Just about every month we get positive news coming out of China regarding their nuclear sector – completed reactors coming online, new construction beginning. In the same way that we’ve become used to the world’s second-largest economy powering ahead with its reactor construction boom, we’ve also become used to Japan hemorrhaging money and pumping out fossil fuel emissions with so many of its reactors still offline.
It was therefore a pleasure to read, a few days ago, that Japan’s Kyushu Electric Power Co. had restarted a nuclear reactor in the Kagoshima prefecture after the governor, who is opposed to nuclear power, admitted to the prefectural assembly that he had no legal power to prevent the restart.
This is the fifth reactor to be restarted and once again raises the question of when we can expect more to return to operation. It’s an incredibly difficult question to answer. It’s fair to say that most of us in the industry were expecting a faster pace once the restart applications started coming in but in retrospect, considering the politics involved, it’s probably not surprising it’s taken this long to get this far.
However, as things progress perhaps a clearer picture of restart pace is emerging and I want to quote some figures published by Japan’s Nuclear Energy Institute over the Summer.
In its Economic and Energy Outlook of Japan Through 2017, the IEEJ outlines a couple of different scenarios. It’s mid-level case (the reference case) estimates a total of seven reactors could be online by the end of March 2017 and a total of nineteen reactors by the end of March 2018.
This number of restarts would see total spending on fossil fuel imports in FY2017 decrease by JPY4.7 trillion ($45 billion), which is a major incentive to get more of them switched back on. It will also have a major (positive) impact on energy-related emissions which, according to the IEEJ, reached a historical high of 1235 million tonnes CO2 in FY2013. Considering Japan was one of the countries that signed the 2015 Paris Climate Change Agreement to cut emissions, this is more important than you might realize.
If we see another few restarts in the next three-and-a-half months, we’ll know the IEEJ has got the first part of its prediction correct and we may have a better idea of what to expect in the coming year. Now, it’s important to remember that the long-term growth of the nuclear sector is not dependent on how many reactors Japan switches back on and how long it takes. However, as more come online it is going to boost market sentiment and speed up the already-strong rate of growth.
Dev Randhawa, CEO of Fission Uranium