Case Studies of International Fuel-Conditioning and Fuel-Leasing ArrangementsBack to table of contents
International fuel-leasing arrangements have proven popular with some states both because they do not require customers to build indigenous fuel cycle capabilities and because the suppliers can benefit economically. Some arrangements allow customers to completely avoid the issue of dealing with used fuel in-country, which is especially attractive to states with small nuclear power programs. The downside of these arrangements is energy security: customers must usually depend on only one supplier.
International Used-Fuel Recycling in France
International back-end fuel cycle services already exist in the form of used-fuel reprocessing. A prime example is the service provided by France to reprocess used fuel from other countries and return it as MOX (mixed uranium-oxide plutonium-oxide) fuel and vitrified waste. France has reprocessed fuel from The Netherlands, Belgium, Switzerland, Japan, and Germany. The structure of the agreements between France, customer states, and the IAEA can be used as an example for multilateral arrangements for interim used-fuel storage. When France enters into an agreement with another state to treat its used fuel, a date by which the waste must be returned to the customer state is agreed upon. The customer owns the material through the entire process. This is not uncommon in the nuclear industry; for example, nuclear power plant utilities in the United States purchase uranium and then send it to various facilities—owned by different companies—for enrichment and fuel fabrication, though the utilities maintain ownership of the material throughout the processes.
The international safeguards agreement between France and the IAEA also outlines the provisions for safeguarding nuclear material that belongs to nonnuclear-weapons states while it resides in France. This material is subject to safeguards measures and inspections and France must declare all material received from and sent to other states. The location of this material while in France must also be declared.37 When designing a safeguards approach for the multilateral interim storage facility, lessons can be learned from how safeguards are applied to foreign-owned nuclear material.
Russian Fuel-Leasing Arrangements
Russia has long provided fuel to states that have reactors based on Russian technology and it is one of the strongest proponents of international fuel banks and fuel-leasing arrangements. Russia already has fuel-leasing arrangements with several states in which it provides fresh fuel, leases it to the state while it is burned in the reactor, and then takes back the fuel for treatment. If the fuel is reprocessed, the waste must be returned to the lessee, according to Russian law. However, current practices are to take back Russian-origin used fuel without waste return. This arrangement especially appeals to newcomer states without a nuclear fuel cycle infrastructure.38
37 International Atomic Energy Agency, “Protocol Additional to the Agreement between France, the European Atomic Energy Community and the International Atomic Energy Agency for the Application of Safeguards in France,” INFCIRC/290/Add.1, February 2005, http://www.iaea.org/sites/default/files/publications/documents/infcircs/1981/infcirc290a1.pdf.
38 World Nuclear Association, “International Nuclear Waste Disposal Concepts.”