thorium and environmentally compatible energy strategy

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Thorium and Environmentally Compatible Energy Strategy

Ryoichi KomiyamaThe University of Tokyo

International Thorium Seminar,The University of Tokyo, April 9, 2014

Outline

� Energy Situation in Japan and the World

� Significance of Thorium in Energy Market

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Energy Policy Challenges after the Fukushima in Japan� NuclearDecommission of Fukushima, Radiation-tainted water problem, Difficulty in restarting,

Public acceptance, Waste management, Effective nuclear regulation , Act on Compensation for Nuclear Damages, Development of human resources in nuclear technology� Fossil fuelsLNG import increase, LNG price rising, Asian premium, Trade imbalance� Energy GeopoliticsMiddle-East uncertainty, Northeast Asian tension in political issue, Competition over

resource equity, Sea-lane security such as in Malacca and Hormuz Strait� RenewablesFeed-in-tariff (FIT) sustainability, Grid connection, Control of surplus power from

intermittent sources� Climate ChangeNuclear suspension and CO2 surging, Post-Kyoto dropout � Electricity marketRising retail electricity price, Power sector reform 3

Nuclear Power Plants in Japan after the Fukushima

【Permanent Shutdown】Tokai:The Japan Atomic Power Company (1998)Hamaoka No1,No2:Chubu Electric Power Company (2009)Fukushima Daiichi No1,No2,No3,No4,No5,No6:Tokyo electric power company (2011-2013) 4

(Source) FEPC(Federation of Electric Power Companies Japan), IEEJ

11 22

Kashiwazaki-Kariwa, Tokyo Electric Power Company

Shika, Hokuriku Electric Power Company

Tsuruga, The Japan Atomic Power Company

Mihama, Kansai Electric Power Company

Ohi, Kansai Electric Power Company

Kaminoseki, Chugoku Electric Power Company

Genkai, Kyushu Electric Power CompanySendai, Kyushu Electric Power Company

Output

100MW and more1000MW and less500MW and lessPlanning

Under construction

In operation

68.15562Total

16.5529Planning

2.7563Under construction

48.84750In operation

Total output (GW)Units

68.15562Total

16.5529Planning

2.7563Under construction

48.84750In operation

Total output (GW)Units

11 22

11 22 33

33 44 55

22 33 4411

66 77 8855

3311 22

11 22

11 22

22 33 4411 55 66 77

2211

22 33 4411

3311

22

22 33 4411

Takamaha, Kansai Electric Power Company33 4411 22

Shimane, Chugoku Electric Power Company11 22 33

2211

11 22 33 44

66

33

3

Higashidori, Tohoku Electric Power Company

Higashidori, Tokyo Electric Power Company

Tomari, Hokkaido Electric Power Company Ohma, Japan Power Development Company

Onagawa, Tohoku Electric Power Company

Namie-Odaka, Tohoku Electric Power Company

Fukushima Daiichi, Tokyo Electric Power Company

Tokai Daini, The Japan Atomic Power Company

Ikata, Shikoku Electric Power Company

4321

Attack of Tsunami

(As of April 2013）

0

10

20

30

40

50

60

70

80

90

100

2010 2011 2012 2013 2014

Solar

Wind

Thermal

Nuclear

Geothermal

Hydro

% of Thermal

(TWh) or (%)94.4%

Thermal

Nuclear

0

2000

4000

6000

8000

10000

12000

2008 2009 2010 2011 2012

OtherRenewablesHydro

Petroleum

LNG

Coal

Nuclear

TWh

26% 29% 29% 11%

1.7%

25% 25% 25%

25% 28%

28% 29% 29% 40%

43%

12% 7% 8% 14% 18%

7.8% 8.3% 8.5%

9.0% 8.4%

1.0% 1.1%

1.1% 1.4% 1.6%

Dependence on thermal plant65% 61% 62% 79% 88%

Japan’s Power Generation Mix after the Fukushima: Increasing Dependence on Fossil fuel

Monthly Power Generation Mix

5(Source) Ministry of Energy, Trade and Industry

(METI): Monthly Power Generation Statistics

Fukushima

Power Generation Mix

(Source) FEPC (The Federation of Electric Power Companies of Japan ) statistics

� Since the utilization of nuclear power generation significantly declined after the earthquake due to the accident and the political reason, the fraction of fossil fuel over total power generation reached at the highest level in the last three decades (94.4% in Jan.,2014).� Nuclear is mainly replaced by LNG and petroleum, expensive fossil fuel.

Fukushima100GWhDependence on Thermal power

(Source) MOF (Ministry of Finance Japan): Monthly Trade Report

Surging Fuel-Import Cost in Japan after the FukushimaNuclear suspension after Fukushima causes soaring fuel-import cost

Fuel import cost in Japan2009： 14 trillion yen2010： 17 trillion yen 2011： 22 trillion yen ( +5 trillion yen from 2010)2012： 24 trillion yen ( +7 trillion yen from 2010)2013： 27 trillion yen (+10 trillion yen from 2010)

Fuel Import Cost in Japan before and after the Fukushima

*1 $≒ 100yen

0200400600800

100012001400160018002000

2009 2010 2011 2012 2013 2014

(billion Yen, Nominal)

LNG (Liquified Natural Gas)

Coal

Oil

Fukushima

6

(Source) TEPCO (Tokyo Electric Power Company)

Soaring Electricity Bill in Japan After the Fukushima

Monthly Household Electricity Bill in Tokyo*1 $≒ 100yen

6000

6500

7000

7500

8000

8500

2010 2011 2012 2013 2014

Fukushima

FIT surcharge

Japanese Yen (Nominal)

� For Industry• If electricity rates increase by 15% due to continuous shutdown of nuclear, the income

(operating income margin) of the steel industry will decrease by 0.4%. Cement and general machinery industries will also suffer from 0.2% reduction of operating income margin.

• Higher electricity rates would deteriorate the Japanese industries’ competitiveness.� For Household (Electricity bill)

If electricity rates for households increase by 10%, the annual additional payment per household will be about 8000 yen.

� Continuous nuclear suspension will decrease GDP by 0.5% (30 US$ billion) and cause Loss of 50,000 job opportunity

Impact of Increasing Electricity Cost on Industry and Household (Source: IEEJ, Apr, 2012)

7

0.00.20.40.60.81.01.21.41.6

2009 2010 2011 2012 2013 2014

(Jan. 2009 = 1.0)

(Source) Estimated from “METI: Monthly Electricity Report”

Nuclear Suspension Increases CO2 in Power Sector After the FukushimaAfter Fukushima, CO2 emissions in power sector rapidly increase, despite of national concerted effort for electricity saving

Fukushima

CO2 emissions

Power generation (kWh)

FY1990 FY2008 FY2009 FY2010 FY2011 FY2012Electricity demand(TWh) 659 889 859 906 860 852CO2 emissions from electricity(Mt-CO2) 275 395 353 374 439 486CO2 intensity (kg-CO2/kWh) 0.417 0.444 0.412 0.413 0.510 0.571

After Fukushima

(Source) FEPC(Federation of Electric Power Companies Japan)

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Risks in Global Energy Market� Growing energy demand & imports in emerging countries � Competition of access to energy resources� Impact of unconventional fuel (shale gas, tight oil) on

global power balance (USA, Middle East, Russia)� Increasing geopolitical risks (nuclear issues in Iran, political

instability in Middle East, …)� Energy supply constraints• Investment risks in resource exploration and development• Instability of energy transportation and sea lane security• Market liberalization and environmental constraints

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0

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18000

20000

22000

1971 1980 1990 2000 2010 2020 2035 2050

MtoeMtoeMtoeMtoe

30%34%47%70%

30%53%

66% 70%

China

India

Other non-OECD

Other Asia

USA

Japan

Other OECD

non-OECDnon-OECDnon-OECDnon-OECD

OECDOECDOECDOECD

Primary Energy Demand (World)

Difference(2010 - 2050)

54508077

575

OECD non-

OECD

Asia

� Energy demand is expected to grow in emerging countries, particularly in developing Asian region including China and India. � Growing demand will rise concern on energy supply, environmental pollution

related to energy use not only for the country but also for international market.

(Source) IEEJ, Asia/World energy outlook 2013, 2013 10

World Oil Supply by Type

（（（（Source））））IEA, WEO2012, OECD, Paris

� Crude oil production from existing oil fields will decline by two-thirds by 2035 from the current level.� World oil production will shift to smaller fields and deep-water developments,

where the exploration and development cost is more expensive than conventional fields

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Crude Oil Price

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� Crude oil price is one of most influential factors in energy market. � International crude oil price has largely fluctuated so far and recently shown steep rise,

backed by the concern for energy supply constraint and geopolitical risk in Middle East and North Africa.� Large variation of energy price hinders smooth investment for energy resource

development and related infrastructure.

0

20

40

60

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140

1970 1980 1990 2000 2010 2013

$/bbl 1973

1st Oil crisis

19792nd Oil crisis

1990Gulf war

1986Oil price collapse

2003Iraq war

1997Asian currency crisis

2008US financial crunch

Escalating demand in emerging countries,

Growing geopolitical risks

Crude Oil Import CIF Price in Japan

Real price

Nominal price

(Source) MOF: Monthly Trade Report

Global CO2 Emissions (by Reduction Measure)� Renewable energy, fuel switching (from coal and oil to natural gas), nuclear, energy saving and

CCS could potentially play a crucial role to massively mitigate world carbon dioxide emissions.� In order to halve global CO2 emissions from present levels, various measures will be

indispensable.⇒⇒⇒⇒ There is no single panacea (solution) for climate change issues, and thorium is considered to be one of important future technologies for addressing it

(Source) IEEJ, Asia/World energy outlook 2013, 2013 13

(Source) JAIF (Japan Atomic Industrial Forum, Inc.), World Nuclear Power Plants, 2013

Nuclear Power Plant (NPP) in Asia and the World� In the world, 30 countries possess 429 commercial nuclear power reactors with a total

installed capacity of 388 GW, and 76 additional nuclear power reactors (78 GW) are under construction, equivalent to 20% of present capacity, while 97 units are firmly planned equal to one-third of present capacity.� In Asia 49 nuclear power plants with a capacity of 53 GW are under construction in Asia,

suggesting world NPP construction concentrated on Asian regions.� NPP capacity in Asia under both construction and planning is 103 GW. NPPs 103 GW is

equal to 93 million tons of LNG.*Assumed operating ratio of NPP: 80%, Assumed conv. Eff. of LNGCC: 55%**LNG import (2013): Japan 87 mil. ton, Korea 37 mil. Ton, Asia 167 mil. ton

Output Units Output Units Output Units Output UnitsJapan 46 50 4 4 12 9 63 63South Korea 21 23 5 4 7 5 33 32China 13 15 35 32 26 23 73 70Chinese Taipei 5 6 3 2 0 0 8 8

India 5 20 5 7 5 4 15 31

Asia Total 89 114 53 49 51 41 193 204

USA 107 104 1 1 11 9 118 114France 66 58 2 1 0 0 68 59

Russia 25 29 10 11 18 17 54 57

World Total 388 429 78 76 111 97 577 602

In Operation Under Const. Planned TotalOutput [GW]

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Nuclear Energy Outlook in East Asia� Even after the Fukushima nuclear disaster, considerable growth of nuclear energy utilization in the

part of Asian countries is projected in the long-term perspective� The nuclear expansion in Asia is mainly expected in China and Korea. Both countries adopt policies

progressively promoting nuclear power. � China is expected to show the largest growth in nuclear power capacity, adding 114 GW of capacity

by 2035, and Korea is projected to add 21 GW of new capacity by 2035.� In China, the 12th Five-Year Plan for Energy Development describes targets for the future development of nuclear. The number

of nuclear power plants will increase from current 15 to 25 by 2015. � The government plans to install nuclear capacity to 58 GW by 2020, while 32 new reactors are under construction and 23

reactors are under firmly planning.

0

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1990 2000 2010 2015 2020 2025 2030 2035

China Korea Japan

GW

(Source) IEEJ/APERC, APEC Energy Demand and Supply Outlook 5th Edition, 2013 15

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h/y

ear

FBRLWR-PLLWRSolarWindHydroMunicipal WasteSTIGBiomassBIG/GTIGCCMethanolH2-firedGas-firedOil-firedCoal-fired

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Power Generation Mix to 2100 (World and Asia)Reference Case: Nuclear will increase in the latter half of the century, reflecting on the depletion of conventional fossil resources.CO2 Regulation Case: Nuclear will expand due to its economic competitiveness under global CO2 constraints. Biomass and Coal (Coal-IGCC with CCS) become also attractive. Due to the uranium resource depletion constraining LWR usage, nuclear expansion is driven by FBR with nuclear fuel cycle in the latter half of this century.

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Coal Fired

Reference(Asia) CO2 Regulation(Asia)

Reference(World) CO2 Regulation(World)

Coal Fired

LWR

LWR

LWR

FBR

LWR

FBRLWR-PL

IGCC

IGCC

BIG/GT

LWR-PL

(Source) S.Sharma, R.Komiyama, Y.Fujii, Journal of Env. Sci. & Eng., A1, pp.1215-1232 (2013)

In the last half of the century, uranium resource constraint might potentially pose a challenge for sustainable use of nuclear energy.

Spot Uranium (U3O8) PriceSince 2004, uranium price has considerably increased reflecting on tight uranium supply, decreasing secondary supplies (inventories, weapon), massive procurement of uranium concentrate by China, global intensive quest for uranium equity, speculative fund channeled into spot market.

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012

(US

$/lb

U3O

8）

（Year）

Chernobyl (April 1986)

136 $/lb U308（June 2007）

63.5 $/lb U308(March 2011)

（（（（Source）））） International Monetary Fund, Uranium price 17

Uranium Identified Resources 2001-2011� Uranium identified resources show a growing trend. However, production cost of

uranium have increased and the economically affordable resource (< 40$/kgU) exhibits a decreasing tendency.

� On a resource basis, total identified uranium resources are currently abundant enough to provide a uranium supply more than 100 years based on current uranium production (total uranium production in 2010: 54.7 (1000 tU)).

� Challenge for uranium production countries like Kazakhstan, Canada, Australia, Niger, Namibia and Uzbekistan is to implement an sufficient financial investment for ensuring stable uranium production

010002000300040005000600070008000

2001 2003 2005 2007 2009 20011

1000

tU

Year

<USD 260/kgU<USD 130/kgU<USD 80/kgU<USD 40/kgU

(Source) OECD/NEA ”Uranium 2011: Resources, Productions and Demand” 2011 etc. 18

World Uranium Production and Enrichment by Company

Global Enrichment CapacitiesGrobal Uranium Production

⇒Securing nuclear fuel supply is important agenda. One of important measures to strengthen nuclear fuel supply is developing alternative source like thorium

� World uranium production and enrichment are in oligopoly; a small number of companies or countries dominate the market. � Particularly in enrichment service, only four large suppliers (Rosatom, Urenco,

USEC, Eurodif) hold more than 90% of the market.

（（（（Source）））） WNA(World Nuclear Association), Uranium Enrichment, WNA website

KazAtomProm15%

Areva15%

Cameco15%

ARMZ13%

Rio Tinto9%

BHP Billiton6%

Paladin5%

Naovi4%

Others18%

WorldWorldWorldWorld

58,400 tU58,400 tU58,400 tU58,400 tU

(Source) WNA(World Nuclear Association), World Uranium Mining Production, WNA website

ROSATOM51%

URENCO30%

USEC10%

Areva5%

CNNC3%

JNFL1%

Others0%

WorldWorldWorldWorld

49,000 tSWU49,000 tSWU49,000 tSWU49,000 tSWU

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� Identified thorium resource is estimated to be from 673 mil. ton to 759 mil. ton, which is comparable to total identified uranium resources (reasonably assured and inferred resource), 533 mil. tU (OECD/NEA(2011)).

� Thorium resources are widely spread in the world; the situation is totally different from crude oil which resource is heavily concentrated on Middle eastern countries.

� Among thorium-rich countries, USA, Australia, Brazil, Canada, Norway, Russia and Kazakhstan are major countries which are endowed with large oil and natural gas reserves, while India faces domestic rapidly-increasing energy demand.

Thorium Resource in the World

(Source) OECD/NEA ”Uranium2011:Resources, Productions and Demand” 2011

Turkey12% Norway

4%

Greenland1% Finland

1%Russia (Eu. part)1%Sweden

1%Other Europe

0%Brazil18%

USA6%

Venezuela4%Canada

2%Other America0%

Egypt5%

South Africa2%

Other Africa2%

CIS(Kazakhstan, Russia(Asian part)

etc)20%

India11%

China1%

Other Asia1%

Australia7%

Global Thorium Resource Endowment by Country

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Power Generation Cost of Thorium� A thorium reactor, AHWR, in a once-through fuel cycle is potentially economically

competitive with conventional nuclear reactors, depending on the cost of natural uranium.� If the cost of natural uranium significantly increases, thorium fuel cycle technology is

estimated to be cost-competitive against conventional once-through fuel cycle technology

(Source) IAEA, Role of Thorium to Supplement Fuel Cycles of Future Nuclear Energy Systems, No. NF-T-2.4, 2012＊mill=0.001$

AHWR： advanced heavy water reactor with plutonium, U233, thorium fuel (Once-through)

Levelized unit energy cost (LUEC) of Nuclear depending on Uranium Cost

Reactors using reprocessed fuel (LWR1, LWR2, HWR1, HWR2, FR and FRTh)

FRTh： fast reactor with plutonium, depleted uranium fuel, and thorium in blankets

HWR2： heavy water reactor with plutonium, Th, 233U fuelHWR1： heavy water reactor with plutonium thorium fuel

LWR0： light water reactor with UOX Th fuel

LWR1： light water reactor with plutonium Th fuel

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Conclusion: Significance of Thorium Technology Development

� Thorium technology development has a significance in following contexts: • Alleviating the resource constraint of fossil fuel and uranium• Potentially preventing energy price escalation

(theory on backstop technology)• Realizing sustainable energy development• Encouraging the advancement of new industry• No single panacea (solution) for energy security and climate change, and

technological portfolio is important⇒⇒⇒⇒ Thorium is one of various important technological options in global energy

market

� Continuous elaborate effort for R&D and public acceptance is indispensable for the actual future deployment of thorium technology in energy market

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Thanks for your kind attention.

Ryoichi Komiyama, Ph.D.Associate Professor

Resilience Engineering Research Center,Department of Nuclear Engineering and Management

The University of Tokyo

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thorium and environmentally compatible energy strategy

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