Nuclear option: The developing world weighs energy needs and security risks

Western governments and the nonproliferation community in general tend to view every developing nation that pursues nuclear power as a potential risk for nuclear weapons proliferation. This attitude is unfortunate for several reasons. First, it fails to recognize the pressing need for increased energy supply that many developing countries face. Second, it deflects attention from the legitimate issue of poor safety practices at developing-world nuclear power plants. Third, it reinforces the Nuclear Non-Proliferation Treaty's (NPT) division of the world into nuclear "haves" and "have-nots."

Low energy. In the developing world, a number of countries are perpetually energy-starved. In India, for example, economic liberalization over the past two decades has resulted in sharply increased energy demand that cannot be satisfied solely with electricity derived from hydrocarbons. Thus the country's urban areas are routinely subjected to rolling blackouts (otherwise known as "load shedding"). These power cuts, especially prevalent during the hot summer months, force many business owners to establish backup electricity options, like diesel generators. Such arrangements are costly and polluting and constitute a burden both for business owners and for the economy at large. In addition, the country must import a large share of the hydrocarbons it uses, including about 70 percent of the oil it consumes, and this exacerbates the country's trade deficit.

China, too, has become energy deficient due to rapid economic growth. Other developing countries, like Jordan, enjoy only limited energy resources to begin with. But whatever their circumstances, many developing countries must increase their energy supplies if they are to achieve and sustain economic growth and fulfill their people's aspirations.

Unfortunately, every available option for increasing energy supply presents problems of some sort. Oil is a polluting resource; imported oil is subject to wide price fluctuations; and dependence on foreign oil becomes especially problematic whenever the Persian Gulf experiences conflict or tension. Coal is even more polluting than oil. Hydropower, meanwhile, depends on the vagaries of rainfall, and a country dependent on hydropower can suffer acute electricity shortages during times of drought. Alternative energy sources like solar, wind, and biofuels have not yet taken hold because of the large investments necessary and problems with commercial viability.

For many developing countries, then, nuclear energy is — plain and simple — a practical means for increasing energy supply and thus enabling economic progress. Much of the international community, however, imposes its proliferation concerns on nuclear-power programs that do not merit such worries. To be sure, proliferation concerns are justified in some instances. Iran springs to mind. Also, India started its atomic energy program with the stated aim of pursuing only peaceful uses but eventually began a nuclear weapons program under the same aegis (though the fissile materials for India's nuclear weapons are believed not to be derived from power production reactors). Still, not all countries that have pursued nuclear power in the past have pursued weapons capability — and indeed, some countries' pursuit of nuclear power has hardly even elicited concerns about proliferation, much less resulted in proliferation itself.

Japan is an example. In its case, of course, proliferation fears were muted because the US military maintained a presence in the country and the United States acted as a security guarantor in the region. But these factors alone were not sufficient to eliminate proliferation concerns. Rather, the deciding factor was postwar Japan's decision to demilitarize its foreign policy and to improve fractious relationships with neighbors. Thus, Japan's development of nuclear power was seen abroad as an integral part of the country's economic policy — not as part of its strategic policy. Other countries can try to emulate this model today, though doing so requires a willingness on their part to pursue transparent, credible policies that are open to international scrutiny.

Safety last. In any case, the key problem that nuclear energy presents in most developing countries is not proliferation but plant safety. In many developing nations, the idea of public safety is met with apathy. In India and China, for example, the national rail transportation systems experience unacceptably high accident rates, yet this does not deter millions of people from riding trains daily. Similarly, tolerant attitudes apply to nuclear safety, and this problem is compounded in many cases by inadequate funding. Thus, some nuclear energy programs in the developing world compromise on standards, utilize inadequate materials, suffer from corruption, and generally perform abysmally in nuclear safety.

Making matters worse, some of these  nuclear facilities are located in areas prone to earthquake. While this is also true of Japan, of course, government regulators there enforce rigorous construction standards meant to minimize structural damage during earthquakes, including damage to nuclear power plants. This sort of rigor is not maintained in poorer countries. The accident at Japan's Fukushima Daiichi Nuclear Power Station, meanwhile, demonstrated the difficulties that even highly developed countries can experience in managing a nuclear disaster. Less developed countries would certainly face even greater struggles under similar circumstances.

Encouragingly, the Fukushima disaster has heightened public awareness of nuclear safety issues in the developing world. In India, protests over the under-construction Kudankulam nuclear facility in the southern state of Tamil Nadu are one manifestation of such popular concerns. (Public fears there are only intensified by the fact that the area was affected by the 2004 Indian Ocean tsunami.) One hopes that such public engagement will eventually lead to improved safety conditions at nuclear facilities in the developing world.

No technology is immune to accidents. Nor is progress ever free of risk. Nuclear safety is simply another realm of technology — admittedly, a complex and expensive realm — in which progress can be achieved over time. In the short term, though, the number of countries capable of providing nuclear energy to their populations is limited; therefore, it should be possible for nuclear safety challenges in this limited number of countries to be satisfactorily addressed.

Meanwhile, the international community must abandon its traditional attitude according to which every country seeking nuclear power is a potential weapons proliferator. The NPT has evolved into a cartel of the nuclear-weapons "haves," but the same should not be allowed to occur where nuclear energy is concerned. Certainly, proliferation remains a legitimate worry in a few cases, and all nuclear power plants must be brought under the International Atomic Energy Agency's inspection regime. But misplaced proliferation fears must not interfere with developing nations' legitimate efforts to meet their urgent energy needs.

In some quarters the disaster at the Fukushima Daiichi Nuclear Power Station has prompted a reconsideration of nuclear energy — but in many developing nations with nuclear energy programs, the incident has had barely any effect. Bangladesh, Belarus, Turkey, and Vietnam are expected to start building their first nuclear power plants in the near future, and several other developing countries are likely to follow suit in subsequent years. But is nuclear power necessarily good for the economic development of these nations?

Proponents of nuclear power often tout its ability to meet the energy requirements of expanding economies; in fact, the link between nuclear power and economic development is tenuous at best. True, nuclear power plants are relatively cheap to fuel and operate — but they are notoriously expensive to build. As noted by Brazilian physicist José Goldemberg, any country with a gross domestic product of less than $50 billion probably cannot afford to purchase a nuclear reactor. (Many other developing countries, according to Goldemberg, make poor candidates for nuclear power because of their inadequate electrical grids.) Adding to the expense is that cost overruns have long been common in the nuclear industry: The 75 US nuclear power plants on which construction began between 1966 and 1977 experienced cost overruns averaging in excess of 200 percent. Furthermore, amid growing global demand for nuclear energy, the cost of materials and expertise required to build nuclear power plants has risen dramatically in recent years.

Despite these financial realities, nuclear power is regarded as an attractive energy option in a number of developing countries, particularly those that wish to enhance the security of their energy supply. As energy expert Daniel Yergin has observed, many developing countries equate energy security with the ability to safeguard their balance of payments against fluctuations in energy prices. Thus, a number of developing countries — enjoying only limited access to domestic energy resources, and acting in the expectation that prices for oil, natural gas, and coal will rise over the long term — have begun to contemplate the adoption of nuclear energy. In Malaysia, for example, interest in nuclear power is largely driven by the likelihood that, unless the country soon discovers new oil and gas resources (which is unlikely because of territorial disputes in the South China Sea), it will become a net importer of energy by the end of this decade. Concerns about supply security have likely influenced Vietnam and Bangladesh's decisions to adopt nuclear energy as well.

The thorny question. It is certain, then, that a number of developing countries will acquire nuclear reactors in the coming years. But will this necessarily increase the risk of nuclear weapons proliferation?

Arguing otherwise would be difficult. Still, the risk may not be severe enough to merit serious concern. It has been argued that even a tenfold increase in nuclear reactors would not have a significant impact on nuclear proliferation, and that the key issue in proliferation risk is not how many countries use nuclear power but how many rogue states are intent on developing nuclear weapons. Indeed nuclear reactors — especially the light water reactors that are now the industry standard — do not, themselves, present high proliferation risks. Rather, the danger comes from enrichment and reprocessing facilities, which generate fuel for reactors but could also produce weapons-grade fissile materials.

This raises a thorny question: whether countries that adopt nuclear energy should maintain their own enrichment and reprocessing facilities — in other words, whether they should develop their own fuel cycles. The Nuclear Non-Proliferation Treaty suggests that they have every right to do so, with Article IV recognizing an "inalienable right" to "nuclear energy for peaceful purposes." This powerful set of words is generally understood to encompass the entire fuel cycle.

Yet the overwhelming majority of countries that maintain nuclear power plants or plan to build them have demonstrated little interest in establishing their own enrichment and reprocessing facilities — not least because of the considerable investment required. These countries also recognize that new enrichment and reprocessing facilities place additional strains on the international community's capacity to monitor nonproliferation compliance. Therefore, they have preferred to purchase the fuel they require from external sources.

Even so, they have generally demonstrated a lukewarm attitude toward proposals for making the fuel cycle multilateral, whether these proposals entail fuel banks, multilateral management of facilities, or assurances of supply. Arrangements like these, some nations fear, would create an irreversible divide between supplier states and buyer states — in effect, an erosion of the rights established under Article IV of the treaty.

Ways forward. Even in the absence of a broad consensus on multilateral approaches to the fuel cycle, a host of measures is available to promote the peaceful use of nuclear energy. As outlined in a memorandum by the Council for Security Cooperation in the Asia Pacific, a network of regional nongovernmental organizations, these measures might include promoting effective export-control regimes to prevent nuclear technologies and materials from falling into the wrong hands. Another important step would be ensuring that the International Atomic Energy Agency has sufficient financial resources to conduct activities in technical cooperation, inspection, and enforcement.

More could also be done to cultivate a culture of safety and security in nations that adopt nuclear energy in the future. For instance, it is not enough for countries to train their law-enforcement officials to prevent, detect, and respond to illicit trafficking of nuclear materials. Officials must also be inculcated with a genuine appreciation of why proliferation needs to be prevented. In some developing countries, the risk of proliferation is regarded as the developed world's peculiar obsession rather than as a real threat to the nation's own security. That sort of attitude needs to be dispelled if the global nonproliferation regime is to remain effective in the long run.

In discussions about nuclear energy, whether in the developing world or in industrial countries, the topics that generally dominate are cost, waste disposal, risk of accident, and weapons proliferation. This Roundtable introduces an additional dimension to the nuclear-power conversation: developing countries' need for economic development and the energy that such development requires.

In Latin America, where I live and work as an energy analyst, nuclear energy is not very widespread. Only a small fraction of the electricity generated in the region is nuclear, and only three countries — Brazil, Argentina, and Mexico — operate nuclear power plants. In Brazil, Latin America's biggest energy consumer, nuclear power provides only about 2.7 percent of the domestic electricity supply. Hydropower, meanwhile, accounts for about 74 percent of domestic electricity production, while biofuels and wind play an increasing role as well.

But energy demands will only grow over time in Latin America and elsewhere in the developing world, and nuclear power's potential to help meet that growing demand should at least be considered in certain cases. Still, determining whether nuclear energy makes sense in the developing world requires carefully examining the relationship between energy and economic development. More specifically, it requires asking how much electricity is really required for economic development.

More than money. A provisional answer to this question might come from distinguishing between two types of developing countries — low-income nations and middle-income nations, as classified by the World Bank on the basis of gross national income per capita. In low-income countries, like Cambodia for example, where a large proportion of the population lives in rural areas, electricity is required chiefly to satisfy basic needs in lighting, health services, education, and so on. In these countries, per capita, about 50 to 100 kilowatt hours are an adequate annual supply of electricity (depending on differences in climate, culture, and so forth). In middle-income developing countries, like Brazil, where certain segments of the population enjoy only limited access to modern electricity services but other segments exhibit consumption patterns very similar to those in industrialized countries, electricity use ranges from 1,000 to 2,000 kilowatt hours per capita per year.

This information is useful, but any approach that categorizes countries according to their income levels alone is perhaps too narrow for this Roundtable. A better tool for current purposes is provided by the United Nations' Human Development Index, which assesses not only countries' incomes but also their life expectancies and education levels. Research constructed around this index has revealed surprising relationships between electricity use and human welfare.

For example, several studies have shown that human welfare tends to improve rapidly as societies advance from low to modest levels of commercial energy consumption, but that welfare does not improve very much as energy consumption increases further. Moreover, as shown in a comprehensive data analysis published in 2009, the amount of energy required for improvements in human welfare has decreased significantly over time. This suggests that improvements in human welfare do not require any fixed quantity of energy.

Don't need it, don't want it. For low-income countries, then, nuclear power hardly seems an appropriate supply choice. In the short term, these countries' energy needs are not large enough to justify the adoption of nuclear power; in the medium term, these nations can achieve significant, necessary improvements in the welfare of their people without massive increases in electricity supply. Simply put, nuclear energy is far too costly and centralized for them. Middle-income countries, however, with their expanding urban populations and growing industrial sectors and infrastructure bases, might indeed be candidates for nuclear power.

But even middle-income countries must consider the fact that nuclear energy is not only capital-intensive but also requires sophisticated technical, industrial, and institutional capabilities if plants are to be operated safely and reliably. Very few developing countries can afford to maintain the infrastructure necessary for all this. To be sure, safety standards for nuclear energy have become stricter in the industrialized world over the years and rich nations have made large investments in safer facilities. For most developing countries, however, adopting new generations of reactors would be prohibitively expensive and might only exacerbate these countries' technological — and economic — dependence on advanced nations (unless they also choose to become involved in the nuclear industry's production chain).

In any event, the planning of an energy system should not be reduced to a discussion of supply sources; energy systems are composed of complex subsystems such as primary energy resources, conversion technologies, and final energy services. Hence, developing countries making choices about their energy futures must consider the full spectrum of energy technologies available to them, from primary sources and related conversion processes all the way through to final services. Developing countries must also assess the complete social and environmental costs of putting into place secure and reliable energy systems, costs that include the public institutions necessary to plan, regulate, and supervise technologies and resources over their entire life cycles.

Intriguing alternatives to nuclear power are emerging around the world as new choices in energy technology increasingly become available. Indeed, opportunities to integrate renewable energy sources into existing and future energy grids are becoming ever more feasible due to advances in material technologies; in storage, transmission, and distribution methods; and in end-use energy systems.

As low- and middle-income developing countries plan their energy futures, they have the opportunity to leapfrog past existing technologies to different kinds of energy systems — more flexible systems that integrate distributed sources and make use of smart meters and smart-grid technologies. Such leapfrogging would see developing countries build zero-energy buildings, gain greater efficiency in everything from electrical appliances to industrial processes, and generally establish urban infrastructures that are less energy-intensive. Such a path would allow developing countries to advance their technological and industrial capacities without introducing the proliferation and public health risks that nuclear power poses.

Decision-making processes in the energy realm must, of course, weigh issues such as cost and waste management. But developing countries must also take into account how much energy is really required to meet their economic and human-welfare goals — and must decide whether to advance to an economy based on lower energy intensity.