Many countries in the world made a rather large strategic mistake by depending on Russia for various forms of energy. One of those was natural gas, as Europe is finding out to its detriment. It is weaning itself off of Russian gas at an extraordinary rate and will be just fine, eventually.
In my recently published assessment of Europe’s crisis, I focus on the need for strategic energy interdependence with good global citizens. In that context, I was talking about fossil fuels from bad actors being problematic, especially as so many fossil fuel exporting countries are bad actors and will be increasingly challenged by peak oil demand, and HVDC interconnections with good actors sharing renewables as the primary solution.
However, it’s not just Russian gas or Iranian oil that energy strategists should be concerned about. The other form of energy that many countries rely on is Russian-refined uranium from Rosatom, some in Russian-built nuclear reactors in other countries, and some in non-Russian designs. The way that nuclear fuel supply chains work ends up meaning that all 30 countries with nuclear generation are exposed to greater or lesser extents to Russian supplies.
“One of the reasons for that is certainly the heavy reliance on uranium and nuclear fuel as most of the 32 countries that use nuclear power rely on Russia for some part of their nuclear fuel supply chain,” Ananyeva told RFE/RL.
Nuclear fueling isn’t an every minute of operation thing like coal or natural gas, it’s an every 18–24 month thing. Nuclear fuel bundles are expensive and resupply timeframes are very long, not atypical for the nuclear industry as a whole. It’s not a fast moving industry.
And a bunch of reactors, especially specific Russian models, use only Russian fuel bundles at present, although other major players are working to develop products that are compatible to reduce this fragile supply chain dependency.
The Redefining Energy podcast — strongly recommended — recently had the head of one of the major players in nuclear power plant fuel supplies on to talk about this.
“… there is no better guest than Boris Schucht, CEO of Urenco, to have an open debate on the pod. The Urenco Group is a British-German-Dutch nuclear fuel consortium operating several uranium enrichment-plants in Germany, the Netherlands, United States, and United Kingdom. It supplies nuclear power stations in about 15 countries, and has a 29% share of the global market for enrichment services in 2011.”
It’s well worth listening to the episode.
The point is that 30 relatively affluent countries depend on Russian nuclear fuel and there’s little alternative right now. Germany and the UK can send senior leaders around the world, cap in hand, begging for LNG, but there are very few nuclear fuel suppliers, and in some cases no alternative at all to Russia.
That means that there was and remains intensive pressure and lobbying to keep Rosatom, the Russian nuclear reactor construction, operation and fueling organization, out of all sanctions. And it’s worked. That means that Rosatom is free to do business with anyone who is willing to do business with it.
In the case of some legacy contracts, it would be deeply disruptive to change firms in mid-construction, so Turkey is continuing, albeit with some changes in how things are organized it seems. Business conditions have changed, and Rosatom is in a weaker bargaining position now, as Russia is clearly a rogue state, some alternatives exist and the like.
The alternatives are interesting however. Outside of China’s fairly successful rollout — although not nearly as successful as its wind and solar rollouts — the recent history of new nuclear designs has been pretty dire.
The AP1000 was supposed to save the nuclear industry with a simpler, standardized design. The Summer and Vogtle debacles, with billions and years of overruns, made that pretty clearly not a solution.
France’s EDF went big on its European pressurized reactor (EPR) design, and buyers including France in Flamanville, Finland, and Europe with the Hinkley site, have seen billions and years of overruns as well.
SMRs are currently a glimmer in the industry’s eyes more than a thing.
Russia’s reactors have an ‘advantage’ over the new designs which have not lived up to expectations. Their designs are decades old, and they’ve been built a bunch of times. They don’t pretend to be anything new, they assert that they are bog standard, proven, nuclear steam kettles. And with Russia’s economy tanking in recent years, and even more so with the invasion of Ukraine, they can be picked up even cheaper, if that can be considered remotely a good thing.
The next thing to realize is that nuclear power plant acquisitions and contracting takes years. Long before a shovel hits the ground, there are interminable previous steps. The contracts signed this year are the result of potentially a decade or more of pre-work. When we talk about how long nuclear power plant construction takes, we typically ignore the years or decades that pre-date the start of construction. That’s true for other technologies as well. Pumped hydro has a long lead time. Major wind farms have a couple of years or more lead time before construction. Nuclear’s time frames are an outlier due to, among other things, the IAEA’s 28 or so major requirements for supply chain and site safety, national security, sub-national security, and municipal security requirements, but they are on a continuum.
But then the next question arises. Who are they signing contracts with? In some cases, the answer is illustrative. For example, Hungary under Orban is an ally in nationalist, populist, right-wing authoritarianism and rejection of liberal democracy. Even during the current invasion, Hungary has mostly remained a full-throated ally of the the Russian rogue state. And so, it’s unsurprising that it is going ahead with its nuclear plans with Rosatom.
Finland, by comparison, is not an ally of Russia’s or a supporter of the invasion, both of which are fraught for it as it shares a border with Russia and was for a while an autonomous part of an earlier Russian empire, becoming fully independent only in 1917. It’s applying for membership in NATO to protect itself from the obviously expansionary Russian Federation. It’s no surprise that it is taking an alternative approach to Hungary and terminating its contract.
And then there’s a weird outlier, once again likely a decade in the making, South Korea’s deal to build a Russian nuclear facility in Egypt supported by a Rosatom subsidiary. South Korea is a nuclear generation country (with the ability and technology to build a bomb very rapidly as a result, a strategic reason for nuclear generation given the nuclear-armed rogue state to the north they share the peninsula with). It’s flip-flopped on its own nuclear generation fleet, as it had a scandal- and fraud-riddled build-out that left politicians and senior executives jailed and fined, leaving it with a bunch of reactors built with sub-standard parts surrounded by tens of millions of Korean citizens. Post-Fukushima, that looked horrific and the replacement government decided to axe its nuclear fleet over time, but time and administrations change, and the current government is pro-nuclear again.
Egypt doesn’t have any nuclear reactors. The nuclear industry is pivoting to consider Russia a bad choice and hence alternative products and services for fuel and operations are being developed and signed for. South Korea has a scandal-ridden nuclear past. Russia is a rogue state. I personally think this is going to end very badly for South Korea and Egypt. I don’t really care if it ends in tears for Russia or Rosatom.
Then there’s Iran, which rumor has it is seeking assistance from an increasingly interested Russia with its nuclear generation and weapons programs. Iran is, of course, another deeply illiberal state, a theocratic terrorist-financing misogyny zone, long under deep sanctions and inspections to keep it from developing nuclear weapons. A deal there wouldn’t surprise me as Rosatom’s contracts for new plants, fuel, and operations are drying up.
And then, of course, there’s the little problem for the much-hoped-for class of small modular nuclear reactors, which is that most of the designs are working around high-assay, low-enriched uranium (HALEU) fuel, and the only viable commercial supplier of that fuel is Russia. As if SMRs weren’t facing enough headwinds as they’ve foregone thermodynamic advantages of size, likely won’t be able to build enough to get manufacturing economies of numbers, won’t be cheaper as a result, will still cost a lot to decommission, and due to security and economics won’t be able to be used for a large number of the projected remote and small use cases, now they have to get someone to develop a new strategic supply of fuel, or double down on Russian fuel, likely an idea that won’t fly with potential customers.
So Russia’s ability to keep signing nuclear contracts in the midst of massive sanctions over its illegal invasion of Ukraine is a complicated story. I certainly wouldn’t be signing contracts for energy with Russia right now. Of course, I wouldn’t be in the middle of a nuclear deal (or a natural gas deal). I’m focused on renewables, transmission, and storage, the technologies which will actually be dominant in addressing climate change and decarbonization our future energy requirements.
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