Critical Decisions Looming for Japan's Nuclear Industry
Commodities / Nuclear Power Dec 10, 2010 - 09:01 AM GMT
SITUATION: Japan is advancing with plans to reprocess spent nuclear fuel and boost its external nuclear exports. These decisions will impact the conduct of Japan's global non-proliferation diplomacy.
ANALYSIS: Assessing the degree of salience to Tokyo of non-proliferation goals will be aided by monitoring its policy in two areas: its negotiating strategy in nuclear technology supply talks with other states, and especially India, and its management of its internal nuclear power program. Other aspects of its nuclear diplomacy, including pressure for North Korean disarmament and support for enhanced global nuclear security, are likely to remain robust.
External Trade Ambitions: Tokyo signalled its dedication to capturing a larger share of the international nuclear energy market by establishing a new export company, International Nuclear Energy Development of Japan Ltd (JINED), in October 2010. JINED is owned by the Japanese Ministry of Economy, Trade and Industry (METI). Several Japanese nuclear technology manufacturers (including Hitachi, Mitsubishi Heavy Industries, and Toshiba) and electricity providers (including Chubu, Kansai and Tepco) are affiliates. This company will coordinate Japanese nuclear negotiations and exports, illuminating government intentions to integrate nuclear supply and service packages for the international market.
Japan is presently engaged in nuclear cooperation negotiations with Turkey, Vietnam, and India. Japanese diplomats are scheduled to meet with officials from the Turkish Ministry of Energy and Natural Resources in early December. Ankara is seeking an international partner to assist in construction of a nuclear power plant at its planned Sinop site on the Black Sea coast.
Having been unsuccessful in pressuring South Korea to lower its proposed price for electricity provided from the reactors, Turkey has invited Japan to offer better conditions. The outcome of its negotiations with Japan will highlight the assessment of both Tokyo and Seoul of the importance of Turkey's emerging nuclear energy market, in clarifying their willingness to offer a lower electricity price and reduced profits in order to obtain a foothold in Ankara's nuclear program.
Japanese Prime Minister Naoto Kan and Vietnamese Prime Minister Nguyen Tan Dung agreed on 31 October that Tokyo would assist Hanoi in building a second nuclear reactor in the Ninh Thuan region.
Indian Nuclear Negotiations: Although it agreed as a Nuclear Suppliers Group (NSG) member to exempt India from multilateral nuclear trade restrictions in 2008, Japan is yet to conclude a bilateral civil nuclear cooperation agreement with India.
In previous rounds of negotiations, Japanese diplomats have sought to obtain a clear signal of movements toward a permanent ban on Indian nuclear testing. The adherence of New Delhi to this condition would significantly go beyond previous assurances in this area. In its diplomacy to secure the 2005 US-India agreement and Nuclear Suppliers Group exemption, New Delhi refused any linkage of civil nuclear cooperation terms to its military behavior in the agreement text. Instead, India offered a separate statement of vague support for global efforts to ban nuclear testing and end military fissile material production without firmly committing itself to these goals.
Access to Tokyo's nuclear expertise represents a valuable goal for New Delhi. In addition, major American nuclear firms - prominently, General Electric and Westinghouse - are owned or part-owned by Japanese companies. Further delays in agreeing terms for Japan-India civil nuclear cooperation could therefore also affect American entry into the Indian nuclear market. It remains to be seen if Japanese commitment to global nuclear risk reduction goals outweighs its commercial interests in participating in the lucrative Indian nuclear energy market.
Whether Tokyo insists upon a robust Indian commitment to these goals as part of the treaty text, or moderates this to a familiar Indian statement of support separate to treaty terms, will illuminate this Japanese internal calculus.
India's obvious geopolitical potential in helping Japan balance a rising China, and the effect prolonged negotiations could have on Indo-Japanese relations, will also be taken into account by Tokyo.
Internal Energy Developments: Japan is the only non-nuclear weapons state under the Nuclear Non-proliferation Treaty to operate a 'full' or 'closed' fuel cycle, involving extraction of plutonium and uranium from spent nuclear fuel and reprocessing to manufacture new fuel elements. This process involves handling of significant quantities of fissile materials, which could be used for military purposes. Japan's decision to manage its nuclear energy sector in this way, rather than the cheaper 'once-through' cycle involving using nuclear fuel once and moving spent fuel to a long-term waste storage facility, has long been controversial in permitting Tokyo to handle quantities of plutonium sufficient to produce nuclear weapons.
Japan's Rokkasho enrichment and reprocessing complex, as the principal site of these activities, serves as a symbol for regional proliferation concerns regarding Japan. Seeking as ever to divide the states united against it, a North Korean official mischievously suggested on 12 November that technology and expertise involved in establishing a uranium enrichment site at its Yongbyon facility was obtained from leaked details regarding installations at Rokkasho.
This remark, widely believed to be untrue, intends to redirect the spotlight of regional proliferation concerns toward Tokyo in its pursuance of nuclear activities beyond the 'once-through' cycle. Japan also established its first mixed-oxide fuel assembly plant at Rokkasho earlier this year, granting it another means of handling plutonium for internal nuclear fuel supply purposes.
Tokyo emphasizes a concern for energy security as its principal justification for its development of the 'closed' fuel cycle, in reducing dependence upon external suppliers by maximising its recycling of nuclear fuel. With Australia and Canada among its principal suppliers (states not known for their political risk or unreliable service to longstanding economic partners) this justification does not explain the whole story.
A stronger reason is the political difficulty of locating an internal long-term nuclear waste storage site. As few domestic prefectures wish to host such a facility, this problem is partly circumvented by recycling spent fuel. A METI study in 2004 estimated that Japan's adherence to a simpler once-through fuel cycle would have accrued one-third of the cost of operating its present closed fuel cycle network.
The Japanese Diet resolved in 2000 to identify a long-term waste storage site by 2030. Tokyo's firm commitment to identify and build a long-term storage facility will limit cost escalations in operating a closed fuel cycle network, while reassuring concerned allies that it has a plan for the ultimate disposal of its substantial plutonium stockpile. Any backsliding in this work will exacerbate regional nuclear tensions and add unnecessary expense to Japan's nuclear program.
BOTTOM LINE: Tokyo is dedicated to obtaining a stronger position in global nuclear trade, as symbolized by the formation of JINED. Japan's determination of the importance of visible Indian support for a permanent nuclear test ban as a condition of a civil nuclear cooperation agreement, and of its degree of support for a long-term nuclear waste storage site against local political opposition, will characterize its nuclear outlook in the early 21st century.
As Japan serves as a leading example of nuclear energy expertise, its policies in these areas could soon be replicated by states presently initiating a nuclear energy program. As illustrated by the pointed remark of a North Korean official in likening Yongbyon to Rokkasho, Japan's external nonproliferation goals are likely to be affected by its internal nuclear practices.
Source: http://oilprice.com/Alternative-Energy/...
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