Growth in Nuclear Energy: Supply Chain Challenges

John Wood
Despite the Fukushima nuclear accident and the withdrawal from the market by countries such as Germany, nuclear energy is experiencing a global resurgence as countries aim to diversify their energy mix and reduce their carbon emissions.

This includes oil producing countries seeking to reduce their oil and gas reliance. Saudi Arabia’s projected energy demand, for example, means they would be a net importer of oil by 2032. In January 2014, the World Nuclear Association reported 71 nuclear reactors under construction, 172 on order or planned, and a further 312 proposed reactors. This is in addition to ongoing projects to extend the life or increase capacity of existing nuclear power plants.

This growth in demand presents considerable capacity and capability challenges for the nuclear supply chain, not only for the design and construction of the plants, but also their ongoing operation and maintenance. This also applies to consultancy services where there are limited resources with nuclear experience. Construction and operation of nuclear power plants is highly regulated and controlled. Requirements vary from country to country, but some fundamental principles are the same. UK site licence holders are responsible for nuclear and radiological safety and security, including contractors’ work. This has significant implications for the procurement of the construction and operation services, to ensure compliance with the site licence conditions.

This growth in demand presents considerable capacity and capability challenges for the nuclear supply chain...

The site licence holder is directly responsible for managing its suppliers, and this should be cascaded down to the supply chain. Contractors engaged on works requiring nuclear and radiological safety and security must be aware of the licence conditions and the licensee’s obligations. The licensee must ensure that all contractors are suitably experienced and qualified. As no new UK nuclear power stations have been constructed since the early 1990s, demonstrating the necessary new build experience may be a challenge for many UK companies. However there are organisations with experience in nuclear decommissioning and nuclear generation who will be able to demonstrate nuclear capability. Whether the supply chain has the capacity to handle nuclear new build as well as the existing nuclear generation and decommissioning is a different question.

The supply chain for the construction and operation of nuclear power plants is complex. However there are large parts of the nuclear power plant that are no different to any other power station. In very simple terms the supply chain can be categorised as nuclear related and non-nuclear related.


Typical elements:

  • Nuclear island (NI)
  • Conventional island (CI)
  • Balance of plant
  • Ancillary facilities
  • Supporting infrastructure (construction logistics centre/construction workers’ accommodation)

The number of nuclear technology vendors in the global market is limited. All have well established supply chains to support the manufacture and construction of the nuclear island. Ongoing, the key factor will be their current order books and whether their supply chains have the capacity to meet delivery timelines, particularly the heavy forgings required for the nuclear steam supply system (NSSS). Increasing capacity in existing suppliers or certifying new suppliers can be costly and time consuming.

Countries embarking on nuclear power for the first time face additional challenges in obtaining the necessary agreements to enable nuclear suppliers to export their technologies. For the non-nuclear elements of the nuclear power plant, market capacity may not be an issue. However major equipment such as turbines, generators and switchgear are likely to be long-lead items and again may be impacted by manufacturing capacity. 

Fuel Cycle

There are several elements to the nuclear fuel supply cycle:

  • Mining
  • Enrichment
  • Milling
  • Manufacture
  • Reprocessing

Fuel for the current generation of nuclear reactors is uranium which is abundantly available but needs to be enriched prior to manufacture of the fuel rods. The demand for new nuclear reactors will need additional capacity in existing fuel enrichment, manufacturing, and reprocessing facilities. New facilities are expensive and controlled through international treaties.

The demand for new nuclear reactors will need additional capacity in existing fuel enrichment, manufacturing, and reprocessing facilities.

Operations and Maintenance

The supply chain for operation and maintenance of the nuclear power plant varies depending on how much the operating company does in-house but may include:

  • HSSSEQ (health and safety, security, health physics, environmental, quality assurance)
  • O+M labour
  • Spares/equipment
  • Hired in plant
  • Support services (training, engineering, project, finance, legal, facilities management, transport)
  • Planned outages
  • Waste management
  • Supporting infrastructure - Operations and maintenance (waste management facilities, new communities)

Countries with existing nuclear power stations have a well-established supply chain and as existing stations reach the end of their operational life, there should be capacity to cope with new stations coming on line. Countries with no existing nuclear power stations face a major challenge in establishing a supply chain. One solution is to outsource the entire operation and maintenance to an experienced nuclear operator, but challenges remain in establishing a local supply chain to support the operator.

So what is the solution?

The UK government has published the 2012 Nuclear Supply Chain Action Plan (PDF, 698KB) which sets out the plan for identifying/enhancing skills and increasing capacity through training and funding.

Emerging nuclear generating countries are seeking to establish capability and capacity in-country to support their nuclear ambitions but face tough challenges in attracting the knowledge, capability and investment needed in the absence of in-country capability. Long term strategies are needed to create a supply chain capable of providing the necessary capacity and capability to support the nuclear programme.

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