COMMENTARY — Nuclear industry expectations

Since 1990, the demand for new nuclear capacity in Canada has diminished as a result of the economic recession, and heightened energy conservation by industry and consumers. Major utilities such as Ontario Hydro have consequently postponed plans to build new nuclear plants.

In 1980, users of nuclear energy enjoyed a 52% cost advantage over users of coal, in the generation of electricity. This cost advantage fell to 35% in 1986 and then began to shrink more rapidly, dropping to 4% in 1992. The trend is surprising because, in 1986, it was expected that the cost advantage of using Canadian deuterium uranium (Candu) reactors over coal would grow gradually to 45% by the turn of the century. Yet the cost advantage of using nuclear energy has, as stated, diminished, a key reason being the decline in internationally traded coal prices during the past decade.

A positive factor for the domestic nuclear outlook is that many of the commercially viable hydroelectric sites have already been exploited. As the economy recovers and demand for energy rises, it is likely that a demand for new nuclear plants will also emerge.

The Canadian nuclear industry is therefore poised to increase its presence on the global scene. It can build on its current 7% world market share of established nuclear reactors and 10% of the reactors under construction. The diminishing Canadian demand for new capacity is consistent with the trend among other Western nations. However, world energy consumption is forecast to increase steadily during the next two decades in response to industrial growth in China, India, Eastern Europe and elsewhere.

According to data published in recent years, total world energy consumption is expected to increase by 29-36% from 1991 to 2010. However, the data reveal tremendous regional variations.

In both North America and Western Europe, energy consumption is projected to rise by 11-22% in this period. Only Africa will have a lower increase, of 5-7%. Energy demand in Eastern Europe is estimated to increase by 22-32%. In other major regions, the projected ranges of increased energy demand are: Latin America, 54-66%; the Far East, 41-56%; Southeast Asia and the Pacific Rim, 54-69%; and the Middle East and South Asia, 66-77%.

A study by Ernst & Young reports that the Canadian nuclear industry expects South Korea and Indonesia to be among the countries with the greatest potential markets for nuclear power. Others include Thailand and Turkey. — From the proceedings of a 1993 symposium hosted by The Uranium Institute of the United Kingdom.