China May Resume Nuclear Plant Approvals as Cabinet Passes Plan
China, planning to build more nuclear reactors than any other country, approved a safety framework that may help end a ban on approving new atomic plants imposed after last year's Fukushima disaster in Japan.
The State Council, or Cabinet, approved "in principle" the proposed plan on nuclear safety for the five-year period ending 2015 and long-term targets for 2020, the government said on its website yesterday. The report didn't specify when approvals for new plants would resume or mention capacity goals.
The move follows a report yesterday that Japan is closer to resuming nuclear power generation after an earthquake and tsunami crippled the Fukushima Dai-Ichi plant and prompted a global review of atomic energy projects. Chinese nuclear power equipment makers, including Shanghai Electric Group Co., Dongfang Electric Corp. and Harbin Electric Co., had their long- term contracts frozen after the ban.
"Now that the key barrier has been cleared, we expect new projects to be approved soon," Patrick Dai, an analyst at Macquarie Group Ltd. in Hong Kong, said in an e-mail. Shanghai Electric, Dongfang Electric and Harbin Electric may get contracts for 5 gigawatts of capacity this year, worth more than 50 billion yuan ($7.9 billion), he said.
China, which started its first commercial nuclear plant in 1994, is building 25 reactors on the mainland and plans to add another 27, according to data from the World Nuclear Association.
The quality of the country's nuclear industry, including reactor design, manufacturing, construction and operations, is "under control," according to the government report. China's nuclear safety standards match the International Atomic Energy Agency's specifications, it said.
Some atomic plants didn't meet new requirements for flood control and some had "weak" capabilities in evaluating and dealing with tsunami-related problems, according to the report. A few civil experimental reactors and fuel-cycle facilities fell short of new earthquake standards, it said. Corrective measures have been taken, the government said.
A nationwide inspection of China's nuclear plants started after the Fukushima accident and lasted more than nine months, according to the report. Checks were carried out at 41 reactors that were operational or being built and three that were due to start construction, it said.
The government will seek the public's opinion on the approved proposal on nuclear safety and development, according to the report.
The safety plan was "the key hurdle before the restart of new nuclear project approvals," Guo Shou, a Hong Kong-based analyst at Barclays Plc, said by e-mail. "There is still no definite timeline of the actual restart, but we believe the earlier expectation of a first-half restart is still on track."
Guo estimates the value of orders this year at 10 billion to 15 billion yuan.
Chinese power-equipment companies expect at least four new projects to go forward in 2012, though there are more to go, depending on the speed of approvals, Guo said. "Nine projects were in line to be approved in 2011 prior to the Fukushima incident," he said.
China may have 70 gigawatts of installed nuclear power capacity and 30 gigawatts under construction by the end of the decade, Xu Yuming, the vice secretary-general of the China Nuclear Energy Association, which advises the government, said May 17. The country may have 200 gigawatts of installed capacity by 2030, he said.
Japan may approve the restart of two reactors of Kansai Electric Power Co. as early as next week, the Nikkei newspaper reported yesterday, without saying where it got the information. The government wants the units fully operational before power demand peaks in mid-July, according to the report.
Japan is without an operating nuclear reactor for the first time since May 1970, with all its atomic plants idled for maintenance or additional safety checks. Nuclear power provided 30 percent of the country's electricity prior to the quake.