Over the past two decades, much has been made of the importance of China’s nuclear reactor build program to the global outlook for nuclear power. UxC has documented these developments carefully for many years as remarkable growth levels have been achieved while lofty, pre-Fukushima targets were missed. Given the recent history, it is therefore important to appreciate that China’s nuclear power expansion is not predetermined, and the past decade has seen growth prospects ebb and flow. Moreover, we have found that many in the industry talk about China’s future nuclear power outlook in broad brush strokes, although the reality is usually much more nuanced. Although China’s central government clearly continues to promote new reactor builds and greater reliance on nuclear power to help alleviate environmental and climate change concerns, the actual development of new nuclear power plant projects is much more granular and dictated by individual nuclear utility actions, while also shaped at the local/provincial governmental level. Therefore, here at UxC, we focus on specific developments for each new reactor project, including under construction, planned, and proposed. Based on our ongoing tracking of projects around China, it is clear that the pace of new build activity has intensified recently, which indicates that future growth trends are much better than where we plotted them just a year or two ago.
Currently there are 48 reactors with roughly 46.1 GWe in net capacity operating at 14 different nuclear plant sites in China. Another 15 units with about 14.7 GWe in cumulative net capacity are also under construction today at eight separate sites. Of those under construction, one project began in 2012, five in 2015, two in 2016, one in 2017, four in 2019, and two so far in 2020. These units are all projected to be completed between the end of 2020 through mid-2026. Thus, we can expect China to have at least 63 units and 60.8 GWe in operation in 2026.
Where the outlook gets even more interesting is the status of future reactors yet to begin construction. Over the past several months, UxC has observed a rapid increase in the level of activity in terms of new build preparations by all four of China’s licensed nuclear plant operators – China National Nuclear Corp. (CNNC), China General Nuclear Power Group (CGN), State Power Investment Corp. (SPIC), and China Huaneng Group. The most obvious place to see this intensification in preparatory activity is through China’s nuclear regulatory process, which UxC closely monitors. In addition, we are seeing an escalation in preparations on the part of the major companies as it relates to requesting public comments on their proposed projects, issuing tenders for site evaluations, raising new financing to support capital investments, among other important steps.
UxC currently considers advanced planning to be active for a total of 21 units accounting for roughly 20 GWe in capacity and located at 10 different sites as far south as Guangxi Autonomous Region bordering Vietnam all the way along the coast up to northern Liaoning Province border North Korea. Interestingly, the mix of reactor technologies for these new units is diverse: ten HPR-1000s, four CAP-1000s, four VVER-1200s, two HTR- 600s, and one ACP-100. Thus, while it is clear that the domestic 1,000 MWe class Generation III PWR design – HPR-1000 (Hualong One) – is the dominant technology of choice, there will also be a smattering of other designs, including the localized version of the Westinghouse AP1000 and imported Russian VVERs, as well as a few advanced reactor technologies.
While there are still numerous uncertainties surrounding these planned projects, including unknown impacts of reforms in the Chinese electricity market, it appears quite plausible that all these units will see start of construction begin sometime between 2021 and 2024. This should allow them to be completed no later than the end of this decade. As noted in the table on page 1, combining the operating, construction, and advanced planning reactors, we find a net total of 84 units and nearly 81 GWe in net capacity at 22 separate sites. Thus, barring any unforeseen changes, we are relatively confident that China should be able to reach 81 GWe by 2030.
This analysis does not preclude the potential for many other reactors to enter the planning pipeline. UxC can list at least ten more projects that it is aware of at this time, which have yet to experience the same level of regulatory filings or other preparations compared to those we classify as in “advanced planning.” These unspecified projects are mainly additional phases of construction at existing sites, but there are also a few brand new sites we are watching as well. Much of the future pace of development of future projects will depend on the results of the 14th Five Year Plan, which China’s State Council should affirm in March 2021. Once the broad outlines of China’s future energy plans are announced, nuclear energy companies and related government agencies will be in an even better position to proceed with additional reactor projects. Over the next few years, we could see at least another 5-10 GWe of new capacity added to our list for start of construction by 2025. Thus, a reasonable estimate for China’s nuclear capacity by 2030 falls in the range of 85-90 GWe.
China’s long-term nuclear growth prospects have been one of the most important issues of interest to our industry for the better part of the past two decades. There is good reason for this focus considering that 47% of all new reactor capacity in the world added since 2000 has been in China. While lofty future Chinese GWe targets have often been bandied about, we are finally starting to see concrete evidence of what is now possible in terms of new reactor construction for the remainder of this decade. Our analysis shows that a minimum of 80 GWe by 2030 can now be reasonably expected, while 90-100 GWe under a higher case is also possible. What is truly different today than just a year ago is the large number of new regulatory filings (and approvals) along with a steady stream of other positive news about new reactor projects. The recent authorization of Huaneng Group as the fourth licensed nuclear plant operator is another sign the government is serious about giving the industry further incentives to grow and prosper.
Much has been made of President Xi Jinping’s speech to the United Nations this September announcing his country’s pledge of net zero emissions by 2060, which includes a commitment for CO2 emissions to peak no later than 2030. China’s government clearly understands that achieving this goal will require an “all of the above” strategy with nuclear power at the top of the list of carbon abatement options along with renewables, efficiency, conservation, and transportation electrification efforts. If the nuclear new build activities in China over the past year, especially considering the ongoing COVID-19 pandemic, are any indication, the pace is only quickening these days. These positive signals from China should bring further confirmation to the global nuclear industry that things are starting to look up again.