Game Changers for Nuclear Energy

Strategies for Game Changers

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Kate Marvel and Michael M. May
Global Nuclear Future

No one can think of or plan for every game changer. Even if it were possible to list all separate events and developments that could affect nuclear power in the future, the combination of them would lead to unforeseeable situations. Nevertheless, the survey of the previous sections will, we hope, narrow the range of “unknown unknowns.” It casts light on the causes and limitations of current planning as well.

Given this necessarily partial survey, the question remains: what can be done about game changers? Four main factors complicate the ability to answer this question:

  1. There is considerable uncertainty and, in many cases, ignorance about both the probability and the consequences that can be assigned to the individual game changers considered. Game changers are not necessarily “black swans,” or events that are assigned low probability based on a known distribution. Often, their likelihood is unknown because the probability distribution is so uncertain. It is not possible, after all, to construct a mathematical measure of terrorist motivations, or to quantify the probability of a future event that focuses popular attention on nuclear power. The normal approach of assessing risk and then determining how much to spend hedging against that risk is in many (perhaps most) cases not available or necessarily applicable.
  2. There is also considerable uncertainty about the timescale on which the game changers could occur. Some potential game changers stem from ongoing events (climate change, increased export capabilities from China and other Asian countries). The unknown game changers in those cases are the reactions to those events: their form, timescale, and magnitude. Other potential game changers may or may not occur in the distant future; viable commercial fusion is one such example. Still others could occur at any time, such as the success of small modular reactors or a terrorist strike.
  3. The greatest complication for analysis comes from the question of whose strategy will capture the most interest and command the most influence. If we define strategy as a combination of plans and decisions that can lead or is leading to a series of concerted actions, a number of the major actors in the nuclear energy field—governments and private firms—seem to have strategies. In the following subsection, we will characterize some of those strategies.
  4. If a study of game changers is to produce actionable policy recommendations, it is important to define the desired outcome. The strategies of individual actors are designed to achieve differing, and sometimes conflicting, goals. Some game changers—an accident or attack, for example—will have universal negative consequences, but many will benefit some actors at the expense of others. Therefore, it is necessary to identify issues of common interest and promote those strategies that best deal with the game changers in those areas.

Having looked at nuclear energy around the world and at the global and local factors that could change prospects for nuclear energy as a whole, one may ask whether an analysis such as this one leads to a global strategy. If so, is there an actor that can carry it out? We will consider those two questions at the end of this section.

Strategies of Individual Actors

Our survey of national programs shows some definite strategies for development of the nuclear energy industry in various countries. China, South Korea, France, Russia, and to some degree, Japan have committed to major buildup and export programs to help support and make large domestic programs more profitable. The United States remains very much in the export business, but the lack of both a U.S.-only reactor builder and a generally agreed-upon national policy for nuclear power has prevented a clear strategy from emerging. India is committed to a large increase in nuclear power as well as other forms of power. Other states have announced that they are either continuing or reconsidering their policies.

How do these state strategies deal with the possible game changers out-lined in this paper? In the following section, we argue that certain game changers would be either desirable or very undesirable for all actors in the nuclear game and examine how the strategies of states can prevent or bring about these events.

Preventing Attacks and Accidents. Ensuring reactor safety and keeping nuclear material out of the hands of terrorists are universal goals; accidents or attacks can have only negative consequences by any metric. National strategies for dealing with possible game-changing events stemming from terrorism, accidents, and diversion from nuclear reactors are agreed in principle if not always carried out in practice. To varying degrees, most countries cooperate in international attempts to prevent nuclear terrorism and nuclear trafficking. There is also international cooperation on improving safety through better reactor design and operational procedures and operator training. These are avowed goals of all national strategies. Implementation is checkered, and it is difficult to assess the extent to which those goals are translated into effective practice in some countries. Similarly, agreement on better safeguards through putting the IAEA Additional Protocol into force is a work in progress, despite the fact that this is an avowed goal in most national strategies.

Controlling the Spread of Sensitive Nuclear Material. There is no agreement yet on limiting the spread of sensitive facilities to discourage nuclear weapons proliferation. With the exception of a few suspected proliferators, most actors in the nuclear power arena have an interest in limiting the spread of sensitive nuclear material. However, the difficulty inherent in balancing the right to nuclear power technology within the parameters of the nonproliferation regime has led to wide disagreements on how best to control fissile material. It can be argued that because such proliferation has not proven to be a game changer for nuclear power, agreement on such limits has no place in a strategy to deal with game changers in nuclear power. But that argument is seldom explicitly made, and is perhaps shortsighted. The spread of enrichment or reprocessing nuclear facilities could lead to more latent nuclear-armed states: states that could fairly quickly acquire nuclear weapons, perhaps on a timescale as short as months. That development, coupled with the entry of new exporters into the market, could make for a very different marketplace. Optimistically, it could lead to new and more broadly accepted agreements on safeguarding nuclear power; pessimistically, it could lead to fragmentation of the market along political lines or, worse, to a marketplace in which effective steps are no longer taken to limit the dangers of nuclear weapons.

Safer, More Secure Reactors. Among states using nuclear power, there is general agreement about the desirability of safe and secure nuclear facilities. The implementing tools (for example, the World Association of Nuclear Operators standards setting, the adoption of standards concerning safe design and siting by the U.S. Nuclear Regulatory Commission and other such regulators, and, to different degrees, the various IAEA national agreements) can be viewed as adding up to a strategy, albeit an evolving one necessarily subject to national variations.

Beyond these steps, technological developments that render nuclear facilities safer and more proliferation-resistant or that reduce waste are in everyone’s interest. Strategies to deal with technological game changers consist mainly of R&D by private entities with government support, at paces ranging from accelerated to somnolent. The disparity in national R&D strategies could in time lead to major new actors in the nuclear market, with China and India particularly active. Historically, new technologies have taken decades to penetrate the electricity generation and transmission markets. R&D investments are made largely by the state in China, India, and Russia, while in France R&D is shared between the public and private sectors. In the United States and some other Western countries, investing in such developments as small modular reactors, laser enrichment, and other innovations is mainly the province of industries and utilities.

In addition, two major changes in the nuclear fuel cycle are currently being studied by governments: the thorium-based fuel cycle in India and the final disposal site for spent fuel or parts of it in the United States and elsewhere. If it can be economically implemented, the thorium-based fuel cycle could make India’s nuclear program independent of external uranium suppliers and could also broaden the appeal of its exports. The U.S. program to find a new disposal site stems from a domestic political standoff and reflects the lack of a generally understood and supported strategy for nuclear power in the United States.

Preventing or Mitigating Climate Change. The reaction of state governments to climate change is variable and generally quite slow. Most industrialized states are reconsidering their domestic energy mix in light of climate change, with differing results. Investments in efficiency and conservation vary from country to country. Thus, there is no global agreement or strategy on emissions, although there may be international agreement on limiting the use of some of the more deleterious climate change agents, such as HFCs, where commercial opposition is less strong.42 There has been a general move toward greater use of renewables, but their higher cost at a time of recession and perceived high government indebtedness is limiting these moves in some countries. At most, ongoing and planned actions will decrease the rate of growth of greenhouse gases in the atmosphere, but they will not limit the anticipated warming to some predictable value, let alone reverse it. It is difficult to see how this pace of change, if continued, can amount to a game changer for nuclear power—at least not until the consequences of climate change become sufficiently obvious and damaging to support a global consensus on a remedial strategy.

Besides governments, industries and utilities also have strategies, which may generally be classified as “minimax strategies”: that is, strategies whose dominant objective is to avoid worst possible outcomes, namely, bankruptcy. Nuclear enterprises today fall into two camps: those that can rely on enough government support or sponsorship to prevent bankruptcy and those that cannot. The former category has shifted the worst risk to government, while the latter category, which includes most U.S. utilities and some others, faces an uncertain financial and regulatory environment. This is especially true with regard to future externality pricing of emissions; as a result, investors are reluctant to commit to financing expensive new power plants. This reluctance applies (to a greater or lesser degree) to all but the most essential investments in the electricity sector. Anything that would reduce investor uncertainty and make realistic risk assessments possible could be a game changer for nuclear firms, in particular, and the electricity sector, in general, as well as for the country in which they operate. Pending such an eventuality, minimax strategies are likely to dominate plans in the private sector.

Global Strategies

The brief survey we have just laid out illustrates the areas in which goals are shared between many actors, making a global strategy possible, at least in principle. Such a strategy should address universal common goods, including security and the global environment. Technological and local economic opportunities and risks are more effectively addressed by the private sector and individual governments, but a global strategy would provide for the transfer of innovations that make nuclear power safer and reduce the risk of accident or diversion.

In brief, avoiding accidents and terrorism is generally agreed to be a common good, and the elements of a common strategy are in place, if not always effectively implemented. As noted above, states and localities vary in their approaches to the global environment, particularly where climate change is concerned; despite much negotiating, we are still short of a global approach to such problems. Avoiding nuclear weapons proliferation is also considered a global common good by the vast majority of states, but the steps to implement a common strategy, such as limiting the spread of enrichment and reprocessing facilities and accepting more intrusive safeguards, are not generally agreed upon. To obtain agreement among the states involved in nuclear power use or trade, a common strategy will have to provide for continued competition in the provision of internationally traded nuclear supplies, such as enrichment services or uranium ore. It must also provide some safeguards against politically based interference with international nuclear trade.

Economics plays an ambiguous role in the potential spread of sensitive facilities. The very large enrichment and reprocessing plants needed to provide economically for a fleet of power reactors require multibillion-dollar investments and the development of advanced technological capabilities in areas as varied as metallurgy and remote operations. As long as both buyers and sellers of enrichment and reprocessing services have access to a competitive international market free of political restrictions, so that they can buy enriched or reprocessed fuel at market prices, it may be some time before the enrichment and reprocessing capacities of the major nuclear power users are matched by any significant number of new national efforts. On the other hand, the enrichment and reprocessing requirements for even a few power reactors far exceed what is needed to provide materials for a few nuclear weapons per year. States that wish to have a latent nuclear weapons capability do not need to make the large investments in enrichment or reprocessing required for an economical civilian capability.

The United States and states that share its priorities with regard to avoiding nuclear weapons proliferation and safeguarding civilian nuclear operations face a problem in dealing with potential proliferators. To the extent that the United States and allies limit international access to nuclear services on grounds of proliferation risk, they also motivate the spread of sensitive facilities, which even on small scales can provide a state with at least a latent nuclear weapon capability. In the past, the United States and other states interested in limiting nuclear weapons proliferation held enough of a monopoly on the needed materials and technologies so that supply constraints were partially effective in delaying or preventing weapon proliferation. This near-monopoly is decreasing due to both the entry of new suppliers that do not or may not share the U.S. priorities and the wider availability of the needed technologies. Even a poor, isolated state such as North Korea has succeeded in making enough plutonium for several nuclear weapons and, more recently, in building what appears to technically trained observers to be a modern enrichment facility.43 The strategies proposed to deal with this problem range from continuing attempts encouraging suppliers to agree on limiting or conditioning supplies, despite probable growing ineffectiveness, to trying to enlist more cooperation by leading a move to universal nuclear disarmament. It is not clear that any of these strategies will be effective. It is also not clear whether success or failure in dealing with the problem of weapons proliferation will affect the future of nuclear power.


42. John M. Broder, “A Novel Tactic in Climate Fight Gains Some Traction,” The New York Times, November 8, 2010,

43. Alex Spilius, “North Korea has Built Sophisticated Uranium Enrichment Facility, US Scientist Says,” The Telegraph, November 21, 2010,