In view of Australia's position as a major
uranium exporter and holder of the world's largest uranium reserves, clearly
future developments in the nuclear industry are of considerable interest to
Australia. It is essential that nuclear
developments, in our region and globally, proceed in a way that enhances
non-proliferation objectives. Another
area of major importance is the impact of future energy programs on the
environment, in particular climate change, and the role of nuclear energy in
this context.

Introduction

It is a common perception that nuclear
energy is an industry that has peaked and is facing decline. In recent years there have been no new power
reactors built in North America and few in Western Europe, some governments are
resolutely against nuclear energy, and one or two governments have adopted a
policy of phasing out nuclear energy.
The only growth areas appear to be in Asia, but even here some
uncertainty has been expressed about the future of the region's largest
program, in Japan.

This general impression is misleading. For a start, nuclear energy contributes a
very substantial share of world electricity supply16%
globally, an average of 25% in OECD countries.
Some 32 countries have nuclear power
programs (see Table 8 on page 83). In over half these countries nuclear energy
contributes more than 25% of electricity supply, in some as much as
70-80%. A number of other countries
import significant amounts of electricity generated by nuclear programs.

In addition
to electricity supply, both direct and indirect, there is another way in which
nuclear power is importantthrough the reduction of greenhouse gas
emissions.
Global CO₂ emissions from electricity generation would
increase by 25-30% if existing nuclear power generation were replaced by
coal-fired stations.

Increasing
electricity demand There is no doubt that global electricity demand will grow very
substantially this century, particularly as living standards in developing
countries improve. For example, the
World Energy Council has estimated^[7] that annual world electricity consumption will at least double or
even triple over the next 50 years:

Table 6 Electricity projections
(figures in terawatt/hours (TWh))

(figures in terawatt/hours (TWh))">
Table 6 Electricity projections
(figures in terawatt/hours (TWh))

Scenario

2000

2020

2050

Present:

15,000

Conservative
middle growth scenario:

19,000

32,000

High
growth scenario:

23,000

41,000

Electricity consumption could be higher
still if opportunities for fuel substitution are maximised, e.g. replacing
petroleum through large-scale use of electricity in transportation, both directly
and through production of hydrogen fuel.
Substitution offers very substantial environmental benefitsbut only if
supplied by non-fossil sources.

Clearly if a two to three-fold expansion in
electrical production were based on fossil fuels the environmental
consequenceslocal and globalwould be very serious. Environmental impact has to be a key consideration in making
energy choices. Other essential factors
will be economics and security of supply.
As an illustration, natural gasthe fuel of choice for new power
stations in many countriesfaces a number of uncertainties in the future: there
are predictions that world natural gas production will plateau in 30-35 years,
reflected in escalating prices well before then; much of the world's supply comes
from, or through, areas of uncertain political stability; and of course use of
natural gas releases major greenhouse gases, CO₂ and methane.

Energy
choices
Governments will choose an energy mix depending on particular national
circumstances, e.g. availability of energy resources, including the feasibility
of renewables, opportunities for energy conservation and fuel substitution, and
so on. Of the various non-fossil
sources, only hydropower and nuclear have a demonstrated ability to generate
large-scale baseload electricity.
Hydro-electrical schemes are not without environmental (including
greenhouse) consequences and political difficulties, and in OECD countries few
suitable sites remain. The ability of
nuclear energy to significantly mitigate the environmental and climate change
consequences of using fossil fuels can be expected to become increasingly
relevant to decisions about national energy mixes.

Factors affecting the status of nuclear energy In current circumstances
there are several factors that work to the disadvantage of nuclear energy:

• the high capital
  costs of a new plant;
• liberalisation of
  the electricity industry is encouraging short-term profit horizons;
• comparatively low
  prices currently for alternative fuels, especially natural gas;
• whole-of-cycle
  costs for nuclear are internalised in electricity tariffs, while the indirect
  costs of other fuels are not;
• public and political concerns about radioactive
  waste disposal, safety, and nuclear proliferation.

On the other hand, over the medium to longer term there are important
factors which can be expected to lead to a re-evaluation of nuclear energy:

• increasing public
  and political concern about the impact of fossil fuels on global climatelikely
  to be reflected in emission limits and possibly taxation regimes;
• associated with
  this, increasing recognition of the internalisation issue, i.e. that
  electricity tariffs should reflect the true costs of different energy sources;
• while most power
  generation is sensitive to rises in fuel pricesincluding taxationwith nuclear capital
  costs predominate and substantial increases in the price of uranium would have
  little impact;
• security of supply considerations.

Issues of waste
disposal and safety are beyond the scope of this Reportthese are predominantly issues of public
confidence, not technical inadequacies, and there is no doubt greater efforts
are required towards improving public understanding.
As to nuclear proliferation, there is a robust non-proliferation regime,
centred on the NPT and IAEA safeguards, which is outlined elsewhere in this
Report.

Seeing nuclear energy in context
Overall, there is a need to view nuclear energy in context, not in
isolation, with any discussion of nuclear's pros and cons being set against the
consequences of other energy sources.
The perceived risks of nuclear need to be compared to the certaintiesmany of them adverseassociated with the
use of other fuels.

Developments in technology

ASNO maintains a close interest in
developments in nuclear technologyfrom two perspectives: the potential for
establishment of, and growth in, nuclear programs; and potential implications
for the non-proliferation regime and for the application of safeguards.

In the short to
medium term there are two broad trends in power reactor technologythe
development of reactors incorporating enhanced safety features, such as
advanced pressurised reactors (APWRs) and advanced boiling water reactors
(ABWRs), and the development of new reactor types which are more economically
competitive than those currently available.
These two trends are not mutually exclusive:

• as far as light water reactors (LWRs)
  are concerned, while there is some concern that APWRs and ABWRs are more
  expensive than established modelsat a time when the capital costs of nuclear
  are seen as a disadvantage and there is pressure to reduce costsit is possible
  that standardisation on say two or three models that could be manufactured on
  an assembly-line basis might bring about offsetting savings;
• on the other hand, cost considerations
  have led to considerable attention being given to an entirely different reactor
  concept, the modular high temperature gas-cooled reactor (MHTGCR), which
  happens to also offer major safety advantages.

Currently there are two MHTGCRs at an
advanced stage of development, the pebble-bed design of South Africa's ESKOM,
and a design from a US/Russian/French/Japanese group led by the US company
General Atomics (GA). Both designs are
graphite-moderated and cooled by helium which drives a turbine for electrical
generation directly (i.e. there is no steam cycle). Both feature emergency passive cooling, i.e. safety does not
depend on forced circulation of the coolant.
Both are designed to be installed in modules, the ESKOM unit having a
capacity of 114 MWe and the GA unit 284 MWe. The
small size suits smaller grids, while the modular approach allows capacity at a
particular site to be increased progressively by installation of more
units. The ESKOM reactor is designed to
operate on fuel of around 7-10% enrichment.
The GA reactor could operate on a variety of fuels, but is being looked
at particularly for the consumption of plutonium released from the Russian
weapons program.

Both reactors are designed to operate on a
once-through cycle, i.e. the fuel would not be reprocessed, and in fact
reprocessing would be complicated due to the presence of graphite. If these reactors live up to expectations
they will be substantially cheaper to build than LWRsin the case of the ESKOM
design around half current LWR costs. A
number of experts are predicting that the MHTGCR will be the next generation of
reactor, likely to be chosen for many new nuclear power plants over the period
2010-2030.

On current information the MHTGCR appears
to offer advantages from the non-proliferation/safeguards perspective. ASNO will be following the development of
this technology with considerable interest.

Plutonium recycle and fast reactors

The thermal fuel cycletypified by the
LWR (the MHTGCR is also a thermal reactor)is an extremely inefficient use of
uranium resources, generating
energy primarily from the fissile uranium isotope U-235 which comprises only
1/140^th of natural uranium^[8].
At current rates of consumption, existing and estimated uranium
reserves recoverable at up to $US80/kg (compared with current spot prices
around $US20/kg) are sufficient for only about 50-60 yearsgrowth in
the nuclear industry will reduce this period.
Of course, further uranium discoveries can be expected, and very
substantial higher cost uranium resources exist (e.g. seawater offers a
virtually unlimited supply, albeit at about 10 times current prices). Higher costs, however, will make inefficient
resource use even less sustainable.

The most efficient use of uranium resources
will come from the use of the fast neutron fuel cycle. The basis of this fuel cycle is the use of
fast (unmoderated) neutrons to convert the predominant uranium isotope U-238 to
plutonium, and the use of that plutonium as reactor fuel. The development of fast neutron reactors is
generally on hold at present, mainly for economic reasons (particularly
depressed uranium prices), but also because of engineering complications, and
public concerns about safety following incidents at Super-Phnix (France) and
Monju (Japan). Nonetheless, the
advantages of the fast neutron fuel cycle頗in energy terms and also for high
level waste management (see the article on partitioning and transmutation on
page 70)are such that it may well come into widespread use in the
future.

It should be noted that plutonium plays a
significant part even in the current thermal cyclee.g. towards the end of a
fuelling cycle about half the energy in an LWR comes from the fissioning of
plutonium produced in the fuel.
However, thermal reactors are inefficient users of plutonium: very
little of the non-fissile^[9] plutonium isotopes can be fissioned in a thermal reactor, and only
a small fraction of the potential energy from plutonium can be realised. Use of MOX fuel in LWRs can be viewed as a
fill-in measure pending establishment of the fast neutron fuel cycle.

Conventional fast breeder reactors (FBRs),
such as Super-Phnix and Monju, use MOX (uranium/plutonium oxide) fuel with a
relatively high proportion (20-30%) of plutonium. The fuel is surrounded by a uranium 頑blanket in which neutrons
are captured to produce further plutonium.
The blanket can be made from depleted uranium, thus providing a use for
the millions of tonnes of tails left over from the uranium enrichment process
which currently are essentially a waste material. The plutonium produced in the blanket is recovered by reprocessing,
and made into fresh fuel. An issue from
the non-proliferation perspective however is that plutonium produced in FBR
blankets has a very high proportion of the isotope Pu-239, making it highly
suited to nuclear weapons.

While on the face of it greater use of
plutonium recycle, and the introduction of the fast neutron fuel cycle, will
present the non-proliferation regime with new challenges, it is possible for
these developments to be pursued in ways which will actually enhance
non-proliferation objectives. This is
the subject of the following article, on non-proliferation issues.

Conclusions

Despite the popular perception of an
uncertain future, there are a number of developments that are likely to lead to
a re-evaluation of nuclear energy, especially increasing recognition of the
global effects of different energy choices, and the changing economics of
various energy sources. This century a
massive expansion in electricity supply will be essential for rising living
standards, and nuclear energy can make a major contribution to mitigating the
impact of greatly increased fossil fuel use.
Within the nuclear industry there are developments, such as the
emergence of new reactor types, aimed at enhancing the competitiveness of
nuclear energy. It is essential that an
expansion of nuclear programs occurs in a way that enhances non-proliferation
objectives. As a major uranium supplier
and a key supporter of the non-proliferation regime, Australia is well placed
to exercise a constructive influence on these developments, and it is clearly
in our national interest to do so. This
is an important aspect of ASNO's work.

[7]. WEC/IIASA (International
Institute for Applied Systems Analysis), Global Energy Perspectives, 1998.

[8]. Allowing for U-235
remaining after enrichment in depleted uranium tails, in fact the proportion of
uranium unused in the thermal cycle is even greater, around 99.5%.

[9]. The fissile plutonium
isotopes are odd-numbered, e.g. Pu-239 and Pu-241. Typically they comprise
about 70% of the total plutonium in LWR fuel.

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