News in Depth: Returning to Yucca Mountain

Recently, Ken Ritter of the Houston Chronicle reported on the renewed debate over the proposed nuclear waste repository at Yucca Mountain in Nevada. The Yucca mountain story stretches back decades, and Ritter’s report highlights many of the points of friction which continue to delay the project. In this week’s News in Depth, we’ll take a look at this report and the story of the proposed Yucca Mountain repository.

Background: The Yucca Mountain Story

Yucca Mountain was officially selected to be the national repository for spent-fuel and high-level radioactive waste in 2002. President George W. Bush approved the site choice, but the governor of Nevada, Kenny Guinn, then vetoed the decision. That veto was subsequently overturned by Congress.

In 2008, the US Department of Energy submitted a license application for the Yucca Mountain site. The initial plan called for a facility that could hold upwards of 77,000 tons of waste for up to 1 million years.

2-YuccaMountain-Fig1

However, in 2011, the Obama administration cut funding for the project and, effectively, left the U.S. without a long-term storage plan for civilian nuclear waste. In response to the Obama administrations cancellation of the project, a handful of U.S. states and organizations “filed suit in the U.S. Court of Appeals for the District of Columbia Circuit asking for a writ of mandamus requiring the Nuclear Regulatory Commission (NRC) to restart licensing proceeding for Yucca Mountain.” The court granted their request, and as a result the NRC restarted the review process for the DOE’s original application.

In 2014, the NRC approved the final part of the DOE proposal. As Eli Kintisch reported at the time on the Science Insider blog,

The 781-page report concludes that the proposed site… includes “multiple barriers to isolate radioactivity from the environment” for hundreds of thousands of years, commission staff said in a statement. That should allow it to comply with standards to protect ground water and people in the distant future.

Today, the debate continues over the Yucca Mountain site. While the initial environmental assessment has largely been completed, questions still remain as to land ownership over the site and other environmental, social, and political issues. To add to the difficulty of the situation, a federal appeals court ruled two years ago now that the NRC has to either approve or reject the license application.  The process for the approval will likely take years.

The Debate Today

Ken Ritter’s recent report expands on many of the key issues related to the project. For the people quoted in the piece, the biggest issue is perhaps that of ground-water contamination. As one opponent to the project put it:

The only question to be answered is, ‘Can waste emplaced in Yucca Mountain be isolated and not contaminate groundwater?'” said Judy Treichel, an opponent since the 1980s of the project who heads an entity called the Nevada Nuclear Waste Task Force. “The answer is, ‘No.'”

However, at the article points out, “a report released in August by the NRC acknowledged a small chance of contamination, but said someone drinking two liters of groundwater a day would still not accumulate as much radiation as they do from natural and background sources.”

Overall, it seems that the fear of radiation, no matter how small of a projected risk, is fueling much of the debate. In addition, opponents highlight the logistics of transportation, construction, and maintenance, arguing that the costs are far too high.

As a 2014 New York Times piece by Matthew Wald put it, Yucca Mountain “was never described as the best place for burying nuclear waste, only an acceptable one about which a consensus could be achieved.” Is this a case of politics trumping science, as some critics argue? If we are to believe that, does it not discount the research and regulatory study that has gone in to the project? 

One potential way to reset the conversation is to think about the alternatives. If Yucca Mountain is scrapped, what’s next? This isn’t to say that alternatives should not be considered, or that the current site’s momentum is a rationale for its continued front-runner status. Rather, it’s a question of thinking about asking what is truly realistic. On balance, do the negatives outweighs the positives? And in either case, what are the next steps? Those are the questions worth answering.

 

 

News Analysis: Exploring Viewpoints on the Future of Nuclear

On September 2, the BBC World Service Inquiry programme published transcripts of four expert’s viewpoints on the future of nuclear energy technology. In this week’s News in Depth, I will discuss this article and take a critical look at the perspectives shared by the interviewees.

Four Viewpoints, One Theme

First, we hear from Tatsujiro Suzuki – Director of Research Centre for nuclear weapons abolition at Nagasaki University and former Vice-Chairman of Japan’s Atomic Energy Commission. Mr. Suzuki was Chair of the Commission at the time of the 2011 Japanese earthquake and subsequent Fukushima disaster. His recent career change – from nuclear regulatory official to nuclear critic – reflects the difficult journey Japan has faced in the last four years.

I personally felt very responsible for the event and I felt very sorry for the Fukushima people… This kind of accident has a serious social, ethical, political impact on their lives.

He is pessimistic that the people of Japan will be able to support any serious return to nuclear energy, saying that

In the public mind there was no clear connection between the peaceful use of nuclear energy and nuclear weapons… [Fukushima] is a huge, huge loss of public trust.

Next, Miranda Shreuers – a research director at the Free University in Berlin and a member of the commission to determine Germany’s nuclear policy – unequivocally states that she doesn’t believe Germany “could every again live with nuclear power.”

Gabrielle Hecht – a Professor of History at the University of Michigan – then speaks to the growth of nuclear energy in developing nations across Africa and argues that’s the path of those countries is similar to western nations in the 1950s,

The prospect of having abundant electricity in place where there are very often electricity brownouts and blackouts, and where large parts of the country are not electrified, is huge.

However, Hecht believes that new nuclear plants should not be built and that these countries should look for other solutions.

Finally, the BBC spoke with Steve Kidd – a nuclear energy consultant with East Cliff Consulting in the UK who has over over 18 years experience working for the The World Nuclear Association (WNA). While a proponent of nuclear, Mr. Kidd is pessimistic that nuclear energy can “take on that role that’s been left open for it.” His belief is that the industry’s core issue is that it has failed to communicate effectively,

The industry has tried to counter [public fear] with a factional approach, almost saying to the public, ‘you’re stupid, you’re irrational’, but in fact the development of their beliefs has been wholly rational, based on what they’ve seen and heard over the years, and something like the Fukushima accident obviously gives credence to such fears.

In summary, these four experts share a common idea: that nuclear energy as we know it faces a difficult future. For everyone but Mr. Kidd, it seems that that future is one of full decommissioning – a future in which nuclear is part of medicine and scientific study but not energy production. However, is this narrative of decline and the supremacy of fear over fact unchangeable? What, if anything can be done?

A Living Narrative

It turns out that Mr. Suzuki, quoted earlier from the BBC transcript, provides us with a useful starting point for thinking about the power of narrative and the ways in which we talk about nuclear. In March, he penned a lead essay for the East Asia Forum, in which he made the argument that the best strategy for Japan’s nuclear energy regulator and industry to regain trust is a simple one, honesty.

Transparency in policymaking is essential. The public needs to be involved in decision making… The current Japanese policy debate is completely polarized between advocates for and opponents against nuclear energy. An independent organization is required to help adjudicate between the two sides, and it needs to be one that the public can trust.

In other words, what is needed to overcome the fear, uncertainty, and doubt that surrounds nuclear energy in Japan – and arguably elsewhere – is intense, unwavering honesty and dialogue.

This leads me to forward a thesis – the nuclear energy story, or narrative, as we know it is in crisis, and the only way forward is for proponents and opponents to work together in good faith. What does this mean? It means that the narrative is not something that simply is but rather something we do. We, as individuals and as groups, shape and reshape the story of nuclear. For some, they believe that it is a story that should end. For others, myself and many of our readers included, we believe that the story is simply evolving. For some places, maybe nuclear is not the best solution. But for others, the technology may unlock vast amounts of human potential.

We must work together to find out what the story may bring next. The BBC piece that started this discussion is part of that, but of course it is but one small part of the story. The people quoted here have a viewpoint, and we can take it and build upon, but we can’t stop there. Many people, and many voices have to be involved in this messy process, but we will can continue to write this story together, one line at a time.

 

News in Depth: Nuclear, the Next Generation

In our continuing effort to explore what’s next for nuclear, we turn this week to the recent announcement that China will begin construction on a 600 MWe fourth generation fast neutron reactor. While details of the project are few, there is speculation that this project may be the first successful partnership between China and TerraPower, the Washington state based energy firm founded and chaired by Microsoft co-founder and philanthropist Bill Gates.

In this week’s News in Depth, we will take a look at the technology behind fourth generation fast neutron reactors, the story of TerraPower, and China’s efforts to be at the forefront of nuclear energy development and deployment.

Next Generation Technology

As the World Nuclear Association (WNA) notes, fourth generation fast neutron reactors (FNRs) have been in development for decades. As of 2010, over 400 reactor-years of operation have been logged with approximately 20 reactors in different periods. The WNA also provides a useful summary of the initial motivation behind FNR tech:

The FNR was originally conceived to burn uranium more efficiently and thus extend the world’s uranium resources – it could do this by a factor of about 60. From the outset, nuclear scientists understood that today’s reactors fuelled essentially with U-235 exploited less than one percent of the energy potentially available from uranium. Early perceptions that those uranium resources were scarce caused several countries to embark upon extensive FBR [Fast Breeder Reactor] development programs.

The technology is incredibly complex, but for reference note that

Natural uranium contains about 0.7% U-235 and 99.3% U-238. In any reactor some of the U-238 component is turned into several isotopes of plutonium during its operation. Two of these, Pu-239 and Pu-241, then undergo fission in the same way as U-235 to produce heat. In a FNR this process is optimized so that it ‘breeds’ fuel. Some U-238 is burned directly with neutron energies above 1 MeV.

TerraPower‘s Travelling Wave Reactor (TWR) leverages the knowledge gained from decades of FNR research to produce what they describe as “Generation IV, liquid sodium-cooled fast reactor.”

TWR

Image Source: TerraPower

China’s New Project

According to the WNA, China first began research FNR reactors in 1964 and, in 2003, built “a 65 MWt fast neutron reactor – the Chinese Experimental Fast Reactor (CEFR) – … near Beijing [in partnership with] Russia’s OKBM Afrikantov [and] OKB Gidropress, NIKIET and Kurchatov Institute.”

This new project is part of China’s efforts to have, according to CIAE projections, fast reactor capacity progressively increasing from 2020 to at least 200 GWe by 2050, and 1400 GWe by 2100. As noted in the opening, TerraPower’s involvement in the project is still unconfirmed, but industry and media sources seem to be coalescing around such a partnership as Gates himself recently travelled in February of this year to China to meet with “with Nur Bekri, a vice chair of China’s National Development and Reform Commission, and with China National Nuclear Corp chairman Sun Qin.”

In any event, what we are seeing here are the early stages of what looks like a new phase in nuclear technology. 4th Generation reactors – in this case, sodium FNRs – have been in development for over a decade and now we are seeing an example of one of the these new designs taking shape. Development is slow, yes, but it is happening and happening at in increasing pace in China. We can only now wait to see what comes next and, hopefully, to see confirmation that this project marks the first partnership between China and Gate’s TerraPower.

 

News Brief: China’s Nuclear Energy Developments

Last week, Mike Orcutt at MIT Technology Review wrote an update on China’s nuclear energy development plans.

China is rapidly moving up the global nuclear power leaderboard. Since 2012, as the traditional leaders in nuclear energy production have remained stagnant or backed off of their reliance on nuclear in the wake of Fukushima, China has added 11 new reactors and over 11 gigawatts of nuclear generating capacity.

As Orcutt notes, by the end of this year China is expected to pass South Korea and Russia to become the fourth largest producer of nuclear energy in the world. He links to an interesting infographic that highlights the differential in nuclear energy growth around the world.

graphitix860_6 copy

Image Source: MIT Technology Review

China is clearly in the lead when it comes to capacity growth, with Russia and India not far behind. However, as the infographic notes, it will be important to keep an eye on those nations that have yet to produce nuclear energy but plan to do so. As we’ve highlighted here at Future of Nuclear, those countries – and the new technologies they apply – will be interesting to watch.

News in Depth: Reflecting on the World Nuclear Industry Status Report

INTRODUCTION

In this week’s News in Depth, we take a look at the World Nuclear Industry Status Report 2015, linked here (and reported on by Katherine Tweed at The Energy Collective). The report’s author’s lay out a number of statistics and cover developments in nuclear energy around the world, concluding that innovation is lacking and progress slow. We will look at some of the report’s key findings in brief here and hope that you, the readers, can voice your feedback on the report and its findings.

THE REPORT’S FINDINGS

To start, here is a selection of key points from the report:

  • Nuclear plant construction starts plunge from fifteen in 2010 to three in 2014
  • Three quarters of all reactor construction projects worldwide are delayed. Five units have been “under construction” for over 30 years
  • The share of nuclear power in the global electricity mix is stable at about 11% (and has been for three years now)
  • Since 1997, when the Kyoto Protocol was signed, 694 TWh of wind power and 185 TWh of solar power capacity have been built. Nuclear has only added 147 TWh
  • The average age of reactors is now 28.8 years. In the U.S., one third (33) of reactors have operated for more than 40 years

Generation

Source: World Nuclear Industry Status Report 2015

Jonathon Porritt, a well known British environmentalist, wrote the forward to the report. His conclusion from the data was that any hope of a global nuclear renaissance was being eclipsed by the rapid development of decentralized renewable energy and storage technologies. In other words, the issue for nuclear in his opinion is its pace of change, or lack thereof.

As Porritt puts it,

The consistent history of innovation in the nuclear energy industry is one of periodic spasms of enthusiasm for putative breakthrough technologies, leading to the commitment of untold billions of investment dollars, followed by a slow, unfolding story of disappointment caused by intractable design and cost issues.

Porritt remains skeptical that future innovations will ever translate to effective applications for energy production (he specifically references Small Modular Reactor (SMR) technology, Generation IV reactors, and thorium technology). In the report itself, many issues relating to the real-world applications of nuclear power are highlighted. In a review of the UK Hinkley Point C project and Areva’s recent financial troubles, the report concludes that “few have started to radically adjust to new circumstances.”

Another noted issue area is that of nuclear’s centralized generation paradigm. As the report notes, nuclear is in some ways incompatible with the decentralized model of energy production that has many cost advantages and flexibility.  Amory Lovins, Chief Scientist at the Rock Mountain Institute, is quoted saying that renewables, which are in their own nature small and modular, can scale down much faster and leverage economies of scale much more effectively. In his words, “Nuclear SMRs can never catch up.”

It’s hard not to read the report, and Porritt’s forward, as a kind of epitaph for the nuclear sector. Porritt’s description of a “static, top-heavy, monstrously expensive” world of nuclear reads so negatively that the future seems bleak. However, with the report’s main points and Porritt’s view in mind, we must ask new questions. What is left unsaid in the report? What are the positive attributes of nuclear energy that are not discussed? Is the analysis of the numbers in the report biased in any way? In the end, what then is the future of nuclear?

OPEN TO DISCUSSION

We hope that this report can be a starting point for discussion in the industry and beyond. While experts may be familiar with many of these figures and facts, they are still new to many. As a result, this can be an opportunity to talk, reflect, and work towards a better future. Nuclear energy presents many challenges – from initial design to waste storage – and they are not solved overnight. Indeed, these things take time. Sometimes, more time than desired. But the last half-century has seen many moments of rapid progress and achievement. They are moments punctuated by stasis, yes, but it is over the long run that we see great progress.

We welcome your thoughts on these issues and many more. Here’s to what comes next.

 

 

 

 

News in Depth: Should Singapore reconsider their “no” to Nuclear?

On Friday, July 4, Peter Schwartz, business strategist and member of Singapore’s Research, Innovation and Enterprise Council, said in a panel at the Institute of Policy Studies that Singapore needs to consider turning to nuclear power as a key part of its strategy against climate change.

Mr. Schwartz, who is also a SVP at Salesforce.com and a co-founder of the Global Business Network, framed it in the context of Singapore’s current reliance on natural gas;

You’re going to continue to need electricity, and renewables will be insufficient. You’re either going to have to continue using natural gas or move to nuclear power.

In this week’s News in Depth, we look at the current state of energy sector in Singapore and consider Mr. Schwartz’s call for the country reconsider its current stance against nuclear power.

Singapore’s Current Energy Landscape and Policy on Nuclear

As the Channel News Asia report on Mr. Schwartz’s talk explains, in 2012 the Singapore government concluded that nuclear power was not suitable for the small industrialized country, owing mainly to the safety risks. The “nuclear pre-feasibility study” – a summary is available here – provides some useful context to our analysis.

Singapore, the study notes, lacks indigenous energy resources and generates around 80% of its electricity from imported natural gas from Malaysia and Indonesia. The study also notes that renewable sources such as solar and wind can only augment the energy supply, as the country simply lacks the space for large-scale renewable installations. As a result, the country is challenged with finding a reliable energy source that can provide a stable baseload of capacity while also moving the country towards a low-carbon energy system.

The government initiated the study in response to these challenges, but the study found that “nuclear energy technologies presently available are not suitable for deployment in Singapore.” Despite the findings, the report did state the Singapore should play an active role in the future of nuclear technologies and safety. In other words, the door may be closed for now, but they did not throw away the key.

Reconsidering Nuclear Energy in Singapore

This renewed call to consider nuclear comes at a crucial time in the global energy industry. With the world’s attention this year on climate change in the lead up to the UN Convention in Paris, perhaps it is time to reconsider what may be possible in Singapore.

Mr. Schwartz argues that nuclear energy technology has advanced a great deal, and believes that nuclear power plants could be built on offshore barges, underground, or potentially on partnering island who have more space and may be willing to share in the benefits of a new nuclear power plant. These ideas echo similar stories we have previously explored. In May, we looked at Dunedin Energy Systems’ idea of deploying SMR (Small Modular Reactors) technology onboard ships in Canada’s arctic. The concept there, and here potentially, is to think of nuclear options that are smaller, safer and perhaps even mobile. In addition, in the last five years more advanced reactor technologies have increased safety and relability, take Westinghouse’s AP1000 PWR as an example.

In short, in the three years since Singapore said “no” to nuclear, the landscape has indeed shifted. Of course, policies don’t change overnight, but perhaps it is time for Singapore to once again consider nuclear and the new applications of safety and operational technology that are emerging today.

Special Report: Nuclear Law and Liability Developments in India (Part 3 of 3)

INTRODUCTION

In early May, we started this special series on the developments in nuclear law in India. In Part 1, we examined the key historical and legal developments in India’s nuclear law regime. In Part 2, we then turned to the recent India-US trade deal and asked whether the deal would finally resolve unanswered questions as to the extent of liability for foreign suppliers of nuclear technology and supplies.

This week, in the final post of this series, we explore the establishment of the India Nuclear Insurance Pool (INIP) by drawing on multiple sources, including the recent talk by Els Reynaers-Kini – a Partner at M.V. Kini law firm in Mumbai – at a Mindfirst seminar in Toronto. To conclude, we ask what may come next for nuclear law and nuclear development in India and suggest a number of issue areas in need of further exploration and discussion.

THE INSURANCE POOL

On May 27, Els Reynaers-Kini gave a talk at a Mindfirst seminar on developments in nuclear liability in India. One of the key aims of her talk was to discuss the practical implications for Canadian parties interested in establishing commercial exports of civil nuclear energy technology and uranium.

One of key roadblocks to increased foreign investment and trade in India’s nuclear sector has been the 2010 Civil Liability for Nuclear Damage Act (the Act). The Act uniquely expanded the scope of liability beyond the operator to the suppliers of the technology used in the civilian nuclear energy sector. Under s 17(b) of the Act, a specific right of recourse was granted to the operator, enabling them to pursue damages against suppliers where…

…the nuclear incident has resulted as a consequence of an act of supplier or his employee, which includes supply of equipment or material with patent or latent defects or sub-standard services.

Earlier this year, US President Barack Obama travelled to India and, together with Indian Prime Minister Narendra Modi, announced that both countries had agreed on a new foreign investment framework for nuclear technologies. While the announcement was met with great fanfare, left unresolved was the specific insurance and liability regime that foreign suppliers would be subject to under the Act.

Under s 8 of the Act, it is mandatory for the operator to take out an insurance policy or other financial security. However, as Ms. Reynaers points out in her talk, up until recently, insurance policies only provided coverage for “cold zones,” areas where no nuclear reactions take place. Bank guarantees, as another form of financial security, were not enough to cover the liability risks and thus a new insurance structure was needed to accommodate the operators and the suppliers.

After months of newly invigorated negotiation, in June the Indian government formally announced a new insurance pool of Rs. 1,500 crore (US $234 Million) that will provide coverage to operators and suppliers. The pool will be managed by the state-owned reinsurer, GIC Re. The fund will cover the risks of the liability for the operator, pursuant to s 6(2) of the Act and suppliers under s 17 of the Act. As Ms. Reynaers also noted in her talk, premiums will be roughly 2% of the insurance amount and will vary depending on a number of facts considered under the the Department of Atomic Energy (DAE)’s Probabilistic Safety Assessment study.

The announcement of the INIP’s formation will, in the long-term, likely be seen as a major turning point in the story of India’s nuclear energy development. It is, in a sense, a compromise of public policy and business – allowing for the right of recourse under the Act while building in security and certainty for foreign suppliers and the operators of India’s current and future nuclear power plants.

NUCLEAR POWER AND INDIA: WHAT’S NEXT?

As of July 2015, there is a great deal of activity in India’s nuclear sector. Deals are being signed for new reactors, and GIC Re is already talking about ways in which they want to enable the INIP to be a “one-stop” facility for covering all nuclear risks. For perspective on growth in the Indian nuclear sector overall, see the graph below.

indias_nuclear_power_capacity_2016

 

Source: World Nuclear Association

In the long run, India hopes to supply 25% of its electricity from nuclear power by 2050. While the road up until this point has been rough, India is uniquely positioned to leverage it’s massive population and increasing industrialization to spearhead development. In addition, the country’s cutting edge research into fast reactors and the thorium fuel cycle will help it develop a stronger presence in the nuclear sector beyond it’s own borders (for a current snapshot of the industry, see the the “Heavy Engineering in India” report by the WNA here). In short, there are tremendous opportunities now not only for foreign suppliers working in India, but India’s own industry players abroad.

Returning back the INIP now, in the coming months and years, careful attention must be paid to the exact structure of the contractual arrangements between suppliers and operators in India. As Ms. Reynears pointed out in her concluding slides, it will be crucial that precise definitions are laid out and that parties remain cognizant that the INIP is only advisable for suppliers (while it is mandatory for operators). However, if a supplier chooses to not take part in the INIP coverage, the INIP/GIC Re can still try to establish fault in Indian courts against the supplier.

In summary, in the short term the establishment of the INIP has ameliorated many of the concerns of foreign suppliers and local communities alike. As we discussed earlier, it both allows for recourse against those who may be at fault, while also building in some security and certainty for those suppliers who may find themselves liable. It is, thus, a compromise. However, as we noted above, there are many details and angles to the INIP that will require careful navigation by all parties involved. Let’s hope that, in time, the experience will be a smooth one and that India can continue towards its nuclear goals.

 

News in Depth: Defering the Decision on Ontario’s Nuclear Waste Plans

Back in March, we examined Australia’s efforts to find a site for a new National Radioactive Waste Management Facility. In that report, we also highlighted efforts being made in Canada to find a suitable nuclear waste management site, known formally as the Deep Geologic Repository for Low and Intermediate Level Radioactive Waste (DGR). One of the favoured sites, as of May, was the Bruce nuclear plant in Kincardine, Ontario.

This week, we will explore the recent developments in the DGR project, the story of the Bruce site, and discuss what may come next in this country’s quest to solve our waste management problem.

The Study and Approval Process So Far

In May, a report by the Joint Review Panel of the Canadian Environmental Assessment Agency (CEAA) approved the Bruce site and recommended it to the federal environmental minister, Leona Aglukkaq, saying that the “project is not likely to cause significant adverse environmental effects.”

For background, the plan at the Bruce facility to build a repository deep beneath the site where “200,000 cubic metres of low and intermediate level waste from the Pickering, Darlington, and Bruce nuclear plants” could be stored indefinitely. The facility would be more than one kilometre from Lake Huron and over 680 metres underground. The Bruce site was selected after years of consultation and assessment undertaken by Ontario Power Generation (OPG). This project is part of a larger movement in Canada to find safe sites in which we can store used fuel.

In 2002, the Federal government established the Nuclear Waste Management Organization (NWMO) to help guide this processIn 2011, Ken Nash, the current President and CEO of the NWMO, spoke with the National Post about the ethical motivations to finding suitable long term storage facilities that doesn’t simply leave materials above ground,

We can’t just leave it where it is, it’s up to this generation to look for something better and not pass on the burden…

The Bruce facility planned by the OPG is just such a solution, one that is designed to safely store materials for years to come. However, as the Toronto Star noted, over 152 communities in the US and Canada oppose the site. Local residents that live near the Bruce plant have also voiced concerns. Beverly Fernandez, of the Stop the Great Lakes Nuclear Dump group, has been particularly vocal on the issue of potential contamination of drinking water. In a March report in the London Free Press, she is quoted saying that

There should be no deep geologic repository (DGR) for nuclear waste anywhere in the Great Lakes Basin… locating it beside the drinking water of 40 million people defies logic.

The CEAA report, however, found that the risk of drinking water contamination “would be extremely low relative to current radiation levels in Lake Huron and negligible relative to dose limits for the protection of the public.”

Site proponents and the CEAA report also argue that there are a number of key components to the Bruce site that make it a good choice, including the stability of the rock, the current safety and security infrastructure, and the presence of engineering and construction expertise at the facility.

When the report was released in May, the federal environmental minister was given till early September to make a final approval. However, with federal elections looming in the fall, the decision was recently made to extend that deadline into December.

The Future Challenges Facing the DGR Decision

Some critics argue that the delayed decision is a sign that the Bruce DGR’s future is in peril. Ms. Fernandez, cited earlier as a strong opponent to the plan, thinks that the deferral reflects the fact that “more and more Canadian are expressing deep concern and strong opposition.”

Meanwhile, another local citizen’s group, Save our Saugeen Shores, has filed an application to the Federal Courts for judicial review, asking that the CEAA’s decision to approve the site be set aside. They argue that the panel “failed to consider Canada’s international obligations, was biased and violated the Country’s environmental rules.” 

This recent court challenge, and the continuing public debate, suggests that in the run up to the federal environmental minister’s December decision, every effort must be made to exhaustively discuss both the practical and political, the global and local. This project, no matter where it is located, will have implications on people and the environment for centuries to come, it’s only right that we take our time over the coming months to discuss and dissect the plan piece by piece, so we can make the best decision we can. 

The deferment, as a result, should not be viewed as avoidance. If anything, it is a reflection of the noted complexity of the project. If anything, it gives parties more time to resolve open questions and to hopefully address concerns regarding transparency. These things take time, and more time we now have.


Update (June 29, 2015) – two corrections were made in the article relating to the management of the Bruce DGR project and the to the approval process by the Federal minister. I apologize for the errors and appreciate reader feedback.

Special Report: Nuclear Law and Liability Developments in India (Part 2 of 3)

Introduction

Last week, in Part 1 of this Special Report, we explored the history of India’s nuclear law liability regime and the passing of the 2010 Civil Liability for Nuclear Damage Act. We ended by highlighting how the 2010 Liability Act effectively drove a wedge between international suppliers and India’s nuclear industry by exposing suppliers to increased liability in the event of accidents.

Today, in Part 2, we will discuss and analyze the recent India-US agreement on nuclear trade and liability. In addition, we will canvas news reports and opinion pieces to get a sense of the reaction’s of industry experts and observers.

Part 2: The India-US Agreement

In January of this year, U.S. President Barack Obama visited India to meet with Prime Minister Narendra Modi. One of the key goals of the president’s trip was to formalize an agreement on nuclear development and liability issues.

_80505230_4ymom3z6

(Image Source: Reuters via the BBC)

As a report by Dan Roberts in The Guardian notes, the threat of tough Indian compensation laws – specifically the 2010 Liability Act – had “frustrated US hopes of an export boom in the energy sector.” As of May 2015, the details of the deal are still being finalized. However, certain baseline elements are set. As this Reuters report lays out, the deal sets a framework for the US nuclear industry to enter commercial talks with India’s nuclear operators by resolving two concerns, inspections and liability.

On the issue of liability specifically, the agreement upholds the strict liability regime and the supplier liability provisions of the 2010 Liability Act. However, to address supplier concerns, India will establish an insurance pool to cover liability up to a hard cap. The insurance pool, which would be backed by the state of India, would cover operator liability of up to 15 billion rupees (around $250 million US). Any recourse sought by the operator against a supplier could not be exceed this figure. In addition, insurance premiums for suppliers would be a fraction of the amount paid by the operator of the plants.

The Reuters report also highlights that in the event of a large scale incident, the Indian government would cover additional costs up to $420 Million (US) and, for additional funds, the report says that India would need to join the IAEA Convention on Supplementary Compensation for Nuclear Damage (CSC).

Following the India-US agreement, India has made it clear that the 2010 Liability Act will not be amended. A report from the India Express highlights the government’s position that

the foreign suppliers of the reactors cannot be sued for the damages by victims of a nuclear accident but can be held liable by the operator who has the right of recourse that could be operationalised through the contract between the operator and the supplier.

As a result, the agreement should not be viewed as a reform of India’s liability laws, but as an agreement to work within those laws by establishing an insurance pool for the operators and suppliers. In retrospect, it is clear that it was very important that India maintain its liability regime, as public and political opinion favoured increased liability for foreign suppliers following the Bhopal disaster in 1984. The agreement thus establishes a mechanism that keeps this regime in place while allowing for increased international nuclear trade.

Reactions to the Agreement and Concluding Thoughts

Reactions to the agreement have been mixed in the ensuing days and months. Partly, this is due to the fact that many of the details of the insurance pool have yet to be finalized. In an interview with Germany’s Deutsche Welle (DW), Mycle Schneider, an independent international consultant on energy and nuclear policy, shared concerns about the deal;

apparently, no specific document was signed. The Indian government reportedly announced its plan to set up a 122 million USD insurance fund to cover operators and suppliers from liabilities in case of an accident. Senior US nuclear industry officials stated they need to understand the “fine print” of the insurance. Equipment suppliers are keeping the champagne on ice, as one Indian business journal commented.

Mr. Scheinder, when asked if he expects the Indian market to become more appealing for US companies, says that “there is no real market for foreign companies in India, unless they bring their own funding. Under free market condition, it is not possible anymore to build a nuclear power plant anywhere in the world.”

A recent article on Monday by Ran Chakrabarti, an Indian lawyer, echoes similar skepticism.

It remains to be seen whether the Act and the Rules set out a balanced framework, encouraging suppliers to dip their toes into the Indian nuclear energy market, yet protecting the legitimate interests and concerns of the public in the event of a nuclear accident.

Given the complexity of nuclear development and the liability regime in India, it’s clear that this agreement will not be a panacea for all of the industry’s problems. As we’ve seen in these criticisms, and throughout India’s history, the role of foreign companies and governments in trade and development has been at times troublesome and, at other times, even disastrous.

However, India is growing at incredible rates and, as we explored in Part 1, lacks access to domestic energy resources such as coal and oil (which have driven China’s much faster economic growth). As a result, nuclear energy can help provide for a better base capacity for the country as it continues to also develop renewables such as wind and solar. In Part 3, to be published in the coming weeks, we will explore the future of nuclear in India and also focus on the ongoing finalization of the US-India agreement.

Special Report: Nuclear Law and Liability Developments in India (Part 1 of 3)

INTRODUCTION 

On May 27, 2015, Mindfirst will be hosting a Future of Nuclear Seminar on Nuclear Liability Developments in India. The speaker at the event will be Els Reynaers, a Partner at the law firm of M.V. Kini & Co. and President of the International Nuclear Law Association.

In her talk on the recent Indo-US political breakthrough on nuclear liability, Ms. Reynaers will explore the legal and insurance-related developments in India’s nuclear sector, and what those changes mean for Canadian nuclear vendors, regulators, and suppliers.

In the run up to this event, we bring you a three-part special report on India’s nuclear law regime. In Part 1, we explore the history of India’s nuclear law and liability regime. Next week, in Part 2, we discuss the recent negotiations and tentative agreement reached between the US and India in early 2015. In Part 3, to be published the week of Ms. Reynaers’ talk, we will explore the opportunities and challenges ahead for India’s nuclear energy sector.

We hope that this report will give you a clearer understanding not only of the recent Indo-US agreement, but the unique evolution of the nuclear law regime in India. We hope you can join us on May 27 to discuss these issues in person.

Part I: The History of India’s Nuclear Law and Liability Regime

As Gruendel and Reynaers pointed out in their 2012 article, India is not well endowed with natural energy resources. In response to this lack of reliable and local reserves, India plans to have 20,000 MW of nuclear capacity by 2020, with plans to derive 25% of its electricity (approximately 3000 GW) from nulcear by 2050.

Up until the passage of the Civil Liability for Nuclear Damage Act, 2010 (2010 Liability Act), to be discussed below, nuclear activity in India was governed by the Atomic Energy Act of 1948 and the Atomic Energy Act of 1962. Together, these Acts made the Central Government of India the sole legal operator of nuclear facilities in the country. The legislation did, however, leave room for private sector companies to hold a minority share in the ownership and operation of nuclear facilities under joint ventures.

Another key detail – highlighted by Yash Mannully in an important 2012 article on issues in Indian nulcear liability law – is that the Acts gave power to the Government to make rules that deliniate

the [operator’s] liability in respect of any hurt to any person or any damage to property caused by ionising radiations or any radioactive contamination either at the plant under license or in the surrounding area.

However, despite provisions that enable the Government to regulate liability, little was done in terms of legislating until the last decade. Additionally, up until the last decade, India’s 20 nulcear power plants operated at reduced capacity, given that India was excluded from international nuclear trade under the 1970 Nuclear Non-Proliferation Treaty. However, with a 2008 agreement by the Nuclear Supplier Group to grant a waiver to India, the country was able to import nuclear technology and sign bilateral agreements on civilian nuclear energy technology with countries such as Canada, France, the Republic of Korea, the United Kingdom, and the United States.1

As of 2008 then, India’s nuclear energy sector was primed to grow at an incredible rate. The country, then home to over 1.1 billion people, was given a new opportunity to fulfill it’s nulcear energy ambitions, in new partnerships with suppliers from around the world. As Gruendel and Reynaers note2, these partnerships were not for “turn-key”, full construction services, but rather for specific contracts for reactor technologies and related components. Given that these contracts are between the suppliers and India’s state nuclear operator (the Nuclear Power Corporation of India Limited (NPCIL)) the challenge of establishing a clear liability regime for the industry, and the scope of the liability itself, remained.

The 2010 Liability Act was the first concerted effort by the government to outline the scope of liability for the nuclear sector in India. In essence, the Act, in conjunction with subsequent ammendments, expanded the scope of liability beyond the operator – in this case, the NPCIL – to the suppliers of technology used in the civilian nuclear energy sector. By affirming strict and no-fault liability on the operator, the Liability Act was in keeping with the 1960 Paris Convention on Third Party Liability in the Field of Nuclear Energy and the 1963 Vienna Convention on Civil Liability for Nuclear Damage.3

However, where the 2010 Liability Act differed significantly was in its granting of special rights of legal recourse to the operators in the event of an incident. Under s 17(b), the operator of the nuclear installation “shall have the right of recourse where:

the nuclear incident has resulted as a consequence of an act of supplier or his employee, which includes supply of equipment or material with patent or latent defects or sub-standard services.”

As Gruendel and Reynaers note in their 2012 article, linked above, the original language of 17(b) targeted situations where “the nuclear incident has resulted from the willful act or gross negligence on the part of the supplier,” but such language was dropped when experts agreed that establishing mens rea (or “guilty mind”) would be too difficult and would potentially weaken the government’s power, through their role as operator, to rely on legal recourse for damages against suppliers.

There are additional issues in the 2010 Liability Act that are important – including limitation periods and the complex interaction between international and domestic law – but they are beyond the scope of this brief review.

SUMMARY

The key point is that up until the early 2015 Indo-US agreement – which established an insurance pool and clearer liabilility limits for both operators and suppliers in India – suppliers were subject to special legal liability in the event of a nuclear incident. The establishment of this statutory tort – which coexists with common law tort liability – thus drove a wedge between suppliers and India’s nuclear industry. The 2008 agreement to allow bilateral trade was thus at a standstill – the country was open for business, but there was a massive catch. In addition, while the law was extensive, it did not necessarily clarify many of the issues it was designed to solve.

As a result, reform was crucial to any opening of trade between foreign suppliers and India’s NPCIL. Next week, in Part 2 of this series, we explore the efforts to reform and clarify the 2010 Liability Act and the recent Indo-US agreement on nuclear liability and technological development.


 

  1. See Gruendel and Reynaers 2012, page 46.  
  2. See their 2012 article, linked above, page 48. 
  3. See Gruendel and Reynaers, page 49, footnote 26.