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The Benefit Of Extending Usage of Nuclear Plants

As the weekly uranium spot price continues to move in a tight range, new research explores the effect of delaying nuclear plant closures on global uranium demand.

-The effect on uranium demand of delaying plant closures
-Fourth quarter results for Kazatomprom
-Uranium spot price falls marginally

In the wake of President Biden’s inclusion of nuclear in his clean energy plan, new research from  Bank of America (BofA) poses the question “what if expected US nuclear plant retirements over the next 10 years were postponed?”

If expected closures in the period 2021-2030 were delayed to beyond 2030, then there would be “an additional 26mlbs of global uranium (U3O8) demand over that period.”

While this is just a 2% increase, it is of assistance and could lead to increased pressure on utilities to move forward new contracting, notes the analyst.

In the US there are twelve nuclear reactors expected to shut down between 2021 and 2030. Together, they account for more than 10,000 MW of electrical generating capacity and approximately 4.5mlbs of annual uranium demand, or just under 3% of estimated 2021 global reactor requirements. Five are currently expected to close in 2021, all earlier than required by the operating licenses.

The BofA report follows President Biden signing a raft of executive actions addressing climate change, several of which have the potential to directly benefit existing US nuclear generation and US competitiveness in the small modular reactor (SMR) and advanced reactor industry.

These measures included incorporating climate ambitions into foreign policy, climate financing measures and a National Intelligence Estimate on the security implications of climate change. In addition, they included the role of carbon-free electricity in stimulating the Administration’s Build Back Better recovery plan, and the introduction of scientific integrity and evidence-based policymaking.

In subsequent news out of Japan directly related to the above research, the mayor of the town of Takahama in Fukui Prefecture granted permission for the restart of two nuclear reactors at Kansai Electric Power Company’s Takahama Nuclear Power Plant.

The first of February announcement is significant as the mayor becomes the first local leader in the nation to approve use of nuclear reactors that are more than 40 years old.

“The use of nuclear power is indispensable for the stable supply of electricity, and the government’s role is to move things forward in that regard,” noted industry minister Kajiyama.

Country News

In the UK, the French multinational electric utility company EDF has reported another revised schedule and budget for the Hinkley PointC Nuclear PowerPoint project, industry consultant TradeTech reports. The project aims to construct a nuclear power station with two evolutionary power reactors (EPR) in Somerset.

The initial operation of Unit 1 is now expected in June 2026, a six month delay. Moreover, delays related to the pandemic will also increase the cost of the project by US$684 million. The project completion costs are now estimated at US$30.1-31.5 billion.

IThe Canadian Nuclear Association (CNA) and the European Atomic Forum (FORATOM) have signed a Memorandum of Understanding (MoU) to collaborate in nuclear and promote clean, innovative, and advanced nuclear technologies. This agreement will strengthen both associations’ efforts in advancing nuclear energy’s development, application, and deployment to meet climate change goals, according to a joint statement on January 27.

The MoU addresses the need for greater dialogue and exploration of nuclear’s role in effective environmental stewardship. In particular, it advocates for more explicit and prominent inclusion of nuclear energy in Europe and Canada’s energy and environmental policies.

Company News

Kazatomprom, the world’s largest producer and seller of natural uranium, released a fourth quarter operations and trading update February 1.

All 2020 production and sales figures were just below the top end of revised guidance and the company intends to sell a similar quantity of uranium in 2021 as in 2020.


Source: FN Arena