ARCHIVES Danyliw Seminar 2014
The Challenge of Economic Reforms
After Maidan: The Future of Nuclear Energy Independence
Even after Chernobyl and twenty years of indepence, nuclear energy remains vital to Ukraine, especially in light of Russia’s annexation of Crimea and support of separatist movements in eastern Ukraine. Russian aggression has heightened tensions between the two countries; moreover, Ukraine is dependent not only on Russian gas, which Russia uses as a cudgel on Ukraine’s economy and people, but also on nuclear technologies and fuel cycle support. Yet Ukraine is determined to produce the lion’s share of its electricity from nuclear power plants, and in this way achieve energy independence. In 2014 Ukraine had a total nuclear generation capacity of 13.83 MWe in fifteen reactors (versus 11.88 MWe in 1996) with production of 89.2 billion kW/h in 2010, up some 9.6% in 15 years. Ukraine is the third largest producer of nuclear electrical energy as a share of total domestic electrical energy at over 50% (behind Belgium and France). There are 38,000 people employed in the atomic energy industry in Ukraine making it a crucial employer in a time of ongoing economic and political uncertainties.
But Ukraine confronts a series of persistent obstacles in pursuing nuclear power. These include: the costly legacy of Chernobyl; bureaucratic changes that at times blurred responsibilities for promotion and regulation; corruption in the energy sector; cost overruns typical for nuclear power everywhere; aging power stations, the desire of energy officials to extend the licenses of current reactors, and plans to build a series of new nuclear power stations; uncertainty how to deal with nuclear dependence on Russia in terms of both nuclear technologies and the nuclear fuel cycle; and the ongoing national economic and political crisis, not the least because of Russia’s annexation of Crimea and encouragement of instability in the eastern regions. Will increasing the share of nuclear power really allow Ukraine to be less dependent on Russia for energy? Or, because of traditional reliance on Russia for fuel, reprocessing, and reactor technology, will Ukraine find it difficult to escape this dependence, too?
From Chernobyl to Nuclear Rennaissance?
The shadow of Chernobyl continues to hang over Ukraine. The explosion of reactor four on April 26, 1986, led to heavy radioactive contamination of regions of Ukraine (and Belarus and Russia). Yet when Ukraine gained its independence in 1991, the country fell into economic crisis, and therefore embarked on policies to preserve nuclear power generation capacity. Public attitudes toward nuclear power changed dramatically: citizens and politicians ceased to see nuclear power plants as symbols of Russian colonial dominance, but rather as a means to build energy self-sufficiency and national sovereignty. In October 1993 the Parliament voted to overturn a 1990 moratorium on construction of new reactors and to keep Chernobyl open in order to address projected power shortages for the winter of that year. The station was closed in 2000, but it still costs Ukraine, what with payments to invalids and their families, lost farm land, spent nuclear fuel and radioactive waste storage, and the need to build a new “Shelter Object” to protect the environment from radiation should the old “Sarcophagus” collapse; the shelter is scheduled to be rolled into place in 2015. After the repeal of the moratorium, construction resumed at Khmel’nits’ka, Zaporiz’ka and Rivenns’ka stations. The shut down of Chernobyl’s units 1-3 and the construction of the new Shelter Object, however, became a never-ending debate involving Ukraine, Western countries and international organizations over political and financial issues.
In March 2006 the Ukrainian government published an “Energy Strategy of Ukraine to 2030.” Its 15 existing nuclear stations (all Soviet “VVER” reactors or pressurized water reactors – PWRs) would operate until 2030 (in part by extending the licenses to operate the 13 older ones), and Ukraine would bring into operation an additional 7,000 MW of capacity (seven new 1,000 pressurized water reactors, perhaps of Russian, perhaps of western technology), while doubling annual electrical energy production. The strategy noted the completion of Khmel’nits’ka units 3 and 4, which were, respectively, 75% and 28% complete when work stopped in 1990. In February 2011 the government signed a framework contract with Russia’s Atomstroieksport to supply reactor equipment to finish the stations, but construction has not begun, and I saw only empty, massive, flooded, unfinished concrete and steel struture at units 3 and 4 on my visit to Khmel’nits’ka in October 2014. Nuclear officials have declared they are now looking for partners other than Russian to complete the project.
Bureaucratic Challenges to Building and Relicensing
Ukraine confronts a series of persistent obstacles in pursuing nuclear power at Khmel’nit’ska and all stations. First, Ukraine did not have its own nuclear institutions after the collapse of the Soviet Union and had to create them. Since the early 1990s a series of bureaucracies and agencies to promote, manage and regulate nuclear power have been created, renamed, restructured or abolished, even if the nation’s industry works closely with the IAEA, the EU, and other groups to ensure compliance with international standards. Constant reforms left the industry with insufficient staff and responsibilities in flux and unclear. The state nuclear agency, Goskomatom, and its utility partner, Energoatom, and then the Ministry of Energy and Coal Industry (from 2007), with a tiny Department of Nuclear Energy and Atomic Industry which in 2014 employed in all only 24 people, have all been involved in nuclear issues.
As for regulation and safety, a similar pattern of the creation, restructuring, and recreation of regulatory agencies also persists. The Soviets created a State Committee for the Supervision of Safe Conduct of Work in Atomic Industry in the early 1980s, but it had no branch dedicated solely to Soviet Ukraine. After independence Ukraine created a State Committee of Ukraine on Nuclear and Radiation Safety in February 1992. It was abolished at the end of 1994 and its functions were transferred to the newly created Ministry of Environmental Protection and Nuclear Safety, which included a State Inspectorate for Supervision of Nuclear Safety. Finally, in December 2000, in response to international pressure, an independent State Nuclear Regulatory Committee of Ukraine was created (later the State Nuclear Regulatory Inspectorate).
Given these changes, chronic lack of funding, and personnel issues it remains unclear if the inspectorate is prepared to fully follow its responsibilities even if the inspectorate has achieved relative independance. But the government and industry continue to pressure it. In December 2010 the inspectorate signed a 20-year extension of the operating licences for units 1 and 2 at the Rivenns’ka nuclear power plant. On October 14, 2013, the inspectorate published a draft decision to extend lifetime of Iuzhno-Ukrains’ka unit 1 to December 2023; that reactor has been out of service since March 2013 for maintenance and upgrade. Representatives of NGOs continue to worry about the independence of the inspectorate, while the Fukushima accident led government officials to recognize the need for more circumspection and increased safety expenditures as they pursue nuclear power.
Expansion of Nuclear Power to Avoid Energy and Technology Dependence?
Many Ukrainian politicians and energy specialists – and citizens – worry about the nation’s extremely high energy dependence on Russia. This dependence (as well as Ukraine’s very high energy inefficiency) constitutes a major legacy of the Soviet system and has profoundly shaped Ukraine’s political and economic crises. In 1991 net imports constituted approximately 54% of Ukraine’s primary energy supply. While they have dropped to 38% of total primary energy supply, in 2011 Ukraine still imported a total of 45 billion cubic meters of natural gas with 90% from the largest Russian state corporation, Gazprom. Since 1991 successive Ukrainian governments proclaimed the importance of energy independence, but achieved little, largely because of corruption in the energy sector and government as a whole.
Ukrainian politicians, scientists and businesspeople are determined to rejuvenate the nuclear sector for energy independence and distance from Russian oil and gas. Yet, having been part of the Soviet nuclear energy establishment, Ukraine remains beholden to Russia for production of fuel rods, spent fuel storage, and so on. Already in April 1995 the Ukrainian government approved an ambitious program for the creation of a nuclear fuel cycle in Ukraine, so that all nuclear fuel could be domestically produced. But the program got very little funding and could not meet targets. The state target economic program “Nuclear Fuel of Ukraine,” adopted in 2009, adjusted the goals and insisted more modestly on “diversification of nuclear fuel supplies for nuclear power plants in Ukraine.” What are the main elements of the fuel cycle that state and industry have tried to develop ? First, Ukrainian officials hope to increase domestic mining of uranium ore. Ukraine also mines zirconium, which is crucial for cladding fuel rods. It sends both to Russia for processing, enrichment and then manufacture into fuel pellets and fuel assemblies at the Russian nuclear fuel company “TVEL,” which sends manufactured fuel back to Ukraine. This reinforces the belief that the Ukrainian nuclear industry risks becoming an “ore appendage of Russia.” Ukraine negotiated with Russia to create a state corporation with minority Russian ownership in which the processed uranium will be manufactured into fuel assemblies in Ukraine beginning in the late 2010s via the new “Nuclear Fuel” concern. In February 2014 the Ukrainian government approved the plans for its fabrication facility. Yet, as with so many other crucial projects in the nuclear industry, construction has not commenced. Significant problems with the financing of the plant remain, and they are unlikely to be resolved given the ongoing Ukrainian-Russian crisis.
At the same time, in order to diversify nuclear fuel supplies, Energoatom has sought to use US fuel in its 1,000 MWe PWRs. In 2005, Iuzhno-Ukrains’ka 3 first used six Westinghouse test assemblies. In April 2014, over the objection of Russian nuclear officials who declared it unsafe to use non-Russian assemblies, Energoatom and Westinghouse signed an agreement to extend the contract for nuclear fuel supplies up to 2020 including for all three Iuzhno-Ukrains’ka reactors.
Ukraine has also been slow to address the problems of radioactive waste and spent nuclear fuel management in a systematic way. Ukraine depends on Russia to reprocess spent nuclear fuel (SNF) from its reactors. This fuel is sent to Zheleznogorsk or Ozersk, Russia, at a cost of over $100 million per year, although Ukraine did build a dry storage for spent nuclear fuel at Zaporiz’ka station that opened in 2001. On top of this, Ukraine is obligated at some point to reimport the spent nuclear fuel and waste associated with its reprocessing. In 2012 the Rada approved construction of a dry storage facility at $460 million within the Chernobyl exclusion zone, which began only August 2014. Most of the radioactive waste from the Chernobyl accident and clean-up is also stored in the Chernobyl exclusion zone. The authorities have yet to make a decision about what to do with other radioactive waste from power plant operation that remains stored on power station sites.
After Maidan, More Nuclear Reactors?
In pursuit of nuclear power in the twenty-first century, Ukrainian leaders, scientists and citizens face a series of problems and choices. Chernobyl will remain a costly and unsafe reminder of the risks of nuclear power in an environment with inadequate oversight and citizen input. The new “Shelter Object” indicates that Ukrainian and European officials and scientists can work together and address the legacy of disaster. But Ukraine’s greater energy, and specifically nuclear, independence will be long in coming because of difficulties in reforming the energy sector, the close tie between Russia and Ukraine in nuclear technologies, and the war in Ukraine’s east – especially with a shaky cease-fire and understandable mistrust between Ukraine’s President Petro Petroshenko and Russia’s President Vladimir Putin. As a sign of that mistrust, in October 2014 the Ukrainian government reiterated its determination to build new reactors without Russian involvement, no matter the cost, no matter the legacy of Chernobyl.