Business and Nonproliferation: Industry's Role in Safeguarding a Nuclear Renaissance

4. Industry and Emerging Nuclear Energy Markets

66 4 Industry and Emerging Nuclear Energy Markets charles k. ebinger and sharon squassoni As mentioned previously, a notable feature of the nuclear renaissance is the widespread interest in nuclear power, especially in countries without a commercial nuclear infrastructure.1 According to the International Atomic Energy Agency (IAEA), at least sixty-five countries have expressed such interest, most from outside the industrialized economies of the Organization of Economic Cooperation and Development (OECD), the main locus of nuclear power capacity at present.2 Most of the capacity growth up to 2030 is expected to occur in the Middle East, South Asia, Southeast Asia, and the Far East.3 As part of this growth, eleven developing countries are serious candidates for first reactors, although progress in carrying out their plans varies widely (see table 4-1).4 These countries are drawing new suppliers into the nuclear market (notably China, India, and South Korea) and sparking activity among existing suppliers such as Russia and Japan. Overall, however, many countries will not be able to follow through on growth plans owing to cost, limited grid capacity, and perhaps public resistance.5 Countries are moving toward nuclear energy, not to mention other sources of primary fuel, in large part because of mounting demand: between 2008 and 2035 global electricity consumption is expected to increase 80 percent, and 80 percent of that growth will take place in non-OECD countries.6 Underlying this large increase in electricity demand are population growth, urbanization, concerns about CO2 emissions from fossil fuel combustion, energy security, and pressure from a growing middle class for goods and services using or produced 04-2147-5 ch4.indd 66 9/7/11 3:30 PM industry and emerging nuclear energy markets 67 by electricity. Over this period, global population will rise from 6.7 billion to 8.5 billion, with 7.2 billion of the total living in non-OECD countries.7 Most of this increase will take place in China, India, and the Middle East, with the balance in the rest of the developing world, while the share of global population in the OECD and Russia will decline. Today nearly 1.4 billion people have no electricity, a figure that may well increase with further population growth, despite movement into the modern energy economy.8 Urbanization will undoubtedly push demand up as well. For the first time in history, a majority of the world’s population is living in urban areas, a trend likely to continue, especially in developing countries. With the movement of hundreds of millions of people from rural areas to cities, more communities will turn from traditional and often free fuels (wood, forest residues , agricultural wastes, bagasse, and dung) to modern fuels such as electricity, natural gas, and petroleum products. The dramatic growth of the middle class in a number of emerging market nations is also having a large impact on energy consumption. The World Bank predicts that by 2030 the middle class in these nations will jump to 1.2 billion from 430 million in 2000.9 It is estimated that in Indonesia alone, a country Table 4-1. Status of Nuclear Power in Emerging Nuclear Markets Category Country Reactors currently operating Argentina, Brazil, China, India, Pakistan, South Africa, South Korea, Taiwan Power reactors under construction Irana Contracts signed, legal and regulatory infrastructure well developed United Arab Emirates (UAE), Turkey Committed plans, legal and regulatory infrastructure developing Vietnam, Jordan Well-developed plans but commitment pending Thailand, Indonesia, Egypt, Kazakhstan Developing plans Saudi Arabia, Malaysia Source: World Nuclear Association, “Emerging Nuclear Energy Countries” (Paris, February 2011). a. The details of Iran’s nuclear program are a matter of enormous international discussion and debate. While it is clear that the country has made significant progress on a nuclear power reactor, most attention on the country’s nuclear activities relate to the ambiguity of its intentions and the security implications of the development of an Iranian nuclear weapons capability. The political and security-related complexities of Iran’s nuclear program are beyond the scope of this volume. Similarly, given the clandestine nature of the development of the Iranian nuclear program and the lack of ongoing involvement in the program by the established commercial nuclear industry, it is the authors’ view that the case of Iran is of limited relevance in this study. 04-2147-5 ch4.indd 67 9/7/11 3:30 PM 68 charles k. ebinger and...