Global Nuclear Decommissioning Services Market – Insights
Nuclear decommissioning is the process in which a nuclear facility is dismantled so that it no longer requires to be protected from radiation. The challenges in nuclear decommissioning include technical, economic, and social factors. The process of removal of radioactive materials is occupationally hazardous, time-intensive, expensive, and also pose environmental risks that are to be addressed to ensure that radioactive materials are stored on-site in a safe manner or transported elsewhere for storage.
Rising risk and safety concerns regarding nuclear decommissioning services are one of the major factors propelling growth of the market, globally. Increasing focus on renewable energy sources such as wind, solar, and others is resulting in less use of nuclear power, which in turn drives growth of the nuclear decommissioning services market, globally. The Energy Information Administration (EIA) projected that total renewable energy used in the power sector was anticipated increase by 8.7% in 2016 and 6.5% in 2017. Solar PV capacity was also expected to increase from 10 GW to 27 GW between 2014 and 2017. Wind capacity was expected to increase by 9% in 2016 and by 8% in 2017, accounting at that point for 5.6% of the total generation.
However, the cost of decommissioning is one of the major factors hampering the market growth. Decommissioning cost estimates are in the range of US$ 1 billion - US$ 1.5 billion per 1,000-megawatt plant. Moreover, Germany has set aside US$ 44.08 billion to decommission 17 nuclear reactors and the U.K. Nuclear Decommissioning Authority estimates that clean-up of U.K.'s 17 nuclear sites will cost between US$ 126?290 billion over the next decades.
The global nuclear decommissioning services market was valued at US$ 171.74 billion in 2018 and is expected to register a CAGR of 7.0% in terms of revenue over the forecast period (2019 – 2027).
Figure 1. Global Nuclear Decommissioning Services Market Share (%), By Region, 2018
Source: Coherent Market Insights, 2018-19
Europe accounted for the largest market share in the global nuclear decommissioning services market with a value of US$ 78.48 billion in 2018. Stringent government regulations in Europe to support nuclear decommissioning activities is a major factor driving growth of the market in the region. Europe is projected to become the world’s largest market for decommissioning and decontamination (D&D) in the next five years. Over half of the European Union’s 223 nuclear power plants are due for closure by 2025.
The market in Asia Pacific is expected to witness the fastest growth in the global nuclear decommissioning services market over the forecast period. The ongoing nuclear decommissioning activities and initiatives of the governments in this region to reduce nuclear energy are major factors driving growth of the nuclear decommissioning services market in Asia Pacific. For instance, in May 2018, the government of Taiwan announced plans to diversify the energy mix and replace nuclear power with clean energy such as wind and solar power.
Figure 2. Global Nuclear Decommissioning Services Market Share (%), By Application, 2018
Source: Coherent Market Insights, 2018-19
The pressurized water reactor segment accounted for the largest market share in the nuclear decommissioning services market in 2018. Pressurized water reactor (PWR) is a type of nuclear reactor used to generate electricity and propel nuclear submarines and naval vessels. It utilizes light water (ordinary water, as opposed to heavy water) as coolant and neutron moderator. According to World Nuclear Association, PWR was originally designed for the U.S. Navy, however, it gained significant traction and became widely used reactor in nuclear power plants; with 297 in operation around the world as of 2018.
Major players operating in the global nuclear decommissioning services market include Orana Group, AECOM, Babcock International Group Plc, Westinghouse Electric Company LLC, Enercon Services Inc., KDC Contractors Limited, NUVIA Group, Onet Technologies SAS, Sogin S.p.A., and others.
Decommissioning refers to an activity that includes all clean-up of radioactivity and progressive dismantling of the nuclear plant. Decommissioning includes activities such as planning, physical and radiological characterization, facility and site decontamination, dismantling, and material management.
Aging nuclear power plants is expected to propel growth of the global nuclear decommissioning services market. Several existing nuclear power plants are expected to inevitably close down over the next two decades, as plants are nearing the end of their operational lifespans. Bulk of worldwide retirements are owing to aging fields i.e. the oldest fleet, particularly by the U.S. followed by the European Union (led by France, Germany, and the U.K.), Japan, and Russia. Rate of retirement that is end of life of nuclear power plants is projected in the first half of the 2020s, as reactors built in 1970s are taken off-line, and then again in the 2030s, particularly if life extensions in the U.S. are not re-extended for another 20 years.
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