VZCZCXYZ0004
RR RUEHWEB

DE RUEHGZ #0080/01 0400643
ZNR UUUUU ZZH
R 090643Z FEB 09
FM AMCONSUL GUANGZHOU
TO RUEHC/SECSTATE WASHDC 0181
INFO RUEHGZ/CHINA POSTS COLLECTIVE 0090
RUCPDOC/USDOC WASHDC 0003
RHMFISS/DEPT OF ENERGY WASHINGTON DC 0002
RUEATRS/DEPT OF TREASURY WASHINGTON DC 0049
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC 0055
RUEAIIA/CIA WASHDC 0087
RUEKJCS/DIA WASHDC 0087
RHHMUNA/HQ USPACOM HONOLULU HI

UNCLAS GUANGZHOU 000080 
 
SENSITIVE 
SIPDIS 
 
EMB BEIJING FOR DOE 
USDOE FOR OFFICE OF THE SECRETARY 
USDOE FOR INTERNATIONAL AFFAIRS 
USDOE FOR FOSSIL POLICY AND ENERGY 
STATE FOR EAP/CM AND EB 
STATE PASS TO NUCLEAR REGULATORY COMMISSION 
 
E.O. 12958: N/A 
TAGS: ENRG TRGY ETTC IAEA CH
SUBJECT: Guangdong Moving to Expand Nuclear Power 
 
¶1. (U) Summary:  Guangdong province, the home of the Daya Bay and 
Ling Ao power stations, is getting set to rely even more on nuclear 
power as an energy source in the years ahead.  The Yanjiang Nuclear 
Power Station (YNPS) 189 km south of Guangzhou, on which workers 
broke ground on December 16, is expected to supply 10% of 
Guangdong's overall demand for power by 2015.  The new plant also 
represents progress on efforts to localize nuclear technology with 
85 percent of the design and equipment originating in China.  In 
addition, the project is expected to contribute US 14.7 billion to 
Guangdong's GDP and create thousands of unskilled jobs.  End 
Summary. 
 
--------------------------------------------- - 
Guangdong Breaks Ground on a New Nuclear Plant 
--------------------------------------------- - 
 
¶2. (U) The new Yanjiang Nuclear Power Station, one of Guangdong's 
main projects under the 11th 5-Year Plan, will include six-1000 
megawatt nuclear power reactor units.  Guangdong's current nuclear 
power capacity totals less than 4000 megawatts at two sites -- the 
Daya Bay and Ling Ao Nuclear Power Stations.  With majority 
investors China Guangdong Nuclear Power Holdings Company (CGNPC) at 
the helm, operation of reactor units 1 and 2 at YNPS is expected to 
begin by 2013, and will generate 45 billion kwh of electricity 
annually.  The final two units should be operational by 2017. 
 
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Quenching Guangdong's Thirst for Power 
-------------------------------------- 
 
¶3. (SBU) Quenching Guangdong's ever-increasing thirst for energy is 
challenging.  Ding Zhenxing, Manager of CGNPC's Engineering 
Management Department, estimated that by 2015, Guangdong's power 
demand will reach 573 billion kwh annually; YNPS is expected to 
supply 10% of that demand.  The addition of YNPS to Guangdong's 
nuclear cluster also represents a significant step in expanding the 
proportion of nuclear energy in Guangdong's energy mix.  The 
provincial government hopes to expand the amount to 20% by 2020 with 
a total annual capacity of 24 million kilowatts (kw) and 10 million 
under construction.   During a site visit, Party Secretary Wang Yang 
said that the new plant had the potential to contribute effectively 
to solving the power shortage problem in Guangdong, to changing the 
province's energy structure, and to strengthening Guangdong's 
efforts at environmental protection. 
 
¶4. (U) In addition to the Yanjiang project, Guangdong is planning 
the expansion or construction of several nuclear power facilities 
along its coastline.  In Taishan, six units will be constructed, the 
first two of which will be 2-1700 megawatt Areva EPR units, with an 
expected delivery date of 2013.  Phase II of Ling Ao, 2-1080 
megawatt CPR-1000 units, is expected to be delivered in 2010. 
Construction of the Lufeng/Shanwei/Tianwai facility is still pending 
NDRC approval.  Of China's overall net nuclear power generating 
capacity of 8.6 million kilowatts, Guangdong contributes 4 million 
kilowatts through the operations of Daya Bay and Ling Ao (Phase I). 
 
 
----------------------------------------- 
Home Grown, Home Owned - 85% Localization 
----------------------------------------- 
 
¶5. (SBU) The YNPS project attests to China's growing desire to 
become self-sufficient in the design and operation of nuclear 
facilities.  CGNPC's Ding emphasized that YNPS is 85% localized, 
meaning 85% of the station's design and equipment is sourced 
domestically in China.  Among new nuclear projects nationwide, the 
national average is 83%.   Local innovation and design are 
priorities for nuclear projects in China's Nuclear Power Development 
Plan (2005-2020).  YNPS has adopted domestically produced CPR-1000 
pressurized water reactors for units 1-3.  CPR-1000 technology is 
also being used in Phase II of Guangdong's Lingao Nuclear Power 
Station.  Ding said units 3-6 would use CPR-1000+ technology. (Note: 
CPR-1000 technology is based on French-owned Areva designs.  Media 
reports indicate that China expects to employ CPR-1000 technology in 
at least forty domestic nuclear generators in the near future. End 
note.)  The remaining 15% of the station's manufactured parts, 
project design, and technical assistance is provided by foreign 
 
companies, including Siemens. 
 
--------------------------------------------- -- 
Benefiting Guangdong's Economy and Environment 
--------------------------------------------- -- 
 
¶6. (U) The provincial government has welcomed the project for its 
anticipated contribution to Guangdong's economic growth in the face 
of the global economic downturn. YNPS will contribute RMB 100 
billion (USD 14.7 billion) to the province's GDP and create 
thousands of unskilled jobs for area residents, according to media 
reports. 
 
¶7. (SBU) Investment in the project totals RMB 70 billion (USD 10.1 
billion), mostly funded by CGNPC.  According to Ding Zhenxing, much 
of the invested capital is revenue from CGNPC-owned Daya Bay, 
Guangdong's first nuclear power plant.  According to media reports, 
YNPS is currently the most cost-efficient nuclear project under 
construction in China, with a unit cost of RMB 10,070 (USD 1,480) 
per kilowatt (kw).  Once completed, YNPS's on grid price will be an 
estimated RMB 0.364 per kwh, far below fossil fuel power prices. 
General Manager Ding told us that CGNPC expects to see a return on 
its initial investment in fifteen years. 
 
¶8. (SBU) Ding also said that the plant is taking steps to ensure 
energy-efficient practices.  The first is the implementation of an 
18-month refueling cycle, instead of the standard 4 months.  YNPS 
will adopt highly efficient transformers and will use half-speed 
steam generator units (SG), the heat exchanger in a pressurized 
water reactor, to heighten energy efficiency.  In addition, 
technology design will incorporate measures to prevent heat and 
energy loss, and green lighting will be used throughout the 
facility.  Ding also told us that once the plant is at full 
operating capacity, its emissions will be watched closely to ensure 
that current environmental standards are met. 
 
GOLDBERG