2016 Half Year Review of the Chinese Nuclear Industry

//2016 Half Year Review of the Chinese Nuclear Industry

Ever since 2014, China has been being one of the most active countries in the global nuclear market under its trend of being more market-oriented and international. This year, China kept the steps on rapidly developing its nuclear industry.

As we reached the halfway stage of 2016, I have summarized three main fields of the industry that China has made progress and achieve breakthrough so far in 2016.

1.Nuclear Safety: A complete legislation system is being established

On 27th January of 2016, the Chinese State Council published China’s Nuclear Emergency Preparedness white paper, which explains the current situation of China’s solution to the nuclear emergency and clarifies the government functioning for the nuclear safety issues. China’s Nuclear Emergency Preparedness is the first official nuclear related white paper in China, and it is a milestone documents of Chinese nuclear industry. Although China has the most number of nuclear reactor units under construction now, the lack of relevant legislation in China for civil-use nuclear energy is one of the issue that is hampering the development of China’s nuclear industry. This white paper is a good start for China to complete the nuclear related regulation which can increase the competiveness of China’s nuclear industry in both domestic and international markets.

In April, the Chinese president Xi Jinping attended the Nuclear Security Summit in Washington. During the summit, he mentioned the progress that China has made on the safety of civil-use nuclear energy, and he reiterated that China will continue enhancing the system establishment.

The next six months of 2016 in the nuclear safety field, in my opinion, China will continue on completing the related standard and regulation system establishment. Besides, according to the target of China’s 13th five-year plan, nuclear back-end management and radioactive security will be another important part of China’s nuclear safety work.

2.Nuclear Industry Export: consolidation and improvement

In 2015, China successfully signed several contracts of building nuclear power plants in other countries such as UK, Romania, and Argentina. However, like the Hinkley Point C project, due to the financing problem of EDF, this project now is taking the risk of being delayed. At the start of this year, China National Nuclear Corporation (CNNC) set up a subsidiary in UK to look after the European market. Some people guessed the purpose of CNNC’s foundation of the subsidiary was to get involved in the Hinkley Point C project as well with its abundant financing support.

On 17th March, the joint-venture of CNNC and China General Nuclear Power Corporation (CGN), Hualong International Nuclear Power Technology Company was officially established. As one of the most popular product of China in the global nuclear industry, Hualong technology was exported to Argentina in 2015 and it is expected to build another one in UK few years later. Not like CNNC and CGN working separately before, this joint-venture Hualong Company is specially working on the export of Hualong-1 technology and expand its international market.

On the other hand, some new countries became China’s next target of the nuclear industry export in the past six month of this year. In March, CGN and CEZ Group signed a new MoU on cooperation in the nuclear and clean energy industries. Czech Republic is the second largest energy-exporting country in Europe where two nuclear power plants are located. Based on the latest energy policy of Czech Republic announced in May of 2015, there will be 4 more nuclear units being constructed before 2030. In May, Nur Bekri, the Minister of National Energy Administration, together with the President of CNNC Sun Qin visited Sudan, one of the most undeveloped countries in the world. Sun Qin and the Sudanese Minister of Water Resources, Irrigation and Electricity, Mutaz Musa signed the contract that China will build the first nuclear power plant in Sudan to encourage the local economy.

For China, developing countries is a big market for its nuclear industry. According to the “One Belt One Road” Initiatives and “Going out” strategy, in the future, as I would like to say, China will focus more on developing nuclear newcomer’s market.

3.Marketization: foundation of a free and mature cooperation-competition mechanism

Since State Nuclear Power Technology Corporation (SNPTC) and China Power Investment Corporation (CPIC) merged together into State Power Investment Corporation (SPIC) in 2015, there are three organizations own the license of operating nuclear power plant in China which are SPIC, CNNC, and CGN.

This year, a new member joined the competition which is China Nuclear E&C Group (CNEC). CNEC used to be a subsidiary of CNNC focusing on the engineering and construction of nuclear power plants. In 1999, CNEC was separated from CNNC and became an independent company. CNEC grew rapidly and its business was no longer limited in the E&C of nuclear power plants. In earlier of this year, the first High Temperature Gas-Cooled Reactor which was developed and owned by CNEC was installed in Shidaowan Nuclear Power Plant, and CNEC will become the next organization owns the nuclear power plant operation license. Few days ago on 6th June, CNEC was listed on China’s stocks market and its price climbed up to the 10% daily limit immediately.

As the big opportunity in the nuclear market, besides CNEC, China Huaneng Group and China Datang Group also wrote the nuclear power plant operation license in their future development plan.

China Huaneng Group being a part of Shidaowan Nuclear Power Plant

With the continuous reforming of China’s state-owned company, the nuclear industry of China is becoming more and more market-oriented. In my point of view, the Chinese government will keep on releasing the control of the civil use nuclear industry and allow it to be led by the market.

2016 is a very important period for the development of China’s nuclear industry. It is the first year of China’s 13th five-year plan. There are 6 nuclear reactor units expected to commence the operation in this year. China has entered a new phase of steadily fast development of its nuclear industry. The government need to play an important role of the planner and supervisor to make sure the industry can grow safely and efficiently.

Half of this year has passed, I believe that the Chinese nuclear industry will show the world a satisfying result by the end of 2016.

By |2019-01-05T13:00:10+08:00July 4th, 2016|industry-insights|0 Comments