July 10, 2010

My Uranium and Nuclear Bets On the Oil Drum

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An article is up on the Oildrum which discusses my winning the world uranium in 2009 bet and the energy generation bet. The Oildrum article was not written by me, so Gail had a different take on the situation.

Updated Uranium predictions
      Brian Wang  Dittmar            midpoint
2010  56000 tons  45,000 tons        50,500 tons
2011  60000 tons  45,000             52,500 tons             
2012  64000 tons  45,000             54,500 tons
2013  68000 tons  45,000             56,500 tons
2014  72000 tons  45,000             58,500 tons
2015  76000 tons  45,000             60,500 tons
2016  80000 tons  45,000             62,500 tons
2017  84000 tons  45,000             64,500 tons
2018  88000 tons  45,000             66,500 tons
I am expecting the amounts to be higher, but these are my 90% confidence level for betting numbers.

Gail made a big deal about the decline in nuclear generation since 2006. Japan had an earthquake (2007) that caused the shutdown of 7 nuclear reactors aboue 40 TWH of reactors. Those reactors are being brought back. Most have been.
This last year France had labor problems and some maintenance problems 30-40 TWH with the economic troubles and lower energy demand utilities had the incentive to perform more maintenance and shutdowns last year.
Japan has had some issues raising its capacity factors. But they have a program to get up to US and South Korean 90+% levels over the next 4 years.
France also has a program to raise capacity factors.
Germany is extending its 17 reactors for about 15 years past a previous political shutdown for 2021.

There will be over ten nuclear reactor completions in 2011. A few were delayed from 2010, but there have been completions in 2010.

2010 9 new reactors, 6.2 GWe (shifted the two Canadian Reactors to 2011) 2 reactors are scheduled for December, so a slip into next year is possible for the South Korean and Argentine reactors.

2011 11 new reactors, 9.3 GWe

2010 and 2011 should see 15.5 GWe of new reactors or about 100-120 TWH. Plus there will be 1GWe of uprates.

then 100-150 TWH of new reactors every year
2012 10 new reactors, 9.92 GWe
2013 12 new reactors, 13.08 GWe
2014 14 new reactors, 13.63 GWe

61 reactors are under construction now. Those are the reactors that are getting completed from now to 2014. some may take longer but the ones in Asia are getting completed by 2014-2015 at the latest for the ones already under way.

Of the 61 (58.8 Gwe) being built in the world now
China   24 (not OECD)
Russia  11 (not OECD)
S Korea  6
India    4 (not OECD)
Bulgaria 2 (not OECD)
Slovak   2
Ukraine  2 (not OECD)
8 other countries 1 reactor each
Also about 5 GWe of uprates are expected by 2014.
There is even bigger build up to 2020. Vietnam plans 13 reactors. China another 30-50 beyond the 24 already under way. By the end of the 2020s the world will be back to the 24 completions per year of the 1980s. During the 1980s over 210 completions. With double the world GDP getting to 50 completions per year in the 2020s-2030s is just getting to proportionally what was done in the 1980s. For 2020 and beyond the big impact will be factory mass produced reactors which will get proven prior to 2020.

There are very few shutdowns expected.

Dittmar said that uranium production would be the limiting factor from 2013-2018 and already in 2009-2012. He was 15% wrong from 2009-2018 already as he never increases uranium prediction above 45,000 tons/year

This is one of two point that I would emphasize about the bets. Uranium production is clearly heading up with a lot more from Kazakhstan, Niger, Namibia, Canada, Russia. (10,000+ tons per country over the next 5-10 years.) and some more a few thousand tons from other countries. Australia could ramp up a bunch but how much they do depends upon politics. So uranium supply is not in doubt through 2020.

I had indicated that the nuclear generation differences predicted for 2009 and 2010 were small and a 2-3% variance is in the noise.

Operating capacity efficiency is the big kicker for the upside. Ukraine, Japan, France, Russia, India can get their operating factors up. Getting up to 90% is doable. India just had to have an embargo lifted for fuel and that happened last year. A 10% boost in capacity factor for those counties will add about 100 TWH/year.

A Reply to Someone Who talked About Cost of Construction and Government Support

Gail already pointed out the need to convert to price per Kwh. Nuclear reactors can operate for 60+ years. Wind turbines and solar can wear out in 15-25 years. Nuclear can operate 90% of the time wind and solar at 25-35%.

75% of the new nuclear construction is outside the OECD. Look at the costs in China, India, Russia where most of the build is going. In those places the costs are $1400-2000 per KW. Russia uprated reactors for $200 per KW. (added 311 MWe). They will add another 300 MWe with another set of reactor uprates. Not the equivalent of a full large reactor from those uprates but the point is the cost without western style regulation was ten times less.

Note : all of the reactors. Even the ones in Russia, China etc... now all have containment domes and upgraded safety and other features. I am thus confident in their safety.

As for government sponsored ... All Energy has massive government sponsorship and support. Renewables have feed in tariffs. Oil and Gas have massive tax breaks.

International Energy Agency revealed that total global subsidies to fossil-fuel energy amounts to $550 billion a year.

The world will spend over $13 trillion on energy infrastructure over this decade. $6 trillion on fossil fuel subsidies which is not included in that $13 trillion.

Energy is a big money game.

Coal and oil have the biggest subsidy which is not included in those figures is that they do not have to pay to contain or clean up their pollution. Nuclear does pay to do that. But coal and oil dump billions of tons of CO2 and smog, and millions of tons of toxic metals. Mercury, Arsenic etc... this costs the world over a trillion in health costs and environmental damage and business damage.

Acid rain reduces the years you can use a car and increases the frequency for repainting buildings. How long does an east coast car last versus a west coast car ?

Nuclear is at 2600 TWH. Wind is at 300 TWH. Solar at 20 TWH. Coal is at about 6200 TWH.

Why wouldn't you want nuclear to go to 4000 TWH by 2020 and offset coal going from 6200 TWH to 8000 TWH instead of 9400 TWH ? All of the non-fossile fuel combined from now to 2020 is just to try to stop the growth of coal. Through 2030 then we might look at using everything including nuclear to try to retire some coal plants.

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