Japan's nuclear crisis will bring some important lessons for the global nuclear industry.
NEWensure- The explosion in the reactor first, second, and third in Fukushima Daiichi nuclear complex, Japan, has brought back the world's attention to the sustainability of nuclear power. The explosion that triggered the failure of the cooling system caused by the earthquake and tsunami that has raised concerns the actors and the nuclear industry investors. No exception, countries that are planning development.
The Japanese government has assured its people that the health hazards arising from the disposal of radioactive steam was very low. Thickness of the retaining wall of the reactor apparently in good condition, so that is not clear impact on health, environment, and the future of the industry.
For decades, Japan's nuclear power safety record no doubt. In fact, nuclear power proponents often refer to Japan - which is located in the Pacific ring of fire, where earthquakes frequently occur.
Japan is considered to have been able to develop a series of strong nuclear utilization from designing, manufacturing, construction, operation, to maintenance.
Impact on Nuclear IndustryConcerns over global warming and energy demand in recent years have brought about a nuclear revival. Some 56 nuclear reactors built in 2010, where the Asia Pacific region including China, India, Korea, and Taiwan has more than half of this power project.
Several other countries in the oil-rich Middle East, the developing countries in South Asia and Asia Pacific, as well as developed countries in North America and Europe have developed a serious plan for the construction of nuclear plants.
This shows the future of some players such as nuclear giant Areva, GE-Hitachi, and Toshiba-Westinghouse looks very bright. Other global players including Doosan of Korea, Russia's Rosatom hopes to reach an agreement with local government.
However, whether Fukushima disaster threatens global nuclear power plant? It is difficult to assess the impact of events that are still ongoing. However, some short-term effects may occur, such as:
Review of the safety of all Nuclear Power Plant (NPP) operating, whether they are in an earthquake prone zone or not, tend to be reviewed comprehensively. More risk scenarios, the better. International Atomic Energy Agency (IAEA) will likely play a big role in this salvation.
The next impact is the cost of insurance. Insurance costs of all matters relating to nuclear would increase. As a result raising the cost of electricity.
Plans to build nuclear states, the possibility of much opposition. Germany has announced a three-month postponement of the plan. Some countries are also likely to announce a review of nuclear policy, especially if the crisis in Japan last long.
The stock market nuclear technology companies and their supporters also tend to hit big. Shares of General Electric, the supplier of the reactor at the Fukushima has experienced a significant decline.
Another impact is the public perception. Public perception of nuclear power will likely tarnished, at least in the short term. This means that governments around the world will suspend nuclear several important decisions, until the news recede.
Disasters in Japan will encourage the shift of attention to alternative technologies, such as hydropower generation and clean coal. More specifically, the development of clean coal technologies such as Carbon Capture and sequestration (CCS) and Integrated gasification Combined Cycle (IGCC) would be an advantage.
We have seen the return of the nuclear power industry after Three Mile disaster in the United States and Chrenobyl in Ukraine, despite having to go through a long road to recovery phase.
If the Japanese government managed to anticipate the damage and maintain public trust, it is possible Fukushima nuclear power plant and the global nuclear industry will be able to get through the worst crisis in history.
Conversely, if the situation uncontrollable Fukushima, most likely the nuclear industry will experience a shock, at least for the short and medium term.
This crisis will bring some important lessons for the nuclear industry, among which should improve security in the design, operation, and maintenance. The cost of building and operating nuclear power plant can be increased significantly, but the industry did not disappear from the market. (Art)
Ravi Krishnaswamy, Vice President, Energy, & Power Systems Practice, Asia Pacific, Frost & Sullivan.
