1. Understanding our Nuclear Future - Global Growth in Nuclear Power
Raymond James 2007 Uranium Conference by
Milton Caplan, President,
Dr. Terry Thompson, Senior Advisor
MZConsulting Inc
2007 May 8

2. Outline Uranium and its use Nuclear New Build Nuclear Characteristics
Performance
Project schedules
Economics
Alternative Fuel Cycles
Future Projections

3. Understanding Uranium Demand
The World of Uranium
Spot price hits $113/lb, breaking through $100 as expected
“It could quite conceivably get to $150 a pound before the end of this year “
Thomas Neff says “Nuclear Plans may Stall on Uranium Shortage”
“China is finding it hard to get enough uranium to fuel nuclear plants”
Understanding Uranium Demand

4. Uranium Energy = Highly energy intensive source of energy Coal
Uranium Pellet =
7 grams (.24 oz)
1,780 lbs
(or 17,000 cu ft of gas)

5. Only with Nuclear Power
Need a nuclear power plant to realize this energy

6. Uranium – without Nuclear Power
It’s nothing but a rock!!
Demand for Uranium is a direct function of the number of nuclear plants in operation and their performance

7. The Global Nuclear Fleet
435 reactors in operation
30 countries
Producing
368 GWe
16% of global electricity
Burning 66,500 tonnes of uranium/year
1,000 MW reactor uses about 230 tonnes/ year
28 units under construction, 64 planned and 158 proposed
Source: WNA

8. Uranium Supply and Demand
Understanding Future Demand means understanding Nuclear Growth

9. Potential for Growth The Stars are Aligned!!
Finland constructs Olkiluoto 3
France to build at Flamanville
UK considers new nuclear
Germany to do energy review
Sweden supports ongoing nuclear operations
China planning a fivefold increase in nuclear power by 2020
Russia planning to play a major role in nuclear power construction
Canada commits to nuclear
US supports nuclear energy
G8 supports nuclear power as part of the mix
Nuclear power is part of Australia’s future
Bush reopens nuclear cooperation with India
Environmentalists now supportive

10. Why Nuclear?
Environmental – Climate Change continues to move up the political agenda and nuclear emits no GHGs
Security of Supply
Economics
Excellent performance of existing fleet

11. What are the Alternatives?
Fossil fuels falling from favour
Coal is dirty, new clean coal technology under development
Gas prices volatile and increasing
Renewables increasing in use
Acceptance that it can’t do it all
Nuclear is the only large scale generation option available for baseload (24/7) requirements

12. Understanding nuclear characteristics that lead to growth
Hype vs. Reality
Understanding nuclear characteristics that lead to growth

13. Global Forecasts
WNA base case predicts 542 GW by 2030 with a high case of 740 GW
IEA World Energy Outlook (WEO) predicts a more modest 416 GW in its reference case and 519 GW in it alternative scenario
USA
applications for COL for 33 or more new reactors.
EIA Annual Energy Outlook (AEO) assume 12.5 GW to be built by 2030

14. Nuclear Performance Capacity Factors
Source: WANO

15. Performance has peaked and no further improvements are likely
Capacity Factors in the US consistent at ~90%
WEO assumes that capacity factors will improve from global average of 85% in 2005 to 91% in 2030
Performance has peaked and no further improvements are likely

16. There are no surprise increases in demand
Project Schedule
Nuclear plants are capital intensive projects
Schedules are long relative to alternatives
Planning can take from 3-5 years
Construction can take from 5-8 years
Total schedule anywhere from 8 to 13 years
There are no surprise increases in demand

17. Economics 1 2 3 4 5 6 7 Nuclear high low CCGT Coal steam IGCC Wind1 2 3 4 5 6 7
Nuclear
high
low
CCGT
Coal
steam
IGCC
Wind
onshore
US cents per kWh
Capital
Operation and maintenance
Fuel
Source: IEA WEO 2006

18. Competitiveness of Nuclear
Source: IEA WEO 2006

19. Impact of 50% increase in Fuel Costs
10%
20%
30%
40%
Nuclear
IGCC
Coal steam
CCGT
increase in generating cost
Source: IEA WEO 2006

20. Fuel Cost is Important Operational Costs ~ 1.7 cents/kWh
Fuel Costs ~ .4 cents/kWh
Uranium cost ~ .1 cents/kWh
At uranium price of $10/lb
At uranium price of $100/lb
Uranium cost ~1 cent/kWh
Total Operational Cost ~2.6 cents/kWh

21. Alternative Fuel Cycles
Today thermal reactors (US, Canada, Sweden, Finland, Spain, South Africa) use a “once through” or “open” fuel cycle
Only about 0.7% of the uranium mined is used
Some countries (Japan and Western Europe) have started to recycle and use MOX (uranium and plutonium oxide) fuel
Typically reactors can use MOX for 1/3 of their core
US GNEP Program

22. Only nuclear power can replace fossil fuels in the long term
Longer Term Fuel Use
Fast reactors consume virtually all uranium mined
100 times more efficient than thermal reactors
Best for burning plutonium
Thorium cycle (India leading)
At any price, fuel is cheap
With fast reactors, uranium as a fuel is inexhaustible
Only nuclear power can replace fossil fuels in the long term

23. Demand Forecast Stable until 2020 740 Gwe 542 Gwe 519 Gwe (WEO Alt)
416 Gwe (WEO Ref)
368 Gwe
Dashed lines – 2003 report

24. Summary Uranium needs nuclear power
Demand is predictable in the short to medium term
Nuclear renaissance has just begun
Long term demand is more uncertain

25. And so…… The future is bright as
Nuclear Power remains the only emissions free large scale form of electricity production

26. Thank You Milton Caplan MZConsulting Inc mzconsulting@rogers.com