Friday 22 August 2014

Iran's Bushehr plant

Nuclear-powered Middle East draws closer

London, March 5, 2013

By John Kemp


The Middle East generates a smaller share of electricity from nuclear than any other region of the world. But before the end of the decade the UAE is set to join Iran, which has linked a nuclear power plant to its grid.
Other countries considering construction of reactors include Turkey, Jordan and Saudi Arabia.
The attraction of building nuclear power plants to provide cheap baseload power, preserving oil and gas for exports, is obvious.
In 2011, countries in the Middle East and South Asia generated just 1.8 percent of their electricity from nuclear, compared with 87.3 percent from oil, gas and coal, according to the International Atomic Energy Agency (IAEA).
The Middle East's reliance on thermal generation is not surprising, given that it contains some of the largest oil and gas deposits in the world.
Some foreign policy analysts have wondered why a country like Iran (or for that matter Saudi Arabia) would want to develop nuclear when it has abundant gas and oil supplies. Some assume that civilian nuclear power programmes are just a cover for military ambitions.
But many countries in the region, including Turkey and Pakistan, have few petroleum or coal resources of their own. And major oil and gas producers like Saudi Arabia, the UAE and Iran need to reserve as much as possible for export. For the big producers, oil and gas are more valuable if they can be exported rather than burned in domestic power plants to produce electricity.
Financial pressure on both producers and importers is set to become intense as population growth and rising incomes boost electricity demand substantially.
Saudi Arabia, for example, has more than 30 Gigawatts (GW) of generation, split between gas and oil, but demand is growing 8 percent per year, and is expected to hit 60 GW by 2020.
The UAE, which relies almost entirely on gas for generation, some of it imported, forecasts electricity demand will grow by 9 percent a year, and require 40 GW of capacity by the end of the decade, according to the World Nuclear Association (WNA), a trade group.
At the moment, the only Middle East country with a civilian plant is Iran, which commissioned its reactor at Bushehr in 2011, becoming the first new member of the civilian nuclear power club in 15 years, according to the IAEA.
Several other countries are constructing or planning new nuclear plants. The UAE is the most advanced. It has awarded a $20 billion contract to a consortium led by Korea Electric Power Corporation (Kepco) to build 4 reactors capable of generating 1.4 GW each by 2020.
Building work on the first started in July 2012. It is set to begin generating in 2017, with one additional reactor coming onstream in each of the following three years.
Turkey, which generates half its power from imported Russian and Iranian gas, is considering an application to build and operate up to four 1.2 GW reactors at Akkuyu, near the port of Mersin on the Mediterranean coast.
The first contracts for site work were completed in February 2013 and the reactors are expected to start up between 2019 and 2023.
Jordan is also carrying out pre-construction studies for a 1 GW reactor to help meet an expected doubling in demand by 2030.
Saudi Arabia has the most ambitious plans of all.
The kingdom wants to build up to 16 reactors over the next two decades. "The development of atomic energy is essential to meet the kingdom's growing requirements for energy to generate electricity, produce desalinated water and reduce reliance on depleting hydrocarbon resources," according to a decree issued in 2010.
Not all of these projects will proceed. Israel and Oman have both abandoned planned power projects in recent years. Others in Libya, Syria and Egypt have been overtaken by uprisings and political instability.
Saudi Arabia has the money to develop a string of nuclear plants ($80 billion for 16 reactors) but has made no progress. Jordan has the inclination but may not have either the money or a suitable site with adequate water supply.
However, the UAE's four reactors, and at least some in Turkey, seem likely to be built before the end of the decade, with some more to come in the 2020s, possibly in Saudi Arabia.
The spread of nuclear power in the world's most politically unstable region is bound to cause alarm. Iran's nuclear programme has long been seen by many of its regional rivals, as well as the United States, Israel and European countries, as a cover for developing atomic weapons.
In reality, building a bomb and building a civilian nuclear reactor have little in common. The one element they share is the enrichment. Reactor fuel is enriched to just 5 percent while bomb-grade uranium is enriched to 95 percent, but the process is essentially the same.
The concern of the United States and its allies has shifted from Iran's power plant at Bushehr to its enrichment activities at Natanz, Fordow and elsewhere. The Iranian government insists these are producing reactor fuel (enriched to 5 percent) and medical isotopes (enriched to 20 percent) but the United States and Israel fear it is producing a stock of uranium that could be further enriched to bomb-grade quickly and secretly.
Proliferation experts have therefore sought to separate power generation from the fuel cycle. The IAEA has approved the creation of a "bank" for low-enriched uranium (LEU) to be funded with $150 million contributed by members and hosted in Kazakhstan. It has also negotiated the creation of a 120-tonne LEU reserve located at the International Uranium Enrichment Centre at Angarsk in the Russian Federation.
In 2011, the IAEA approved a proposal from the United Kingdom, co-sponsored by the EU, Russia and the United States, to create a "model nuclear fuel assurance agreement" by which a state supplying LEU or enrichment services to another would agree not to interrupt supplies to recipients that comply with international obligations and published export licensing standards.
The idea is that countries like Iran, the UAE and Turkey should produce their own power, but not enrich uranium or reprocess their own spent fuel. Instead, the fuel cycle would be hosted in an existing and trusted nuclear country, like Russia or the United Kingdom. In return, the model agreement tries to give generators some assurance their fuel supply would not be interrupted for any reason provided they comply with their international obligations.
The UAE has already agreed to forego domestic enrichment and reprocessing and "to conclude long-term arrangements ... for the secure supply of nuclear fuel, as well as the safe transportation and if available disposal of spent fuel via fuel leasing or other emerging fuel supply arrangements," according to WNA. Fuel supply contracts have been signed with companies from Canada, the United Kingdom, France and Russia.
The Western powers initially seem to have hoped to force Iran to accept similar arrangements, abandoning its domestic enrichment activities and relying instead on fuel that would be supplied and reprocessed from overseas.
It now seems unlikely Iran will agree to forego domestic enrichment entirely. Western objectives seem to have shifted towards allowing some enrichment within the country, but trying to steer the government away from enriching to 20 percent and restricting it to 5 percent.
Despite the obvious political and military problems, the economic case for more nuclear generation in the Middle East is compelling. The region's gas and especially crude oil are too valuable to disappear up in power-station smoke (literally). Nuclear along with solar is a sensible alternative for domestic electricity production.
But if the expansion of civilian nuclear power is not to give rise to fears about weapons proliferation, more countries may need to follow the UAE and agree to separate power generation from the fuel cycle. - Reuters 
(John Kemp is a Reuters market analyst. The views expressed are his own)

Tags: Iran | Nuclear | power plant |

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