.S.
(a)
(b)

35
13

(c)

44

Source: Author's calculations based on the data in IAEA (1983b).


Nuclear News (1984) and Nuclear Engineering International (1983).

- 45 -

Table 15 : ~0CA Capacity Factors, Major Reactor Types, Major


Countries -1 (Average Cumulative load factor to mid-1983)

PWRs
No. of Units
U.S.
France
Japan
FRG
Canada
Sweden
Switzerland
Belgium
Finland
Spain

48
23

Load Factor

No. of Units

PHWRs
BWRs
Load Factor No. of Units Load Factor

23

56.1

54.8
56.0
56.2
71. 2

12
4

61.0
44.1

2
3
3 2/
22

38.3
75.1
75.1
75.6
36.8

7
l

65.1
80.5

2
1

62.7
62.0

11

80.1

Source: U.S. Congress, OTA (1984), in turn from Nuclear Engineering International,
October, 1983.
Notes:

l_/

]j

Limited to three major reactor types and to countries with at least 3 such nuclear
power plants in operation for more than a year by 1983. Thus excludes U.K., Italy
and Netherlands. For developing countries, see Table.
Load factors calculated on moving-average basis; plants operating less than a
year as of July 1983 excluded. Plant load factors weighted by plant rated
capacity (gros~ MW) to get country and reactor-type averages.

- 46 -

Table 16: Nuclear Power Plant Operating Experience - Developing Countries


Countr;t:/
Plant

Size
(MW,

Supplier

Comm.
start

gross)

Capacit;t: Factors
1982
1983
Cum.to 1981
1981

Lifetime
Output
to end
1983
(TWh
~ross)

Argentina
Atucha-1
Embalse

357
649

PHWR
PHWR

Brazil
Angra-1

637

PWR

India
TAPS-1
TAPS-2
RAPS-1
RAPS-2
MAPS-1

210
210
220
220
220

South Korea
KoRi-1
Wolsung-1
KoRi-2

KWU
AECL

6/74
9/83

81.1

1985

BWR
BWR
PHWR
PHWR
PHWR

GE
GE
AECL
AECL
DAE

10/69
10/69
12/73
4/81
2/84

50.9
51.5
36.1

595
679
650

PWR
PHWR
PWR

w
w

4/78
4/83
/83

60. l

AECL

Pakistan
KANUPP

137

PHWR

CGE

12/72

28.0

Taiwan
Chinshan-1
Chinshan-2
Kuosheng-1
Kuosheng-2

636
636
985
985

BWR
BWR
BWR
BWR

GE
GE
GE
GE

12/78
9/79
10/81
10/82

Yugoslavia
Krsko

664

PWR

/83

South Africa
Koeberg-1

964

PWR

Fram

/84

90.0

59.8

80.5

22.39

.24

N.A.
N.A.

60.5
30.3
2.6
22.5

43 .o
57.l

56.3

73.4

63.6

18.97
3.2
2.5

19.2

7.0

19.0

3.54

87 .3
75.2

52.4
80.3
51.1

80.0
77.4
56.7
60.8

22.14
20.37
10 .91
6.53

43.1
50.8
27.8

o.o

53.l

13.13
13.44
6 .1
2.29

6.73

Sources: IAEA (1983b) and Nucleonics Week (various late January issues).
Cumulative capacity factor to end-1981 refers to full calendar year capacity
factors after the first year of operation; these data are from IAEA, which
does not give information on Taiwan.

- 47 -

Table 17 : Comparison of WOCA Nuclear Capacity Projections for 1995


(Unit: GW, net)

Table 4.1

OECD/NEA
(1984a)

U.S. DOE/EIA
( l 983c)
(Range)

IMES
Belgium
Canada
Finland
France
FRG
Italy
Japan
Netherlands
Spain
Sweden
Switzerland
U.K.
U.S.
(Subtotal)
Developing
Argentina
Brazil
China
Cuba
Egypt
India
S. Korea
Mexico
Pakistan
Philippines
S. Africa
Taiwan
Yugoslavia
(Subt:-otal)

5.5
15.0
2.2
64.4
22.9
2.9
36.4
0.5
7.5
9.4
2.9
11.5
109.9
291.0

5.5
15.6
3.2
68.9
28.l
12.9
46.1
0.5
9.2
9.4
2.9
15.0
122.0
339.3

1.6
3. 1
2.1
0.9
1.8
2. 1
9.3
1.3
0 .1
0.6
1.8
6.9
0.6

1.6
3.0
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
1.8
N.A.
N.A.

32.3

N.A.

5.5
13.7
2.2
51.5
18.9
4.8
32.l
0.5
7.0
9.4
2.9
12.3
113.0
273.8

1. 6
1.8

2.3
4.7

0.9
3.9
13.6
3.7
0.7
1. 2
3.5
8.8

7.3
16.6
2.8
- 68.3
- 25.S
- 5.7
- 45.3
- 1.2
- 10.0
- 10.4
- 3.8
- 14.9
- 127.0
- 338.8

N.A.
N.A.
0
2.7
9.1
1.3
0.3
0.6
2.9
6.6

1.2
N.A.

- 48 Table 17 (continued)
Greece
Iran
Israel
Portugal
Turkey

0
0
0
0
0

N.A.
N.A.
N.A.
N.A.
N.A.

Total

32.3

N.A.

1.

0.3

N.A.
0
0
0

0 .3

0. 2
0.8

N.A.

The OECD/NEA projections are from two different sources; for the
IMEs. they are from OEOD/NEA (1984a) which has more recent, and
lower, estimates than OECD/NEA (1983d) which has been used for the
developing countries here. The former lists three developing
countries - the OECD members Greece, Portugal and Turkey. for whom
its estimates of 1995 nuclear capacity are O, 1.9 and 3.2 GW
respectively.

- 49 -

the 'supply' industries are neatly segregated between the EENMEs and WOCA;
most of the developing-country nuclear business has been within WOCA; and,
because information on the supply industries in the EENMEs is not available,
the discussion will be confined to WOCA.
The Nuclear Steam Supply System (NSSS) Industry
The Nuclear Steam Supply System (NSSS) consists basically of the
'nuclear' part of a NPP - reactor vessel, steam generators, coolant pumps/pump
drives, in-core instrumentation, and other related components. (The 'reactor
plant equipment' includes several other items.) The NSSS itself does not form
a major part of the total NPP costs; estimates in the US put the NSSS cost at
less than 10 % of the base costs or about 5 % of the total costs of a NPP.
However, it is the NSSS industry (as also the architecture/engineering
industry) which is crucial to the technological/market futures of nuclear
power. We shall focus our discussion on the major NSSS vendors here.
These vendors, in turn, have in the main been outgrowths of the
conventional electrotechnical industry.
In the US, Westinghouse and General
Electric expanded into NSSS business from their conventional base of
combustion turbines, turbine generators, motors, and electrical distribution
equipment
via the work performed for the US military nuclear program.
Babcock and Wilcox (B & W) and Combustion Engineering (C-E) involvement in the
NSSS business grew from their base in fossil steam boilers and, again, via the
involvement in the US military program.
The Japanese, German, and Swedish
vendors also had a previous base in the conventional electrotechnical
industry. In Canada and the UK, the NSSS vendors have had a somewhat diffuse
organization, with a central entity (Atomic Energy of Canada Limited - AECL, a
Crown Corporation in Canada, and various companies in the US now under the
umbrella of National Nuclear Corporation
NNC) serving as the main
contractor, covering many subcontractors for various components manufacture.
In France, the NSSS vendor Framatome has been a subsidiary of a heavy
is their more direct links with the nuclear fuel cycle activities rather than
with electricity generating market alone.
40. In as much as weapons and other military programs also place demands upon
many of these 'supply' industries, their impacts should also be covered.
However, quantitative information on the military nuclear programs is
difficult to come by. In the case of uranium mining and milling industries in
W.OCA, it is thought that the impact of military programs would be minor or
negligible since large inventories of natural or enriched uranium for
potential use in military programs already exist with the NWS (except possibly
China). In the case of the US, uranium requirements for the military programs
over the next few years would be low since much of the plutonium for new
weapons can be obtained from the retired weapons and though the HEU (highenriched uranium) requirements for the naval reactors could increase, this
would be but very small as compared to the civilian reactor requirements.
Also in the US, there are dedicated reprocessing plants for military programs
and no civilian reprocessing plants. However, the effect of military programs
on the NSSS industry can be fairly substantial, particularly in the US.

- 50 -

engineering and steel firm Creusot-Loire (with interest at various times been
held by Westinghouse, the French CEA, and now EdF). [For a detailed review of
the NSSS vendors' organizational structure, see Lonnroth (1982) and Walker and
Lonnroth (1983)].
On a plant by plant basis, sometimes the entire NSSS is provided by a
single vendor, while sometimes the components are provided separately by
different vendors, including other companies who do not by themselves have the
capacity to build the entire NSSS. The decision to go one way or the other is
usually made by the customer and the architect/engineer. In addition to the
NSSS-vendors themselves, there is usually a group of 'sub-tier' companies
which are subcontracted by the vendors to provide engineering assistance or
component manufacture.
Table 18 provides the data on distribution of major types of power
reactors among the NSSS vendors in WOCA. It is seen that Westinghouse has had
a lion's share of all PWRs and GE even higher of all BWRs; their shares would
be higher still if all the orders, rather than just the reactors completed or
under active construction, were covered .
Most of the other PWR vendors are
former or current Westinghouse licensees; C-E and B & W developed their PWR
technology independently; B & W has had partial owenership of the BBR of West
Germany. Among the BWR vendors, again, most have been or are GE licensees or
have had technical cooperation agreements with GE.
For PHWRs, AECL is the
major supplier; the Canadian General Electric (CGE) has supplied PHWRs under
AECL contracts, and the Indian Department of Atomic Energy (DAE) had developed
the CANDU technology based upon past agreements with AECL. The sole exception
for PHWRs is Siemens, which developed a non-CANDU PHWR in-house.
Table 19 gives information on the recent experience and the current
status of twelve NSSS vendors in WOCA. The 'netting out' of cancellations and
indefinite deferrals admittedly gives a biased picture in terms of the amount
of business actually received or the amount of work actually performed,
because in many such cases some amount of component manufacturing work was
completed before cancellations or deferrals. Further, such netting also gives
an impression that some of the less active vendors may have technologically
fallen behind, in that in the absence of active business - particularly for
the US vendors - the amount of technfcal innovation work may also have
declined, though such is not the case. (41) Besides, hopes of order revivals
has also helped continue such innovation work.

Table
indi~ated that
expected to be small.
The
industry, where no orders are
least. (Under some scenario,
one or two units before 1990
been placed since 1978 and as

the volume of orders in the next few years is


most difficult situation is for the US NSSS
expected over the next four or five years at the
the possibility of one or two utilities ordering
cannot be ruled out altogether.) No orders have
many as 119 plants (representing about 132 GW of

41.
In the US, for example, component manufacture work has continued at a
fairly brisk rate so far, and the general impression is that such work including the technological changes required because of more stringent
regulatory requirements - has faciliated technical innovation.

- 51 -

Table 18:Distribution of Power Reactors among Major Suppliers - WOCA (a)


Reactor type/
Vendor

Country

Number of Reactors
Domestic

Installed
Export

France

31
27

20
1

us

10

---Under Construction--Domestic
Export

PWRs
Westinghouse (b)
Framatome (c)
Combustion
Engineering
Mitsubishi
KWU (d)
Babcock &
Wilcox
Siemens (d)
Other ( e)

us
Japan
FRG

7
3

us

8
4

FRG
See note

Total (f)

24
27

13
4

5
2

8
6

2
2

90

23

74

20

25

14

13

7
5
2
2
2
3

2
5
3
2

46

16

26

12

2
2

11

(2)

BWRs
General Electric (g) us
Sweden
ASEA-Atom
Japan
Toshiba
Japan
Hitachi
KWU (d)
FRG
AEG (d)

FRG

Other (h)

See note

Total

PHWRs
AECL ( i)

CGE
Siemens ( d)
KWU (d)
Other (j)
Total

Canada
Canada
FRG

FRG

14

17

Source: Nuclear News (1984) 9 and author's estimates of reactors under


construction. See notes below. For a list of abbreviations. see the source
or IAEA (1983b).

- 52 -

Table 18 (continued).
a. Excludes types of reactors other than conventional LWRs and PHWRs.
excludes plants shutdown (including the Austrian one), cancelled and
indefinitely postponed.
b.

Also

Includes also ACECOWEN and the ACLF group (Belgium).

c. Includes FRAMACECO (Belgium) and ACECOWEN/Fram (for Chooz A in France).


d. KWU was formed in the late 1960's by a merger of AEG and Siemens' nuclear
division. The practice followed in the sources to list AEG, Siemens and KWU
reactors separately has been retained here. The KWU PWR figures also include
a plant built jointly with RDM in the Netherlands and a plant under
construction jointly with ENSA in Spain.
e. Includes a BBR plant in FRG (the reactor vessel for which is from B & W),
and the Chinese Quinshan plant (which will use components from several foreign
suppliers).
f. The WOCA totals here differ slightly from those in the table for reactortype distribution because the two Soviet reactors each in Finland and Cuba
have been excluded here.
g. Includes also GETSCO, which built and is building plants in Italy and
Switzerland.
'
h. Includes one plant each by RDM in Netherlands, Allis Chalmers in the US,
and AECL in Canada. GE was also involved in the Netherlands project.
i.

Bracketed plants are the exports to Romania.

j. Includes the Department of Atomic Energy (DAE) of India; reactor vessels .


come from two or three Indian companiesF

- 53 -

Table 19: Principal


Country/
Company

WOCA NSSS Vendors - Status as of August, 1984 (a)

Cumulative Net Orders


1974 - 1983

( b)

Domestic

Export

0
0
0
0

10

42

Year of Last Order(s)


(Still active or completed) (c)
Number of Units ---------------------~
Domestic
Export

us
Westinghouse
General Electric
C-E
B & W

10

1973
1973
1973
1970

(5)
(l)
(3)
(2)

1978 (2)
1973 (2)
N.A.
N.A.

France
Framatome

( f)

1980 (2)

(f)
(f)
(f)

N.A.
N.A.
N.A.

( f)

1980 (l)

Japan
Mitsubishi (d,e)
Hitachi (e)
Toshiba

10
3
6

FRG

KWU (g)

UK
NNC (h)

1980 ( 2)

N.A.

Sweden
ASEAAtom

1975 (l)

1974 (l)

1974 (l)

1981 ( 1)

77

31

Canada
AECL

Total (i)

Sources: Information compiled mainly from Nuclear News (1984) and Nuclear
Engineering International (1983) but also from other sources which forms the
basis for Table 18.

- 54 -

Table 19 (continued)
a. Includes only the commercial power reactor types in WOCA, i.e., LWRs,
PHWRs, GCRs/AGRs.
Some of the NSSS vendors also manufacture research and
military (for naval propulsion mainly; to the author's knowledge, no new
production reactors have been built in recent years) reactors.
b. Excludes some of the vendors who have already dropped out of the market
(General Atomic, Allis Chalmers in the US; Brown Boveri in FRG).
c. Thus excludes plants cancelled or indefinitely postponed. Also excludes
Kaiseraugst (Switzerland), Sayago (Spain) and Carroll County (US) - which are
still maintained on the Nuclear News roster but whose future is unclear. Such
'netting' gives a bleaker picture of the NSSS vendors' business than was
actually the case, since on many of the cancelled or indefinitely postponed
plants, orders for NSSS equipment had been placed and fulfilled. On the other
hand, as importing countries acquire increasing capability for local
participation, the value of the export orders for the major contractor/vendor
has been gradually declining.
d.

Cumulative orders for 1974-83 include those for Tomari-1 &2 and Ikuta -3.

e. Excludes the Monju FBR whose construction was authorized in 1983; Toshiba,
Mitsubishi, and Fuji are expected to work jointly on it. Some foreign vendors
may also participate.
f, New domestic orders are expected to come annually for Framatome and at
least two of the Japanese vendors; KWU is also expected to continue receiving
orders as some of the plants seriously delayed during the 1974-83 period move
on through licensing and ordering process.
g. The KWU is a subsidiary of Siemens, formed in the late i960's out of a
merger of AEG and Siemens nuclear divisions.
h.

Including the predecessor entities and participating companies.

i. Also excludes four orders in Belgium - Doel 3 & 4 and Tihange 2 & 3 which were placed in 1974-75 with the two consortia ACECOWEN and FramACECO

- 54a -

..

19a
Tabler~ Us Nuclear Power 1953-1983

Year

Orders, gross

SubseguentlI caneelled7ind-

Orders 1 net

Year-end
Installed
CaEacitI

Annual
Generat ion

finitel~
~oned

No.
1953
1954
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967(a)
1968
1969
1970
1971
1972
1973

No.

MW

No.

MW

MW

60

60

2
1

465
175

2
1

465
175

1
1

65
72

1
1

65

2
5

630
3,018

2
4

630
2,556

7
20
31
15
7
14
21
38
38

462

4,475
16,526
26,462
14 ,018
7,203
14,264
20,957
41 t 313
43,319

2
3
3
1
12
27
29

1,462
2,386
2,947
583
11,671
29,162
32,650

1974
1975
1976
1977
l 978(b)
1979
1980
1981
1982
1983

34 40 ,015
4,148
4
3
3,804
5,040
4
2,240
2

34
4
3
4
2

40,015
4,148
3 ,80"4
5,040
2,240

Total

251 248 ,269

-
-

125 136 ,570

Sources and notes: (over)

72

7
20
28
12
4
13
9
11
9

4,475
16 ,526
24,074
11t632
4,256
13 ,681
9,286
12,151
10,669

--

--

125 110 t 773

No.

MW

1
1
1
2
3
4
7

60
60
60
260
435
700
910

Neg.
0.2
0.2
0.5
1.7
2.3
3.2

9
10

885
901
1t798
1,763
2,730
4,040
5,088
8,467
13, 171
20,051

3.3
3.7
5.5
7.7
12.5
13.9
21.8
38.1
54.1
83.5

29,207
36,885
40, 542
47,013
49,957
51,082
52,937
52,937
57,921
601848

114 .o

11

10
10
13
16
21
27
36
44
53
57
65
68
70
72

72
74
77

Twh

172.5
191.1
250.9
276.4
255.4
251.1
272.7
282.8
292.1
2611 .o

- 54b -

Tablel9a: (continued)
For orders, USDOE/EIA 1982a; for year-end capacity, various sources. For
generation, USDOE/EIA 1984a. Capacity and generation data here may differ
slightly from other sources used elsewhere in the paper due to differences in
definitions and coverage.
(a) TMI-2, ordered in 1967, operated for less than four months before the
accident; it has been taken out of the 'net' numbers here. One interpretation
could be that this was a 'cancellation' by God.
(b) The two reactors ordered in 1978 - Caroll County l & 2 - have not been
cancelled yet nor 'indefinitely' postponed. They are now scheduled for
operation beginning in the early next century, and there is no specific plan
for their construction; hence, they have been treated here as effectively
'cancelled'.

- 55

capacity) have been cancelled over the 1974-83 period.


About two-thirds of
the plants were cancelled either before construction start or at preliminary
stages of construction; the remaining plants had completed various stages of
construction and/or had some or most of their NSSS components ordered and
delivered. (42)
As a result, the effect on the volume of business for the
NSSS vendors (as well as the second-tier suppliers) was less pronounced than
the cancellation rates may suggest.
However, most of the activity for the
NSSS components production and their delivery for the remaining plants under
construction is expected to be over by mid-1985, marking a sharp recession for
the US NSSS industry. (43)
Situation for other vendors over the very near term is not too
encouraging either. The volume of new domestic orders is expected to be zero
(for AECL, ASEA-Atom) or much smaller than the available capacity, indeed much
smaller than in the past (for Framatome, Mitsubishi, Hitachi, and Toshiba).
Only in West Germany will the vendor have a fairly active business, a result
of revival of several deferred orders rather than of new orders; and, in the
UK, the NNC will likely get a significant share of the PWR business if and
when a favorable decision to proceed with the Sizewell PWR is made.
Around mid- to late-1970's, the US NSSS industry (major vendors and the

42.
The cancelled NPPs which had a substantial amount of equipment
manufactured and delivered represent a valuable inventory for possible sales
to foreign customers of the US.
It is estimated that this inventory of
nuclear equipment and material 'in storage' is about 25 to 30 CW-equivalent.
Some of this inventory will have been used by the early 1990's for replacement
on in-service plants, but a large part of it would still be unused.
In the
current atmosphere in the US, the owner utilities have little interest in
maintaining the inventory, since the plants for which the orders were placed
will most likely never be revived and even if they were, some of the equipment
might not prove acceptable anyway.
Considering that no new NPPs will be
ordered in the near future, the chances of selling parts of this inventory to
other domestic utilities are also slim.
If, on the other hand, a large
quantity of it were offerred for overseas sales at distress prices, it could
have a profound impact on the US - as well as other countries' - supply
industries. So far, it is reported that the Tennessee Valley Authority (TVA)
and the Washington Public Power Supply System (WPPPS) have tried to interest
the Chinese in their mothballed NPPs.
Whether such efforts will succeed
remains to be seen. One could ~dvance a proposal similar to the 'PL-480' under which the US transferred large quantities of food at subsidized prices
and special payment arrangements - for the NPPs; however, the US as well as
the non-US vendors would probably protest against such an arrangement.
43.
One major vendor has recently started major layoffs and closing of the
plants, and has not been active in the export market recently.
Another,
minor, vendor started winding down about five years ago and is no longer
considered active in the market.
Problems for the US NSSS industry were
foreseen by some astute observers as far as ten years ago; see Joskow and
Baughman (1976), and Lonnroth and Walker (1982, originally prepared around
1978).

- 56 -

subtier companies) had the capacity to manufacture about 30 units (equivalent


to about 30-35 GW) per year; it has now fallen to about eight to ten units per
year (from the active and readily available capacity), and is expected to
decline by around 1986 to a level of four or six units per year. (44)
Framatome - whose 'theoretical' capacity is probably around eight uni ts per
year - is reported to have 'optimized' i t at about 6 units per year. KWU is
estimated to have capacity for 6-8 units per year; Mitsubishi about 4-6 units
per year; and, Hitachi and Toshiba each about 3 units per year. Information
on other vendors is not readily available; the author's guess is that about 35 units per year for ASEA-Atom and the NNC (for AGRs) and about 6 units per
year for AECL.
Faced with the declining domestic markets, the NSSS vendors have been
looking for export orders more anxiously in recent years (since about 1980)
than has been the case in the past. However, the export market situation has
also been bleak in these years. Until the late 1960's, the US and Canada were
the major vendors in the export market, as the other countries had not yet
fully established their NSSS industries. In the market for exports to other
IMEs, only the US vendors had succeeded, a result of the 'appeal' of the LWR
technology and of US diplomatic capabilities.
In the markets for the
developing countries, both the US and Canada had succeeded for a mixture of
reasons. Some countries were sold on the LWR technology, which everyone else
seemed to be buying; some decided on the basis of their commercial, diplomatic
and strategic ties to the US. Some other countries, which either did not have
such strong ties to the US, or did not desire the dependence upon the US for
enrichment services, or appreciated the better plutonium productivity of the
CANDUs (the superior operating performance of the CANDUs relative to the LWRs
was not so evident then), or were more successfully courted by the Canadian
government (than the US government) purchased the CANDUs.
By 1974/76, non-US v.endors were also in a position to offer LWRs and,
equally important, enrichment services; the USAEC announcement in 1974 to
close the order books for future enrichment contracts, and the Westinghouse
announcement the same year to renege on the long-term fuel contracts made the
US appear to be an unreliable supplier.- Also, in the wake of the Indian
nuclear bomb test, both the US and Canada tightened their export control
policies.
As a result, the export orders between 1974 and 1976 from the
developing countries went heavily in favor of the non-US LWR vendors - two
Brazilian orders (with the intent to purchase eight more) to KWU; two Iranian
orders to KWU; two South African orders to Framatome; two more Iranian orders
to Framatome~ one .South Korean order e~ach to Westinghouse and AECL; and, an
order ~ach from Taiwan, Yugoslavia, and the Philippines to Westinghouse.
Since 1976, additional export orders from the developing countries have
also been slow in coming.
In total, eight more units have been ordered by
mid-1984, six of them from South Korea alone. Four of the South Korean orders
44.
In the early 1970's some other companies had planned to enter the NSSS
business, as two or three even did; by the late 1970's they had withdrawn from
the market, though at least one is continuing with some R & D work on
alternative reactor types.

- 57 -

and one Taiwanese order went to Westinghouse; two South Korean orders went to
Framatome; and, one Argentine order to KWU. GE, which had the second largest
number of export orders for the entire WOCA up to 197 3, has not landed an
export order anywhere since then. (Construction starts for the 1974/75 orders
for va ldecaballeros 1 & 2 in Spain were delayed until 1980 and both are now
practically cancelled).
The export market could have increased in two ways - either the ordering
rate in the countries which had already ordered NPPs could be increased, or
new countries could be induced to purchase them. In the f~rmer case, expected
further orders from Iran, Brazil and Mexico did not materialize (nor from the
Philippines, Spain, Yugoslavia, or South Africa); in the latter case, only one
country entered the international market as a new customer - Romania. (45)
Continuous flurries of interest, and occasional rushes towards announcing of
bids, had not produced a single customer - from among Egypt, Turkey,
Indonesia, Portugal or Algeria, Libya, Iraq, Bangladesh, Israel, Thailand - as
of mid-1984. (Some of these cases, as also that of China is discussed in the
next section.)
The export market race - with the vendors, construction contractors and
architect/engineers as well as the ambassadors, ministers, prime ministers and
presidents in the running - had by 1982 become crucial to the vendors for
their short-term viability. As the domestic order situation has not improved
(or has, in fact, worsened) since, winning a single export order - whether or
not it is profitable to the particular vendor or the home country in question
(whose government, after all, would arrange for subsidized financing and
credit guarantees) - is by now a question less of maintaining or increasing
market share or of furthering government-to-government commercial and
strategic interests, and more of plain survival.
In the longer term, the
outcome of the export market race could have significant effects on the nature
of the future world NSSS industry, as also on the international nuclear
commerce and non-proliferation regimes.
Table 20 provides speculative estimates of the WOCA reactor export
markets.
The first two columns are of Walker and Lonnroth (1983), an
excellent study of the prospects for the civilian nuclear (specifically, NSSS)
industries in WOCA; the next two columns present this author's estimates for
the same period (1983-87), and the last two columns present this author's
estimates for the 1983-90 period.
This latter period is chosen partly to
extend the horizons of the forecast, partly because this author has by now had
about two more years of information than Messrs. Walker and Lonnroth had, and
----~------------------------------------------------------------

45.
Even the Romanian orders - for two CANDUs from AECL - were practically
inactive until about 1982/83, when a new financing arrangement including
further credit guarantees and barter trade had been worked out. One probable
reason for the Romanian purchase of CANDUs is precisely the same as in the
case of some of the developing countries in the past, namely a desire to be
(or to show to be) independent of the probable supplier of LWRs and enrichment
services, in this case the USSR.
The CANDUS, and as such Canada, may also
have been considered a politically safer choice - in terms of the perceived
reaction of the USSR - than the Western LWRs and their suppliers.

- 58 -

Table 20: Estimates of WOCA Reactor ExEort Market (a)


(Number of units)
ImEorting area/
Country group

1983-87 inclusive
Walker &
Author
Lonnroth (1983) (b)
Low
High
High
Low

Industrialized
Europe ( c)
Developing
Europe (d)
Developing
Asia (e)
Developing
Latin America (f)
Developing
Africa (g)

1983-90 inclusive
Author
Low

High

10

11

11

12

18

Total develoEing
(Av. GW/yr) (h)

2
(0.4)

23
(4.6)

8
(2.0)

19
(3.8)

11

(1.4)

30
(3.8)

Total WOCA (i)


(Av. GW/yr)

(LO)

32
(6.4)

9
(1.8)

20
(4.0)

16
(2.0)

40
(5.0)

a. A comparison of the author's estimates with those in Walker and Lonnroth


(1983). Excludes possible Soviet exports to WOCA; includes possible further
exports to Romania from WOCA.
b. Country-group coverage and classification used by the author differes
slightly from that in Walker and Lonnroth (1983) in that they exclude Romania;
here it is included in 'Industrialized Europe'. Israel included here in
'Developing Asia'.
c.

Belgium, Finland, Italy, the UK, and Spain.

d.

Greece, Portugal, Turkey, Yugoslavia.

e.

China, South Korea, Taiwan, Pakistan, Indonesia, Israel.

f.

Argentina, Brazil, Mexico.

Egypt; South Africa.

h.

Based on average l GW size per unit.

i. Total is slightly lower than the sum of individual groups in the 'high'
case on the presumption that a 'high' case is unlikely to be obtained across
the board.

- 59 -

partly because - in this author's judgement - the present problems of the NSSS
industries will continue at least until 1990.
Note that while the author is somewhat more optimistic at the lower end
of the range - partly due to the inclusion of China and partly to have a 'best
worst' scenario, he is also considerably pessimistic at the higher end, i.e.,
the 'best best' scenario.
If the author's judgement is correct, this means
that in the aggregate, the export markets do not offer much of a hope to the
vendors.

Three
industry:

implications

follow

from

the

discussion

so

far

of

the

NSSS

(a). The NSSS industries will pass through a period of retrenchment and
consolidation, the nature and the magnitude of which will depend upon
the length of time it takes for routine orders to resume and, once such
orders resume, on the volumes and average rates of ordering. With the
current LWR market, whose current supply capacity is between 25-35
GW/yr. (although the latent, 'readily available' capacity is about 30-40
GW/yr., a margin which would be lost more or less permanently in the
next two to four years), if reactor ordering rates reach only about 10
GW/yr. by 1988, the supply capacity might fall to about 15-20 GW/yr by
the early 1990's. If the orders are coming from export markets, there
would be an increasing trend towards forming partnerships and consortia
involving more than one vendor, architect/ engineer and from more than
one or two countries. As a result, the NSSS industry would become more
'multinational' in character. There may be economic and technological
implications of such retrenchment and consolidation which are as yet
difficult to point to. (46)
(b). The US NSSS industry may gradually lose whatever market leadership
it currently enjoys in the international market.
The extent of such
loss and and its effects, however, depend upon where the additional
orders come from, when, and the reasons behind such a loss.
It is
unlikely, at the same time, that such a loss would be drastic and/ or
sustained over a long time (unless the export market more or less
collapses or ends altogether). For example, if the export orders over
4~.

Thusf for example, it is said that at an ordering rate of only two units
per year, the cost of Framatome reactor will increase by 15-20 % (Nuclear
News, July 1984, pp. 67). A similar estimate for the US would be meaningless,
given the overall cost explosion in recent years and that there would at best
be two orders per year for the next four or five years (all from the export
market).
Further, the vendor home-country financing agencies might be less
enthusiastic about giving a higher share of financing than the shar~ that
country's indsutries may have in the total package. And, whereas in the past,
LWR sales usually bore the stamp of the USNRC requirements - a standard
against which LWR designs were judged - this will be less the case in the
future.

- 60 -

the next five years were to come largely from the developing countries
(China, Egypt, Portugal, Turkey, South Korea, Taiwan, possibly
Yugoslavia and Israel), it is plausible to argue that the US Departments
of State and Commerce (along with other arms of the US government) would
apply pressures upon - or assist in financing for - some of these
countries with which the US has strong commercial or strategic ties to
place their orders with the US vendors. (47) Or, if the export market
were to be on the low side of the estimates of the author in Table 20,
it is difficult to see what long-term effects of any great significance
any vendor's loss or gain in the export market could follow. Only in
the extreme case of a single vendor - or a group of vendors from a
single country - winning more than SO % of whatever export market there
may be over the next six or so years can the repercussions on the future
of the international nuclear industry be said to be great; in the
author's judgement, such an event is not likely.
(c).
The competition over export orders may lead to the weakening of
the current international nuclear non-proliferation regime. This could
occur in two forms - one, in as much as the cur rent regime is USinspired (48) and US-dominated, a major loss of export market would
loosen the US grip on the regime; and two, as countries other than the
Western countries (including Japan and Australia) enter the nuclear
(equipment as well as materials and technology) export market (as some
of the developing countries - Argentina, Brazil, China, India, South
Korea - have or are thought to be planning for), the Western control
over the regime would weaken.
In the first case, it is not clear
whether the countries other than the US would be willing to change 'the
rules of the game' or would be capable of doing so. In fact, in as much
as some of these countries will be in a position to define the future of
the international non-proliferation regime, it is not even clear whether
this is a position they want to be in and if and when they are in such a
position, whether they would want to differ significantly with the US.
The latter case
- over a longer term - is much more of a problem.
Indeed, in such a case, the objectives of and the strategies for nuclear
non-proliferation may need to redefined or, in an extreme situation such as when accompanied by regional nuclear arms races - may become
irrelevant altogether. (49, 50)
47.
One particular possibility that worries the US industry (and some
sympathetic observers) is that of Japan entering the market. Although Japan
has so far refrained from doing so, one Japanese vendor has recently agreed to
supply some reactor components to China and has joined Westinghouse in
submitting a bid in Turkey.
Whereas Japan may be in a position to claim
technological superiority - if not now, within the next ten years - it does
not have the strategic/military clout the US has and to the extent that such
considerations play a part in NPP orders, it may be at a disadvantage.
48. Ignoring for simplicity the role of the USSR, since it has only a limited
trade with the NNWS (Non-Nuclear Weapons States) and is reported in any case
to require more stringent safeguards conditions than most other supplier
countries.
(continued)

-01

Fuel Cycle and Breeder Activities


The fuel cycle industries can be divided into three parts - uranium
mining, milling and conversion; fuel enrichment and fabrication; and, the
'back-end' activities (including spent fuel transport, handling, reprocessing,
storage, and waste management). The delays, cancellations, and slowdowns in
nuclear power programs have had negative effects on the current and
anticipated volumes of business in the fuel cycle activities, as also on the
profitability of some current and planned activities as we shall see now.
The uranium mining and milling industry in the major producing countries
is made up of private as well as public sector companies; among the private
sector companies involved, most are subsidiaries of large energy-mining or
nonenergy-mining companies. Up to date data on distribution of reserves and
production by companies are not available.
(See Buckley, et al., 1980;
Radetzki (1981), and Bauder and Wagner (1981) for analysis of industry
structure; see also Haring and Martin (1978) and Mulholland, et al. (1979) for
somewhat outdated information on the US.)
The fuel fabrication industry is
also in the hands of private as well as public sector companies.
Economic
information on the fuel fabrication facilities is not available.
Currently,
49.
Thus, the major thrust of the suppliers' (including the USSR) nuclear
non-proliferation policies so far has been on the prevention of a certain
number of key countries - Argentina, Brazil, India, Pakistan, Israel, South
Africa, and Libya - acquiring nuclear weapon capability or, in the cases that
they have already done so, on the continuation of their (at least, official)
weapons testing or on the expansion of their nuclear weapons arsenals. As it
appears now, three of these countries may already have the weapon capability;
one has already officially tested a nuclear explosive; one or two may already
have unofficially tested one; and, three others would have weapon capability
in the next three to five years, if the current programs continue.
If
regional nuclear arms races start in any of the 'two-country' situations India and Pakistan, Argentina and Brazil - or if a nuclear weapon is used in
any regional conflict, it is difficult to say what standing the current nonproliferation regime would ha~e any longer.
50.
At the same time, it is not altogether improbable that a major act of
'proliferation' - such as when one or two additional countries test nuclear
explosives o.r when a regional nuclear arms race appears imminent, that
international efforts for a stronger non-proliferation regime or for nuclear
arms control might begin. It is interesting to recall that between about 1953
and 1963, 'proliferation' was given little explicit attention by the major
countries, and it was not until after the USSR-China split, French nuclear
weapons tests and their announcement to develop a 'force de frappe', and the
Cuban missile crisis that the first nuclear arms control treaty - the Partial
Test Ban Treaty - was negotiated; or that it was not until after the Chinese
nuclear weapons tests that the Non-Proliferation Treaty was offered and
negotiated; or that it was not until after the Indian test and the BrazilianGerman nuclear technology deal that the supplier countries formed the London
Suppliers Group to have a 'gentlemen's agreement' to limit the exports of
'sensitive' nuclear technologies.

1.. ..:

- 62 -

total WOCA fuel fabrication (fuel conversion, powdering, pelletizing, and


assembly) capacity for LWR fuel is about 7000-9000 tons per year (different
levels for different steps); aggregate capacity utilization is about 50-60
%. Canadian PHWR fuel fabrication capacity is about 1500 tons per year. The
UK has a capacity of about 1000 tons per year for GCR fuels, and of about 500
tons per year for AGR fuels.
France has GCR fuel fabrication capacity of
about 800 tons per year (in addition to that for LWRs). Information on FBR
fuel fabrication capacities is not available; it is probable that industrialscale facilities for this purpose so far exist only in France and the UK.
Tables 21 to 24 give some idea of the current status of WOCA uranium
industry and resource situation. (51)
Since there is no central commodity
market as such for uranium, no price data are available. Uranium sales tend
to be governed largely through long-term supply and price contracts,
information on which is not public.
Two or three private companies publish
their estimates of 'exchange value' of the spot market transactions, and these
are usually referred to as the 'spot price'. The current (around September,
1984) spot price of uranium is about $17-18 per pound ($37-40 per kg.) (52).
Table 22 estimate of production capabilities in 1985 appears to have taken
into account the mines and the mills which were operable as of 1982 or 1983
but are no longer operable; most of these closures (or placement in the
'stand-by' category) as well as many - the exact number is not available - of
the deferments of planned capacities have taken place in the US, on average
the high-cost producer. (53)
Soft markets have also led to substantial
decreases in exploration expenditures, particularly in the US.
Overall,
uranium exploration activity is at its lowest level in over a decade, and the
declining trend is expected to continue until there is a marked improvement in
the uranium market.
No price projections are available, though we can try to see the
demand/supply situation in the aggregate. Table 25 gives USDOE/EIA estimates
of WOCA fuel cycle quantities. These are based on the capacity estimates of
the USDOE/EIA in Table 17; both have since been revised and the revisions are
51.
Note that in Tables 21 to 25, -wocA' refers to its conventional
definition, i.e., excluding EENMEs in the World Bank classification as well as
China and Cuba.
52.
Down from the high of $44/ lb. in 1978 it had climbed to from around
$9/lb. in 1973 and $21/lb. in 1974. At least the initial part of the increase
in uranium price was due to a mixed government/private companies cartelization
efforts, the full details of which will probably not be available for a long
time yet. Note that in real terms, the price decline from 1979 to mid-1984 is
about the same as the increase from 1973 to 1978, or in other words, the
current price is about the same in real terms as that in 1973. (Calculation
based upon the use of US GNP deflator.)
53.
From about 196 7 to 1978, the US had imposed an embargo upon uranium
imports (which was one of the reasons behind cartelization of the
international market); beginning 1978, import restrictions were relaxed, and
were completely removed in 1983. The availability of cheaper imports as well
as the secondary market sales at distress prices have also affected the US
uranium mining and milling industry adversely.

- 63 -

Table

21: WOCA Uranium Production, Selected Years

(Unit: Metric tons, Uranium) (a)

Countrr

us
Canada
France
Gabon
Namibia
Niger
S. Africa
Australia
Others(b)
Total(c)

1973

1977

1979

1980

1981

1982

1983

10,200
3 '710
1,616
402

162

9,800
5,790
2,097
1,408
2,339
1 ,609
3,360
356
393

14,810
6,817
2,725
1,100
3,770
3,629
4,800
706
303

16,807
6,739
2,635
1,033
4,038
3 ,880
6' 186
1'561
549

14,800
7 ,802
2,650
1,020
3,970
4 '361
6' 135
2,860
364

10,331
8 ,048
2,880
970
3,777
4,260
5,818
4,470
775

7,885
7 ,311
3,529
980
3,719
3,421
6,080
3,016
486

19 '773

28,852

38,660

43,428

43,962

41,329

36,426

---

948
2,735

---

Source: BP (1984). Data are slightly different from those in UN (1983) for
ISIC 230252M and from those in OECD/NEA (1983d). Definition of WOCA according
to the source.
a.

A Kilogram of Uranium is about 1.2 to 1.25 Kilogram of

u3o8

b. Including Argentina, Japan, Mexico, Portugal, Spain, FRG. Brazil and


India also have been producing some uranium; it is not clear if the 'Others'
category in the source includes such production. Levels of Chinese production
are not known.
c. Cumulative WOCA production is estimated at about 246,000 MTU (Metric Tons
Uranium) prior to 1965, about 200,000 MTU between 1965 and 1973 (inclusive)
and about 330,000 MTU between 1974 and 1983 (inclusive), i.e., a total of
about 776,000 MTU through 1983. Of this, according to the author's estimates
based on some information from various other sources, about 35 to 40 percent
has gone to power (and other civilian) reactors; about 30 to 35 percent is .
being held in stockpiles (in various forms and for various purposes) and about
30 percent has gone to weapons programs. It may be assumed that whatever
China's production has been so far, nearly all of has gone to the weapons
progz:am or to stockpiles.

- 64 -

Table

22: WOCA Uranium Production Capability Projections

(Unit: Metric tons, Uranium)


Countrz

us
Canada
S. Africa
Australia
Niger
France
Gabon
Others
Total

1985

1990

1995(A)

1995(B)

10,400
11 ,500
6,326
3,800
4,000
3,900
1,500

12,200
12,100
6,463
3,300
4,000
3 '900
1,500

14,000
9,900
6, 118
5,000
4,900
3 '900
1,500

18,700
14,200
10,657
5,000
N. A.
3 '900
N. A.

46,600

49,357

50,501

75,490

Source: OECD/NEA (1983d), except for Niger, where the estimate for 1995 was
later revised by OECD/NEA. For 1995, (A) refers to the short-term projections
based in most cases on existing and committed projects; (B) refers to
existing, committed, planned and prospective projects. All production
capability is to be supported by the Reasonably Assured Resources (RAR) and
Estimated Additional Resources - I (EAR-I) categories (as of l January 1983)
recoverable at costs of US$ 130/Kg. U or less. Definition of WOCA.according
to the source.

- 65 -

Table

23: WOCA Uranium Resources

(Unit: Thousands of Metric tons Uranium)

Country
At price
(per Kg U)

us
Australia( a)
s. Africa
Canada
Brazil
Niger( a)
Namibia
Subtotal

--------

< $80

131.3
314.0
191.0
176.0
163.3
160.0
119 .o

1254.3

RAR

$80-130

275.9
22.0
122.0
9.0
16.0
444.9

--------

Total

< $80

$80-130

30.4
369.0
99.0
181.0
92.4
53.0
30.0
854.8
26.6
4.8
0.3
1.3

o.o

10.9
37.0
4.7
27.0

26.0
18.8
15.7
169.1

4.5
4.5
99.9

67.5
42.6
39.0
23.3
27.0
26.0
23.3
23.3
269.0

Others(b)

44.3

30.4

Total (a)

1467.7

57 5 .2

11 .3

EAR-I

407.2
336.0
313.0
185.0
163.3
160.0
135.0
1699.2

France
India
Sweden
Gabon
Denmark
Algeria
Argentina
Spain
Subtotal

56.2
31. 7
2.0
18.7

--------

--------

52.2
25.0
48.0
48.0

Total

82.6
394.0
147.0
229.0
92 .4

23.0
196.2

53.0
53.0
1051.0

6.25
14.6
43.0
8.3
16.0

32.9
19.3
43.3
9.6
16.0

7.0
7.0
45.0

88.2

7.0
7.0
133.2

74.7

14.5

23.4

37.6

2042. 9

914.3

307.8

1221.8

o.o

Source: OECD/NEA (1983d) as reported in NuclearFuel (2 January 1984).


Definition of WOCA as in the source. RAR is for 'Reasonably Assured
Resources' and EAR for 'Estimated Additional Resources'; for definitions and
analysis, see the source. '---' means that resources in that category are
either not known or not reported.
a. NEA has recently revised its estimates of total (RAR +EAR-I) U resources
for Niger from 213,000 Metric Tons UraLnium (MTU) to 454,000 MTU, and for
Australia from 730,000 MTU to 926,000 MTU. (NuclearFuel, 2 July 1984).
b. Including Austria, Cameroon, Central African Republic, Chile, Egypt,
Finland, FRG, Greece, Italy, Japan, South Korea, Mexico, Peru, Portugal,
Somalia, Turkey, and Zaire.

- 66 -

Table 24: WOCA


US $million) .
Host Countri'...

us
France
Australia
Canada
India
Brazil
S. Africa
Others(a)
Total
(In 1983$)

Uranium ExEloration ExEenditures 1

Sele~t_ed

Years (Current

Pre-1977

1979

1981

729.8
(1966-76)
139.6
101.0

385.6

180.3

56.7

61.2
33.0

70.S
43.0

so. 7
N.A.

92. 7
(1971-76)
53.0

110.s

85.2

34.5

7.7

N.A.

1983
(Planned)

N.A.

1977-1983
(Cumulative)
1,718.0
372.0
169.0
(1977-81)
543.2
17.0
(1977-79)
117 .o
114 .3

12.5
24.1

18.8
19.2

4.3
5.3

166.0

7 5 .o

64.2

38.4

N.A.

1,359.3

709.6

481.2

189.9

N.A.

913.4

496.4

189.9

N.A.

77 .2
N.A.

Source: OECD/NEA (1983d). Actual expenditures in the US were$ 73.61 million


in 1982 and $36.86 million in 1983. (NuclearFuel, 18 June 1984).
(a) Excluding those countries for which data are not available.

- 67 Table
(A).

25: DOE/EIA Projections of Fuel Cycle Quantities. (a,b)


Uranium Requirements.(Thousand MTU)

Country/Group

Annual Quantities
1985

us

1995

--

--

2000

Cumulative Quantities
(Since 1957)
1985
2000

14.8

17.8-20.2

21.0-25.4

136.4-141.5

398-433

Other OECD

20.1-22.3

29.7-36.0

30.6-40.2

182-190

595-682

Other WOCA

1.8-2 .4

5.3-7.3

7. 5-9. 9

11.1-13.2

78-103

Total WOCA

36.6-39.6

52.7-63.4

59.1-75.5

330-344

1071-1217

(B).

Enrichment Services Requirements.(Million Separative Work Units or SWUs)

Countri:/GrouE

--

1985

us

Annual Quantities
1995

2000

9.1-9.5

12.0-13.2

13.4-15.9

Other OECD

11.7-12.9

18.1-21.9

19.3-24.9

Other WOCA

o. 9-1.3

2.8-4.0

4.4-5.8

Total WOCA

21.7-23.7

32.9-39.0

37.1-46.7

(C). Spent Fuel Discharges. (Thousand Metric Tons Heavy Metal or MTHM)
Annual

Country/GrouE

Dischar~

--

--

Cumulative Discharges
(Since 195 7)
1985
2000

1985

1995

2000

1.3

2.5-2.7

2.9-3.2

10.6

45.6-48.2

Other OECD

3.0-3.1

5.9-6.6

6.3-7.6

22 .0-22 .2

100.0-109.6

Other WOCA

0.2

0.9-1.0

1.4-1. 9

1.1

12.3-14.8

Total WOCA

4.5-4.6

9.3-10.3

10.6-12.8

33.7-33.9

157.8-172.6

us

Source: USDOE/EIA (1984c).


a. The ranges refer to the "low" and "mid" cases in the source. Since the
capacity and schedule projections have since been revised by the DOE, the next
edition will have projections somewhat lower than those here.
b. "Requirements" do not translate into new "demand" because of the presence
of large inventories and of secondary markets. On a year-to-year basis,
"reactor requirements" and "demand" do not equal because of fuel schedules.

- 68 -

to be published shortly.
The author suspects that the revision would bring
the annual uranium requirements for 1995 low end - which would be comparable
to those corresponding to the author's single point estimate of 1995 installed
capacity in Table 8 - to the estimate of production capability by 1990 or 1995
(A) in Table 22.
While this may give an impression that existing and committed uranium
projects might just about be enough to meet annual demands by 1995, such is
not the case. For one, 1995 annual requirements do not translate into annual
new demand because of the existence of the large quantities of stockpiled
uranium.
In WOCA as a whole, uranium production has always exceeded annual
demand.
As of end-1983, about 180,00.0 tons of uranium were in officially
disclosed government and private stockpiles; in addition, about 70,000 tons of
undisclosed stockes are held by various governments. (54) Even at the lower
figure of 180 ,000 tons, the stocks are enough to meet annual power reactor
requirements for about five years; even if annual production falls below
annual requirements - as is expected to be the case beginning 1985 - the
existence of such large stocks would continue to exercise downward pressure on
prices for quite some time. (55) By 1990, most if not all of the uranium for
the NPPs listed in Table 8 would have been contracted for; if it appeared then
that a possible shortfall of production relative to demand might occur by, say
about 2000, some of the closed mines can be reopened, some deferred projects
can be revived, and of course new projects can be planned.
It is possible
that as production costs rise, prices may begin to rise in real terms around
1995,though the margin of such an increase would depend upon the anticipations
about nuclear capacity growth over the long term. (56) From today's vantage
point, it is not at all clear whether substantial real increases in uranium
prices may begin around 1995, 2000, or 2025. (57, 58)
54. Between 1942 and 1965, about 246,000 tons of uranium were produced; about
80-90% of it went to military programs, though some of it has not been used
for weapons (or military reactor fuel) purposes and is in the government
stockpiles.
Up to end-1983, a total of about 700 ,000 tons of uranium were
produced; about 37 percent this production was actually used in nuclear power
plants; excluding the military use, about- 220 ,000 to 240 ,000 tons of uranium
are in the government and private stockpiles as of 1984. (Author's estimates
based on various fragmentary pieces of information.
The OECD/NEA reports
about 170,000 tons of officially disclosed stocks as of January, 1983.
A
small part of these stocks are in the form of enrichment tails.)
55. The storage and carrying costs of uranium stockpiles is among the items
that do not show up in annual generating costs of nuclear electricity.
56. Prices may also rise because of government restrictions on international
trade (such a reimposition of import controls by the US government) or because
of cartelization.
57. As late as four years ago, there were concerns about the availability of
uranium in the short term - i.e., whether enough production capability could
be established to avoid further increases in prices - as well as in the longterm - i.e., about the physical resource base.
Some of this concern might
have been overplayed, combined with fantastic projections of installed nuclear
capacity, in order to establish a case for the breeder technology.
!!ASA
(1981) took the 1978 estimate of US uranium resources of 1. 7 m.i llion (at less
(continued)

- 69 -

Table 25 also gives USDOE/EIA estimates of enrichment services


requirements. Once again, the projected quantities are likely to be revised
downwards - by a small margin for 1995 and somewhat larger margin for 2000.
Table 26 shows worldwide enrichment plants and their actual and anticipated
capacities.
The demand/supply situation in case of uranium enrichment
services is also similar to that in the case of uranium ore and concentrate.
Expectations of shortage in enrichment services supply - as also the 'nonproliferation' argument that by keeping the overall fuel costs of the 'oncethrough' LWR cycle would limit the incentives for reprocessing and the breeder
had led many countries to plan for building new enrichment capacity.
However, delays, cancellations, and slowdowns in the pace of nuclear power
programs have had adverse effects on the enrichment business.
The worldwide inventory of enriched uranium is equivalent to about 60
million SWUs, in turn equivalent to about three times the current (1983) rate
of consumption of about 20 million SWUs per year (via low-enriched fuel for
LWRs, AGRs and LGRs; data on high-enriched fuel consumption - for research as
well as military reactors - are not available).
The USDOE alone has an
inventory of about 22.4 million SWUs (at 0.2 % enrichment tails; actual is
about 20 million SWUs evaluated at operating tails.)
It also has more
capacity than needed to satisfy the total world annual consumption
requirements at current levels. Total world enrichment capacity at the end of
1983 was about 42 million SWUs; at the current rate of consumption, aggregate
capacity utilization would be less than SO %
However, old contracts particularly with the USDOE - have allowed a somewhat higher rate of capacity
than $130 per kg. in 1978 prices) over a total area of 9.4 square kilometers,
applied the resource density figure (resources divided by area) to the total
world area of about 135.S square kilometers in order to arrive at an estimate
of 24.5 million tons for the entire world. However, under a 'high nuclear'
path of 1630 GW of nuclear capacity by 2000 and 10 TW of nuclear capacity by
2030, even all these resources appeared to get exhausted by 2030, which led to
the IIASA's case for the breeder.
58.
Since estimates of uranium reserves and resources published by the
OECD/NEA over different years are not directly comparable, because the cost
benchmarks the reserves are estimated against keep changing with inflation and
exchange rate changes.
Indeed, over time increasing production costs (in
current terms) has shifted some reserves from 'low-cost' to 'high-cost'
categories, as some reserves altogether out of the ranges eonsidered. At the
same time, greater amounts of both 'low-cost' and 'high-cost' reserves have
also been added.
Major producing countries estimate that they may have as
much as 16 million tons more of speculative resources at forward costs of
$130/kg. or less.
(Nuclear Fuel, 2 January 1984, based upon OECD/NEA
1983d.)
Table 23 only shows the EAR-I category - equivalent to 'discovered
additional resources' - and not the EAR-II category - equivalent to
'indicated, but not discovered, resources.
For an analysis of uranium resource estimate techniques as used in the
US, see Haughton (1983).

- 70 Table

26: Uranium Enrichment Plants and Projects (a)

Country/
Owner/Operator

Location

Process (b) Capacity (c)


(million
SWUs/yr.)

Status (d) Startup


Year

us
USDOE/Union
Carbide
Oak Ridge, TN
USDOE/Union
Carbide
Paducah, KY
USDOE/Goodyear
Atomic
Portsmouth, OH
Total

GDP

Op.

GDP

Op.
Op.

GDP
27.0

~~~~~~~~~~~~~

USDOE/

Portsmouth, OH

1943

GCP

2.2
(Upto 8.8)
AGCEP
(4.5?)

U/C

1987?

(Planned)

USSR
Siberia; exact
GDP
location unknown.
(Available for exports to WOCA)
France
CEA
Eu rod i f
UK

UKAEA
Urenco

7 - 10

Op.

1950?

Op.

1960?

Op.

1979
1957?
1981?
1983/4

(3 - 5)

Pierrelatte

GDP

Tricastin

GDP

Capenhurst
Capenhurst
--(ibid)-

GDP
GCP
GCP

o.4-0.5
0.2-0.4
1.0-2.0

Op.
Op.
U/C

Karlsruhe

JN

0.5

Op?

GCP
GCP

0.2-0.4
1.0-2.0

Op.?
U/C?

1981?

GCP
GCP

o.5-1.0
1.0-2.0

Planned
Planned

1991/5
2000

JN/Helikon

0.2-0.3

Op.

GDP

o.5-2.0

Op.

0.3-0.4
10.8

FRG
Netherlands
Alme lo
-(ibid)-

Uren co
Japan

~outh

Afr-ica
Valindaba

China

Source: Various sources; see also notes on the next page.

- 71 Notes for Table

26:

a. The table information is preliminary; the author is searching and trying


to confirm information. Until then, pilot plants (less than 0.1 mSWU size)
such as a GCP plant in Japan (0.05 mSWU) or a CHEMEX plant in France or those
under construction in Argentina, Brazil and Pakistan are excluded from the
Table. Various 'commercial-scale' plants planned at some time but no longer
under active consideration - such as a COREDIF plant in France, some in
Canada, South Africa or Brazil - have also been excluded from the list.
b. GDP - Gaseous Diffusion Process; GCP - Gaseous Centrifuge Process; JN Becker Jet Nozzle Process, two or three variants of which have been developed;
AGCEP - Advanced Gaseous Centrifuge Process. Various other processes are
under development and at various stages of such development; the purposes of
such development generally are cost reduction as well as quality improvement;
at least in the US, development work on enrichment processes particularly
useful in the weapons program is also proceeding. For a description of the
processes, see Krass, ed. (1983) or USDOE (1980a).
c. Capacity data are approximate; in the case of older GDP capacity in the
US, France and the UK, some may be retired in the near future. (The UK GDP
plant may have been retired already.) For GCP, capacities can be added in
small increments; hence, those under construction or planned may be quite
variable.
d.

Op. - Operating; U/C - Under Construction.

- 72 Table

27:

USDOE Enrichment Service Prices (a).


Annual AveraBe Costs and Prices (b)

Contract Offers
Effective Date
of price

Price (c)
$/SWU
(Current $)

Jan. 1, 1968
Feb. 22, 1971
Nov. 14 , 19 71

26.00
28.70
32.00

Aug. 14, 1973

36.00

Dec. 18, 197 4


Aug. 20, 197 5
Apr. 27, 1976
Oct. 1, 1976
NOV 2 9 , 19 77
Dec. 30 , 197 8
Dec. 31, 1979
Nov. 29, 1980
Oct. 1, 1981
Aug. 21 , 1982
Current (As of Oct.
AFC
RC
USC

42 .10
53.35
59.05
61.30
74.85
88.65
98.95
110 .oo
130.75
138 .65
1, 1984) (e)

Prices (d)
$/SWU
$/SWU
(Current $) (1980 $)

(FY)

Costs
$/SWU
(Current $)

1971

34 .01

26.71

49.65

1972
1973
1974
1975
1976

31 .31
31.75
37.06
44 .17
54.39

30.49
32.53
36.99
46.36
60.30

54.45
54.86
57.35
65.76
81.27

1977
1978
1979
1980
1981
1982
1983

61.44
101.51
100.97
138.68
187.78
174.65
181.79

68.23
84.29
95.60
120.58
112. 81
135.39
143.90

86.92
99.99
104.37
120.58
102.93
116.51
119.22

Year

153.00
157.00
135.00

Source: From various USDOE and USGAO sources; constant price series based on
the author's calculations.
a. USDOE as well as its predecessors, USAEC and USERDA. The USAEC was
authorized in 1964 to sell enrichment services, beginning in January 1969;
financial statements were published only beginning Fiscal Year 1971 (ending
June 30, 1971). In 1976, the US government changed its fiscal year to end on
September, 30th. It is not clear which of the FY listed her e includes the
July 1, 1976 to September 30, 1976 period .b. Refers to the price DOE offered in its contracts as of that date. As of
end-1983, DOE had three different types of contracts active; in January 1984,
a new type of contract (USC, see below) was offerred.
c. Strictly speaking, these are average revenues and differ from the contract
price in effect as of that year because of old contracts.
d.

Using US GNP deflator from IMF (1984c).

e. AFC - Adjustable Fixed-Commitments Contract; RC - Requirements Contract;


USC - Utility Services Contract. These prices will remain in effect for
Fiscal Year 1985. For a description of the types of contract, see USGAO
(1983a,d).

- 73 -

utilization - about 60 % in 1983.


At the same time, as these types of
contracts expire or are cancelled (with substantial penalty), partly because
some of the customers no longer need the enrichment services and find it
costlier to purchase and 'store' them (in the form of enriched fuel) or incur
losses when trying to sell to others, and partly because for some other
customers, the secondary market provides a cheaper alternative.
The US enrichment enterprise - run by the USDOE (59) - which has
sufferred heavily as a result of the market changes. The DOE is required by
law to operate the 'commercial' part of its enrichment business on a 'nonprofit' basis, i.e., on a 'cost-recovery over a reasonable period' basis. The
costing method employed by the USDOE tends to pnderstate the economic costs of
production of enrichment services, thus effectively providing a subsidy to
commercial nuclear power (as also to other types of civilian reactors)
worldwide. Further, even with the costing methods used by the USDOE, it has
not been able to generate sufficient revenues to meet its production costs; as
Table
shows, in ten out of the thirteen years since 1971, the average price
of SWU sold has been less than the average cost of production of SWU.

tJ

The USDOE enrichment enterprise has run into problems for two reasons.
First, the demand for its enrichment services has dropped, because of
secondary market sales and because of increased competition from the French
Eurodif sales to European - as well as to some US - utilities and from the
Soviet enrichment sales to some European utilities. (60) For the (US Fiscal
Year) 1984-88 period, the USDOE is reported to have already lost about 9 .4
million SWUs of work (equivalent to about $1.3 billion of business) due to the
secondary market transactions; if such transactions increase, as is likely to
be the case, the USDOE could lose more than $4 billion of business over these
years. Secondly, the USDOE has been building an enrichment plant based on the
gas centrifuge technology whose investment cost is estimated as about $10
billion. (61)
Faced with the substantial overcapacity, the USDOE has also
59.
At various times, there has been talk in the US of transferring
enrichment business to the private sector.
Around 1973/74, two groups of
companies - one comprising of General Electric and Exxon Nuclear, the other of
Bechtel, Union Carbide, and Westinghouse - considered building enrichment
plants; by around 1976/7, these plans were effectively cancelled.
60.
One reason for increas-ed competition from Eurodif in recent years is
simply the appreciation of the dollar vis-a-vis the French Franc. Another is
that Eurodif could be understating its costs of enrichment services
production.
It is also possible that Eurodif gets a discount on its
electricity purchases from EdF.
USDOE has recently 'threatened' to file
dumping charges against COGEMA, Inc. - the US subsidiary of COGEMA. It is not
clear if anything will come of such threats.
The USSR has reportedly been
offering enrichment services at '10 % less than the US price' to any willing
customer.
61. Another problem for the USDOE is that with lower than planned utilization
rates for its gaseous diffusion plants, it is having to pay 'capacity charges'
penalty for the electric power it contracted for but no longer needs.
By
1992, the cumulative penalties alone would reach about $1.2 billion. For a
discussion of USDOE's costing and pricing method, see USGAO (1983a, d;
(continued)

- 74 -

advanced the date for selection of the 'next generation' of technolog y between adv anced gas centrifuge and laser isotope separation - to 1985.
(Originally, both the technologies were to be developed; however, neither may
be needed for a long time yet and the R & D costs of both together are thought
to be unjustifiable.)
In the aggregate, WOCA surplus of enrichment capacity will persist until
at least 1995 as can be seen from the Table 25 estimate of enrichment services
requirements and the Table 26 estimates of available enrichment capacity by
1995.
Estimate of the cost of enrichment services for the plants currently
operating or under construction is difficult to make, because of the presence
of various types of contracts and of the secondary market, on the one hand,
and uncertainties about USDOE enrichment pricing on the other.
Table 27
provides historical data on USDOE enrichment costs and prices.
Table 25 also gives estimates of annual production rates and cumulative
quantities of spent fuel from WOCA NPPs (revised estimates will be published
soon by the USDOE/EIA). Originally, the expectations were that the spent fuel
will be reprocessed to recover useable uranium as well as plutonium; the
uranium and some of the plutonium could be used back in the converter power
reactors, and the rest of the plutonium would have been used in the
breeders.
However, with the current and anticipated uranium prices,
reprocessing as well as the breeder have become uneconomical options. In the
US, after the government ban on reprocessing and on continuation of the Clinch
River Demonstration Breeder Reactor Project (CRBR) was lifted in 1981,
continued technical uncertainties and lack of economic justification of
reprocessing led to the cancellation of the commercial reprocessing plant, and
escalation in capital cost estimates led to the cancellation of the CRBR as
well (both occurred in late 1983). Hence, as far as the US is concerned, both
commercial reprocessing and breeder reactor 'demonstration' are postponed
indefinitely, perhaps well beyond the lifetimes of the NPPs currently
operating or under construction. As a result, direct disposal (or placement
in Monitored Retrievable Storage facility) of the co!IIInercial spent fuel would
take place.
Reprocessing and breeder programs in other countries have also been
delayed, though the belief in the necessity of both continues. Table 28 lists
most of the reprocessing plants in the world, and Table 29 lists all the
breeder reactors in the world. Technical experience with commercial LWR fuel
- which accounts for the majority of total spent fuel - has so far not been
satisfactory (62), and in any case the economic rationale for reprocessing has
-~-------------------------~-------------------------------------

1984b). The USGAO estimates that the USDOE will lose about $3.3 billion over
the next ten years with the $135/SWU price ceiling the latter has proposed
under the Utility Services Contract.
This is because the USDOE estimates a
volume of about 191 million SWUs demand, which will likely not be realized,
thus driving up the unit costs above the ceiling sales price.
62. Most of the reprocessing done to date has been for the low burn-up fuel
from dedicated production reactors (graphite-moderated and heavy-water) or
from power reactors of GCR type (some of which are 'dual-purpose'). GCR spent
fuel cannot be stored for long periods and has to be reprocessed. However,
(continued)

- 75 -

Table

28: Reprocessing Plants and Projects (a)

Countr~

Location

Owner/Operator

Fuel
Type ( b)

Ca2acit~

( c)
MTHM/Yr

Status
( d)

Startu2
Year

..!:!._ (e,f,g)

USDOE/
Westinghouse
Hanford,WA
USDOE/
Savannah River, SC
DuPont
(Two plants)
USDOE/
INEL, ID
Exxon
Nuclear Fuel
Services
General Electric
Allied General

West Valley, NY

Op.

1983

Op.
Op.
Oxide

130-300

Morris, IL

Oxide

300

(1972)
See note

Barnwell, SC

Oxide

1200-1500

See note

1966

USSR
No information available
France (h)
CO GEMA
CO GEMA
CO GEMA
COG EMA
CO GEMA

Marcoule
Marcoule
Marcoule
La Hague
La Hague

COG EMA
COGEMA

La Hague
La Hague

Metal
Metal
MOX
Metal
Metal/
Oxide
Oxide
MOX

250
800
0.25-2.0
60
400-800

Op.
U/C
Op.
Op.
Op.

800
2.0-5.o

U/C
U/C

Metal/
Oxide

70

Oxide

16-40

1958
1985?
1966
1976
1991
1991 -

Belg_ium

Eurochemic (i)

Mol

1966

(1974)

FRG
Karlsruhe
DWK (j)

Gorleben

Oxide

350

(1980)
Planned

Tokai-Mura
Takai-Mura

Oxide
Oxide

200
730

Op.
Planned (k)

1970
1991/2

Jaan
1976
1995

- 76 -

Table

28: (Continued).

UK (1)
UKAEA
BNFL
BNFL (m)
BNFL (n)

Sellafield
Sellafield
Sellafield
Sellafield

Metal
Metal
Oxide
Oxide

1500-2500
100-300
1000

Op.

s
U/C

1952
1964
1972
1991

China
No information available
India
DAE
DAE

Trombay
Tarapur

Oxide?
Oxide

20-60

(May restart)
100-125
Op.
1982

Sources: Jasani (1974) in SIPRI (1974), SIPRI (1979), Makhijani (1982),


COGEMA (1983), OECD/NEA (1984a), USGAO (1984a), and Duda and Frank (1984).
Information in various sources is conflicting, and it is difficult to resolve
the discrepancies.
a. As in the case of Table 26, the information is preliminary; the author is
searching and trying to confirm it. Many laboratory-scale or pilot-scale
plants have been constructed, operated (or are operating, some possibly
surreptitiously), dismantled, or refurbished, and are under construction.
Such plants include those in Canada, FRG, Italy, Norway, Spain, Argentina,
Brazil, Egypt, Israel, Pakistan, Taiwan, Yugoslavia, and Czechoslovakia.
Similarly, plants under consideration or active planning at one time - such as
a large-scale plant each in France, West Germany, and the UK - are also
excluded from the list.
b. Metal fuel, such as from GCRs; Oxide fuel, such as from LWRs and PHWRs;
MOX or Mixed Oxide fuels such as from FBRs. Reprocessing plants need to be
equipped with the so-called 'head-end' facilities in order to take Oxide or
MOX fuels. A very important consideration in reprocessing is the fuel
burnup. Most of the reprocessing done to date has been for the spent fuel
from military 'production reactors' and from GCRs (some of which are, of
course, 'production reactors'); these - as well as spent fuel from PHWRs have relatively much lower burnups than those from LWRs, particularly
recently. (The author's impression is that once a plant is built, there are
not many opportunities for increasing fuel burnup characteristics, hence the
higher-burnup fuels are used only in LWRs recently built and will be so for
the LWRs currently under construction, but such an impression may be
incorrect.) High burnup fuels also involve much greater risks of occupational
radiation exposure.

- 77 -

Table

28:(continued)

c. 'Capacity' data for reprocessing plants are difficult to come by and in


any case may not matter at all since actual capacity utilization particularly for the Oxide-fuel type plants - seems to have been much lower
than the 'Design Capacity'. For plants which can reprocess more than one type
of fuel, total capacity figures are misleading, since only a part of it can be
assigned for a specific type of fuel. See Makhijani (1982) for some very
interesting details of LWR reprocessing experience.
d. Op. - Operating; U/C - Under Construction; S - Shutdown: It is difficult
to determine 'Status' of various plants, since some are probably being used
sparingly, or are shutdown for repairs and refurbishment and may have plans
for restart.
e. The first four (there are two reprocessing plants at Savannah River)
plants are dedicated for military purposes. (The US seems to be the only
country with single-purpose plants.) The Nuclear Fuel Services plant was
started in 1966 and operated intermittently until 1972 (at about a third of
the capacity), when it was shut down due to operating problems and high
radioactive releases, and was planned to be modified. In 1976, however, the
company declared that it was uneconomical to restart operations. Wastes from
the plants are to be cleaned up at the expense of the State of New York and
the USDOE; total cleanup expenditures are estimated at about 500-700 million
dollars.
f. The GE plant was scheduled to start in 1971. Technical problems precluded
the plant's start-up. It is now used as a spent-fuel stor~ge .facility.
g. The AGNS Barnwell plant was partially completed in 1973, when the company
applied for an operating license. Hearings on the application continued until
J976/7, when licensing was put in.doubt by the US government's announcement to
ban commercial reprocessing. (The 'non-commercial' military reprocessing
continued.) In October 1981, this ban was lifted, but the company demanded
certain financial help and other guarantees from the government. With the
demise of the Clinch River Breeder Reactor project in November 1983, and with
the demand for reprocessing in doubt (to put it mildly, since current
regulations do not allow use of mixed oxide in the commercial power reactors
in the US, and the economic advantage of such use is probably negative), the
company decided to mothball the plant in December, 1983. Total expenditures
on the plant are reported to be around 500 million dollars.
h. More information on French reprocessing plants will be available from the
"author in about January, 1985.
i. The plant was shutdown in 1974 due to some problems in the dissolver.
While in operation, actual throughput varied between 40-60 MTHM per year; one
estimate puts at only 30 MTHM per year over the lifetime. The plant was
originally owned by a multinational consortium, though a transfer to Belgian
ownership was negotiated after shutdown. Restart has been contemplated, but
technical as well as political problems may preclude this possibility.

- 78 Table

28:(continued)

j. This plant was originally planned for construction in the 1970's.


However, no site decision has been made yet and even if one were to be made at
the end of 1984 or in 1985, the plant will probably not be ready until 1991.
BNFL and CEA are participating in the project. Another plant of 1400 MTHM per
year size was also planned earlier; it is not clear if it will ever be
built. Meanwhile, the Gorleben site may be used for temporary spent-fuel and
waste storage. (Nucleonics Week, 20 September 1984) The Social Democratic
Party has recently voted against construction of the Gorleben (if it were to
be decided to build the plant there) plant. (Nuclear News, July 1984, pp.

64.)
k. Originally (until around 1983), the plant was planned to be of 1090 MTHM
per year size.
1.

'Sellafield' is the new name for 'Windscale' since 1982/3.

m.

Shutdown after an accident.

n. Originally (in the mid-1970's) the plant was planned to be available for
operation in the early 1980's.

- 79 -

Table

29: Fast Breeder Reactors (a)

Country_
Name/Location
~

Thermal
Power
MWt

Electric
Power
MWe

Coolant
( b)

Date of
Status
Order/
(c)
Construction
Start

Na/K

1947

Type
( d)

(e)

EBR-1 (f)
INEL Site, ID

1.4

0 .15

(1951-64)
EBR-2 (g)
INEL Site, ID

62.5

20.0

Na

N.A.

(1963)

Fermi-1 (h)
Lagoona Beach, MI

200

60.9

Na

1955

(1966-72)

UK (i)
Dounreay-1
Highland

72

15

Na/K

1955

(1963-78)
Dounreay-2
Highland

600

250

Na

1966

(1977)

France (j)
Phenix
Gard

563

250

Na

1967

(1974)
Greys-Melville (k)
(SuperPhenix)
I sere

2900

1200

Na

1972

U/C
(1985)

58

20

Na

1965

(1979)
U/C
(1987)

FRG
KNK-2
Karlsruhe
SNR-300 (1)
Kalkar

736

300

Na

1969

714

280

Na

1983

Ja.E.an
Mon ju
Tsuruga

U/C
(1991)

- 80 Table

29: (continued)

India
FBTR
Kalpakkam

N.A.

15

Na

1968

U/C
(1985/6)

60

12

Na

1963

USSR (m)
BOR-60

(1971)
BN-350 (n)

1000

350

Na

1963

(1973)
BN-600

1480

600

Na

1967

(1980)
Sources: Information compiled from various sources, including Nuclear
Engineering International (1983), Nuclear News (1984), IAEA (1983b), SIPRI
(1979), and Grathwohl (1982), quoting a study prepared for IIASA. In
addition, various USDOE publications, Lanouette (1983), the 1982 Annual Report
of CEA (France), and JAERO (1982) were also used.

a. Excludes the following fast reactors with no electrical power Clementine, Los Alamos, US (0.025 MWt, mercury coolant, operated 1946-53);
Rapsodie, Cadarache, France (40 MWt, sodium coolant, operated 1967-82,
shutdown due to a discovery of containment leak); Joyo, Oarai-Machi, Japan
(100 MWt, sodium coolant, operating since 1977); Brasimone, Italy (130 MWt,
sodium coolant, under construction since 1969 and now scheduled to become
operable in 1988); and, BR-1 (shutdown), BR-2 (shutdown), and BR-5 (operating)
in the USSR. Also excludes the FFTF (Fast Flux Test Facility) in the US.
b.

Na - Sodium; K - Potassium.

c. Op - Operating Since; S - Shutdown (years of operation); U/C - Under


Construction (scheduled startup year).
d. E - Experimental; D - 'Demonstration'. The French SuperPhenix has been
called a 'pre-commercial' plant, in the sense that it was to be the precursor
of 'commercial' breeders to follow. With the prospects of 'commercial'
breeders nowhere in sight, in this Table it has been listed as . 'Demonstration'
plant.
e. In addition to those cited (and the Clementine reactor; see note above),
the US also built several (about eight) fast reactors of various types and
sizes for its civilian or military programs. Notable among these is the FFTF,
with a 400 MWt sodium-cooled reactor, which began operation in 1982 and is a
major test facility for the breeder program of the USDOE; and SP-100 Space
Nuclear Reactor Power System , with a 1.6 MWt fast, 'heat-pipe' reactor,
planned to begin operation in 1993. The Clinch River Breeder Reactor (CRBR),

- 81 Table

29:(continued)

a civilian 'prototype' reactor with 375 MWe (gross) size was announced in 1972
and cancelled in late 1983 after about $1.~ billion of expenditure, due to
unavailability of funds - about $2-5 billion more to complete. (The original
estimate was $500 million.) As far as the author can tell, these estimates do
not include interest costs, since the project was largely funded out of
government appropriations. The costs of terminating the project are estimated
at about $172 million. Another breeder reactor - abbreviated PLBR in one of
the sources - of 1200 MWe was once considered to follow the CRBR and has now
been shelved. The USDOE breeder program continues however, with the
expectations of developing new concepts and designs. Finally, the
Shippingport reactor - the f irst US 'commercial-scale' nuclear power reactor first operated as a PWR (between 1957 and 1965 with a 60 MWe core and then
between 1965 and 1974 with a 90 MWe core) and then (between late 1977 and late
1982) as a LWBR (with a 60 MWe core) for the USDOE. It was not a 'fast'
reactor, but a 'breeder' reactor nonetheless.
f. The EBR-1 was the first reactor authorized by the USAEC; in a trial run on
December 21, 1951, it generated the world's first tiny amounts of electric
power from nuclear energy and was the first to demonstrate, in July 1953, the
feasibility of breeding. It operated with a plutoniunrbreeding core from
November 1962 to December 1963. The reactor - which sufferred a partial
meltdown of the core - another world first, on 29 November 1955 - was
decommissioned in 1964 and then dismantled. Its site is now a US national
historic landmark.
g. The EBR-2 reactor is a major irradiation facility for the USDOE's LMFBR
program. As such, it operates to test various fuels for breeding rather than
to breed extra fuel.
h. Fermi-1 went critical in 1963 but did not start routine operation until
1966. It also sufferred an accident the same year, leading to partial core
damage. The plant was restarted in 1970 and operated intermittently until
1972 when it was shutdown permanently. Its vessel is thought be impossible to
dismantle for about another fifty years.
i. A 1300-MWe FBR - abbreviated as CFR - was planned at one time, but has now
been postponed until the early or late 1990's. The Dounreay-2 FBR has
operated at an overall capacity factor of 9.3 % through 1983.
j. The next step in the French FBR program was to be a 1500- MWe 'commercial'
reactor - termed SuperPhenix II - design work on which maY. begin in 1986.
Originally, the plans were to build two or three of these reactors, but now it
is not clear if and when even one will be built. EdF and the CEA have created
an advanced FBR study group to examine the future of the FBR program.
k. The SuperPhenix is built by a consortium of European utilities - NERSA in which EdF has a majority holding. The French have not ruled out potential
military uses of the plutonium from the Superphenix. Capital costs of the
SuperPhenix have been cited variously at between 15 and 20 billion FF; the
author has not been able to get information about its financing.
1.

The SNR-300 plant, the latest cost estimate for which is about 6.8 billion

- 82 -

Table

29:(continued)

considerable financial support from their governments. West Germany also has
plans since about 1972 for a 1300 MWe FBR; however, it is highly doubtful if
utility participation and financial support for it can be arranged in the near
future.
m.

The USSR is also reported to be planning for a 1600 MWe FBR.

n. The BN-350 plant was planned to be used for water desalination (New York
Times, 17 July 1973); it is not clear if it was or is being used for that
purpose.

e~

all but disappeared.


It is doubtful if the approximately $ 10 billion (at
1983 exchange rates) of investment for reprocessing capacity currently under
way or planned in four major countries would have been economically wise. (63)
Some of the LWR-fuel reprocessing plants - including the La Hague UP-2 plant
(64) currently operating, the La Hague UP-3 plant under construction, and the
THORP plant under construction - have firm customer contracts for about 10,000
tons of fuel; however, as the operating performance of UP-2 has been less than
satisfactory and as the plants under construction are delayed, only about
6,000 tons of fuel will have been reprocessed by 1990. It is not clear if by
then the demand for reprocessing would match up to the available capacity.
Even if the demand exists, and even if reprocessing plants operate
satisfactorily, it is further not clear what economic use the recovered
uranium and plutonium would be put to.
As the breeder commercialization
programs are delayed everywhere, separated plutonium would only have to be
stockpiled for some possible future use.
As Table 29 shows, operating experience with even the experimental and
demonstration breeder reactors has not been satisfactory so far. Except for
the tiny (20 MW) FBR in the US - which, incidentally, is a breeder that does
not really breed in that it is used to test different breeding fuels rather
than to breed extra fuel on its own - no FBR within WOCA has operated for ten
years yet, while many of the shutdown FBRs as well as the operating FBRs have
been plagued by accidents (the latest in this instance being the French
Phenix). The French 'pre-industrial' large-scale FBR - the SuperPhenix - bas
yet to begin operation; when it is completed, its unit capital cost (around
12 ,500 - 16, 700 FF per KW) would have been two to three times higher than
those for LWRs of comparable size, and the generating costs of its electricity
reprocessing the high burn-up LWR fuel is technically more difficult and far
more dangerous in terms of the potentials for occupational exposure and
leakages. Most of the LWR fuel can also be stored for a long time and indeed
disposed of without reprocessing.
The only technical advantage of
reprocessing LWR fuel is waste volume reduction; it is not obvious that this
advantage is not counterbalanced by the risks potentials involved.
See
Albrighht (1983) for a detailed report on c0Dm1ercial reprocessing experience
and plans in WOCA.
The author is trying to update the information, and will
be able to provide more details by about January, 1985. See also Makhijani
(1982) for an evaluation of LWR reprocessing experience up to about 1981.

63. Based on some reported estimates as follows: France (UP-3, 800 tons per
:,tear, FF 19.2 billion); West Germany (Gorleben, 350 tons per year, DM 4
billion); the UK (THORP, 67 S tons per year in the first stage, 1.8 billion
pound~); and Japan (Takai-Mura, 730 tons per year, 700 billion yens).
64. Capacity information on reprocessing plants is difficult to come by and
in any case may not matter much, since effective capacity has been much lower
than 'design' capacity in many instances. The La Hague plant is curious in
that it s capacity for LWR fuel reprocessing was originally (in 1976, at the
time of startup) stated to be 800 tons per year. After the plant failed to
operate at anywhere close to the full capacity, as Makhijani (1982) reports,
its capacity was retroactively derated to about 350-400 tons per year.

- 84 -

would again be about as much higher or more, depending upon the capacity
factors utilized.
France is apparently rethinking its plans for the next
FBRs.
Until very recently, two or three more FBRs (of 1500 MW each) were
planned to be built by the year 2000, when rising uranium prices and reduction
in FBR construction costs were thought to make the FBRs commercially
competitive. Probably only one more FBR will be built, and possibly none at
all until after 2000. In West Germany, the SNR-300 FBR, ordered in 1969, is
now scheduled for start in 1987; the current estimate of its costs is DM 6.8
billion (about $2. 7 billion, at 1983 exchange rates).
Japan last year
authorized construction of a demonstration breeder reactor; however, there is
no
specific
timetable
for
FBR
commercialization.
Finally,
FBR
commercialization plans have been indefinitely postponed in the UK. (65)
Finally, Table 30 gives information about the status of activities
relating to spent fuel management in WOCA as of 1982 or, in some cases,
1983. It is seen that most of the IMEs - as well as Arge.ntina, Brazil, India
among the developing countries - have plans for reprocessing of spent fuel and
for a FBR-based strategy.
Considering that the date by which reprocessing,
recycling, and the use of breeder technology could become economically
advantageous keeps receding - indeed, it is impossible to say any specific
date by which they could become so ,... it is disturbing that many of these
countries have not yet planned any specific program for the possible
65.
It is interesting to recall the enthusiasm about the breeder about
fifteen years ago in the words of Glenn Seaborg, then-Chairman of the USAEC:
"If we can learn even to make full use of the energy that breeder reactors
will bring us, we may in time be able to use incredibly large amounts of this
energy to create new matter and to rebuild, reshape and reuse all
matter Eventually we might use matter and energy, time and space, like
building blocks There would hardly be such a thing as waste; hence there
would be relatively little pollution. Almost everthing would be recycled and
reused or returned to nature in a near-natural form and distributed so as to
maintain a balanced environment." Heady stuff, but scarcely less so than that
in his reference to the work of Alvin Weinberg at the time - "at a cost of
about 4 mills per KWh it is economical to produce aluminum via nuclear power;
at about 2.5 mills, the direct reduction of iron ore through electrolytic
hydrogen becomes economical; at 2 mills, it (would be) possible to produce
magnesium metal at today's cost of aluminum; at 1 mill, pipeline gas could be
produced from coal; at somewhere below 1 mill general purpose heat and (the
production of) gasoline from coal at a price competitive with current
petroleum processing" - this ?f course before the price of oil went up.
(Seaborg, 1970, pp. 151). At the time, Seaborg said, "(T)he LMFBR R & D cost
will .be in excess of $2 billion through the year 2020 for the AEC. Assuming a
1984 introduction of the commercial fast breeder, the gross benefits to this
nation from electrical energy savings in the 35-year period thereafter, to the
year 2020, are estimated to be more than $200 billion in terms of 1970
dollars.. The savings over the 35-year period would amount to the energy
equivalent of 400 billion tons of coal". (ibid., pp. 14). For analyses of the
USAEC claims about the breeder, see Chow (1975) and Cochran (1974).
For
critiques of the British and the French breeder programs, see Sweet (1982),
Finan (1982), and Collingridge (1984),

- 85 -

Table

30: Civilian Spent Fuel Management Strategies - WOCA

A. Industrialized Countries
Belgium:
Reprocessing; recycling of Pu to LWRs and/or FBRs. Current and nearterm - foreign reprocessing; long-term - domestic reprocessing. Some
reprocessing done domestically in the past. Unreprocessed spent fuel stored
at site. No AFR storage capacity planned. m.w immobilization capacity
planned. No time-table for HLW disposal.
Canada:
Current - long-term retrievable storage at site; long-term - geologic
disposal or domestic reprocessing. Pu recycling in PHWR.s possible, but
unlikely. Conversion to Th/U-233 PHWR strategy also possible. Some AFR
capacity in existence. No time-table for m.w iannobilization or disposal.
Finland:
Current - Soviet fuel returned; Swedish fuel - foreign reprocessing or
geologic disposal. No time-table for m.w immobilization or disposal.
France:
Current - domestic reprocessing; recycling of Pu to FBRs. Unreprocessed
fuel stored at site. HLW immobilization capacity in existence; reprocessing
wastes, solidified or otherwise, to be stored indefinitely. Permanent disposal
planned; no time-table.
FRG:
Current - some domestic reprocessing; some foreign reprocessing.
Unreprocessed fuel stored at site. AFR (dry) storage capacity under
construction. Recycling of Pu in FBRs. m...w immobilization capacity
planned. Technical evaluation of geologic disposal of spent fuel, without
reprocessing, under way. Permanent disposal facility may be available
by 2000.
Italy:
Current - interim storage at site; some foreign reprocessing. Long-term
- domestic reprocessing planned. Recycling of Pu in LWRs and/or FBRs. No AFR
storage planned. m...w immobilization capacity planned. No time-table for
permanent disposal.

- 86 -

Table

30:(continued)

J a pan:
Current - interim storage at site; some foreign reprocessing, some
domestic reprocessing. Long-term - larger domestic reprocessing capacity
beginning in the early 1990's to 2000. Recycling of Pu to LWRs, FBRs and
possibly ATRs. No plans for AFR storage. HLW immobilization capacity
planned. No time-table for permanent disposal.
Netherlands:
Current - some foreign reprocessing. Unreprocessed spent fuel stored at
site. A participant in the Eurochemic project in the past.
Spain:
Near-term - foreign reprocessing; long-term - domestic reprocessing.
recycling plans unclear. Unreprocessed spent fuel stored at site. AFR
storage under study. No time-table for HLW iannobilization or permanent
disposal.

Pu

Switzerland:
Reprocessing contracts signed with foreign companies, who may also keep
some of the HLW. Plans for Pu recycling unclear. Unreprocessed fuel stored
at site. Permanent disposal facility may be available by 2000.

UK:
Current - reprocessing of domestic metal and MOX fuels; long-term reprocessing of foreign oxide fuel by early 1990's and of domestic oxide fuel
by late 1990's (if Sizewell-B is authorized). (Spent metal fuel cannot be
stored unreprocessed for a long time, unli~e the oxide fuels.) Stockpiling of
separated Pu for eventual (after 2000?) FBR use. (Military use not ruled
out.) Indefinite (50 years or more) interim storage of HLW planned; HLW
immobilization plant either at advanced stages of planning or under
construction. No time-table for permanent disposal.

us
Reprocessing indefinitely postponed; near-term prospects for FBRs nil.
Currently most spent fuel stored at site; some shipped to other sites. AFR
storage may be planned. Direct disposal of civilian spent fuel, possibly
along with military HLW, in geologic repositories beginning 1998 or later.

- 87 -

Table

30:(continued)

B. Developing Countries
Argentina:
Current - at site storage; long-term - domestic reprocessing.
recycling in PHWRs planned.

Pu

Brazil:
Near-term - at site storage; !on-term - domestic reprocessing.
China:
No civilian power reactor spent fuel or reprocessing wastes yet; has
off erred to receive spent fuel from some Western European utilities for longterm storage or permanent disposal. Industrial capabilities for such tasks
are unclear; no information available on waste management experience so far.
India:
Near-term - at site storage; some domestic reprocessing of non-powerreactor spent fuel done so far. Strategies for the use of separated Pu
unclear; an experimental FBR may begin by 1985. Long-term - domestic
reprocessing; recycling of Pu in FBRs. HLW immobilization capacity in
existence; indefinite interim storage of solidified HLW. No time-table for
permanent disposal; a repository may be available by around 2000.
South Korea:
Near-term - at site storage; long-term plans indefinite.
Pakistan:
Near-term - at site storage; long-term plans unclear.
Taiwan:
Near-term - at site storage;
plans indefinite.

mediu~term

- AFR storage planned; long-term

Sources: Information compiled from Shemilt and Sheng (1983), Raudenbush (1983)
and other diverse sources.

- 88 -

alternatives, namely long-term storage or disposal of spent fuel (or of


separat ed high-level wastes).
Only the US now has a specific program although the time-table is likely to get stretched out - for the permanent
disposal of high level waste. The early US lead in this respect is probably
due to the fact that so far it has the largest quantities of wastes to be
disposed of - from both its commercial nuclear power plants and from its
military program (in terms of volume, they are about equal as of now).
However, by 1995 or 2000 substantial quantities of spent fuel (or reprocessing
wastes, from whatever reprocessing that has occurred by then) would also have
accumulated in other countries. It appears to the author that during the next
five to ten years, a reassessment on economic and planning grounds alone of
spent fuel management strategies worldwide is called for. (In as much as any
arrangements for reprocessing and the breeder have their technological and
political repurcussions, these would also need to be addressed.)

We can see the following .._., implications - some of which parallel


those in the case of NSSS industry - of the current situation and prospective
trends in the fuel-cycle activities:
(a). The uranium mining and milling industry will probably go through a
phase of retrenchment and consolidation, the nature and the magnitude of
which will depend upon the prospective scale, timing, and geographical
distribution of the market. This would in turn depend upon the scale, the
timing, and the geographical distribution of the NPP market.
The US
uranium mining and milling industry - in the absence of government
intervention - would shrink from its current scale, as the non-US
producers would expand their share of the US market. The situation in the
enrichment market is and will probably remain fluid, partly because of the
nature of contracts involved (no specific information is available on nonUS enrichers right now) and partly because of the uncertainties in USDOE
enrichment program policies, though a clearer picture may begin to emerge
around late 1985. In as much as some of the new LWR orders over the next
five years are to come from countries which already have (or will have, by
the time their new LWRs enter operation) enrichment capacity of their own
(such as the UK and Japan), the USDOE position in the enrichment market
will depend upon what share of the NPP export market the US NSSS vendors
are able to extract, and upon the share of the rest of the LWR market the
USDOE is able to extract on its own.
(b).
Over the next ten or fifteen years, the US will have had limited
progress towards commercialization of reprocessing and development of the
breeder technology as compared to some other countries, such as France,
West Germany, and Japan. At the same time, it is not obvious that this
would have been necessarily a bad thing for the US; major technological,
economic, and political risks are involved in the reprocessing and breeder
programs of these other countries, and only experience - as also changed
perceptions of nuclear power futures - will tell whether their (i.e., the
latter group of countries') programs would have been 'wise'.
In the
author's opinion, there is at least as much chance for the US decisions
(particularly, those of the US Congress) to be vindicated as for the non-

- 89 -

US ones.
Further, i f the plans for breeder commercialization of these
other countries are not particularly successful - thus effectively also
removing the economic justification for reprocessing - they will have to
reexamine their current strategies for spent fuel and HLW management
which, seen from today's vantage point, appear to be guided more by the
influence of past technological momentum than by economic rationality.
(d)
The weakening of the rationale for the use of reprocessing and the
breeder technology also strengthens the case for a 'technical fix'
approach of non-proliferation strategies as advocated by the previous US
administration and by the Ford-Mitre report (NE.PSG, 1977). Whereas some
specific countries which were then judged to be 'proliferation risk' Argentina, Brazil, Pakistan - would have acquired nuclear weapons
capability by use of domestic enrichment/reprocessing facilities over the
next few years, the current situation nonetheless supports a case for
restricting a further spread of these technologies over the foreseeable
future. No prospective sales or transfers of such technologies have come
in the recent past, and it is fruitless to speculate whether they will in
the near future; however, a strengthening of the export controls on such
technologies would be entirely justifiable and needs to be pursued
further.

Overall, the status of the worldwide nuclear industries today can be


described by the quasi-paradox of 'half-full, half-empty' glass.
This is a
remarkable change within just ten - or even five or four, judging from INFCE
(1980) or IIASA (19810 studies - years. Following the record numbers of NPP
orders in 1973/74 worldwide, and the expectations that such ordering would
only continue, if not accelerate, the major concerns were whether there was
enough NSSS capacity to keep up with the demand, about the availability and
costs of nuclear fuel, about availability and costs of enrichment services and
of heavy water, and about the pace of transition to the reprocessing/breeder
'plutonium-economy' phases. The glass seemed to be 'running over'.
Ten - or, even five - years later, the situtation is quite different.
The glass is half-full in that installed nuclear capacity has increased at a
remarkable rate over the last ten years (though at a much slower rate than
anticipated or planned for); uranium supplies are ample and the prices low;
enrichment prices are low; new technologies for enrichment are being developed
and, in s..ome cases, implemented; and, while the US has - for the time being,
~t least - forgone the reprocessing and the breede r options, some other
countries are proceeding forward (albeit at a much lower pace). Indeed, the
concern now is whether the glass is half-empty and leaking. Net NPP ordering
rates have been averaged nearly zero over the last five or so years; uranium
markets are in a glut, as are the enrichment markets; heavy water plants are
being shut down. Plans for reprocessing and breeder plans have been cancelled
or are being delayed or indefinitely postponed; at the same time, the economic
advanatage of the investments already made or planned in the near term for
some reprocessing plants as also for some breeder reactors is plainly
doubtful. One may, for the sake of argument, concede that at some unspecified

- 90 -

time in the situation might be reversed; the problem is, one cannot say when.
might be reversed; the problem is, one cannot say when.

- 91 -

IV. Uncertain Economics


T~ere are several reasons why cost accounting of nuclear power ought not
to be done in the same manner as that for electricity generation from other
sources; most of these can be discussed under the rubric of a special kind of
'externalities'.
These include - (a) the possibilities of severe accidents
with varying magnitudes of impact upon the nuclear facility itself, workers,
as well as off-site property and people; (b) the possibilities of accidental
exposures to radioactive releases from the by-products of the nuclear fuel
cycle (ranging from uranium mine and mill tailings to high-level waste) over
long periods of time extending to hundreds of years in the future; and (c) the
possibilities of the use of some by-products for the manufacture and use of
nuclear weapons by governments or non-government actors. These externalities
are 'special' to nuclear power in that while it is impossible to assign
specific values to the potential costs of such events, general thinking seems
to be that under some scenarios they could be very high, no matter what
procedures and assumptions were used (valuation of property and life, choice
of discount rate, weighting of inter-group welfare, among others).(66)
Further, nuclear power technology is unique in that (b) and (c) are not
associated with any other form of electricity generation (although the longterm ecological impact of carbon dioxide from fossil combustion for
electricity generation can be said to be comparable to (b)), while (a) can
occur with some other power generation sources, such as large dams for
hydroelectric plants.

Even if one ignores externalities, there are as yet unknown costs of


nuclear power generation which may be incident upon the producer of nuclear
power; these include (i) the costs of decomm.issioning, dismantling and
permanent disposal of nuclear facilities; (67) (ii) the costs of long-term
66.
So far, little empirical information is available on the extent of such
damages and their associated costs because only a few, apparently minor,
acknowledged events of the type mentioned have occurred and estimates of their
costs are not readily available.
In these instances - for example, the
Windscale fire in the UK; the TMI-2 accident in the US; uranium tailings in
the US; reprocessing wastes in the US; exposure of military personnel and
populations to the radioactive fallout from nuclear weapons testing by the UK
as well as the US (though, admittedly, the US weapons program is mostly
'dedicated' in nature) - a majority of the costs of remedial action have been
borne . by the governments and not by the owners of nuclear facilities
themselves. (The costs of cleanup alone at TMI-2 are thought to be about $1.5
- 2 billion; the loss of the plant itself, the additional cost of replacement
power, and the administrative costs relating to the accident and cleanup
activities would be extra.)
Beginning around 1957, the US AEC developed
various estimates of the damages and losses under the 'worst accident'
scenario for nuclear power plants. From what the author can judge, the USDOE
or the USNRC no longer have any specific cost estimate for such accidents.
67.
So far,
(continued)

only

few

reactors

most

of

them small

have

been

- 92 storage and/or permanent disposal of spent fuel or reprocessing wastes; (68)


and, (iii) the costs of compensation payments to the victims of radiation
effects from occupational exposures in the nuclear fuel cycle (69)
Microeconomic analysis of nuclear power costs on the basis of available
data and estimates is further complicated by the extensive participation of
governments in nuclear power business.
Not only have the governments spent
substantial amounts of money on research, development and demonstration of
various nuclear power technologies, much of which can be generally
characterized as support activities justifiable on the grounds of social
benefit externalities but the government participation in production
activities has also been extensive, making difficult any proper costing of the
'inputs' to nuclear power generation.
Even if we ignore the cases where
governments or governmental agencies directly own NPPs and sell power,
presumably on 'commercial' basis, government participation in the fuel cycle
business leads one to doubt if the fuel cycle input costs - for example, the
cost of uranium, of enrichment services, of reprocessing services, of waste
disposal services - incident upon an NPP owner/operator do not involve
substantial 'market distortions' resulting in implicit economic subsidies to
nuclear power. (70)
decommissioned and fewer still permanently disposed of. There is no operating
or cost experience with the decommissioning and disposal of large LWRs or of
the industrial-scale fuel cycle facilities. Generally, decommissioning costs
for NPPs are thought to be around 10 % of the original investment cost, net of
any salvage value of the plant.
Provision for decommissioning fund is not
always made; assuming an inflation rate of about 7 % p.a., the decommissioning
costs in current dollar terms could be more than 75 % of the original
investment cost.
68. Under the Nuclear Waste Policy Act of 1982, the US utilities are to pay 1
mill/KWh for their nuclear electric generation to the waste disposal fund to
be administered by the USDOE.
This fee is based on some very optimistic
projections for the costs of the waste disposal program and may need to be
revised periodically. According to some rough calculations of the author, the
uncertainty range for the waste disposal costs alone is wider than some
estimates of comparative economic advantage of nuclear generation over coalfired generation based on 'hypothetical' situations.
Some other countries
also charge waste disposal f~e, higher or lower than US 1 mill/KWh depending
in part upon the choice of exchange rate.
69.
Once again, this element has been unimportant so far because very few
cases of compensation for occupational hazards have been brought to courts and
most of them relating to the operation of weapons facilities and programs
rather than the power facilities.
The author has no information about how
significant this element can be in the future.
70.
The issue is controversial and difficult to settle.
For the US, see
DOE/EIA 1981; USGAO 1979; and, in the particular case of pricing of enrichment
services by the USDOE, see USGAO 1983 a, b, d and 1984b. See also Table
One problem with government projects often is that the investment costs of a
particular facility are financed out of year-to-year appropriations and thus
exclude interest costs or an imputed cost of capital. This seems also to be
(continued)

- 93 -

Finally, actual plant-wise bus-bar generation cost data - while useful in


examining cost structures and trends, and necessary in order to 'normalize'
the effects of different variables for the purposes of inter-plant, interutility or intercountry comparisons - do not fully reflect the total costs of
nuclear electricity generation.
For one, there are many cost elements of a
nuclear power program which are not reflected in the costs of particular
nuclear plant, or for that matter, in the costs of all nuclear plants taken
together. Rarely is a NPP is built as a 'stand-alone' plant; it is usually a
part of a program which involves not only other NPPs but also the fuel-cycle
facilities as well as support activities such as for training, research and
development, whose costs ought also to be counted as a part of the total cost
of nuclear electricity. (71)
It is customary to ignore such issues when preparing hypothetical cost
estimates for power generation alternatives.
The procedure usually is to
assume that a specific amount of capacity needs to be added, and that the
choice of generation technology (i.e., nuclear or coal or any other) does not
affect such requirements; and, to calculate comparative bus-bar generation
costs.
'Quick' estimates of this type require many simplifying assumptions.
Actual costs and cost structures can differ widely from any such hypothetical
calculation in that many of the costs can be specific to particular type,
size, design of a NPP; to a particular country, particular region and even a
particular site; to particular owner and its specific characteristics such as
financial health, construction management, prior experience in construction
and operation, and a host of other factors.
Further, comparison of nuclear
generation costs with those of the alternatives is also complicated because
the competitive alternative (i.e., one which is closest to nuclear in terms of
generation costs and is technically feasible) is different in different parts
of the world, that the costs of alternatives in some cases also tend to be
specific to particular contexts and particular policies.
We will restrict our attention to a comparison between nuclear
electricity (or simply 'nuclear') and electricity from coal-fired power plants
(or simply 'coal'), though recognizing that in many of the developing
countries the competitive alternative to nuclear may not be coal. Further,
the discussion would be by and large restricteq to current-generation LWRs (or
in particular, PWRs, though US data suggest there is not much of a difference
between PWRs and BWRs in terms of comparative economics) of about 1 GW size.
the problem with some of the reprocessing plants in operation or under
construction, as they are built with advances from customers and with
government appropriations.
A purely financial analysis of costs would thus
ignore th~ economic cost of capital.
71. One example of this is France, where EdF apparently excludes some of the
cost elements of its nuclear program from generation cost data; also, whereas
the EdF nuclear program may so far have been a 'success' in terms of the
number of plants built or under construction or perhaps even in terms of the
economic advantage of nuclear generation in the specific circumstances, it is
not seemingly the case that the rest of the French nuclear program particularly, investments in the fuel cycle facilities and the breeder program
- has also been or will be economically successful. Another example is the
Indian heavy water program.

- 94 -

The principal factor influencing comparative economics is the basic


asymmetry in the structure of generation costs: nuclear is more capital
intensive or that capital costs account for a relatively larger share of total
generation costs ( 50 to 90 % in the case of actual plants, depending upon
plant-specific characteristics and nature of fuel contracts, but generally
two-thirds) while the production costs account for a relatively smaller share;
the situation is reverse in the case of coal (or for that matter, other
thermal plants) where capital costs account for a relatively smaller share of
total generation costs (25 to 50 % depending again upon plant-specific
characteristics and nature of fuel contracts, but generally a third to 40 %)
and the production costs account for a relatively larger share. Nuclear is
also more capital-intensive in another sense - capital investment cost per
unit of capacity is generally higher than in the case of coal (by 1.3 to 3 or
more times, depending upon specific contexts, but generally 1.5 to 2 times).
Three additional factors - partly stemming from the greater capitalintensiveness of nuclear - are overall leadtimes and particularly the
construction leadtimes, plant lifetimes, and capacity factors.
Because
nuclear power plants take longer to build, the effects of inflation and
interest during construction (actual or imputed, depending upon specific
structure of financing and regulatory practices) on final completed capital
investment costs are much greater than in the case of coal.
As for plant
lifetimes and capacity factors, power plants generally do not have a
physically fixed lifetime in that they do not become physically impossible to
operate; while their operability may become more difficult as they age, it is
often possible to refurbish them and prolong their physical lifetime.
As
power plants age and become less efficient, and as production cost structures
for generating alternatives change, older plants are operated at lower
capacity factors or retired because to do otherwise becomes uneconomical.
However, in the case of nuclear power plants, there may be fairly inflexible
physical lifetimes as well as physical limits on their capacity factors particularly as they age - beyond which their operation may become unsafe.
Therefore, in as much as there are questions of method and policy in
comparative cost calculations, the most important ones pertain to costing of
capital in the case of nuclear and costing of fuel in the case of coal. (72)
Secondly, in as much as there are questions of making appropriate assumptions,
the assumptions regarding construction leadtimes, cost of capital, plant
lifetime and average capacity factors have a greater bearing on nuclear
generation costs than on coal generation costs, while the assumption regarding
inflation may affect either costs relatively more or less depending upon the
specific 'real' (i.e., net of inflation) increases in the cost of capital
72. For the time horizon considered here, we shall avoid the possibility of
uranium price escalation in order to simplify calculation;;.
In the recent
past, such escalations have had unfavorable effects on nuclear economics as
quite a few utilities were locked into high-price contracts for uranium as
well as for enrichment services, some of which they did not eventually need or
did not need at the schedule originally contracted for (in the latter case,
thus forced to bear high costs of carrying inventories and losses on secondary
sales).

- 9 -

equipment and of fuel.


(Depending upon how much of the capital equipment or
fuel is to be imported, assumptions about exchange rates can also affect cost
comparisons.)
On purely financial basis, average nuclear generation costs over the last
ten or so years have been of ten lower than average coal generation costs particularly in the US, until around 1980 or 1982, depending on whose method
and whose data one accepts - for two principal reasons: older nuclear plants
have relatively much lower capital costs and when they are mixed in with the
newer plants with much higher capital costs, the average capital costs are
lower than marginal capital costs; and, coal cost escalation has been much
higher than originally anticipated. (73)
(The cost of cancelled or shutdown
nuclear power plants do not show up in generation statistics.) However, as
coal cost escalation has slowed down and as new nuclear plants with, on the
73.
Below are some data for national average nuclear generation costs for
investor-owned (i.e., excluding public) utilities in the US over the last
seven years (in current mills/KWh):

Fuel (actual)
0 & M (actual)
Capital (estimated)
Total (estimated)

1977

1978

1979

1980

1981

1982

1983

2.85
2.46
9.15
14.46

3.22
2.95
10.53
16.70

3.92
4.25
14.03
22.20

4.99
5.69
14.00
24.68

5.46
6.23
14.40
26.09

6.19
8.24
17.57
32 .oo

6.31
9.02
18.02
33.35

15.5

32.9

11.2

5.7

22.7

4.2

% increase, year-to-year

In order to make a meaningful aggregation, capital costs were estimated


on the basis of a uniform Fixed Charge Rate (FCR) applied to all the plants;
the assumed FCR for 1977-79 was 17 % and for 1980 onwards was 18 %. Cost data
on year-to-year basis are sensitive plant coverage, operating conditions, and
to the particular new plants entered into operatio in a given year; thus, the
appearance of sudden 'explosion' of capital costs, followed by some
'stabilization' is misleading. If at all, larger increases in capital costs
are yet to come. However, the trend towards increasing 0 & M costs is more
gradual and appears to be continuing.
Average coal generation costs for
investor-owned utilities in the US in the last three years were [in current
mills/KWh; in the order - fuel+ O&M + capital(assuming 18 % FCR) =total]:
1981 - 16.64 + 2.86 + 9.41 = 28.91; 1982 - 17.35 + 3.18 + 11.35 = 31.88; 1983
- 17.41 + 2.81 + 11.57 = 31.79. Cost comparisons on year-to-year basis are
sensitive to capa~ity factors attained; the author suspects that if both
nuclear and coal data were adjusted to the same capacity factor, the nuclear
advantage would narrow (or the disadvantage widen).
Finally, the cost data
include only the plants which were in full operation (or 'operable') in the
given year; i f plants under prolonged or permanent shutdown (before their
capital costs have been fully recovered, such as TMI-2) are also included,
again the nuclear advantage would narrow (or the disadvantage widen).
Source:
USDOE, as quoted in Rahn, et al. (1984) , pp. 85 7 for up to 1981;
USDOE (private communication) for 1982 and 1983. Details for 1983 will be
published soon by the USDOE.

- 96 -

average, much higher capital costs than the plants completed as recently as
1980 enter into operation, the nuclear disadvantage is expected to widen and
remain.wide until such a point in time when coal costs start escalating again.
(74) No meaningful data on comparative generation costs of LWRs vs. coal is
available outside of the US, though the author suspects that if nuclear
advantage has persisted in any of these other countries (partly because of
high~r coal costs than in the US), it would shrink or indeed be reversed over
the next few years.
The matter of historical comparative costs is of limited use in planning,
and one needs to turn to hypothetical estimates for the future.
One such
recent estimate by OECD is given in Table 31.
Note that among the cases
presented, nuclear is cheaper than coal only in the combination of a 6-year
leadtime for nuclear and base coal price of $55/MT. Varying assumptions and
methods would give varying results. Thus, for example, the base capital cost
estimate for nuclear in this Table are likely to be about 55 % of a reference
cost estimate in the US (75), whereas the corresponding estimate for coal is
likely to be about 65-85 % of a reference cost estimate in the US.
Plant
leadtime of 6 years for nuclear is about the most optimistic, while that of 10
years is not the most pessimistic. The capacity factor assumption of 65 % for
both nuclear is also fairly optimistic; it is quite likely that on average,
74. Another reason nuclear generating costs have been lower than otherwise is
that the nuclear fuel costs have not risen as much as anticipated as late as
five years ago.
However, many of the plants which have recently gone into
operation or are under construction are covered by uranium and enrichment
service purchase contracts which are costlier than the current market
situation would imply, so that generation costs from these plants - plagued as
they are by significantly higher capital costs than originally anticipated would be even higher. Utilities which cancelled their NPPs under construction
have become uranium sellers in the secondary markets; it is not clear whether
their losses would be counted on their existing NPPs.
The buyer utilities
would of course benefit from such sales, whose effect would show up on the
generating costs from their operating NPPs.
75. Reference capital cost estimates in the US vary region by region, though
for a 'middletown' location, base costs (i.e., excluding escalation and
interest during construction) were estimated at $1822/KW in January, 1983
dollars in one recent study (Bowers, et al., 1983); revision of the same
database upon which that estimate was based now gives a figure of $2036/KW in
January, 1983 dollars. Given the trends in reference capital cost estimates
in the US, the author estimates that the next round of revisions would yield a
figure of about $2200/KW in mid-1984 dollars.
A USDOE estimate of capital
costs (excluding interest during construction) for the US nuclear power plants
under construction as of 1982 gives a range of $1331-$4160/KW in 1983 dollars;
of the plants under construction as of mid-1984, the range is likely to be
around $1800-$5000/KW in mid-1984 dollars. As far as the author can tell, not
much (certainly not as much as in the case of nuclear, even which is limited)
work has been done in the US about coal capital costs in recent years, so it
is not possible to refer to actual experience. Reference estimates for coal
power plants in the US suggest a base cost figure of around $1000-$1300/KW in
January 1983 dollars.

- 97 -

Table 31 : Comparative Cost Estimates


(Year of estimate: 1983; Estimator: OECD/IEA)
Type

Nuclear, PWR

Size

2-1100 MW

A.

Assum.E.tions

Base capital costs


(1984 $/KW, excl. IDC)
Leadtime, years
Plant lifetime, years
Capacity factor, %
Real discount rate, % p.a.

--- 1200 - 6
30
65
10

10
30
65
10

Base coal price


(1984 $/MT)
Real escalation in
coal price, % p.a.
after 1990
B.

Coal, with FGD


(90 % sulfur removal)
2-600 MW

----------- 850 -------------30


65
10

Not
30
65
10

given
30
65
10

30
65
10

38

38

55

55

19.2
5.0
22.0
46.2

19.2
5.0
26.3
50.5

Unit generating costs

Capital (incl. IDC)


Operating
Fuel
Total

29.7
5.0
10.0
44.7

36.0
5.0
10.0
51.0

19.2
5.0
15.2
39.4

19.2
5.0
18.1
42.3

Source and notes:


OECD/IEA (1984d), Appendix E, pp. 173-176~ Calculations based on 5 % real
discount rate show nuclear to be cheaper in all cases, except when the
leadtime for nuclear construction is ten years and coal price remains at
$38/MT in real terms. Here the 10 % real discount rate case has been
presented, in the belief that such a case is more appropriate for the
developing countries. Coal prices are assumed to remain constant in real
terms throughout "the 1980's. The estimates are confusing in that plant start.up d6tes are not a given; if a coal plant does take six years to build and
starts in 1990, the assumptions about the price of coal until 1990 are of no
significance.

- 98 the large LWRs would achieve only about 60 % capacity factors over their
lifetime.
(This is largely a matter of opinion.
Some large LWRs have had
much higher capacity factors, and some of the specific reasons for the lower
capacity factors so far for some other large LWRs may not obtain in the
future; only experience will tell for sure.)
Debates over hypothetical estimates of comparative costs go back to the
days before any nuclear electricity was generated (see Isa rd and Lansing,
1949, pp. 226-228) and would continue for years to come. (76) Let us perform
some calculations of hypothetical estimates and see the effects of varying
assumptions. To begin with, the major contributors to nuclear relative cost
increases in recent years have been (a) much longer leadtimes than coal
plants; indeed, much longer than those estimated at the beginning of the
planning period for nuclear; (b) overall inflation, and particularly real
(i.e., net of inflation as measured by various indices) (77) escalation in
nuclear material, equipment and labor costs in construction; (c) high interest
rates, both nominal as well as real; and (d) disappointing experience with
nuclear capacity factors.
Whereas the quantitative evidence behind each of
these statements is available only for the US, it is the author's impression
that other countries differ only in degree and not in kind.
The precise
magnitudes of the impacts have differed not only across countries but, in a
country such as the US, across utilities, but concern about them is
nonetheless general and will probably remain so for a while. It is difficult
to say whether the past experience will be repeated, it is equally difficult
to say whether it will not.
If at all, it is more likely that different
countries would repeat each-other's experience rather than their own in the
past.
In the examples that follow, we will adopt an approach generally
favorable to nuclear costs and yet trying to be realistic. Let us assume base
76. At the time, various nuclear cost estimates ranged from about 4 mills/KWh
to 14 .5 mills/KWh.
Much has changed since, yet it appears that the spread
among plant-wise nuclear generation costs (for plants of all types, sizes, and
age) in the US is currently about the same magnitude, i.e., by a multiple of 3
to 4.
For US plants under construction as of 1982, the capital cost
(including interest during construction) spread was estimated as $1275$4100/KW (as-spent dollars); under some reasonable assumptions about capacity
factors, production costs and fixed charge rate, the spread in total
generation costs when these plants enter into operation would again be of
about the same magnitude. As these figures suggest, it is just plain folly to
make an 'authoritative' estimate of comparative costs.
77. It will be noted here without further comment that precise estimates of
real increases in nuclear capital costs are fraught with conceptual problems
and are a matter of controversy. See Bowers, et al., (1983) and USDOE 1984f
for one view, and Komanoff (1981) for another. These sources use different
measures of capital costs and different methods for deflating, neither of
which are satisfactory; in the author's judgement, the relevant figure for
planning purposes is likely to lie in the range 5-10 % p.a. (i.e., over and
above general inflation rate as measured by the GNP deflator). The USDOE/EIA
is expected to conduct a study on the subject over the next year or two.

I '

- 99 capital costs for nuclear to be $1500/KW and for coal to be $1000/KW in


January, 1985 dollars. (78) To see how these translate into final total
capital investment costs, we need to assume plant leadtimes and an
expenditure/cash-flow model.
For simplicity, let us assume a six-year
construction leadtime for nuclear and a four-year one for coal. (We ignore
pre-construction leadtime of two to three years for nuclear and about two
years for coal.)
Further, again for simplicity, let us assume that the
expenditures are incurred in equal amounts throughout the construction period,
and that all the amount is financed from borrowing. (Alternatively, one may
choose to impute a cost of internally generated funds at the same rate as
would have applied if that amount was borrowed.) In other words, the nuclear
project requires exactly $250/KW of expense every year, beginning the first
day, and that the coal plant similarly requires exactly $250/KW of
expenditure.
If construction on both these plants started in January, 1985, the
nuclear plant will be ready by January, 1991 while the coal plant will be
ready by January, 1989.
The simplest way to deal with the problem of
normalization is to deal solely with a specific base period and assume real
escalation rates for capital costs and real interest rates. However, let us
first see what effects the addition of inflation and interest charges can have
on final total capital investment costs (TCIC). Table 32 (Case A and Case B)
provides some estimates of these effects for our simple expenditure model.
The $1500/KW estimate in January, 1985 dollars for nuclear may balloon into a
$3045/KW in January, 1995 dollars in Case A and $4988/KW in Case B. In Case
C, we have ignored the general inflation rate to see how the base cost of
$1500/KW in January, 1985 dollars can still increase to $2391/KW in January,
1985 dollars as long as there is a real escalation in capital costs and the
real rate of interest is positive (in this case, both assumed to be 5 % p.a.,
along with a 10-year construction period).
Table 33 allows us to see the effects of varying assumptions about real
escalation rates, real interest rates, plant lifetimes, plant capacity
factors, and of the choice of discount rate on unit capital costs for nuclear
and coal. Case A here generally reflects an 'optimistic' scenario for nuclear
and makes comparable assumptions about coal as well.
The assumed higher
escalation rate for nuclear expresses the author's bias that nuclear capital
costs will increase faster in real terms than those for coal, but the exact
magnitudes assumed do not make any difference to the argument. Case B makes
especially pessimistic assumptions about nuclear/ coal relative real capital
cost escalation rate, more to point out the potential negative effects of
uncertainties on nuclear economics than to convey the impression that such a
scenario is more or less likely than any other.
The subcases (i) and (ii)
turther illustrate the effect of the choice of discount rate and capacity
factors on relative unit capital costs; subcase (iii) shows how the unit
capital costs ratio can be about the same as the ratio of base capital costs
under the special assumptions of a 5 % real discount rate and a much superior
performance on the part of nuclear plant. Many more combinations of varying
78. The specific numbers or their ratio are not of great significance here,
though as compared to the reference cost estimates in the US they are more
favorable to nuclear.

- 100 -

Table 32: Effects of Construction Leadtimes, Inflation and Interest Cha rg es


on Total Capital Investment Costs. (Illustrative figures, based on the
assumption of uniform expenditures over the construction period)
Construction Period
(Years)

Added Costs of Inflation and Interest


Charges as % of Base Capital Cost

Case A
(Nominal escalation rate for base capital costs 5 % p.a.; nominal interest
rate 10 % p.a.)
4
6
8
10

24.8
45.9
71.6
103.0

Case B
(Nominal escalation rate for base capital costs 10 % p.a.; nominal interest
rate 15 % p.a.)
4

44 .1

87.7
148.0
232.5

8
10

Case C
(Real escalation rate for base capital costs 5 % p.a.; real interest rate 5 %
p.a.)
4
6

8
10

16.0
28.6
43.0
59.4

- 101 -

Table33: Effects of Parameter Changes on Comparative Unit Capital Costs


(All money figures in January, 1985 dollars)

Base Capital Cost, $/KW


Case A
Construction period, years
Real escalation rate for
capital costs, i. p.a.
Real interest rate, % p.a.
Total capital investment
costs (TCIC), $/KW
Plant lifetime, years
Average capacity factor, i.
Real discount rate, i. p.a.
Unit capital costs, mills/KW

Nuclear

Coal

Ratio

lSOO

1000

l.S

1788
30
70

1.63

1094
30
70
5

18.97

11 .61

1.63

3
10
2392

0
10
1160

Plant lifetime, years


Average capacity factor, i.
Real discount rate, i. p.a.
Unit capital costs, mills/KWh

25
60
10
so .14

60
10
22.88

(ii)
Plant lifetime, years
Average capacity factor
Real discount rate, % p.a.
Unit capital costs, mills/KWh

30

30

SS
lS
7S.61

15
31.03

30

30

7S

SS

23.68

lS.66

Case B
Construction period, years
Real escalation rate for
capital costs, % p.a.
Real interest rate, i. p.a.
TCIC, $/KW

2.06

(i)

(iii)
Plant lifetime, years
Average capacity factor
Real discount rate, i. p.a.
Unit capital costs, mills/KWh

3S
2.19

6S
2.44

s
1.51

Note: Unit capital costs calculated via applying a Capital Recovery Factor
appropriate to the assumed discount rate and plant lifetime to TCIC and then
dividing by total energy produced.

- 102 -

assumptions can
illustrative.

be

created,

of

course.

Those

given

here

are

merely

However, some justifications can be offered: nuclear construction


leadtimes have often been as long as eight years or even longer in the past;
although the matter of real escalation in nuclear capital costs over the last
ten years is a bit controversial, there are still quite a few avenues via
which such escalations would continue for quite some time (79) and the 3 %
p.a. figure is, if at all, a rather conservative assumption (particularly
combined with the $1500/KW figure for base cost); as for plant lifetimes,
there is not much of a guide to go by, except that 30 years is roughly the
license-time for NPPs in the US (BO); finally, the capacity factor assumption
is based on the experience of large LWRs in the last decade or so.
The principal arguments in favor of choosing the capital-intensive
nuclear option are that (a) lower production (i.e., 0 & M and fuel) costs
result in overall lower generation costs over the plant lifetime; and, (b) the
greater capital-intensity of the nuclear plants make them relatively
'inflation proof', i.e., unaffected by the real increases in unit production
costs. In practice, whether such advantages are and will be realized depends
upon a number of factors, including plant performance and precise magnitudes
of the changes in relative production costs. The latter in turn depend upon
actual capital cost differentials and upon specific contexts - such as fuel
pricing policies, nature of contracts for fuel and fuel service deliveries,
etc. (81)
79.
This is largely a matter of opinion, even for technical people.
The
current designs of LWRs have a list of what the USNRC likes to call
'Unresolved Safety Issues'; as and when such issues are resolved, operating
plants as well as in some cases plants under construction may have to be
refurbished in order to accomodate the new equipment (or operating)
requirements.
In the recent past, a number of regulatory 'backfits' have
arisen out of the evidence from major accidents and/ or unanticipated events
such as the Browns Ferry Fire, or the TMI-2 accident.
There is no telling
that such accidents would occur with any less frequency, just as there is no
telling that they would not.
Another interesting, though not quite
convincing, hypothesis is by Komanoff (1981) who argues that as the size of
the 'nuclear sector' - i.e., total installed capacity - increases, safety
requirements have to be made tighter in order to keep the average population
risk the same, so that there is a built-in escalatory factor for nuclear
capital costs. Other reasons to suspect a continuation of trends for nuclear
capital costs can be found; the general point is that the evidence so far does
not make it reasonable to assum~ zero real rate of increase. Some spotty data
from France and Japan also suggest a real rate of increase of about 3 to 5
percent a year over the last five to seven years. Overall, while some of the
increase - in the US and elsewhere - is probably due to site-specific features
and some due to the regulatory backfits arising from accidents, it is thought
that the major contributor is changes in the 'state-of-the-art' of the
technology.
Absolute standardization can, in principle, limit real cost
increases, but evidence on that count is absent so far.
80. In any case, it is unlikely that any NPP would continue to operate beyond
25 or 30 years without some major refurbishing and modification.
(continued)

- 103 -

Table 34 gives estimates of comparative generation costs for nuclear and


coal under varying assumptions. Several comments are in order:
(a) The TCIC estimates for nuclear and
the specific assumptions in Table 33 ;
combinations of assumptions, as well as
ignored in Table 33 - such as exchange
figures used in Table 34.

coal do not necessarily correspond to


as mentioned before, many different
the effects of some of the variables
rate changes - can produce the TCIC

(b)
Similarly, a variety of specific combinations of detailed assumptions
about uranium ore price, enrichment service price, fuel fabrication price,
fuel burnup characteristics, treatment of fixed fuel costs can produce the 10
mills/KWh figure used in Table 34. Such details are not of major significance
in illustrative calculations, since minor variations one way or another tend
to cancel out in the aggregate or make a marginal impact upon total fuel
costs.(82) The figure cited here is in line with other recent estimates such
as Table 31. It is assumed that nuclear fuel costs will not increase in real
terms over the projected period; the uranium markets will firm up, to be sure,
and the price of uranium will rise in real terms from the current contractaverage of about $30/lb. (or $66/kg.) but a combination of other factors such as improved burnups - can counter such price increases. (83)
(c) The implicit assumption in unit coal costs is for a heat content of 22
million Btus per ton and a heat rate of 9700 Btus/KWh (i.e., about 35 %
efficiency).
Some other combinations of coal price, heat content and heat
rate can also produce the figure of 22 mills/KWh (see, for example, Table 32).
(d)
0 & M costs again can be broken down into various components, and
specific assumptions made about each. Here we assume that the 0 & M costs are
81.
It is worth noting that in the presence of certain institutional
rigidities such as when a utility has difficulty in passing through increases
in production costs to consumers, or in the presence of certain market
imperfections, such as when a utility faces a particularly low cost of
capital, the nuclear option would seem .more attractive even if the argument
(a) above were not met or did not give a very confident answer one way or the
other.
17.
Except in the case of the 'back-end' costs such as for spent fuel
reprocessing (net of the value of recovered fuel), for waste disposal and for
decommissioning and dismantling; it is not possible to make any specific
judgements about what such costs might be ten or thirty years from now.
83. Such seems to be the general opinion; however, urani~m ore costs are but
a part of the total nuclear fuel costs and when the other elements are
considered, particularly the reprocessing or waste disposal costs, and the
fictitious credit for plutonium is removed (since in all likelihood there will
be no economic use of plutonium for at least fifty years to come), it is not
at all certain that nuclear fuel costs will not increase in real terms. Some
part of the fuel costs are also 'fixed' in nature and hence susceptible to the
capacity factors assumed or realized. We shall stick with the assumption of
no real increase in order to be somewhat optimistic about nuclear economics.

- 1 ')4 -

Table34: Comarative Cost Estimates - I


Assumptions
(a)
TCIC, $/KW (1985$)
Plant lifetime, years
Capacity factor, %
Real discount rate, %
Coal price, $/MT
(1985 $)
Real escalation rate
for coal price, % p.a.
1990 onwards

Nuclear
( c)
( b)

( d)

(e)

Coal
( f)

(g)

(h)

1800

1800

2400

2400

1100

1100

1200

1200

30
70
5

30
60
10

30
70
10

25
60
15

30
70
5

35
60
10

30
70
10

35
60
15

50

50

50

50

Unit Costs (1985 mills/KWh)


19 .1

36.3

41.5

70.6

11. 7

21. 7

20 .8

34 .5

7.3

8.6

7.3

8.6

4.9

5.7

4.9

5.7

Fuel

10.0

10.0

Total

36.4

54.9

Capital
0 & M

- -10.0
- -10.0
58.8

89.2

22.0 29.9 22.0


- -- --

--

38.6

68.6

57.3

47.7

28.4

Note: Unit capital costs calculated via application of Capital Recovery


Factor appropriate to the assumed discount rate and plant lifetime. Under
some simplifying assumptions, this method yields the same value as that by
levelization method. 0 & M costs assumed to be flat 3 % of the base capital
cost ($1500/KW for nuclear, $1000/KW for coal) per year. Nuclear fuel costs
include all the fuel cycle costs, and are simply assumed to be 10 mills/KWh on
the basis of some scatt~red data and projections available. (See Table
,
for example.) Coal price assumption is arbitrary, though it appears that the
international steam coal prices would be around $50/MT (in 1985 $) or less by
1990. Unit coal costs calculated on the basis of some reasonable assumptions
about coal heat content and heat rates; variations in these assumptions would
not significantly change the figures here. Levelized unit coal costs are
lower in case (h) than in case (f) because of the difference in assumed
discount rate. For a discussion of the cost levelization methodology, see
USDOE 1984f.

10~

simply 3 % per year of the base capital cost for each option.
Table 34 estimates do not fully convey the effects of uncertainties in
comparative costs. Cases (a) and (e) show that with a real discount rate of 5
% and" optimistic assumptions about both nuclear and coal capital costs and
capacity factors, nuclear is about 6 % cheaper; whereas cases (c) and (g) show
that with a discount rate of 10 % and somewhat pessimistic assumptions about
capital costs and capacity factors, nuclear can be about 23 % more
expensive. Other cases are not intercomparable because the 'ground rules' for
nuclear and coal are not identical (differing in assumed lifetimes). I t is
impossible to say how actual experience may turn out.
However, in the
author's opinion, cases (b), (c), (f) and (g) are the most appropriate for a
utility with little previous experience with NPPs - as is the case in most
developing countries. In as much as the coal prices assumed here are, if at
all, on the higher side as compared to recent long-term projections of the
same, it is important to note that the range of nuclear advantage in these
cases extends from plus 5 percent to minus 23 percent.
All the cases presented do not exhaust the possible scenarios, but it is
important to note that nuclear capital costs and operating performance are
more unpredictable than corresponding coal ones and that coal prices are more
predictable - since long-term contracts can be entered into at the time of
planning. Overall, seen f rom today's vantage point, it appears that nuclear
investments would have a higher 'risk margin' (84) than that for coal
investments. To the extent that the estimates in Table 34 are representative
of probable scenarios, it is seen that nuclear costs may differ by a margin of
about 63 percent whereas coal costs by about 44 percent [ignoring cases (a)
and (e) since the assumption of a 5 % real discount rate may be unreasonable
for the developing countries].
As far as the author is able to judge, the
Table 34 assumptions are, i f at all, quite favorable to nuclear costs and
unfavorable to coal costs; reasonable estimates of larger risk differentials
can of course be made. Developing countries with limited or no experience in
NPP construction and operation may do well to assess whether their future
nuclear investments are worth such an additional risk.
Table 35 provides estimates of comparative costs under yet another set
of assumptions, this time in 'current dollar' terms.
In order to achieve
comparability, capital costs for different plants are adjusted to the date of
construction start and all the alternatives are assumed to start operation in
1995.
The basic assumptions here do not exactly correspond to any of the
. cases in Table 34, so the numbers between the two tables are not comparable.
However, it is seen that undt!r the assumptions, nuclear cost range is wider
than that for coal. A comparison of "the 'better/better' scenario - i.e., the
lower costs for both the options - and the 'worse/worse' scenario - i.e., the
higher costs for both the options - suggests that either way the margin is
84.
That is, the ratio of lowest possible achievable costs and the highest
probable costs a utility may have to suffer, even ignoring the possibilities
of longer construction periods than assumed here (as has been the case in many
developing countries) and of prolonged shutdowns in the case of nuclear
plants.

~-06

Table 35 : Comparative Cost Estimates - II


Coal

Nuclear
(A)

( B)

(C)

(D)

1500

1500

1000

1000
7

12

10
15

12

10
15

1989

1985

1991

1989

2117

1500

1500

1464

3416
2524

4988
2391

1984
1665

2747
1883

30

25
60
15

30
70
12

25
60
15

50

50

Assumptions
Base capital cost
(Jan. '85 $/KW)
Inflation rate, % p.a.
Capital cost escalation
rate, % p.a.
Interest rate, % p.a.
Year of construction start
Base capital cost at the
time of construction start
(in then $/KW)
TCIC, in current $/KW, at
the time of commercial
operation start
TCIC (excluding IDC) 11
Plant lifetime, years
Average capacity factor
Nominal discount rate

70

12

Coal price, 1985 $/MT


Coal price real escalation
rate after 1990, % p.a.

Unit costs (levelized current dollars, in /KWh)


Capital

6.92

14.68

4.02

8.09

0 & M

2 .86

2. 91

1.91

1.94

Fuel

3.90

3.40

8.58

9.84

Total

13 .68

20.99

14. 51

19 .87

Notes:
TCIC m"Total Capital Investment Costs. Calculation of TCIC via assuming a
simplistic expenditure model as discussed in the text; specific assumptions
are not crucial to the argument; any from among a number of factors can result
in the TCIC ranges presented here. For a discussion of the levelizat1on
methodology, see USDOE 1984f. Some simplifying assumptions have been made here
(such as, no taxes or tax credits, no recurring costs related to investment
costs, etc.). Basic 0 & Mand fuel cost assumptions are the same as in
Table
Nuclear fuel costs and both nuclear and coal O & M costs are
assumed to stay constant in real terms. The reason they differ between
columns here is because of the effect of assumed plant lifetimes and discount
rates in cost levelization procedure.

- 107 -

about 5-6 percent; similarly, a comparison of the 'better/worse' scenarios


suggests that either way the margin is about 45 %
However, the crucial
assumptions in comparative cost estimates presented in Table 35 - as compared
to cases (b), (c), (d), (f), (g) and (h) in Table 34 - is that of a 'real'
discount rate - of 5 % in case (A) and (C) and of 8 % in case (B) and (D).
If; for whatever reason, the discount rates assumed here are judged to be too
low and increased to 10 or 15 %, the nuclear cost advantage will be much lower
(or the disadvantage much higher) and the corresponding measures of risk also
much wider. (85)
How 'reasonable' are the estimates in Tables 34 and 35?
It is not
possible to judge them on the basis of available international evidence. As
mentioned earlier, detailed and fairly useful actual data are available only
in the case of the US. (86) First we see the reference nuclear power plant
capital cost estimates in the the US over fifteen years, in Table 36. The US
actual experience over the last five or so years is unlikely to be repeated
elsewhere (though there can be differences of opinion on this point). Nor is
it likely that that experience will be exactly repeated in the US either; over
the next several years, many plants will be entering into operation with
capital costs in current (i.e., as of 1985 and 1986) dollars two to five times
higher than the $925-$1130/KW estimated for such plants in 1975 and 1976, and
indeed comparaple to the $5200/KW estimated in terms of 1995 dollars in the
most recent published estimate, so that even the $5200/KW estimate, if it were
to be achieved, would mark a remarkable reversal of recent trends.
On the
other hand, no new NPP is likely to be ordered and completed by 1995 anyway,
so the question whether the US experience will continue its trends is purely
conjectural.
Some other data for the US NPPs under construction as of 1982 are more
revealing.
Capital costs in current dollars including AFUDC (Allowance for
Funds Used During Construction), ranged from $1276/KW to $4125/KW; those
excluding AFUDC ranged . from $742/KW to $2682/KW; capital costs in constant
85. The scope of the paper prevents excursion into the debates about choice
of discount rates in development planning or energy policy. For an excellent
summary view on the subject of the role of discounting in energy policy, see
Lind, et al. (1983).
The important point about coal/nuclear comparisons is
that the risks are higher in the case of nuclear.
86. EdF, while claiming its nuclear program a great success, is nonetheless
shy about .making available the evidence in detail. Annual aggregate coal and
nuclear generation cost data (in 'constant centimes') are made available, but
plant-specific data are apparently guarded as secrets.
It is not clear what
is being counted (for example, EdF is allowed to charge its customers for work
under construction, so that a specific plant's capital costs exclude the
proportion which would have been attributable to interest during construction)
nor is it always clear how (for example, EdF' s treatment of year-to-year
exchange rate gains and losses or for that matter of its deficits).
As
mentioned earlier in the text, the mixing of plants of different age and
capital costs make it impossible to judge how plant-wise trends are moving.
French domestic coal prices are also higher than the border price, pushing up
nuclear advantage.

- 108 -

Table 36: History of Reference Nuclear Power Plant Capital Cost Estimates - US
Experience
as of

Start of
project

Commercial
startup

Total capital costs


($/KW, as of year
of comm. start)

WASH-1082

3/67

3/67

late '72

134

WASH-1150

6/69

6/69

mid '75

240

WASH-1230

1/71

1/71

1/78

345

WASH-1230 (Rev.1)

1/73

1 /71

1 /78

440

WASH-1230 (Rev.2)

1/73

1 /71

1 /81

500

WASH-1345

1 /73

6/74

1/83

700

WASH-1345 (Rev.)

1/75

1/75

1/85

925

NUREG-0241-44

6/76

6/76

mid '86

1130

EEDB-I

1/78

1/78

1 /88

1500

EEDB-III

1/80

1/80

1/92

3192

EEDB-V

1 /82

1/83

1 /95

5200

Source

Source:
USDOE/EIA (1982b), V. 2, PP 34 for up to EEDB-III; Bowers, et al. (1983) for
EEDB-V. The author's preliminary estimate based on some EEDB-VI figures is
about $5800/KW for 1/95 commercial operation start. 'WASH' refers to
publications of the erstwhile USAEC; NUREGs are published by the USNRC; EEDB
stands for Energy Economic Data Base sponsored by the USDOE.

- 109 -

the
1983 dollars including AFUDC ranged from $1871 /KW to $6134 /KW;
corresponding range excluding AFUDC was $1331/KW to $4160/KW.
Construction
schedule length ranged from 71 months to 187 months; engineering manhours per
KW ranged from 2.3 to 9.9; craft labor manhours per KW ranged from 12 to 27;
concrete requirements in cubic yards per MW ranged from 139 to 588; and, large
bore pipe in linear feet per MW ranged from 99 to 368.
( 87, 88) Other
measures of variations can be given, though these numbers alone suggest the
importance of specific contexts.
(At the low end of the ranges, the US
numbers are lower than or about the same as those claimed in some other
countries, particularly France and Japan.)
Detailed analysis of the data carried out for the USDOE suggested that no
statistically significant trends were found when $/KW figures were regressed
against the areas of general design features (reactor type, size and the
like), 'learning potential', schedule variables, labor requirements and costs,
commodity quantities and financial variables. The direct implication of this
observation is that a quantitative explanation of cost variations is well-near
impossible.
The US data suggest a tantalizing hypothesis - statistically, the US NPPs
completed and under construction make up the largest sample of LWRs to date
(and will probably remain so until the year 2000); these cover a long enough
period and hence a considerable amount of technological and institutional
change; a wide enough array of specific economic and political contexts; a
wide enough variation in designs, sites, type of manpower employed, quality of
construction management; and, a large enough sample of utilities, their
financial and human resource characteristics.
Could it be that the US
experience may provide a statistical view of what may happen elsewhere?
Despite the paucity of data - after all, the developing countries have
very little experience with nuclear power so far - the author feels inclined
to take such a view. The US experience is relevant statistically, precisely
87.
The capital costs cited here give only a partial idea of how much the
utilities have spent in installing nuclear capacity in the US in that some in many cases, the same - utilities also invested and lost a sizeable sum in
the NPPs that they later cancelled. There are no up to date precise estimates
of the losses on cancelled plants (see USDOE/EIA 1983a for data up to 1982);
rough adding up of several numbers suggests the figure to be in the range of
about $20-30 billion.
Estimates of the total 'economic damage' - covering
cancellations as well as cost overruns - run to about $80 billion to $100
billion.
Estimates of total utility capital expenditures in NPPs over the
last ten or so years run to about $150-200 billion (current) dollars,
excluding the amount still to be spent on the plants under construction. The
author's rough guess is that when all the nuclear capacity added since 1974
and to be added from orders before 1974 is counted against the total capital
expenditures on NPPs (including those cancelled), the $/KW figure would turn
out to be around $3000-3500 (current dollars, including AFUDC) average.
88.
A more recent study of the 'most expensive' and the 'least expensive'
NPPs under construction in the US gives a range of $1353/KW to $5122/KW (in
current dollars, including AFUDC) as of early 1984. (Nucleonics Week, 14 June
1984, PP 13)

- 110 -

because of the wide possible variations that have occurred, and will continue
to exist in the developing countries as a group - whether any particular
country has built five NPPs or none; whether the country has the required
infrastructural and manpower facilities; whether the financial situation is
healthy or precarious; whether the projects can be completed competently or
not; whether the NPPs can be operated safely and reliably, whether the
attitude towards nuclear technology is one of requisite caution and respect or
one of exaggerated faith, overconfidence and plain foolishness; whether, to
borrow John Kemeny's phrase, the 'mindsets' are appropriate to use the
technology.
Combine such variations with the uncertainties at one level - whether a
NPP can be built for $2000/KW or $6000/KW, whether it would take six years or
eighteen years to do so, whether it would be operated at 35 % or 75 % capacity
factor (89) - or another - whether electricity demand would grow at 8 % or 15
%, over five years or twenty years, whether $5 billion can be raised from
international financial markets (with or without suppliers' credit guarantees)
or whether even $100 million would be close to impossible, whether the
interest rate would be 10 % or 20 %, whether the domestic currency would
appreciate 20 % or depreciate 1000 %, whether the domestic inflation rate
would be 5 % or SO %, and one has the impression that while some of these
factors make any type of investment, particularly power plant investment,
risky, some others make nuclear investments especially risky. Include further
the possibilities that a country chalks up a plan for not just one or two NPPs
but ten, twenty or more; for fuel cycle facilities; for nuclear engineering
education; for research and development activities; for long-term economic and
political agreements with other countries; for a nuclear weapons program, or
at least an 'option' of a weapons program.
It seems to the author that at
least some of these plans would founder, while some may indeed succeed,
economically as well as politically, at home or in the international arena.
A general case of economic advantage or disadvantage for nuclear power
cannot be made with any precise degree of confidence. The evidence so far is
incomplete, limited in detail and across countries, subject to a number of
qualifications and, above all, uneven. There are some specific indications,
however, that for an investment to be decided upon today (as opposed to some
older decision which is carried forward for reason no other than inertia and
resistance to change), in_the circumstances as prevail now and are expected as
of now for the next ten or so years, nuclear plant investments have a greater
chance of proving uneconomical than otherwise - the margins depending upon
which alternatives are perceived and chosen.
Until such a time when ( i) long and wide enough
obtained with the specific nuclear technologies that the
may consider acquiring (i.e., the 1-1.4 GW LWRs or the
the 0.22 GW Indian CANDU version i f India were

experience
developing
O. 7-0.9 GW
able to

has been
countries
CANDUs or
offer it

89. The ranges cited are not purely speculative; nuclear capital costs cited
for some of the NPPs completed in the developing countries range from $860/KW
(Taiwan, excluding IDC) to $3500/KW (the Philippines), in current dollars
(higher if converted to constant 1985 dollars); for construction leadtimes and
capacity factors, see Tables 14 and 16.

- 111 -

internationally);
(ii)
nuclear technology, particularly the LWR, has
stabilized; (iii) the structure of the future international nuclear industry
has become clearer; (iv) the anticipated 'rethinking' of the nuclear power
technology and institutions in the countries which, after all, pioneered them
- US, Canada, and the UK - has taken place and technological/ institutional
alternatives are examined and decided upon, a large-scale commitment to the
nuclear power technology which has so far has had only a mixed technological,
economic and political record would seem to be unjustified.
Although a
detailed assessment of such arguments as have been advanced so far here would
need to take place at the level of individual countries (and within them), it
is unlikely that the possible costs of 'waiting' would outweigh the potential
costs of making mistakes.
For the developing countries overall
specifically, the group which has embarked upon nuclear power programs of
particular ambitions already - the possible technological, economic, or
political advantages of nuclear power are unlikely to be a very significant
factor in their efforts and plans for modernization, economic growth, or much
whatever else.
Such a conclusion is not radically new; in a way, it is not very
different from one presented nearly 37 years ago by an economics professor
then at MIT:
"It appears unlikely that atomic energy will have a revolutionary impact

upon world and national economies.


We can anticipate, within broad
limits, competition with coal, oil and gas as fuel in power stations, but
probably not with water power at :3Uperior hydroelectric sites.
The
effects upon real output and industries in general should be noticeable
but nothing extraordinary, although these may be of considerable
consequence for certain specific industries and trades.
Spatially, the
structure of the world economy should experience mild alterations,
especially in favor of aggressive and growing economies. However, a more
equitable distribution of industrial and commercial activities between
backward and highly developed economies does not appear in sight, unless
international authorities intervene, though instances of feverish growth
of undeveloped regions may of course crop up.
Similarly for various
districts within any given economy, though to a lesser extent, because
within heavily agglomerated areas the impetus toward decentralization may
be strengthened. Whatever rearrangements occur will probably be in those
industries where the p~ll of fuel and power sources is on a level with the
pull of other locational factors, rather than in those industries where
the overwhelming dominance of fuels and power has oriented plants to
superior fuel and power localities.
These tentative conclusions are based upon the presumption that the
nations of the world will avert an atomic bomb race and the catastrophic
destructions which would inevitably ensue.
The problems of evolving an
effective international authority and of establishing a federation of
nations of high moral integrity remain paramount in our efforts to achieve
a more abundant world."
(Isard, 1948, pp. 227-8)

- A 1 -

Annex A - 1: Recommendations for Research


Specific research recommendations can be given only in the specific
contexts of who is sponsoring the research and for what purposes. Most of the
research related to nuclear energy programs in the developing countries
appears to be concentrating on either the scientific-technical side, about
which the author has no expertise or, within social sciences, on the subjects
of (a) energy/electriciy futures and (b) the connection between nuclear energy
programs and nuclear weapons programs (actual or hypothetical). Whereas these
subjects are worthy of attention and of further research, the author would
like to point out the significant gaps in information or analytical research
in some other areas.
a.
Nature of decision-making for nuclear energy programs:
There is as yet
limited information available (Marwah and Katz, ed., 1982 is an exception) on
the organizational frameworks and the processes of decision-making for nuclear
energy programs in the developing countries. It is necessary to prepare 'case
histories' for individual developing countries using a common analytical
approach to understand issues such as - which decisions were taken, by whom,
for what reasons; which alternatives were perceived viable, which not; which
factors affected the perceptions of alternatives as well as the final
decisions; how specific responsibilities and power are distributed; what
political influences played part in particular decisions, and how. The range
of such decisions include - the choice of a particular scale and schedule for
the nuclear energy programs; the choice of reactor-type and supplier;
decisions
regarding
technology
transfer,
development
of
indigenous
infrastructure and supply industries, fuel cycle strategies, and the
international role of the domestic nuclear programs.
Too often the view
adopted in looking at nuclear energy programs is that of a utility planner;
whereas such an approach is useful in understanding the decisions regarding
the scale and the size of the nuclear capacity expansion program, it
nonetheless leaves out the range of decisions made at the broader governmental
and societal levels.
Further, while it is always possible to provide the
rationales once the decisions have been taken, it is equally important to look
at how the decisions were made and why some other decisions were not made.
Only in this manner can one begin to understand the influences of particular
institutional frameworks on the strategies adopted and, in turn, the
influences of such strategies on the results of the nuclear energy programs.
So far, somewhat understandably, the main concern in nuclear decision-making
appears to have been on the ordering and the construction of nuclear power
plants; as the developing countries' nuclear programs mature, and as these
plants are operated for a long enough period, the concern should shift towards
understanding and explaining the results.
(b). Construction and Operation Experience with Nuclear Facilities: Many of
the developing countries have been 'sold' on the promise of nuclear energy as

- A 2 -

an economic option - in the short term as well as the so-called 'long' term.
However, very little detailed information is available on the economic side of
the nuclear energy programs of these countries. It is necessary to search and
compile such information, and to develop methods to utilize it and to
interpret the results. Until quite recently not many developing countries had
nuclear energy programs of substantial scale, the particular programs were
relatively young, and the amount of expenditures involved was probably minor
(relative to, say, the cost of a nuclear power plant). However, the scale of
the nuclear energy programs have increased, and greater experience has been
obtained. Over the next five or so years, the pace of further nuclear orders
itself would be slower while at the same time, more operating experience would
be acquired from the plants currently in operation and under construction
(most of which would, hopefully, have been entered into operation over the
next five years). If and when the time comes for further major investments in
nuclear energy programs, a detailed analysis of the experience would serve as
a useful guide.
The author's impression is that in many countries this may
not be possible, as the entities involved - utilities, atomic energy
commissions, other government agencies - regard the specific information
sources - siting studies, feasibility studies, engineering studies, accounts as 'proprietary' or matters of 'national security'.
On the other hand, it
needs to be established that such is indeed the case, i.e., specific
information is not available for independent scrutiny.
(c). Technology Transfer and Adaptation: Little attempt seems to have been
made so far in understanding how the developing countries open and take apart
the 'black-box' of nuclear technologies - what kind of arrangements they make
with technology suppliers; which technologies are more successfully adapted,
and why; how countries build up their own regulatory capabilities; how they
decide upon their nuclear technology policy programs. There appears to be an
assumption, in the case of nuclear power plant design and construction for
example, that a well-developed domestic electrotechnical industry can - over
the span of the construction and operation of some five or so nuclear power
plants - will be able to develop indigenous capability for design and
construction on its own. Such an assumption may be valid in some cases, but
not in some others. Considering that nuclear technologies - particularly, the
NPP technology - change rapidly, and will probably do so even more over the
next ten or so years, it is necessary to examine the experience of the
developing countries in technology transfer and adaptation to be able to judge
what future options these countries may have.

- A3 -

Annex A - 2: List of Experts


In the author's reading over the last few years, the following
individuals have been among the active researchers and sharp observers of
the subject and the issues discussed in this paper:
(Alphabetically)
1.

Mr. Leonard L. Bennett and Mr. Panos Karousakis


Division of Nuclear Power
International Atomic Energy Agency
Wagramerstrasse 5
P. O. B~x 100
A-1400 Vienna. AUSTRIA
(Messrs. Bennett and Karousakis are economists who have done considerable
amount of work on nuclear costs as well as on the IAEA's programs for the
developing countries.)

2.

Mr. Irvin C. Bupp


C/o. Cambridge Energy Research Associates
56 John F. Kennedy Street, Suite 5
Cambridge, MA 02138. USA
(Professor Bupp - it is not clear whether he still remains on the faculty
of the Harvard University Graduate School of Business Administration is among the best and the most pr0MinPnt observers of the US nuclear
industry; he has also had interest in the global scene.)

3.

Professor Ted Greenwood and Professor George Rathjens


Department of Political Science
Massacusetts Institute of Technology
77 Massachusetts Avenue
Cambridge, MA 02139. USA
(Professors Greenwood and Rathjens have both worked extensively on the
problems of nuclear non-proliferation policies.)

4.

Professor John Holdren


Energy and Resources Group
University of California
Berkeley, CA 94720. USA
(A leading critic of the environmental risks of nuclear power; has also
recently been working on the subject of nuclear proliferation and the nuclear
arms race.)

5.

Professor Henry Jacoby


Alfred Sloan School of Management
Massachusetts Institute of Technology
77 Massachusetts Avenue
Cambridge, MA 02139. USA

Mr. Thomas L. Neff


Energy Laboratory

- A 4 -

List of Exper ts
(continued)
(Both Mr. Jacoby and Mr. Neff have been studying the international
uranium industry and the nuclear fuel market over the last ten or
so years; Mr. Neff's book on the subject was published recently and
was not available to the author in time for this paper.)
6.

Professor Paul Joskow


Department of Economics
Massachusetts Institu~e of Technology
77 Massachusetts Avenue
Cambridge, MA 02139. USA
(Professor Joskow has been studying the US electric power industry for
some fifteen years now; as a part of that work, he has also written
on the subjects of nuclear power in the US, the role of the US nuclear
industry worldwide, and the problems facing the US supply industries.)

7.

MT.

Ch~rles Komanoff
Komanof f Energy Associates
451 Broome Street
New York, NY 10013. USA.

(A major critic of nuclear economics in the US; his work on the cost
and operating performance of Westinghouse PWRs in particular
should be of interest to any PWR buyer. Mr. Komanoff's work and some
of his theses do remain controversial, and are not viewed with particular
favor by some other students of nuclear economics.)

d~vPlnrments

8.

Mr. Mans Lonnroth


Secretariat for the Futures Studies
Stockholm. SWEDEN.
(A student of the WOCA nuclear supply industries; among the most perceptive
observers of the broader social and political issues.)

9.

Mr. Onkar Marwah


Graduate School of Internatioal Studies
Geneva. SWITZERLAND.
(Mr. Marwah is an economist and a political scientist, who about ten years _
ago was studying the problems of nuclear proliferation and regional security
interests; in 1982, he edited a book with Prof. James Katz - now at the
University of Texas in the US - which remains as the best collection of
essays on nuclear power programs and policies in the developing countries.)

10.

Mr. John Surrey and Mr. William Walker


Stience Policy Research Unit
Sussex University
Brighton. UK.
(Messri::. Surrey and Walker - togetller with their colleagues Messrs. Steve
and Gordon MacKerron at SPRU - study the electrotechnical industry
in the UK, Europe, and at the worldwide level; some of the best empirical
work on nuclear power plant performance, nuclear economics, and the
world nuclear supply industries has also been coming out of this group
'Lion.ci:o

::...1j.

- A5 List of Experts
(continued)
in recent years).
11.

Mr. Stephen Zorn


Ta~zer P.nergy Associa~es
New York, NY. USA.
(The author is not much fami]iar with Mr, Zorn's work, except for the paper
he published in Natural Resources Forum on uranium contracts in the
developing countries. In the author's judgement, this io a very important
subject - particularly for the developing countries which would for a
long time not have any 'benefits' of nuclear power and are yet tangled
into the economics and the politics of the international uranium industry and has not received the attention of independent scholars that it deserves.)

- B 0 -

Annex B:

Note:

Bibliography

The attached bibliography was prepared as a part of the author's


ongoing work on the subject matter of this paper. Much of the
information on the specific status of nuclear energy programs
worldwide - upon which this paper's projections as well as
judgements about probable outlook have been based - is so far
scattered in newspaper articles and trade journal reports.
Please contact the author if more information on any specific item
discussed in the paper is desired. The author would also
appreciate receiving additional information.

- B 1 -

Bibliography
Adelman, M.A., J. C. Haughton, G. Kaufman and M. B. Zimmerman. 1983.
Energy Resources in an Uncertain Future. Cambridge, MA: Ballinger.
Ahearne, John F. 1983. "Prospects for the U.S. Nuclear Reactor Industry",
Annual Review of Energy, pp. 355-384
Ahmed, J. U. 1981. "Occupational Radiological Safety in Uranium Mines and
Mills", IAEA Bulletin, V. 23, No. 2, PP 29-32.
Ahmed, S. Basheer. 1979. Nuclear Fuel and Energy Policy. Lexington, MA:
Lexington Books.
Allardice, Corbin, ed. 1956. Atomic Power - An Appraisal. (Including
'Atomic Energy in Economic Development - Panel Discussion at the Eleventh
Annual Meeting of the Board of Governors of the International Bank for
Reconstruction and Development'.) New York: Pergamon.
Albright, David H. 1983. World Inventories of Civilian Plutonium and the
Spread of Nuclear Weapons. Prepared for Nuclear Control Institute. Washington,
DC.
Aldrich, D. c. et al. 1982. Technical Guidance
Development. (NUREG/CR-2239).Washington, DC: US NRC
Argonne National Laboratory
Viability Study. Prepared _by the

for

Siting

Criteria

(ANL). 1982 Nuclear Supply Infrastructure


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