Multilateral Nuclear Approaches

Multilateral Nuclear Approaches:

Do they provide a credible solution to non-proliferation challenges posed by the expected global expansion of the nuclear power sector?

Rodrigo Penna

Calls for Multilateral Nuclear Approaches (MNAs) have been raised due to growing risks that the expansion of the nuclear power sector poses to a strained international non-proliferation regime. However, MNAs based on comprehensive arrangements lacks feasibility when proposing to divide the world into nuclear fuel suppliers and fuel clients. The growing thirst for energy security, besides the need for technological independency and sovereign access to international nuclear fuel markets are some of the factors undermining the credibility of MNAs as non-proliferation tools.

The former Director-General of the International Atomic Energy Agency – Mohamed ElBaradei – once stated that the dissemination of sensitive parts of the nuclear fuel cycle is the Achilles’ heel of the nuclear non-proliferation regime. The vulnerability of the regime lies on the fine line between nuclear power plants and nuclear weapons. Both use the same raw materials. The fuel cycle behind peaceful uses can be diverted to feed military purposes. At each stage of the cycle (otherwise, the production of fresh fuel, uranium enrichment, plutonium reprocessing and the ultimate disposal of nuclear waste) there is a breach where fissile material used for electricity can be diverted to build a warhead. This is behind the ambiguity between peaceful and military ends, where a “commercial fuel-making facility represents a latent nuclear bomb”. Therefore, the Achilles’ heel of non-proliferation is the dual-use of nuclear materials. The dilemma is to maintain effective oversight over global fuel-cycles, whilst recognizing the right of countries to develop their own nuclear capacity.

Such oversight has been challenging already, but its prospects for the future might reserve even more daunting results. Considering the expected global expansion of the nuclear power sector in the next few decades, the vulnerability of the non-proliferation regime tends to be more exposed. Safeguards and export control mechanisms are currently strained and have proven to have limited effectiveness against clandestine programmes – as the cases of North Korea, Iran and Libya demonstrate. Even more rigorous inspections established by IAEA’s Additional Protocol face logistical constraints. Besides, the Protocol itself was ratified in less than half of IAEA member-States and still fails to be a strong international instrument. Hence, as Deutch argues, “there is the widespread concern that, even with such measures, proliferation risks will not be reduced to acceptable levels in face of substantial global growth in nuclear fuel-cycle deployment”.

In order to strengthen the non-proliferation regime, there are renewed calls for establishing additional mechanisms such as Multilateral Nuclear Approaches (MNAs). Its concept involves multinational arrangements to control centres for the enrichment and reprocessing of nuclear fuel. In practice, MNAs can offer a variety of alternatives, ranging from multilateral assurances of fuel supply, joint ownership of nuclear facilities, as well as comprehensive arrangements dividing global suppliers and costumers of nuclear fuel. However, despite the existence of concrete multinational arrangements so far, they face critical limitations to meet non-proliferation challenges. The current expansion of the nuclear power sector further strains the effectiveness of MNAs, and thus, their own credibility.

This paper maintains that these limitations are particularly true regarding comprehensive MNAs – such as establishing closed groups of nuclear suppliers and proposals for fuel leasing (or ‘cradle-to-grave’ arrangements). By contrasting their benefits and limitations, this paper concludes that comprehensive MNAs have restricted feasibility, thus lacking the necessary effectiveness against the risks associated with the global expansion of nuclear power. Instead, simpler, regional, multilayered and non-discriminatory arrangements could offer a more credible non-proliferation recourse in addition to existing mechanisms. This discussion proceeds in three parts. First, this paper identifies the main proliferation risks associated with the expansion of the nuclear energy market. Second, comprehensive MNAs are assessed in light of their benefits and limitations to curb proliferation risks. And finally, the third part concludes on the lack of credibility of comprehensive MNAs vis-à-vis the non-proliferation regime and the global expansion of nuclear power.

Nuclear Energy Expansion: What are the challenges?

This decade has been witnessing a rebirth of nuclear energy. After the late 1970s, there was a sharp drop in the commissioning of nuclear power plants (NPPs) as a negative response towards the accidents at Three Mile Island and Chernobyl. The political blow against nuclear energy influenced the U.S. not to order any new reactor for almost three decades since the late 1970s . With the exception of France, Western Europe turned its back on nuclear power – most notably Italy, Sweden and Germany. Hence, it is not surprising to find that “about three quarters of all reactors in operation today are over 20 years old”. As of the end of 2007, “439 nuclear reactors were operating in 30 countries, corresponding to 14% of the global electricity generation”. Nevertheless, according to the IAEA, at least 44 new NPPs are under construction, 64 have been commissioned and 158 have been proposed to meet long-term energy demands. These numbers, even if in high projections, show a reversal of the downward trend of NPP commissioning.

Besides the growth in the number of reactors, more countries are adopting nuclear energy capability for the first time. New NPPs were announced in Turkey, Indonesia, Vietnam, and over 43 countries have formally expressed their interest to participate in IAEA technical cooperation projects for the introduction of nuclear power. Moreover, several other countries – including Argentina, Australia, Brazil, South Africa and Ukraine – are advancing their indigenous enrichment capability as a way to master the nuclear fuel-cycle in a commercial scale.

Some explanations are offered to understand the possible drivers behind the expansion of the nuclear power sector and how such expansion could either favour or hinder multilateral nuclear approaches. Grimston suggests that any energy supply must meet at least four criteria: security and reliability; low costs; manageable environmental impact; and social and political acceptability. Compared to other sources, nuclear energy hardly managed to meet those criteria in the last decades of the 20th century. As mentioned before, two nuclear accidents affected social and political acceptability of NPPs, besides the popular perception on their environmental damage. In terms of costs, fossil fuels (particularly oil and natural gas) were more competitive due to low prices and to the discovery of new reserves. Therefore, in terms of energy security, the world of the 1990s faced a period of comfort even in face of a declining share of nuclear power in the global energy mix.

The upsurge of nuclear power in the later years could be explained by how such variables have changed in light of Grimston’s criteria. In terms of environmental impact, popular perception has focused more on global warming. Ironically, nuclear power has emerged as the apparent solution to the burning of fossil fuels, thus giving an alternative to countries – such as Canada – to meet carbon emission targets under the Kyoto Protocol. Moreover, relative costs and reliability of NPPs have changed. The volatility of oil and gas prices in the later years contributed to a degree of uncertainty. Dependency on Middle-Eastern and Russian reserves has proven to be politically costly and unreliable. Renewable sources, on their turn, have not managed to keep up with growing energy demands. Wind farming is intermittent and is facing declining cost-effectiveness and investment – as revealed by the withdrawal of Royal Dutch Shell and E.ON from major projects on the grounds of low profitability. These examples are some of the factors prompting nuclear energy to regain the centre of global energy security in the 21st century.

In contrast, it is true that there are counterarguments downsizing such nuclear panacea. Uranium prices have shown volatility as well (as much as 1,350% between 2000 and 2007). Costs of key construction materials in nuclear reactors have risen considerably. The economic recession in the next years, although temporary, could have medium-term effects on commissioning new reactors. Nevertheless, the magnitude of new NPP commissioning – as expressed before – suggests the maintenance of the upward trend, even if in lower projections.

Hence, higher demands for nuclear reactors, nuclear fuel and human expertise in such field provide an extra strain on non-proliferation concerns. Squassoni suggests that the “expansion of nuclear power could have cascading effects on the nuclear non-proliferation regime (…); on the practical side, additional facilities will mean additional safeguards by IAEA inspectors”. As Ferguson maintains, the IAEA is already “strapped for funds to pay for inspectors and near-real-time surveillance capabilities for all the current nuclear facilities”. Therefore, “as nuclear energy demand rises, the budget of the IAEA would have to match the rise to increase the probability of detecting diversion of weapons-usable nuclear materials.” An overstretched IAEA has called for

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