Presentation to the International Energy Conference & Exhibition (IECE):

1. The Potential for Nuclear Energy in Developing Nationsby Neil J. NumarkChairman, Sustainable Energy Institute;President, Numark Associates, Inc.Washington, DC Presentation to theInternational Energy Conference & Exhibition (IECE): SUSTAINABILITY: ENERGY FOR DEVELOPING NATIONS Daegu, Korea February 27, 2007

2. Outline • Status of Nuclear Power Today • Characteristics of Nuclear Power • Prospects for Tomorrow (with emphasis on developing nations)

3. Status of Nuclear Power Today Review latest data on worldwide utilization of nuclear energy…

4. Worldwide Nuclear Power Plants Source: International Nuclear Safety Center, Argonne National Laboratory, http://www.insc.anl.gov/pwrmaps/map/world_map.php.  

5. World Electricity Generating Capacity by Fuel Type, 2003 - 2030 Source: International Energy Outlook, 2006 - EIA/US DOE

6. Total and Nuclear Generating Capacity, by Region (current and projected) Source: International Atomic Energy Agency: “Energy, Electricity and Nuclear Power Estimates for the Period up to 2030,” 2006 Edition

7. Electricity Share Supplied by Nuclear Power, by Region (current & projected) Source: International Atomic Energy Agency: “Energy, Electricity and Nuclear Power Estimates for the Period up to 2030,” 2006 Edition

8. Nuclear Share of Total Electricity Generation in 2005, by Country Source: International Atomic Energy Agency: “Energy, Electricity and Nuclear Power Estimates for the Period up to 2030,” 2006 Edition

9. Fuel Shares for Electricity Generation Source: OECD/IEA 2003 "Electricity Information" 2002, Table 4

10. Growth in World Nuclear Generating Capacity Source: Nuclear Energy, Hans-Holger Rogner & Alan McDonald, International Atomic Energy Agency, Ausgabe 1/04, 2004

11. Regional Shares of Nuclear Production, 2004 Source: Key World Energy Statistics – International Energy Agency, 2006

12. Characteristics of Nuclear Power (1) • High power density, large output • Environmental benefits: clean air, carbon-free. Greatest attribute for developing countries. • Costs: • Capital intensive: large units, high cost to build, low cost to operate • Major component of baseload power supply (alongside coal) • Long reactor lifetimes, 40-60 years

13. U.S. Cost Comparison (1)

14. U.S. Cost Comparison (2) Source: Nuclear Energy Institute

15. U.K. Cost Comparison • PF = Pulverized fuel, CFBC = Circulating fluidized-bed combustion, IGCC = Integrated gasification combined-cycle, OCGT = Open-cycle gas turbine, CCGT = Combined-cycle gas turbine, BFBC = Bubbling fluidized-bed combustion • Includes capital, equipment, fuel, operation and maintenance costs • Source: The Cost of Generating Electricity, The Royal Academy of Engineering, 2004

16. Characteristics of Nuclear Power (2) • Safety: Good safety record but plants require continued vigilance; also need governments to maintain independent, technically competent regulatory authorities. • Proliferation concerns: Potential exists to exploit peaceful nuclear plants to produce weapons material. Even without such intentions, a peaceful and safeguarded nuclear program could be a concern to neighboring states. But a country with nuclear power plants is still very far from having weapons capability. • Nuclear waste: Safe disposal is widely considered to be technically feasible, but political solutions still elusive. • Security concerns are increasing, over both reactors and their materials, raising operating costs.

17. Prospects for Tomorrow • 2000-2010: Modest worldwide growth: Korea, Japan, China, India, Finland • 2010-2020: Large growth likely: China, United States, India; possibly Russia, Europe • 2020+: Possible further application in other developing nations (Indonesia, Vietnam…)

18. Near-Term Expansion: LWRs • New generation of light water reactor (LWR) designs from the major global vendor groups offer evolutionary improvements over existing LWRs: • Toshiba-Westinghouse AP-1000 (1100 MW) • GE-Hitachi ABWR (1300 MW) and ESBWR (1500 MW) • Areva EPR (1600 MW); Areva-MHI PWR (1000 MW) • Korean OPR-1000 (950 MW) and APR-1400 (1350 MW) • Russian AES-2006 (1200 MW) • Next large waves of new plants likely in China, U.S.: • China: first plant around 2013; plans for up to 50 GW in new nuclear capacity • US: first plant around 2015

19. Shin Kori Units 3 and 4: 2 units, 2700 MWe

20. Advanced Gas-Cooled Designs • Smaller units (120-300 MW) can be installed incrementally (shorter construction lead-times than large plants; smaller impact from reactor shutdowns) • Well suited to either large or small electric power grids • Potential for higher degree of inherent safety • Potential to produce hydrogen in addition to electricity • Designs include: • Pebble-Bed Modular Reactor (PBMR) • High-temperature Gas-Cooled Reactor — Pebble-Bed Module (HTR-PM) • Gas Turbine-Modular Helium Reactor (GT-MHR) • South Africa: first PBMR to be built by 2012 • China: first HTR-PM module to be built by 2014, at Rongcheng in Shandong Province (see photo). • US: Possible PBMR or GT-MHR by 2018

21. Planned Rongcheng Pebble-Bed Reactors: 19 modules, 3700 MWe Source: Andrew C. Kadak, “Nuclear Power: Made in China,” The Brown Journal of World Affairs, Brown University, Fall 2006.

22. Issues in Implementing Nuclear Power in Developing Countries (1) • Large growth in baseload electricity demand: coal and nuclear are primary choices. • Benefit of nuclear: reduce reliance on coal in China, India and elsewhere. • Power density: an attribute in densely populated countries • Major financing challenges • Plant siting: sufficient distance from large population centers • National electric grid: need to add power in appropriately sized increments

23. Issues in Implementing Nuclear Power in Developing Countries (2) • Advanced reactor designs now offer more passive safety features • But plants still require skilled workforce and strong safety culture. Track record running fossil plants is not good everywhere. • Governments also need to maintain independent, technically competent regulatory authorities • Concerns about limited global manufacturing capacity for heavy forgings, to support large-scale nuclear renaissance • Fuel cycle approach: China and India expected to utilize closed fuel cycles; smaller nations likely best served by once-through cycles.

24. Generating Capacity Projections for Non-OECD Countries Source: International Energy Outlook, 2006 - EIA/US DOE

25. Nuclear Generation Projections for Asia Source: International Energy Outlook, 2006 – EIA/US DOE

26. Issues in Implementing Nuclear Power in Developing Countries (3) • Note the diversity of perspectives by international organizations: • UN Development Programme’s World Energy Assessment, 2004 Update: “Near-term improvements in nuclear reactors can be achieved both through continued evolution in LWRs and through development of new reactor concepts. Already available are LWRs with improved safety features… Another concept, the PBMR, claims to have the potential for a high degree of inherent safety without the need for complicated and capital-intensive safety controls… • World Bank: “Concerning nuclear energy, the Bank’s position of not working in this area has not changed and thus there are no plans for increased involvement.”  • Asian Development Bank: “ADB’s rationale for not being involved in nuclear power development was based on concerns related to the transfer of nuclear technology, procurement limitations, proliferation risks, and environmental and safety aspects.” • International development banks negative Sources: World Energy Assessment Overview: 2004 Update, UNDP, UN-DESA and World Energy Council, 2004; Extractive Industries Review (EIR) Implementation Update, 2006 Spring Meetings, World Bank; Review of the Energy Policy, Asian Development Bank, 2000

27. The Role of Nuclear (1) • An important element of sustainable, clean energy for developing as well as industrialized nations • Baseload fuel mix should combine nuclear; advanced clean coal technologies with carbon sequestration; and renewable energy technologies • Great benefits in reducing urban air pollution and global warming

28. The Role of Nuclear (2) • But need appropriate conditions: • Mature and fiscally sound electric utilities with good operating track records • Ability to ensure safe operations with skilled workforce and strong safety culture • Independent, technically competent safety/environmental regulator • Reactor size suited to grid conditions and financing context • Siting outside of densely populated regions • Sufficient facilities for interim storage of spent fuel; careful consideration of alternatives for long-term disposition.