The Future of Nuclear Power in Latin America
Research From the Field
August 2009 I Link to the article
Latin America relies on hydropower and fossil fuels as its main sources of electrical energy. Nuclear power in terms of total electrical generation is exiguous at about 2% and is concentrated in only three countries: Argentina, Brazil and Mexico. Nontheless, plans to expand nuclear capabilities in these countries have been announced, and other regional governments are considering the alternative of nuclear energy to meet their growing electricity needs. The present global scenario also opens an opportunity for the region to carry out a progressive and ordered diversification of its current electrical power sources. Realistic goals must be set to control the inherent nuclear risks- safety, security and proliferation- which rushed expansion could exacerbate.
AFTER YEARS OF STAGNATION, the nuclear alternative to produce electricity is back on the agenda for many nations worldwide. The phenomenon of nuclear power plants being projected and built on a planetary basis has been equated to a “renaissance” of the nuclear industry. Though, it is still early to assess if such a revival will turn into explosive growth or simply a moderate expansion. The global financial crisis has operated as a natural moderator of initial enthusiasm, by introducing significant restrictions to credit. In fact, only projects based on a solid rationale will be able to get support from capital markets. Consequently, short and mid-term slowdown is expected, but a long-term upward trend will likely persist.
Latin America relies on hydropower and fossil fuels as its main sources of electrical generation. The nuclear power share in terms of total electrical generation is exiguous, about 2%, and concentrated in only three countries: Argentina, Brazil, and Mexico. Nonetheless, plans to expand nuclear capabilities in these countries have been announced, and other regional governments are considering the alternative of nuclear energy to meet their growing electricity needs. This moderate interest might significantly increase in the future with the commercial availability of a new generation of scalable small and medium power reactors, like the Argentine CAREM, which would better suit the region’s needs. Until then, the present global scenario opens an opportunity for the region to carry out a progressive and ordered diversification of its current electrical power sources, following its own pace, meeting realistic goals, and keeping under control the diversity of inherent nuclear risks - safety, security, and proliferation- which a rushed expansion could exacerbate.
NUCLEAR POWER CAME TO STAY
The nuclear industry has experienced ups and down when it comes to power generation. The Chernobyl incident in 1986 precipitated a dramatic downward spiral which took the net growth of new reactors from 12 to 2 per year. In the last few years, however, the pace began to speed up as countries began to return to nuclear energy, either by expanding capacity or building their first power plant.
Drivers of the renewed nuclear interest and their importance have been a matter of debate among experts. It is clear, however, that the influence of growing demand for electricity at a global scale (which according to IAEA is expected to double by 2030) as well as the perception that nuclear power plays a major role in retarding global warming have affected change. Other decisive factors have been high prices of fossil fuels (and their current volatility); nuclear fuel’s smaller impact on electricity’s final price, and a reduced vulnerability to shortages provided by a worldwide uranium abundance. In addition, social acceptance of nuclear energy is improving after decades of public rejection.
Today, 439 power plants operate in 31 countries, 6 of them in Latin America: Laguna Verde I and II in Mexico, Angra I and II in Brazil and Atucha I and Embalse in Argentina. See Table 1.
These six plants, with 4GWe in total, stand for about 1.4% of the world nuclear net installed capacity. On a country basis, it represents the 6.2 % of the total electrical generation in Argentina, about 4.6% in Mexico, and 2.8% in Brazil.
The figure shows Latin American development compared to some key players of the global nuclear power arena, expressed as incidence of this source on the total electrical output. The number of reactors in operation gives an idea of the scale of the nuclear industry in each country.
Information from the World Nuclear Association, points out that today there are 44 plants under construction in 13 countries, but just 2 of them are located in Latin America: Atucha II in Argentina, whose completion is expected for 2010 and the recently reactivated Angra III in Brazil, which could be in operation by 2014.
At present, about 28 states have been evaluating the nuclear power alternative (although some of them in a preliminary stage of planning, or just as a proposal). This number may vary depending on the source, but it is a fact that at least three Latin American countries, Chile, Venezuela and Uruguay, have recently showed interest in seeking to diversify into nuclear power.
The attention on nuclear energy by governments within the region could be linked to a search for stability of power sources, by breaking the reliance on fossil fuels and hydropower, commonly affected by natural, political, or economical phenomena such as shortages, supply interruptions, high prices, and droughts.
Chile, a country under an inherent seismic threat, carried out technical studies during 2007 and 2008 in order to evaluate future nuclear power options. The Zanelli Commission, in charge of the study, highlighted the strategic importance of any decision on the matter and recommended not to discard the nuclear option, as well as the need to review the country’s legal and institutional framework for correct decision making. The experts also stated the availability of adequate anti-seismic technologies, to minimize potential safety risks on a nuclear power facility.
In Venezuela, Chávez administration has sought, so far to no avail, to get nuclear technology from several countries such as Argentina, Brazil, Iran, France, and Russia in order to build a nuclear power plant which could balance severe power outages. For example, a broad civil nuclear framework agreement including “research reactors and nuclear power plants” was signed during the visit of Russian President Medvedev to Venezuela in November 2008.
Years before, there were some signs of interest by officials from the Venezuelan state owned oil company PDVSA about acquiring Argentine reactors CAREM to produce high temperature vapor, which could be injected into wells to liquefy heavy oil.
France could be interested in supplying nuclear technology to Venezuela as well, but no action has been taken so far leaving a potential future agreement as only speculation. Uruguay has also considered a re-analysis of its energetic matrix toward bigger diversification and autonomy, and many voices are requesting a change in the country’s legal framework, which currently forbids the use of nuclear energy. Today the country is strongly dependent on hydropower, oil imports, as well as gas and electricity supplied by Argentina.
A very special case is the Cuban one. Over the last several decades the nation has lived with a drastic energy crisis, as it mainly depends upon imported oil. In 1976 it signed an agreement with the Soviet Union to build two reactors of 440 MW in Juragua, Cienfuegos province. Construction began in 1983 but was stopped in 1992 due to financial reasons. After that, all attempts of restarting the project, even with different external partners, including assistance from the IAEA, led to failure. Moreover, the US is opposed to Cuba’s nuclear program for environmental and security reasons. There could, however, be a reactivation of its program in the future, or at least part of it, should Cuba’s energy needs persist and should Cuba become more globally integrated.
The growth in the number of reactors in the world will necessarily lead to a growth in nuclear fuel production. For example, the world uranium enrichment installed capacity is expected to rise from the current 55 million SWU/yr (separation work units per year) to about 73 million SWU/yr by 2015. Latin America’s contribution in terms of capacity is owed to a small Brazilian industrial plant located in Resende, near Rio de Janeiro, and an even smaller pilot plant in Pilcaniyeu, near Bariloche, Argentina. Together they create 140,000 SWU/yr, or about 0.3% of the total. In the Brazilian case, such capacity will be enough to progressively enrich the uranium required by the current power reactors, and to supply fuel for the future nuclear submarine being purchased from France. In fact, Brazilians hope to become self-sufficient in nuclear fuel (an important milestone in Brazil's national plans) by 2012. It is clear that domestic production, because of the plant’s small scale, is not able to be competitive in costs, versus international markets, but the plant provides Brazil the strategic possibility of dominating the entire nuclear fuel cycle.
In February 2008, Argentina and Brazil signed a nuclear cooperation agreement which included a model nuclear power reactor to meet the countries’ and eventually the region’s electrical systems needs, and that also included a bi-national uranium enrichment company. Nevertheless, doubts about feasibility of the joint project, given its intrinsic complexity and modest progress, persist after more than a year after its launch date.
LONG TERM PLANS
Looking toward the future, information from the World Nuclear Association states that there are significant long term plans for capacity increase in countries such as China, with 103 reactors being planned and proposed, and another 25 by India, 36 by Russia, 31 by the US, 22 by the Ukraine, and 14 by Japan.
Brazil’s 2030 Energy Plan projects four new nuclear power stations of about 1,000 MW each. Brazil currently depends on hydroelectric power for 91% of generation. There have been statements by government officials suggesting that Brazil would be able to install more than 60,000 MW of nuclear energy within the next 50 years, which implies building one power plant per year, but this pace is not considered feasible given the country’s current capabilities.
Argentina still needs to develop reliable, long-term and integrated energy plans to be able to define the role of nuclear power, the number of reactors, as well as technology and fuel requirements. In August 2006, the government announced a US$3.5 billion strategic plan to complete Atucha II and to extend the life of Atucha I and Embalse.
During 2007, an agreement with AECL opened the possibility of advancing with the project to build one or two 740 MWe CANDU-6 reactors with a design based on the twin reactors of Quinshan, China.
Mexico is highly dependent on hydrocarbons, and is an exporter of crude oil. Approximately 90% of all the energy used in Mexico comes from oil and gas and only approximately 5% comes from hydro sources. The Mexican government is open to adding several more reactors, with a horizon of 15 years, to diversify its energy matrix, but there is no formal plan or actions yet.
Even considering such hypotheses, Latin America’s share of world nuclear power would reach about 5.6% of the total electricity generation in the most optimistic scenario, still considerably below the projected world average of 14.4%. See Table 2.
KEY REGIONAL CHALLENGES
Nuclear energy has always created great challenges: technology, costs, safety, security and proliferation. Therefore, a higher level of activity, more actors (the potential new-comer states), and more sensitive technology (and materials) around the region would surely add complexity and increase nuclear risks.
A conceptual framework is required in order to understand the magnitude of the challenges that Latin America will face regarding nuclear power expansion.
A primary issue to take into account is the dual nature of sensitive nuclear technologies involved, especially uranium enrichment, which is a principle ingredient in the production of fuel for reactors and/or nuclear weapons grade material.
In addition, Latin American countries, as every State Party of the 1970 Nuclear Non Proliferation Treaty (NPT) have got the inalienable right to peaceful uses, within the current nuclear disarmament and nonproliferation agreement. The international agreement requires for non nuclear weapons states to put all their nuclear plants under the International Atomic Energy Agency´s -IAEA’s- control and verification rules, known as “full scope safeguards”, aimed at ensuring that no nuclear material be diverted to undeclared uses. An improvement to the system came with the IAEA’s Model Additional Protocol which allows much more intrusive verifications, but this document hasn’t been signed by Brazil or Argentina, an issue that has been deeply worrying the international community.
Furthermore, as stated by 1967 Tlatelolco Treaty, Latin American and Caribbean nations have committed as a whole to keep the region as a nuclear weapon free zone, a concept confirmed by several other documents at a sub-regional and bilateral level such as the Quadripartite Agreement of 1994, which gave legitimacy to the ABACC, the Brazilian- Argentine Agency of Nuclear Materials Accounting and Control, in charge of both countries’ “neighbor-to neighbor control”.
Another issue has to do with the declared intention of terrorists to acquire and employ nuclear weapons, which poses even more concern over control of nuclear technologies and sensitive materials.
Within the described framework, the three challenges of utmost priority for the region, if nuclear expansion takes place, would be:
1/ To reach a rational nuclear power development throughout the region. This requires a deep, long-term analysis of all alternatives for power generation, their feasibility and convenience, on a country-by-country, but also on a regional basis. Decisions should be made taking into account the sustainability and optimization of natural resources based on true energy needs, rather than on a search for prestige or interest in following trends.
2/ To achieve an adequate integration of new-coming states, to keep the highest standards on nuclear safety and security. This implies shared responsibilities between new-comers and suppliers. The first undertaking should be necessarily seen as a long term process [maybe even decades], when the regulatory framework, the infrastructure and the build-up of human capabilities should be progressively developed. This is a key to the nuclear success, given that human capital and nuclear culture cannot be measured in years, but in decades. In addition, suppliers should support potential new-comers, before, during, and after the decisions are made. “Full service” alternatives including facility, fuel, spent fuel, and waste management should prevail.
3/ To ensure that nuclear power growth in the region is done within a strict, nonproliferation framework. This implies to keep working an effective scheme of verification and control to avoid that sensitive materials or technologies could wind up in the wrong hands. It would be useful to analyze an increasing role of regional control under the IAEA’s supervision, given the successful ABACC’s concept and practices, together with a full adherence to the Additional Protocol.
It is early to state with certainty that there will be a significant nuclear expansion in Latin America in the next several years. Nonetheless, decisions regarding regional nuclear development will require a high degree of responsibility by governments, as they imply long-term commitments and high risks. Nuclear power choices should be based on rational, needs-based assessments and on an adequate appraisal of benefits versus risks. The nuclear option is beneficial for communities, only if challenges relating to safety, security, and nonproliferation are managed wisely. Smart decisions regarding nuclear energy won’t happen through isolation, but rather through international cooperation based on recognized common strategic goals.
The present article was published in the Newsletter Insides from the Field, edited by Janie Hulse. For more information click here.