Wednesday, June 29, 2016


Commentary

New International Nuclear-Fuel Bank Likely To Find Few Customers

Irans' nuclear power plant in the southern port city of Bushehr, built with Russia's help
Irans' nuclear power plant in the southern port city of Bushehr, built with Russia's help
By Gregory Gleason
When Russia’s quasi-commercial, quasi-strategic nuclear monopoly Rosatom announced the opening of a nuclear fuel bank in remote Siberia last December, it was a milestone in the nuclear age. The goal of the fuel bank is to offer a nuclear fuel supply of last resort to a country denied access to nuclear fuel.

The irony of the fuel bank is that if it is successful in changing the complexion of the international nuclear fuel trade, no country actually will need to turn to the fuel bank to use its services. The fuel bank will be most successful if it is never used.

The idea of the nuclear fuel bank is not new. Concepts for the establishment of a reserve of strategic nuclear materials have been around since the beginning of the nuclear age. The ideas arise out of the basic paradox of nuclear power. Nuclear power has the Janus-faced quality of being at the same time potentially very beneficial and yet very dangerous. Knowledge cannot be unlearned. The nuclear genie cannot be returned to the bottle. So how is it possible to harness nuclear science’s peaceful benefits while reining in the risks of the world’s most dangerous weapon?

When Dwight Eisenhower presented the “Atoms for Peace” plan to the UN General Assembly in 1953, he called for sharing the benefits of nuclear technology with the entire world and for resolutely opposing the spread of nuclear weapons. Eisenhower imagined isolating nuclear weapons from the influence of the international politics of nation states by creating a neutral and independent repository for fissile nuclear materials. He proposed establishing a nuclear repository under the control of an international agency.

Eisenhower’s idea of an international agency was realized in the establishment under the auspices of the UN of the International Atomic Energy Agency (IAEA). But the idea of a fissile-materials depository languished. During the Cold War no country was prepared to hand over control of its nuclear materials to an international body, let alone another country.

Closely Intertwined

The fate of nuclear weapons and commercial nuclear reactor technology has been closely intertwined. Every step to control nuclear weapons has constrained the nuclear power industry. Every step to free up the nuclear power industry around the globe has threatened to weaken the nuclear nonproliferation regime.

The resolution of this dilemma is to close the nuclear-fuel cycle and keep the most risk-laden aspects under the oversight of the IAEA. The fuel bank is a wedge that closes the fuel cycle and depoliticizes the use of nuclear fuel for power generation. The idea of the fuel bank in its present form was first proposed to the IAEA by Russian leader Vladimir Putin in January 2006 and then was given a boost forward by a $50 million matching contribution to the Nuclear Threat Initiative by the American financier and philanthropist Warren Buffet in September 2006.

In March 2010, the IAEA formally signed an agreement with Russian authorities to establish the fuel bank and the agreement was put into practice in December 2010 after approval by the IAEA Board of Governors. The U.S. government supported the fuel-bank idea. The U.S. government put into effect a new agreement with Russia in nuclear cooperation on December 8, 2010.

So when the doors of the International Uranium Enrichment Center -- the world’s first internationally managed facility capable of enriching uranium — swung open in the Far Eastern city of Angarsk, it ushered in a new period in international diplomacy.

Single Most Significant Step

The fuel bank is a repository for low-enriched nuclear fuel that can be used in the most common form of nuclear reactor -- the light-water reactor. So the new fuel bank is far from a repository for all fissile material. But it is the single most significant step in the 65 years of the nuclear age in bringing the technology to produce fissile material under international controls.

The uranium industry passed through a classic boom and bust cycle. The boom spurred by the Cold War led to the overproduction of uranium. As the Cold War came to an end, nuclear materials were shifted from defense needs to the private sector, dampening prices.

The uranium mining industry suffered a steep downturn. Demand for uranium ore dropped precipitously. Uranium prices were so low many mines became unprofitable and closed. Public fears following the U.S. Three Mile Island accident in 1979 and the USSR’s Chornobyl accident in 1986 constrained the nuclear power industry. But now improved nuclear-safety measures, the growing demand for energy, and the need to find carbon-free sources of energy have refocused attention on nuclear power.

The chief stumbling block for the nuclear power industry is concern over nuclear proliferation and the surreptitious diversion of nuclear materials that could fall into the hands of terrorists. The focus of keeping nuclear explosives out of the hands of irresponsible parties has centered on a few key elements in the nuclear fuel cycle. The technology for isotopic enrichment of uranium is one of these.

Stop-Gap Measure

The fuel bank is a limited, stop-gap measure designed to deter countries from pursuing go-it-alone nuclear-enrichment technology. The nuclear-fuel bank makes it possible for countries to forgo the expense of developing enrichment technology without being subject to fears that reliance on others for nuclear-fuel supplies would make them dependent.

The fuel bank gives the IAEA the ability to ensure access to nuclear-fuel supplies for conventional light -water reactors at “market prices” in the event of a political dispute between fuel suppliers and consumers. The fuel bank does not provide broad and privileged access to uranium supplies. Moreover, the bank can be used only in extraordinary circumstances and only to provide specific amounts of nuclear fuel at market prices, always subject to stringent IAEA oversight and monitoring conditions.

The real benefits of the fuel bank precede its use. One benefit is purely psychological. The existence of the fuel bank offers psychological assurances to developing countries that taking a development path of greater reliance upon nuclear energy would not put them in a position where, in the event of some future political dispute, their access to fuel supplies could be manipulated for political purposes. It thus encourages countries to move in the direction of nuclear power.

The other benefit of the fuel bank idea is diplomatic. The fuel bank presents a disincentive to developing countries to discourage them from investing in the costly and hazardous business of uranium enrichment. Now that it has become unnecessary to enrich uranium for the purposes of power generation, the countries that are sincerely oriented on peaceful development have guaranteed access to nuclear fuels.

Iran over the past five years has committed itself to nuclear self-sufficiency. Iran’s chief diplomat, Manuchehr Mottaki -- before he was replaced last December as foreign minister and replaced by Ali Akbar Salehi, the former head of the Iranian Atomic Agency -- frequently asserted Iran’s “inalienable right to” carry out nuclear activities beyond the reach of the oversight capacity of the IAEA.

The UN Security Council has passed a series of resolutions directing Iran to halt uranium enrichment. In July 2006, the UN Security Council issued Resolution 1696 demanding that Iran suspend uranium enrichment. In December 2006, the UN Security Council issued a second resolution, 1737, again demanding that Iran suspend all uranium enrichment. In March 2007, the UN Security Council issued Resolution 1747, demanding cessation of uranium enrichment and imposing sanctions on Iran.

In March 2008, the UN Security Council adopted yet another resolution (1803) reaffirming Resolution 1737 in calling for Iran to suspend uranium enrichment activity and imposing a more extensive set of sanctions. In June 2010, the UN Security Council called for cessation of enrichment and imposed further sanctions (Resolution 1929).

The alternative of the fuel bank makes uranium-enrichment unnecessary for Iran’s economic development objectives. Yet Iranian President Mahmud Ahmadinejad has made it clear that the government has not halted enrichment. Iran’s choices draw greater attention to the irony of the fuel bank. Countries that are irreversibly committed to developing their own control of the full fuel cycle are not likely to use it. Countries that would benefit from it the fuel bank will have ample access to commercial fuel procurement and so would never find a need to use it.

Gregory Gleason is a professor at the University of New Mexico and the George C. Marshall European Center for Security Studies. The views expressed in this commentary are the author's own and do not necessarily reflect those of RFE/RL, the U.S. government, or the U.S. Defense Department
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by: BD from: UK
January 13, 2011 13:59
Some serious clarification needed:

In November 2009, the IAEA Board of Governors authorised the IAEA to sign an agreement with Russia to establish the LEU fuel bank in Angarsk. The agreement was signed on 29 March 2010 and the reserve was opened last month, December 2010.

On 3 December 2010, the IAEA also authorised the establishment of an IAEA LEU fuel bank that will be owned and managed by the IAEA. This is quite different from the fuel bank at Angarsk. It is the IAEA fuel bank to which the Nuclear Threat Initiative and Warren Buffet have contributed. A location for the IAEA LEU bank has not yet been identified. It won't be in Angarsk.

by: VS from: Los Angeles
January 15, 2011 22:03
It will be virtual bank...