Simultaneously, the People’s Republic of China (PRC) has made great strides in closing the nuclear energy development gap with America. Through a combination of importing technology, research from within China itself, and a disciplined policy approach the PRC is increasingly able to leverage the export of commercial nuclear power as part of its national strategy. Disturbingly, China does not share America’s commitment to stability, transparency, and responsibility when exporting nuclear technology. This is a growing strategic weakness and risk for the United States. To remain competitive and to be in a position to offset the PRC when required the American government should encourage the domestic use of nuclear power and spur the forces of technological innovation.
America: dominant no longer
History has recorded well American wartime nuclear developments which culminated in the July 1945 Trinity Test, but what happened near Arco, Idaho six years later has been overlooked. In 1951, scientists for the first time produced usable electricity from an experimental nuclear reactor. Once this barrier was conquered the atom was harnessed to generate electricity and permitted America to move into the field of commercial nuclear power. In the next five years alone the United States signed over 20 nuclear cooperation agreements with various countries. Not only did the US build dozens of power plants domestically during the 1960s and 1970s, the US Export-Import Bank also distributed $7.1 billion dollars in loans and guarantees for the international sale of 49 reactors. American built and designed reactors were exported around the world during those years. Even today, more than 60% of the world’s 440 operating reactors are based on technology developed in the United States. The growth of the US civilian nuclear power sector stagnated after the Three Mile Island incident in 1979 – the most serious accident in American civilian nuclear power history. Three Mile Island shook America’s confidence in nuclear power and provided the anti-nuclear lobby ample fuel to oppose the further construction of any nuclear power plants. In the following decade, 42 planned domestic nuclear power plants were cancelled, and in the 30 years since the Three Mile Island incident the American nuclear power industry has survived only through foreign sales and merging operations with companies in Asia and Europe. Westinghouse sold its nuclear division to Toshiba and General Electric joined with Hitachi. Even the highest levels of the American government came to cast nuclear power aside. President Bill Clinton bragged in his 1993 State of the Union Address that “we are eliminating programs that are no longer needed, such as nuclear power research and development.”
A recent Government Accountability Office report, which examined data from between 1994 and 2009, found the US to have a declining share of the global commercial nuclear trade. However, during that same period over 60 reactors were built worldwide. Nuclear power plants are being built in the world increasingly by non-American companies.
A Comparison of Value of US and Global Exports of Nuclear Reactors, Major Components and Equipment, and Minor Reactor Parts, 1994 through 2008, in 2010 US Dollars
Source: US Government Accounting Office Report, Nuclear Commerce: Government-wide Strategy Could Help Increase Commercial Benefits from US Nuclear Cooperation Agreements with Other Countries
The shifting strategic landscape
While America’s nuclear industry has languished, current changes in the world’s strategic layout no longer allow America the option of maintaining the status quo without being surpassed. The drive for research, development, and scientific progress that grew out of the Cold War propelled America forward, but those priorities have long since been downgraded by the US government. The economic development of formerly impoverished countries means that the US cannot assume continued dominance by default. The rapidly industrializing PRC is seeking its own place among the major powers of the world and is vying for hegemony in Asia; nuclear power is an example of their larger efforts to marshal their scientific and economic forces as instruments of national power.
In 1978, General Secretary Deng Xiaoping began to move China out of the destructive Mao era with his policies of 'reform and opening.' As part of these changes during the 1980s, the CPC began a concerted and ongoing effort to modernize the PRC and acquire advanced technology including nuclear technology from abroad. This effort was named Program 863 and included both legal methods and espionage. By doing this, the PRC has managed to rapidly catch up to the West on some fronts. In order to eventually surpass the West in scientific development the PRC launched the follow-on Program 973 to build the foundations of basic scientific research within China to meet the nation’s major strategic needs. These steps have brought China to the cusp of the next stage of technological development, a stage known as “indigenous innovation.”
In line with this economic policy, China has bought nuclear reactors from Westinghouse and Areva and is cooperating with a Russian company to build nuclear power plants in Taiwan. By stipulating that Chinese companies and personnel be involved in the construction process, China is building up its own domestic capabilities and expects to become self-sufficient. China’s State Nuclear Power Technology Corporation has partnered with Westinghouse to build a new and larger reactor based on the existing Westinghouse AP 1000 reactor. This will give the PRC a reactor design of its own to then export. If the CPC is able to combine their control over raw materials, growing technical know-how, and manufacturing base, China will not only be a powerful economy, but be able to leverage this power to service its foreign policy goals as well.
The international trade of nuclear material is hazardous in that every sale and transfer increases the chances for an accident or for willful misuse of the material. Nuclear commerce must be kept safe in order for the benefits of nuclear power generation to be realized. Yet, China has a record of sharing dangerous weapons and nuclear material with unfit countries. It is a risk for America to allow China to become a nuclear exporting country with a competitive technical and scientific edge. In order to limit Chinese influence and the relative attractiveness of what they can offer, America must ensure its continuing and substantive lead in reactor technology.
Despite a 1997 promise to Washington to halt its nuclear technology sales to Iran, such assistance is likely to continue. In 2005, Iranian resistance groups accused China of selling Iran beryllium, which is useful for making nuclear triggers and maraging steel (twice as hard as stainless steel), which is critical for fabricating centrifuges needed to reprocess uranium into bomb-grade material.
China sells dangerous materials in order to secure its geopolitical objectives, regardless if those actions harm world stability. There is little reason to believe China will treat the sale of nuclear reactors any differently. Even if the PRC provides public assurances that it will behave differently in the future, the CPC has not been truthful for decades about its nuclear material and weapons sales and hence lacks credibility. For example, in 1983 Chinese Vice Premier Li Peng said that China does not encourage or support nuclear proliferation. In fact, it was that same year that China contracted with Algeria, then a non-NPT [Non-Proliferation Treaty] state, to construct a large, unsafeguarded plutonium production reactor. In 1991 a Chinese Embassy official wrote in a letter to the The Washington Post that 'China has struck no nuclear deal with Iran.' In reality, China had provided Iran with a research reactor capable of producing plutonium and a calutron, a technology that can be used to enrich uranium to weapons-grade. It has been reported that even after United Nation sanctions were put on Iran, Chinese companies were discovered selling “high-quality carbon fiber” and “pressure gauges” to Iran for use in improving their centrifuges.
Strategy and policy
In the context of US – PRC relations, nuclear energy is more than a matter of generating electrical power; it is a critical issue of national and global security. The direct consequences of China’s proliferation of commercial nuclear technology are accompanied by even larger issues which require new responses from the United States. China’s ability to connect and integrate economic and energy policy with their grand strategy is as impressive as it is menacing. The PRC leadership has established a coherent policy of economic diplomacy to leverage their economic and technological advancements in a way currently unmatched by the US government.
The US in contrast has not matched its strategy with actions. The US National Security Strategy (NSS), released in 2010, recognizes that economic competitiveness is the “wellspring of American power.” The strategy cites American’s enduring need for a “strong, innovative, and growing” economy, yet these words are hard to reconcile with the current state of the US nuclear and related industries. The NSS goes further and explicitly spells out that:
The United States has a window of opportunity to lead in the development of clean energy technology… If [the United States does] not develop the policies that encourage the private sector to seize the opportunity, the Unites States will fall behind and increasingly become an importer of these new energy technologies.
It appears that over the past two decades the US government has grown to accept America’s economic soft power as a permanent condition and hence has not felt compelled to promote or actively defend America’s position. The PRC is now showing that America’s economic strength can be mitigated and co-opted. To adequately counter Chinese activities the US will have to make greater efforts to clearly identify the situation and ensure that policy conforms to strategy in order for the US to advance its position. Prudent actions for US government include:
• Build a permanent storage facility, either at Yucca Mountain or elsewhere, to dispose of nuclear waste material. The lack of a permanent storage area is a limiting factor on any expansion of domestic nuclear power plants.
• Streamline the licensing and authorization process for new reactors. Some recent progress has been made in this area, but more can be done to improve efficiencies.
• Continue to build on the incentives for the construction of nuclear power plants that were put in place by the Energy Policy Act of 2005.
• Re-write US export controls to guard against PRC industrial espionage, improve US counterintelligence in places of nuclear research, and confront problems associated with deemed-export at US research institutions.
• Invest in nuclear energy research, specifically in safer more efficient reactors that reduce the upfront costs that often hamper nuclear power plant construction. Small reactors or modular construction represent two areas with good potential.
• Create a whole of government strategy for the construction and export of nuclear reactors and related equipment.
• These previous steps will allow the US to engage the PRC from a position of strength and begin a more serious dialogue that links economic cooperation on reactor construction to safer proliferation practices. America cannot stop the PRC from developing and exporting reactors, but the US can present more attractive, more technically sophisticated options and use diplomatic and economic pressure to influence China to act responsibly when exporting nuclear technology.
• Perhaps most importantly, consistent and strong leadership from the executive branch will be critical for implementing these policy changes and for framing the issue of nuclear commerce with regards to China in terms of security and international influence, not only in commercial terms.
The United States today still holds many advantages, both potential and actual, over the PRC. The innovative culture inherent in America is still pushing forward research. America has the means and tools at its disposal to remain competitive and successful in a world where China is a global power. The question is what America will decide it wants its place in the nuclear world to be. Nuclear energy commerce is important for US energy security with proliferation implications, but it is even more important because it is indicative of larger efforts on both sides of the Pacific to shape the 21st century.
Contributor Scott Cullinane is a graduate student at the Institute of World Politics in Washington, D.C.