The US acknowledged that it is far behind Russia, and even China, in nuclear energy. But America wishes to restore its leadership in this area. This means that the fight between Russia and the US in energy won’t be limited to North Stream. Where is Russia ahead of the US and why the Americans are so scared of the Chinese nuclear industry?
“The US has lost its competitive advantage as the global leader in nuclear energy among the world state companies. Russia and China, as well as other countries, are actively trying to get ahead of us”. This is from the report of the US Department of Energy published last Thursday. Thus, the US officially recognizes its defeat in the field of nuclear energy. The loss of leadership endangers national interests and the security of the country.
DOE suggests a strategy for restoring the American leadership in this area. It includes a number of measures to improve the situation. Russia and China named as the countries that must be watched closely, as Russia has been way ahead of the US for a long time, whereas China has the ability to advance very so quickly that it couldn’t be overtaken.
The US dropped behind Russia in nuclear energy some time ago. Two and a half years ago, two American companies that mine uranium, Energy Fuels and Ur-Energy, warned that the share of the American-produced uranium on the US market dropped from 49% to 5%. They demanded that Trump introduce a quota of 25% for the American-produced uranium and impose tariffs on imported uranium. Trump then refused to introduce these limitations, but created a working group on nuclear fuel. This group was tasked with preparing a report on the US leadership in nuclear energy. The report cited above is the result of this group’s work. The previous report was submitted to Trump in 2019, but he sent it back for improvements.
“The US was not just a world leader – the US created nuclear energy as such. Even today, the US has more reactors in operation than anyone else (96 out of 442 operating in the world). However, after mid-1990s the US stopped building nuclear power plants. From 1996 to 2020, only one generating unit was built, and it was not built from scratch, but previously started construction was completed” – says Alexander Uvarov, director of Atominfo Center, editor-in-chief of Atominfo portal.
The US has lost many of its capabilities a long time ago.
The only thing that the US can still do is to produce nuclear fuel. However, the US have serious problems with uranium mining, and (which is even more important) with uranium enrichment and construction of nuclear power plants.
“Today, the US does not have commercial technologies of uranium enrichment. Old plants are closed, new ones have not been not built” – says Alexander Uvarov.
By official statistics for 2018 (stats for 2019 will be published in May), 52% of uranium enrichment for the US was done by other countries, whereas the remaining 48% were done by an American company. However, this is just a statistical trick, says Uvarov. American company in question is actually a plant of the European company URENCO built in the US. This plant belongs to URENCO USA, so it can be counted in statistics as American. But the Americans have no access to the technology used in this plant. At some point, the Russian Rosatom wanted to build an enrichment plant in the US. If it had, this plant would have also been counted as “American” in stats.
It is important to note that generation of nuclear fuel includes more than just mining (in case of the US – buying) uranium. Uranium mining in the US fell catastrophically – to 5-10%. The next step, uranium enrichment, is a lot more expensive and technologically challenging. The company enriching uranium needs complex technology and equipment. In contrast to the US, Russia has that.
What’s more, the US started using Russian companies to enrich uranium almost immediately after the end of Cold War, mostly because Russian technology was better and cheaper than the American one. Every year saw an increase in the Russian export of enriched uranium. In essence, Russia exports this high-tech service, which is honorable and very profitable. Next, enriched uranium is converted into a state suitable for making tablets out of it that are then incorporated into fuel rods, which we call nuclear fuel.
The American company Westinghouse that produces nuclear fuel and tries to substitute it for Russian fuel in the Ukrainian nuclear power plants, depends on the enrichment services, performed by Russian company Techsnabexport, among others.
“Right now, the US is almost completely dependent on imported uranium, most of which is supplied by subsidiaries of the Russian Rosatom”, – last year report said.
Meanwhile, the US lost not only its own mining and enrichment of uranium, it is way behind in nuclear power plant construction, including those that work on fast neutrons. “These reactors are built by Russia (BN-800 built, Brest-300 and MBIR are at different stages of construction), China (CDFR-600), and India. The US does not build them at all,” – says Uvarov.
The US does not have commercial technologies for the nuclear power plant construction, as it has not been doing this for a long time. The existing US nuclear power plants are reaching the end of their service. This means that they will need to be modernized and rebuilt, which makes the American market attractive for the market leaders – Russia, Europe, as well as ascending China.
Russia is actively building its nuclear power plants in every corner of the planet. Foreign orders for the next 10 years amount to $140 billion, says the head of Rosatom Alexey Likhachev. The key advantage of Rosatom is that is covers everything: construction, credit financing, fuel supply, training of local specialists, repairs, and utilization of spent fuel for the whole lifetime or the reactors (40-60 years).
As far as China is concerned, in the nuclear energy the US clearly acts proactively. For example, Huawei is hardly Apple yet, but Americans are scared of the technological supremacy of China, which, in contrast to Japan, does not intend to toe the line.
“First, this is a general trend of the US fight against China, which covers a lot more than nuclear energy. Second, Chinese nuclear energy is rapidly developing and, in many aspects, China will become a dangerous competitor. The US is already behind China in the capabilities of the nuclear industry and nuclear power plant construction. China has built 48 reactors, 45 of which were built in the last 20 years. And they have no intention of stopping” – says Uvarov.
With regard to Russia, the Americans have been a long time keeping the Russian nuclear energy industry on a tight leash preventing their dominance on the American market. First, Rosatom, in contrast to European URENCO, was not allowed to build an uranium enrichment plan in the US. Second, Russia has been limited in supplying enriched uranium to the US by a quota of 20%. That’s exactly why European URANCO enriches almost half of uranium used in the US, whereas Russia – only 20%. Now DOE demands that this quota is reduced starting from 2021, as the report says.
Interestingly, the US introduced these limitations long before 2014 sanctions, while the US promoted globalization and free markets within WTO. In early 1990s, the Americans conducted so-called anti-dumping investigation and allowed Russia to export to the US only uranium diluted from military grade enrichment. Tariffs were imposed on the rest. When Russian stocks of military grade uranium were exhausted, the US conducted another anti-dumping investigation and limited Russia by a 20% quota until 2020.
Starting in 2021, Russia could have increased the export of enriched uranium, but, likely, it won’t be allowed to do that, like it has not been allowed to do so ever since 1990s.
In its report, DOE proposes to renew the agreement, but reduce Russian quota, says Uvarov.
DOE also pro-actively demands that Russia (and also China) should not be allowed to supply ready nuclear fuel to the US, even though now neither Russia, nor China exports ready-to-use nuclear fuel.
Apparently, DOE is worried that Rosatom will finalize its project of producing fuel for nuclear reactors of Western design. This is the Rosatom’s project “TVS-Square”. “This project was Rosatom’s response to the Westinghouse’s actions in Ukraine. It is not completed on the industrial scale yet. But DOE clearly has that project in mind when demanding a pro-active ban on import of Russian nuclear fuel. They to include China as well for a good measure,” – says Uvarov.