1. 1 © OECD/NEA 2010 Nuclear Renaissance and Impact on Energy Policies Dr Kazuaki Matsui Chair, Nuclear Development Committee OECD Nuclear Energy Agency

2. 2 © OECD/NEA 2010 0 4 000 8 000 12 000 16 000 20 000 19451950196019701980199020002009* TWh End of World War II 2 nd oil price shock US recession Black Monday stock market crash Asian economic crisis Dot-com bubble burst Global credit crunch 1 st oil price shock Source: IEA World Energy Outlook 2010 Slide Library Energy demand has climbed consistently since 1945. The financial & economic crisis is expected to result in a 1.6% drop in electricity demand in 2009 – the first fall of any kind since the end of the 2 nd World War Historical world electricity consumption

3. 3 © OECD/NEA 2010 Energy growth in the WEO-2009 Reference Scenario Such energy growth is unsustainable and a major de-carbonisation of world economies is needed - only governments can make this change happen Mtoe Other renewables 0 2 000 4 000 6 000 8 000 10 000 12 000 14 000 16 000 18 000 198019902000201020202030 Biomass Hydro Nuclear Gas Oil Coal WEO-2008 total In the reference Scenario, global energy demand grows by average 1.5% p.a. to 2030; 22% more oil, 42% more gas, 53% more coal than today Source: World Energy Outlook, IEA 2009

4. 4 © OECD/NEA 2010 Contribution of different technologies and measures to CO 2 emission reductions in the BLUE Map scenario, compared to the Baseline A sustainable option – the BLUE Map scenario

5. 5 © OECD/NEA 2010 © OECD/IEA 2009  Based on a scenario to halve CO 2 emissions by 2050  Establish a baseline of technology status today  Identify and address technology-specific barriers  Create technical, policy, legal, financial, and public acceptance milestones and priority near-term actions  Create a process for stakeholder collaboration  Special developing country focus on engagement, national roadmaps  Identify partners for implementation  Support technology diffusion, knowledge sharing among countries The Role of the Energy Technology Roadmaps

6. 6 © OECD/NEA 2010 Nuclear is Already a Widely Used Low-Carbon Technology Source: World Energy Outlook, IEA 2009

7. 7 © OECD/NEA 2010 Nuclear capacity triples in the BLUE Map scenario, and its share of electricity generation rises from 14% today to 24% in 2050. Under a High Nuclear case, nuclear capacity could reach 2 000 GW, providing 38% of electricity Growth of Nuclear Capacity and Electricity Generation to 2050

8. 8 © OECD/NEA 2010 Region / country 202020302050 United States & Canada 100170450 OECD Europe 110170200 OECD Pacific 2575140 China 853251 200 India 25110500 Latin America 51550 Other developing Asia 535100 Economies in transition 5565 Africa & Middle East 5520 World 3659102 725 Avoided Annual CO 2 Emissions Source: IEA, 2010 Emissions avoided (Mt CO 2 ) through increased use of nuclear energy in the BLUE Map scenario, compared to Baseline scenario

9. 9 © OECD/NEA 2010 Nuclear power plant construction starts, 1955 to 2009

10. 10 © OECD/NEA 2010 LocationNo. of unitsNet capacity (MWe) Argentina1692 Bulgaria21 906 China2019 920 Finland11 600 France11 600 India52 708 Iran1915 Japan11 325 Korea66 520 Pakistan1300 Russia96 996 Slovak Republic2782 Chinese Taipei22 600 Ukraine21 900 United States11 165 Total5550 929 REACTORS UNDER CONSTRUCTION – end 2009 Source: IAEA PRIS.

11. 11 © OECD/NEA 2010 Key Findings (1)  Nuclear is a mature low-carbon energy technology that is already available for wider deployment  In the ETP BLUE Map scenario, nuclear capacity grows to 1 200 GWe by 2050, providing 24% of global electricity  No major technological breakthroughs will be required to achieve a major expansion of nuclear capacity  Obstacles to this expansion are mainly policy-related, industrial and financial, rather than technological  But in the longer term, technological development will be needed for nuclear to remain competitive  A clear and stable commitment to nuclear as part of national energy strategy is a prerequisite  Financing will be a major challenge, and government support may be needed for private-sector investment

12. 12 © OECD/NEA 2010  Nuclear expanded rapidly in the 1970s and 1980s, but few nuclear plants have been built in recent years  The industrial capacities and skilled human resources for building and operating nuclear plants will need to increase  The political, regulatory, construction and market risks of nuclear investments may be too large for the private sector  Electricity and carbon markets need to provide sufficient confidence of an adequate return on investment  Government support, such as loan guarantees, may be needed to start or re-start some nuclear programmes  Longer term, the increased involvement of private-sector financial institutions in nuclear projects will be important Industrial & Financial Aspects

13. 13 © OECD/NEA 2010 Is Nuclear Competitive? (1) Levelised Cost of Electricity Generation by Region (5% Discount Rate) Nuclear is already a very cost competitive technology Source: Projected Costs of Generating Electricity, IEA/NEA 2010

14. 14 © OECD/NEA 2010 Is Nuclear Competitive? (2) Levelised Cost of Electricity Generation by Region (10% Discount Rate) But nuclear costs depend strongly on the discount rate Source: Projected Costs of Generating Electricity, IEA/NEA 2010

15. 15 © OECD/NEA 2010 Key Government Actions 1. Clear and sustained policy support, as part of long-term national energy strategy; 2. Efficient & effective regulatory system; 3. Plan for waste and spent fuel management, with clear financial arrangements 4. Electricity market arrangements (for instance, long-run contracts) adapted for long-term investments such as NPPs (high fixed costs) 5. Suitable CO 2 pricing/trading arrangements 6. Possibly government support to financing (loan guarantees, export credits, MFIs…) 15

16. 16 © OECD/NEA 2010 Key Findings (2)  Industrial capacity to build nuclear plants will need to double by 2020 for expansion in line with the scenario  Known uranium resources are adequate beyond 2050, if realised sufficiently quickly, and exploration is expected to discover additional resources  A great increase in highly qualified and skilled human resources will also be needed  Progress needs to be made in building and operating facilities for the disposal of spent fuel & high-level waste  Safeguards and physical protection measures must be maintained and strengthened where necessary. Regional solutions need to be considered  Generation IV reactor and fuel cycle technologies show potential to offer improved sustainability, economics, proliferation-resistance, safety and reliability, starting before 2050

17. 17 © OECD/NEA 2010 Known conventional resources Total conventional resources With unconventional resources With present reactors and fuel cycles 100300700 With fast reactors and advanced fuel cycles > 3 000> 9 000> 21 000 Uranium resources/consumption ratios, and impact of recycling Source: NEA, 2008 Approximate ratios at present annual consumption for different categories of resources

18. 18 © OECD/NEA 2010  Continuous development of reactor and fuel cycle technologies is needed to maintain nuclear competitiveness  Next-generation nuclear technologies potentially offer improved sustainability, economics, safety and reliability  Leading nuclear countries are collaborating to develop such advanced Generation IV reactors and fuel cycles  Proliferation-resistant small modular reactors (SMRs) may be suitable for deployment in a wider range of locations  High-temperature reactors could expand the use of nuclear energy for industrial heat applications  The recycling of nuclear fuel in fast reactors could extend the lifetime of known uranium resources by several millennia Further Development of Nuclear Technology

19. 19 © OECD/NEA 2010  Nuclear is a proven technology and is a least cost option for a low- carbon strategy provided financial costs are contained  Most energy studies recognise nuclear’s role. The IEA/NEA roadmap indicates that installed capacity should reach 1 200 GW and supply 24% of the world’s electricity in 2050 under the sustainable growth scenario  However:  Governments need to make long term commitments  Industry needs to demonstrate building to time and budget  Repositories for HLW need to be built  The public need to be involved meaningfully  Financing, skilled workforce and nuclear capacities must be addressed  While no major technology breakthroughs are needed immediately, deployment of Generation IV technologies and advanced fuel cycle technologies are needed for nuclear to remain competitive. Conclusions