News in Depth: Should Singapore reconsider their “no” to Nuclear?

On Friday, July 4, Peter Schwartz, business strategist and member of Singapore’s Research, Innovation and Enterprise Council, said in a panel at the Institute of Policy Studies that Singapore needs to consider turning to nuclear power as a key part of its strategy against climate change.

Mr. Schwartz, who is also a SVP at Salesforce.com and a co-founder of the Global Business Network, framed it in the context of Singapore’s current reliance on natural gas;

You’re going to continue to need electricity, and renewables will be insufficient. You’re either going to have to continue using natural gas or move to nuclear power.

In this week’s News in Depth, we look at the current state of energy sector in Singapore and consider Mr. Schwartz’s call for the country reconsider its current stance against nuclear power.

Singapore’s Current Energy Landscape and Policy on Nuclear

As the Channel News Asia report on Mr. Schwartz’s talk explains, in 2012 the Singapore government concluded that nuclear power was not suitable for the small industrialized country, owing mainly to the safety risks. The “nuclear pre-feasibility study” – a summary is available here – provides some useful context to our analysis.

Singapore, the study notes, lacks indigenous energy resources and generates around 80% of its electricity from imported natural gas from Malaysia and Indonesia. The study also notes that renewable sources such as solar and wind can only augment the energy supply, as the country simply lacks the space for large-scale renewable installations. As a result, the country is challenged with finding a reliable energy source that can provide a stable baseload of capacity while also moving the country towards a low-carbon energy system.

The government initiated the study in response to these challenges, but the study found that “nuclear energy technologies presently available are not suitable for deployment in Singapore.” Despite the findings, the report did state the Singapore should play an active role in the future of nuclear technologies and safety. In other words, the door may be closed for now, but they did not throw away the key.

Reconsidering Nuclear Energy in Singapore

This renewed call to consider nuclear comes at a crucial time in the global energy industry. With the world’s attention this year on climate change in the lead up to the UN Convention in Paris, perhaps it is time to reconsider what may be possible in Singapore.

Mr. Schwartz argues that nuclear energy technology has advanced a great deal, and believes that nuclear power plants could be built on offshore barges, underground, or potentially on partnering island who have more space and may be willing to share in the benefits of a new nuclear power plant. These ideas echo similar stories we have previously explored. In May, we looked at Dunedin Energy Systems’ idea of deploying SMR (Small Modular Reactors) technology onboard ships in Canada’s arctic. The concept there, and here potentially, is to think of nuclear options that are smaller, safer and perhaps even mobile. In addition, in the last five years more advanced reactor technologies have increased safety and relability, take Westinghouse’s AP1000 PWR as an example.

In short, in the three years since Singapore said “no” to nuclear, the landscape has indeed shifted. Of course, policies don’t change overnight, but perhaps it is time for Singapore to once again consider nuclear and the new applications of safety and operational technology that are emerging today.

Westinghouse has inside track on sale of 8 reactors ($24 billion) in China

On Mon Apr 21, 2014 Reuters reported:
* Westinghouse in talks to sell eight AP1000 Reactors
* Nuclear plants, with machinery and services, may cost $24 billion
* Liaoning’s Xudapu and Guangdong’s Lufeng part of discussion
* Sanmen 1 to connect to grid in 2015

“China may sign as early as next year the first of several contracts for eight new nuclear reactors from Westinghouse Electric Co, as the government presses ahead with the world’s biggest civilian nuclear power expansion since the 2011 Fukushima disaster in Japan.”

“China’s main nuclear power companies are moving forward with talks to buy the third-generation Westinghouse AP1000 reactors, said Timothy Collier, China managing director of the U.S.-based company. The eight projects, including machinery and services, are expected to cost $24 billion.”

“We are currently in various stages of negotiations for eight new units,” Collier told Reuters. Westinghouse is majority owned by Japan’s Toshiba Corp and its reactors are the blueprint for China’s own nuclear technology.”

“China currently has 20 nuclear power reactors online, with another 28 under construction, as it seeks to reduce its reliance on costly and polluting fossil fuels to generate electricity. Sun Qin, chairman of major nuclear plant operator China National Nuclear Corp (CNNC) recently told Reuters another 20 nuclear reactors may be built within the next six years.”

“China has vowed to more than double the installed nuclear generation capacity to 58 gigawatts (GW) by the end of the decade. Nuclear installed capacity currently stands at 15.69 GW, according to the latest official data.”

“China’s nuclear expansion is attracting many equipment suppliers, including French power firms Alstom SA and Areva.”

“Candu Energy Inc., a subsidiary of SNC-Lavalin Group , is also working with CNNC to start converting two Candu 6 reactors at Qinshan in Zhejiang province, to burn reprocessed uranium fuel.”

“There’s a huge potential for Canada and Candu energy,” Ontario’s Minister of Research and Innovation Reza Moridi told Reuters during a visit to Beijing last week.  The Reuters article further quoted Moridi, “If China is going to build 100 reactors in the next 20 years, they require 25 Candu reactors to burn the spent fuel coming from the light-water reactors.”

Candu has been criticized in China for not having built any new reactors domestically in Canada in recent years. The Chinese apparently have a hard time understanding that in Canada with a relatively stable population of about 30 million there just isn’t the demand to build new reactors at the rate required in China. As population size and density grows and GHG effects and air quality become greater concerns new nuclear becomes a more attractive option because of the great inherent density of nuclear energy and virtually no GHG emissions.

Kudos to Minister Moridi for making the trip to China to support Candu’s marketing effort. Ontario has created hundreds of jobs by encouraging renewable energy through the Green Energy Act. In comparison, Ontario’s nuclear industry employs more than 20,000. In light of the recent announcement between OPG and Westinghouse to market nuclear services globally, Minister Moridi may have been well served to be cheering on the Westinghouse sales efforts as well.

 

Swafford setting course for Candu in China

On February 25, 2014 SNC-Lavalin Inc. (TSX: SNC) announced the appointment of Preston Swafford to the role of Chief Nuclear Officer, President and CEO, Candu Energy. Based in Toronto and reporting to the Company’s Power Group President, Alexander (Sandy) Taylor, Mr. Swafford will be responsible for growing SNC-Lavalin’s nuclear business to meet the needs of its customers for technical services, major refurbishments and new builds across Canada and in key international markets. Mr. Swafford has impressive experience including senior positions at Tennessee Valley Authority (TVA) and Exelon, both companies are major American nuclear operators. On hearing the news industry observers wondered what course would be set by Swafford, and how applicable would his experience be with the iconic, definitively Canadian Candu heavy water reactors. Reports from a major trade show in China earlier this month, China International Nuclear Industry Exhibition, are providing an indication that Swafford is already starting to make his mark.

Candu Energy Inc. has had a rough period in recent years. Demand for new nuclear softened post Fukushima and in the wake of the financial crisis. Nations with stronger economies, such as China and India, have a burgeoning middle class that is hungry for cheap, reliable energy, and also, a need to rein in greenhouse gas (GHG) emissions for air quality, health and climate change reasons. International manufacturers have made inroads in these emerging markets with innovative new technologies, such as the four Westinghouse light water AP1000 reactors that China started building in 2008. With diminished demand, government support and privatization domestically, Candu needs to reinvent and reposition itself for the new 21st century nuclear market.

Swafford has quickly displayed that he understands the unique attributes of the Candu reactors. Some of the reactor features that made Candu a global leader when first developed decades ago are still highly relevant today. Candu reactors have demonstrated that they can use spent fuel to produce energy. Further, they can be most readily modified to use thorium as a fuel and they have superior safety features. Engineers estimate that for every four new reactors that China builds of various designs, they could and should build one Candu reactor to use the spent fuel. If China follows through on plans to build 100 new reactors in coming decades, this could potentially mean 25 new reactor sales for Candu.

Sales cycles in the nuclear industry are long. It is still early in the game for Swafford and the new Candu. One thing is certain, new innovations, partnerships and financial players are emerging. As with other technology industries, your competitor today may be your partner tomorrow. Who would have thought years ago that western companies would be selling nuclear technologies to China? Who would have thought that China, France and Russia would be involved in building and financing a new reactor in Britain? These are the times we are now in. Candu is setting a course to be a player in this new world.

Henry Vehovec
Chair, Future of Nuclear Advisory Board
President, Mindfirst Inc.

 

Westinghouse and OPG agreement a watershed moment for Canadian nuclear industry

With little fanfare, an unassuming tweet came across my screen yesterday afternoon while attending the global carbon leakage seminar at Bennett Jones. Apparently, Westinghouse and OPG had signed an agreement to collaborate and work on selling their nuclear expertise, products, and services in global markets. Under the agreement, the companies will consider a diversity of nuclear projects including refurbishment, maintenance and outage services, decommissioning and remediation of existing nuclear facilities, and new nuclear power plants.

This agreement could represent a watershed moment for Ontario’s economy, certainly for the nuclear industry. Like a sportscaster that tries to call the definitive momentum shifting play in a game, we won’t know for a while yet. But this agreement could be a gamechanger. Let me tell you why. Ontario has been built on the back of cheap energy, first from Niagara Falls and then nuclear. It is cheap energy that allows us to mine economically and manufacture cars with the best the world has to offer. Similarly, in Quebec, the vast hydro projects underpin their economy. In Alberta, oil and gas are key drivers. Any robust economy in the world has an abundant, secure source of energy.

Ontario’s CANDU technology has been a global leader and a gamechanger for many countries in the world. However, as in all technology driven industries, there is great innovation happening, it happens relentlessly,  and CANDU is not the only nuclear technology that growing nations are considering. The thriving economies of the world, China, India and others, are craving cheap, abundant, clean, safe energy. While Ontario does not have the demand to build new reactors now, other countries do. The challenge for our nuclear industry has been to somehow get our tens of thousands of nuclear related jobs serving the global market, not just maintaining our stable domestic market. This means being able to support the multiple and diverse nuclear technologies that are evolving in the global marketplace today.

The significance of the Westinghouse deal is that it ties OPG to a global leader in a non-CANDU technology. OPG is a globally recognized leader in operating nuclear power generating stations. It has an unblemished safety record that is the envy of the world. What a glorious opportunity this represents to market that operating expertise and enter other markets being served by emerging nuclear technologies. There is certainly a place for CANDU in the future. However, Westinghouse has their APS-1000 line of reactors that are making inroads in several countries. Kudos to OPG for seizing this opportunity and diversifying how they deploy their expertise.

Kudos also to Westinghouse. Westinghouse recognizes that in the 21st century the world will need more nuclear energy if it is to stem the effects of GHG driven climate change. In a post Chernobyl world there has been a relative shortage of young engineers and trades trained in the nuclear sciences. Ontario has almost 300 companies in the nuclear supply chain. There are more than 25,000 jobs related to the nuclear industry. There are nine universities that have courses in some sort of nuclear science. We have Chalk River and AECL, world leading nuclear research in medical isotopes and other applications beyond energy. And we have the Canadian Nuclear Safety Commission (CNSC) which is increasingly being viewed as an innovator and leading exemplar in nuclear regulation by emerging economies and jurisdictions that need to model their own regulatory regimes.

Ontario’s Green Energy Act has spurred wind and solar energy. Cumulatively, renewables represent a single digit percentage of our energy mix. There are thousands of jobs related to renewables, depending on how you count them. This is wonderful news as renewable energy represents an important part of the energy mix. The Westinghouse OPG agreement reminds us that Ontario’s existing nuclear industry, expertise and workforce are an order of magnitude larger than the current renewable industry.

The full press release may be viewed at http://bit.ly/1m7nPmg .

Henry Vehovec
Chair, Future of Nuclear Advisory Board
President, Mindfirst Inc.