The Drivers

The world’s economic and population growth is driving the demand for uranium, particularly in countries such as China and India. According to the November 2006 ABARE report, China and India’s energy consumption is expected to expand from 17% in 2005 to 25% in 2030 assuming there are no significant energy consumption policy changes.

China Case Study

China plans to invest US $40 billion on nuclear generating capacity by 2020 - energy consumption is projected at a 4.3% rate of growth through the end of this decade. The economy has been growing at an average rate of 8% per year and electricity demand is growing twice as fast. The ministry of Electric Power has estimated that 15-20% of China’s present energy demand cannot be met, and that 100 million Chinese have no access to electricity.

To keep up with its rate of economic growth, China estimates that it will have to double its electricity-generating capacity over the next decade. At 8.7 million kilowatts of current online capacity, China has an electric grid system second only to the United States. To satisfy this future demand for electricity, China plans to build 40 nuclear reactors within 15 years. The Chinese Government has announced its plans to be at 12 million kilowatts by 2010 and 40 million kilowatts of installed nuclear capacity by 2020 (still only representing 4% of China’s total installed energy capacity).

Key Drivers

Energy Security – In countries with limited indigenous energy sources, nuclear is seen as a secure source of energy thereby reducing a country’s dependence on imported fossil fuels. With increasing instability in fossil fuel rich regions, countries are seeking to secure new sources of reliable large scale energy production. 

Environment – Nuclear power generation does not produce greenhouse gas emissions or local pollution. As the environment continues to move to the forefront of global public opinion, non-polluting sources of electricity generation are becoming popular alternatives to traditional environmentally damaging options such as coal. 

Costs – Nuclear power facilities tend to have high capital cost that are amortized over the facility’s long life, with relatively low operating and maintenance costs. On going research and development into third and fourth generation nuclear reactors is targeted at reducing capital costs while continuing to improve safety.

Source - China National Nuclear Association