Published on January 4th, 2012 | by Ravinder Casley Gera7
The Fukushima Effect Continues: French Nuclear Builder AREVA Announces Losses and Redundancies Amid Slew of Cancelled Projects
When the tale is written of humanity’s struggle to switch to a low-carbon economy, the partial meltdown at the Fukushima nuclear reactor in Japan last Spring will be remembered in one of two ways: either as a warning sign that steered the world away from a dangerous embrace of nuclear power and spurred the growth of renewables; or as a tragedy which led nations to mistakenly turn their back on a vital source of low-carbon energy.
Which you think it’ll be depends, of course, on your view of nuclear power. But what seems certain is that Fukushima has had a real chilling effect on the growth of nuclear power across the world. Germany, followed by Switzerland, decided to abort plans to replace aging nuclear power stations. Then, Israel signalled the cancellation of its early-stage plans for non-military nuclear power. Then, the UK delayed its plans for new nuclear stations by at least a year for additional safety checks. Belgium decided to blow off nuclear. And the Italian public overwhelmingly defeated efforts to push nuclear through in a groundbreaking public referendum. Even the French have reportedly “thumbed their nose” at nuclear now. And some experts predict the cost of nuclear power, already high, will increase by 50% as the result of raised post-Fukushima safety expectations.
Now, one of the world’s leading nuclear developers, France’s AREVA, has announced losses of €1.6bn as a result of collapsing demand for its products. It’s sacking more than 1200 workers in Germany as the result of the cancellation of that country’s nuclear program. It’s also suspended projects to expand existing power stations in France and the US, BusinessGreen reports.
According to Greenpeace, AREVA — which is owned by the French government — expected 50 new reactors to be ordered this decade, but hasn’t received a single order since 2007.
The biggest problem for AREVA, however, seems to be the collapse in the price of uranium since Fukushima. The Financial Times points out that the price of uranium has slumped from $138 a pound to $50 a pound since the disaster. AREVA paid €1.8bn for UraMin, a Canadian company which operates uranium mines in the Central African Republic, Namibia, and South Africa, when prices were at their height. It’s now ‘writing down’ the value of UraMin by €1.4bn.
Anti-nuclear campaigners such as Greenpeace are quick to argue that AREVA’s woes demonstrate the folly of new investment in nuclear power. Greenpeace UK Energy campaigner Louise Hutchins argues that the company’s work on the Olikiluto power plant in Finland, which is overdue and over budget, is indicative of the future if nuclear power is expanded across the world.
“Areva is the only company still in the running to design the next generation of reactors in Britain, but it has proven itself spectacularly incompetent and incapable of building its own reactor on time or to budget in Finland,” she says. ”Now is not the time for the UK government to expose British households to the billions in overspend and years of delays that come with nuclear power. Instead, Britain should be moving to a vibrant and profitable clean energy sector that would provide far more jobs and economic growth as well as safe, reliable energy.”
But AREVA’s CEO, Luc Oursel, told the FT: “Considering the expected growth in electric consumption, we are convinced that the outlook for nuclear and renewable energy development remains strong . . . even if expansion of the global installed base of nuclear reactors is postponed.”
For more on the future of nuclear power, see Tough Road Ahead for Nuclear Power.
Picture: WikiMedia Commons