Freeze on nuclear power projects annoys investors

The long-term impact of the Fukushima nuclear crisis on the mainland's development of nuclear power remains unclear, but investors say they are frustrated that construction projects have been halted since then.

Zhao Chengkun, vice-chairman of the China Nuclear Energy Association, said recently that the State Council had failed to approve any nuclear plant projects since the accident at the Fukushima plant in March. 'In past years, the central government has approved eight to nine projects every year,' Zhao said at this month's China International Nuclear Symposium in Hong Kong.

The Fukushima accident occurred soon after Beijing announced in its latest five-year plan that nuclear energy would play a key role in lifting the share of mainland electricity produced by non-fossil energy to 15 per cent by 2020. In its wake, the State Council ordered a nationwide inspection of existing nuclear power plants and construction sites amid widespread public concern about the safety of nuclear power.

'As a result, the existing four approved projects, in which our government had invested billions of yuan for advanced-phase preparation, were all forced to stop,' Zhao said. He said the shutdown had affected the nation's entire nuclear energy industry, with contracts for nuclear energy projects - especially those involving the purchase of nuclear equipment from overseas - being suspended or cancelled.

Zhao said in the past five years mainland manufacturers had invested as much as 30 billion yuan (HK$36.5 billion) to strengthen their ability to produce nuclear energy devices in what some had termed a 'nuclear renaissance'.

At least 27 reactors have been built, with 50 more planned.

'And now, the worst-hit area is focused on key heavy machinery plants - such as China First Heavy Industries, China National Erzhong Group, Harbin Heavy Machinery Plant, and Shanghai Heavy Machinery Plant - and there are many other companies producing nuclear auxiliary equipment which have also been affected by the Fukushima accident,' Zhao said. Li Yongjiang, vice-chairman of China Nuclear Energy Association, said the industry's target of producing 5 per cent of the mainland's electricity by 2020 would have to be postponed or even scrapped.

The association officials also blamed the Japanese government for the nuclear sector's setbacks.

'The Fukushima nuclear plant was built in 1967, after just three years' construction, and its facilities and standards were all very outdated and far from competitive with the nuclear power plants in China, because we need at least five years to build one,' said Li, adding that the decision to build a nuclear plant in a seismically active area like Fukushima had set a dangerous precedent.

'Indeed, the Japanese government's slow reaction and failure to shut the Fukushima plant as soon as the earthquake occurred should be blamed because it was just concerned about the economic impact, not security, and that obviously had a great impact on the world's nuclear energy industry.'

Takuya Hattori, president of the Japan Atomic Industrial Forum, said Tokyo's failure to provide timely information should also be blamed for the growing impact of the disaster.

Dominic Yin Teh-chuan, founder of the Hong Kong Energy Association, said Beijing's failure to provide information about nuclear energy to the public should also be blamed for the public panic in the wake of the Fukushima nuclear crisis.

'The political style of the Chinese Communist Party should be blamed as it got used to ordering the public to listen to them, but failed to provide all necessary information to the people,' Yin said. 'One question that concerns me is why is there still no independent supervision system to monitor the operations of this deadly industry?'