The market for nuclear power reactor decommissioning is expected to grow at approximately 12.10% from 2020 – 2025. Major factors driving the market include the increasing number of nuclear reactors reaching operational retirement, declining prices of renewable power generation sources (i.e., wind & solar), rendering nuclear power less economical, and growing sensitivity toward environmental issues. On the other hand, the increasing adoption of alternative energy sources, such as gas-based and solar power, is likely to hinder the market growth.
- The decommissioning activity of research reactors is expected to register significant growth, owing to the same reduced requirement, as there is a decreasing trend in research & development activity in the nuclear industry.
- South Korea is one of the new markets for nuclear decommissioning and creates an opportunity for foreign players to provide the necessary expertise that the country needs to develop its decommissioning market.
- North America is expected to be a potential market for nuclear power reactor decommissioning, with the United States being the decommissioning being the major decommissioning hotspots in the region.
Key Market Trends
Research Reactors Set to be a Potential Market
- The decommissioning of research reactors is in a growing phase, owing to the reduced requirement of the same. Globally, the focus is shifting away from nuclear power, which has led to a reduction in research activities associated with nuclear technology. As of February 2020, the IAEA research reactor database showed that there were 220 operational research reactors (87 of them in developing countries), 9 under construction (four of this 100 MWt or more), 14 planned (12 in developing countries), 28 temporarily or in extended shutdown, 60 permanently shutdowns, and 510 decommissioned or undergoing decommissioning.
- Several research reactors' decommissioning activities have been initiated on account of the higher cost associated with regulatory compliances over some time. The cost of decommissioning of research reactors in some cases is lesser than the cost of maintaining the shutdown research reactor. Therefore, the decommissioning market for shutdown reactors is likely to grow.
- The United States is the world's largest producer of nuclear power, accounting for approximately 32% of the total nuclear electricity generated, as of 2020.
- Most of the country's nuclear power were built between 1967 and 1990. Further, from 1977 to 2013, no new construction of the nuclear plant was undertaken due to the increased popularity of the economic attractiveness of gas-based power generation. Consequently, there was a decreasing trend of investments in the nuclear sector, which aided the decommissioning market of nuclear research reactors.
North America – One of the Major Hotspots in the World
- North America is among the most mature markets, with the United States alone having around 98 nuclear reactors operating commercially (As of January 2020). The United States is one of the major hotspots for nuclear decommissioning, with increasing nuclear power plants' closure due to growing focus to reduce the share of nuclear energy in the primary mix, increasing closure of nuclear reactors, and stringent safety regulations.
- Most of the country's nuclear power comes from the reactors built between 1967 and 1990. From 1977 to 2013, no new construction of the nuclear plant was undertaken due to the increased popularity of gas-based power generation's economic attractiveness.
- By the end of 2019, Canada had around 19 nuclear reactors, providing approximately 15% of the country's electricity demand. Previously, in 2018, five nuclear power plants were in the process of being decommissioned or were decommissioned. The extent of opportunities for decommissioning contracts is expected to depend on the plans for refurbishing Canada's remaining shut down reactors.
- Decommissioning is projected to become an increasingly important part of the nuclear sector activity in the coming decades, as many reactors are expected to reach their technical-lifetime very soon. Moreover, as dozens of nuclear reactors are nearing the end of their lives or being retired, many countries are focusing on decommissioning the nuclear power plants, which creates tremendous growth opportunities for the nuclear power reactor decommissioning market.
- The nuclear power reactor decommissioning market is moderately fragmented. Owing to the high risk of accidents during the decommissioning process, customers mostly prefer the services of established and renowned firms. As a result, there is cut-throat competition among the top players offering nuclear-decommissioning services. On the other hand, smaller works related to decommissioning are done without tenders and biddings.
- Some of the major players involved in the market include Babcock International Group PLC, Fluor Corporation, GE Hitachi Nuclear Services, WS Atkins Plc, AECOM, Bechtel Group, Inc., and Westinghouse Electric Company.
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