It is a pleasure for me to address this Opening Session of the 32nd Japan Atomic Industrial Forum on the subject of Nuclear Power and Sustainable Development. Japan is a major user of nuclear power, a substantial contributor to nuclear technology transfer in the region and to developing countries in general, and a strong supporter of the IAEA. In 1998, Japan's commercial power plants supplied some 35% of national electricity demand and achieved an average capacity factor of more than 80%. Moreover, guided by the "Three E's" - energy security, environmental protection and economic growth - the contribution of nuclear power to national energy production is expected to increase. [Japan is also at the forefront of nuclear science and technology in many areas. Some examples are its active participation in the International Thermonuclear Experimental Reactor Project (ITER) and its development of the High Temperature Engineering Test Reactor.]
Yet the use of nuclear power in Japan is not always fully understood by all segments of the public. It is clear, therefore, that one of the key challenges for all those involved in the nuclear sector is to foster a culture of communication and transparency and to engage more widely with civil society. Public understanding is key to public acceptance. And public acceptance is key for nuclear science and technology to be able to contribute their full share to addressing the many serious challenges facing our common future.
My purpose today is to present an overview of the opportunities and challenges facing nuclear power and the importance of strengthened international co-operation to meet those challenges. [I speak from the perspective of the IAEA which was established in 1957 as the vehicle for international co-operation in the safe and peaceful use of nuclear energy. The Agency is guided by three complementary and equally important strategic objectives. These are: to assist Member States in the use of nuclear technology; to promote radiation and nuclear safety; and to ensure to the extent possible that pledges related to the exclusively peaceful use of nuclear energy are kept].
As the worldwide intergovernmental organization dedicated to nuclear science and technology, the Agency acts as an international focal point for technology sharing, the setting and application of standards and verification of non-proliferation undertakings. The reputation of the Agency - and therefore the value of the work that it does - depends on its scientific and technical competence and its objectivity. It is from this perspective that I make my remarks today under four headings: nuclear power and the global energy mix; nuclear safety and the importance of public confidence; economic competitiveness and the role of research and development; and the importance of nuclear verification and prevention of illicit trafficking.
I begin with the contribution of nuclear power to the global energy mix. As we enter the new millennium, two energy related issues are at the top of the international agenda. One issue is the need to meet increasing global energy demand, particularly for electricity, which is driven largely by growing populations and economies in developing countries. According to the United Nations, world population will reach 6 billion this year and is projected to increase to nearly 8 billion by 2050. A conservative scenario projects global electricity demand to treble in the same period. [For developing countries alone, energy demand is likely to increase two to three fold in the next thirty years, depending on the economic growth scenario].
The other issue is the threat of global warming and climate change and the need to mitigate the emission of man-made greenhouse gases (GHG). Under the Kyoto Protocol, industrialized countries agreed to lower their GHG emissions. Last November, at the Fourth Session of the Conference of the Parties (CoP-4) to the UN Framework Convention on Climate Change, other countries announced voluntary commitments to the same ends. Energy produced from fossil fuels accounts for about half of man-made GHG emissions. By contrast, electricity produced from nuclear energy produces practically no GHG. While there are many hopes for 'clean' energy sources, including through nuclear fusion, the fact is that except for nuclear or hydro power (which has limited growth potential), there are not yet any other economically viable, minimal-GHG-emission options for base load power generation. Moreover, the World Energy Council predicts that even with substantial research support and subsidies, non-traditional renewable resources which currently account for 1% of global energy supply could grow to no more than 3 - 6% of global energy supply by the year 2020.
The global challenge is to develop strategies that foster a sustainable energy future that will be less dependent on fossil sources. In view of the relatively long lead times required for the planning, construction and commissioning of new energy production facilities, meeting this challenge is becoming increasingly urgent for both developed and developing countries. [While the short term outlook is for continued high dependence on fossil fuels and greater GHG emissions, the energy choices for the future need to take account of global and national targets and timetables for reducing carbon dioxide emissions].
At the beginning of 1999, nuclear power [some 434 nuclear reactors operating in 31 countries] provided over 16% of global electricity and accounted for the avoidance of about 8% of global carbon emissions. The accumulated operating experience for nuclear power reactors reached a figure of over 9,000 reactor-years. Clearly, nuclear power is already a mature and readily available technology for cost effective mitigation of GHG. This would suggest that nuclear power will continue to play a key role in energy strategies for sustainable development, together with renewable sources, improved fossil fuel conversion and greater efficiency throughout the energy system. And for many countries, nuclear power offers additional advantages in terms of security of energy supply.
However, the most recent IAEA projections show the nuclear power share of global electricity supply falling to 13% in 2010 and between 8.9 - 12% in 2020. New nuclear power projects are at a standstill in Western Europe and North America but growing in some rapidly developing economies in Asia and in parts of Central and Eastern Europe [although the impact of the financial crisis on planned expansion in these areas is not yet clear.] It is appropriate to ask what are the challenges facing nuclear power and what must be done to ensure that the contribution of nuclear power to meeting demand for environmentally clean energy is given a full and fair consideration?
To my mind, two factors are key: public confidence and economic competitiveness. In many countries, public concern over nuclear safety, particularly waste management, is a critical inhibiting factor on decisions to construct new plants and on the continued operation of safe and efficient plants. And in countries which are deregulating their energy markets, the high initial capital costs of new plants and concerns about competitiveness have tended to focus new investment elsewhere, including on combined cycle gas power plants. Meeting the challenges to the future of nuclear power thus requires action on two fronts: the restoration of public confidence in the safe and exclusively peaceful use of nuclear energy and the demonstration of economic competitiveness of nuclear power in comparison with other options.
Nuclear safety is a national responsibility but a global issue. In terms of both potential health and environmental impacts and the effect on public opinion, nuclear accidents know no borders. A demonstrated global record of safety in nuclear, radiation and radioactive waste will be, in my view, a determining factor for the future role of nuclear technology. To achieve such a record requires close international co-operation, by everyone for the benefit of everyone. International co-operation in the safe use of nuclear technology should not be perceived as an intrusion on national sovereignty but, on the contrary, as an investment in the future of nuclear energy and applications [and an invaluable aid in assisting States in exercising their right to use them].
The global safety record for nuclear power plants has shown continued improvement throughout this decade, with marked progress in Central and Eastern Europe. However, the Agency's Nuclear Safety Review for 1998 identifies several areas where increased attention is required. In 1998 there were no accidents at nuclear power plants causing public harm but several safety related events at power plants underlined that constant attention must be given not only to technical safety measures but also to managerial and organizational practices.
The transport of spent fuel was stopped in three European countries after inspections of transport containers revealed minute levels of radioactive contamination which were higher than those specified in national regulations. This led to public concern and emphasized the importance of strict adherence to the Agency's Regulations for the Safe Transport of Radioactive Material and the need for transparency in public communication.
[There were a number of accidents concerning abandoned radiation sources, known as orphan sources. In Georgia, in Turkey and last month in Peru, orphan sources resulted in some cases of serious radiation overexposure. These events underlined the serious challenge posed by the lack of adequate control of radiation sources in some countries].
The role of the IAEA in nuclear and radiation safety is to foster a comprehensive nuclear safety regime in which the international community as a whole contributes to and benefits from binding conventions, accurate and current safety standards and measures to assist in the application of those conventions and standards. In recent years, several important international conventions, negotiated under the IAEA's auspices, have helped to fill gaps in the nuclear safety regime. The first Review Meeting under the Convention on Nuclear Safety is scheduled this month. Peer review is key to the Convention's aim of achieving and maintaining a high level of nuclear safety worldwide. But we remain watchful of other areas in which the international community as a whole would benefit from binding norms.
The Agency's Safety Standards Series represents international consensus on safety requirements and their implementation. In the present biennium we have undertaken the preparation or revision of the entire corpus of safety standards - a total of some seventy documents - to ensure that they are comprehensive, scientifically accurate and current. [Last month, the Board of Governors approved a new safety standard for near surface disposal of certain radioactive wastes. Eight more new or revised standards are expected to follow].
However, the key to what is known as 'safety culture' is in the actual application of conventions and standards. In this area, the Agency offers a wide range of services to assist Member States - various types of review missions, training, the fostering of scientific research, technical co-operation and information exchange. The provision of these safety assistance services is key to achieving a global best practice in the application of safety standards. They are the best practical way for safety culture to penetrate borders.
Waste management is an increasingly prominent public concern even though one of the comparative advantages of nuclear power is the very small volume of wastes generated. [The Agency assists Member States in their management of low and intermediate level waste through the assessment of different technologies and information dissemination. But] With respect to the management of spent fuel and the final disposal of high level radioactive waste, political decisions are required. These decisions can be delayed but they cannot be avoided - the quantities involved are growing. Experts agree that technical solutions exist for safe and permanent disposal. But to my mind, only when these solutions have been demonstrated will the public perceive that the waste issue has been resolved. This is an area for urgent national attention and co-operation on an international or regional basis, as appropriate.
The bottom line is that public confidence is inseparable from nuclear safety. And nuclear safety cannot be merely proclaimed - it must be demonstrated throughout the entire nuclear fuel cycle, most urgently with respect to the management of radioactive waste and spent fuel. [A demonstrated global safety culture, together with timely and transparent public information, is an essential building block for public confidence].
I turn now to the question of the economic competitiveness of nuclear power. The structure of the global electricity sector is changing. Several States are deregulating and privatizing their energy markets. Power plant operators are searching for improved performance and greater economy to reduce costs. National regulatory authorities, including in Japan, are scrutinizing applications for plant life extension. Governments are considering how to factor national GHG emissions commitments into deregulated and privatised domestic markets.
The increasingly competitive environment has significant implications for nuclear power. On the one hand, the increasing safety and reliability of nuclear power plants over the past decade can be seen in the improved production figures, fewer unplanned outages and increased average annual availability which grew from 70% in 1989 to 78% in 1996. On the other, competition from fossil fuels has increased. The price of oil in recent years has been at very low levels and new, more efficient coal and gas technologies with comparatively low initial capital costs and substantially faster construction times are being introduced.
For nuclear power plant operators, there is a pressing need for more efficient use of all resources, including personnel and more effective management of plant activities such as outages and maintenance. At the same time, continued vigilance is required by national regulatory authorities to ensure that there is no sacrifice of safety for the sake of profitability; that plant operators continue to devote the necessary resources to staffing, training, and maintenance; and that there is full adherence to operating procedures. [The IAEA assists its Member States in both these areas through the collection and dissemination of the latest technological improvements and accepted good practices].
Two areas are of immediate importance: managing nuclear plant life extension which, by comparison with the construction of new energy facilities, is a cost-effective means of meeting energy demand, and ensuring that environmental externalities are factored into comparative assessments of energy options. The systematic collection, processing and dissemination of a large amount of data on aging and degradation processes is key to the evaluation of the current condition and future degradation trends of the component system and structure of nuclear power plants. In 1994, the IAEA commenced development of an International Database on Nuclear Power Plant Life Management. [This multi-module database covers reactor pressure vessel materials, pipe components, steam generators and concrete containment]. I would expect that all States would benefit from increased information exchange on successful life management of aging plants.
The issue of full accounting of externalities has both technical and political dimensions. [It should be recalled that the choice of nuclear power and of a particular energy mix is a national decision]. Since 1992, the Agency has developed the technical tools necessary for Member States to conduct their own objective comparative evaluations of all available energy options. Through sophisticated databases and methodologies, economic, environmental and risk analysis of all processes throughout the fuel cycle can be conducted. Over 30 countries are presently using these comprehensive analytic tools. [Several international lending institutions such as the World Bank and the European Bank for Reconstruction and Development utilise data from these programmes before approving investment in electricity projects].
But whether concern about externalities such as pollution and climate change will result in the full internalisation of the environmental costs of fossil fuels remains to be seen. For its part, the IAEA is contributing to the International Panel on Climate Change (IPCC) Third Assessment Report and is working together with the United Nations and the World Energy Council to conduct a world energy assessment for the UN Commission on Sustainable Development which, in 2001, will address energy issues for the first time. Our objective is to ensure that nuclear power is given a full and fair hearing.
This brings me to the role of research and development. As this Conference will undoubtedly show, the full potential of nuclear science and technology has not yet been reached. There are many prospects and opportunities for research and development. Indeed, the challenges to nuclear power require scientific and technical research to improve every component of nuclear fuel cycle technology. Objectives to strive for include new reactor designs with higher efficiency and availability, lower cost and improved safety, and small and medium size modular plants with passive safety features, multiple applications, short construction times and low capital costs. High priority should also be placed on new techniques for storage and disposal of nuclear waste.
[To take just one example of an area where market demand is encouraging rapid development and application of nuclear power technology, at the IAEA's General Conference last year Member States supported strengthening the Agency's activities relating to nuclear desalination and small and medium size reactors. Over 25 different concepts for reactors in this power range are at different stages of development. Also, some countries (Morocco, Egypt, India and others) have started or are preparing their own national nuclear seawater desalination demonstration projects. Through co-ordinated research and technical co-operation the Agency is assisting developing countries to address issues such as design simplification, staffing requirements, cost reductions and the maintenance of safety standards as well as assisting in planning and implementing demonstration programmes].
My final subject concerns two issues - nuclear verification and the prevention of illicit trafficking - which are vital for international peace and security and have a major impact on public confidence in the future of nuclear energy. They also have a bearing on the need for nuclear research and technology to continue to seek to develop proliferation resistant [and "safeguards friendly"] nuclear systems to give the highest assurance of no diversion of nuclear material.
The past decade has brought profound international changes but with respect to nuclear non-proliferation it is a mixed picture of global hopes but regional tensions. While reductions have been made in stockpiles of nuclear weapons in the Weapon States, and several other States have abandoned or foreclosed their nuclear weapons option, in key areas of high tension such as the Middle East and South Asia, regional accommodations have not yet been reached to enable the full application of the non-proliferation regime. Indeed, the nuclear weapon tests conducted last year by India and Pakistan sent two clear messages: the international community must increase its focus on regional instabilities which are the driving forces behind the acquisition of nuclear weapons and it must accelerate the process of nuclear disarmament.
[Two actions are urgently required to move towards nuclear arms reduction and the ultimate elimination of nuclear weapons: a ban on the production of fissile material for nuclear weapons and other explosive devices and a gradual reduction of existing stockpiles of such material. As to the first of these, negotiations in Geneva, in which the Agency has been asked by the United Nations General Assembly to assist if requested, unfortunately have not yet restarted. As to the second, some further progress has been made in preparatory work in anticipation of requests from the Russian Federation and the USA for the Agency to verify that fissile material removed from nuclear weapon programmes in the two countries remains in peaceful activities. But agreement is still to be reached on the modes of financing these and other nuclear arms reduction measures].
The Strengthened Safeguards System
Effective verification is indispensable to advancing the agenda for the reduction of nuclear arms and their eventual elimination. The role of the IAEA, through its verification and safeguards activities, is to provide the necessary assurance that States are complying with the nuclear non-proliferation and arms control commitments they have undertaken. Over 180 States have undertaken to accept IAEA safeguards on their nuclear material and activities.
Since 1991, and as a result especially of the Agency's experience in Iraq, it has become clear that effective safeguards must provide assurance not only about the nuclear activities declared by a State, but also about the absence of any undeclared activities. To do this, the system has needed to move beyond its focus on nuclear material accountancy - [essentially a quantitative audit system designed to keep track of material declared to the Agency] - to a system based on more qualitative assessments. This has entailed development in three major directions: more information, wider access to locations and greater use of advanced technology in areas such as remote monitoring and environmental sampling. [In implementing this system, the Agency's objective is to achieve optimum effectiveness and efficiency by meshing fully the traditional nuclear material accountancy system with the strengthened measures].
In order to introduce the strengthened safeguards system, the IAEA Board of Governors approved in 1997 a Model Additional Protocol which provides the necessary legal authority for implementing the new measures. On the basis of the model, States are invited to conclude a Protocol additional to their existing safeguards agreement. Japan's Protocol was signed last December and is now before the Diet for approval for ratification. To date, Additional Protocols covering 40 States have been signed. I would hope that that by the year 2000 adherence would be global.
The introduction of the strengthened safeguards system will raise substantially the level of assurance, but it must be recognized that, even with full implementation, safeguards cannot provide 100% guarantees. [Some uncertainty is inevitable in any country-wide technical system that aims to prove the negative, that is to prove the absence of concealable objects or activities]. For this reason, while safeguards are a key element, they must be supplemented by other mutually reinforcing non-proliferation components. These include export control and, most importantly, regional and global security arrangements which aim at removing the incentives to acquire nuclear weapons.
Finally, a brief word on illicit trafficking. The potential threat to public safety and the danger of nuclear weapons proliferation from the illicit trafficking in nuclear material and other radioactive sources is an area of major international concern. While there are no known cases where weapons or weapons components have been stolen, there have been cases of theft of nuclear material. In the past 12 months, the Agency's Illicit Trafficking Database programme has recorded 6 incidents involving nuclear material (mostly in insignificant quantities), 24 incidents involving other radioactive sources and 2 incidents involving both. The prevention of illegal movements is a national responsibility but regional and international co-operation is essential. Through information exchange, training, technical assistance and other support services, the Agency is assisting Member States to prevent, detect and respond to theft, diversion and other unauthorized uses of nuclear material and other radioactive sources.
Three decades ago, nuclear energy was hailed as the energy of the future. Today, its growth is stagnant in many parts of the world and it is not absolutely assured that global environmental considerations will, by themselves, result in new investment in nuclear power generation. The extent to which objective consideration will be given to the positive contribution of nuclear energy to human welfare and sustainable development in general depends on ensuring its peaceful and safe use and its competitiveness in the market place. I must emphasize that these are not competing objectives - there is no trade-off between peace, safety and economics. All must be pursued equally.
The challenges to the future of nuclear energy require an active response. The world would not be well served if an important energy choice were to be foreclosed unnecessarily. A strong and effective global safety culture, well focused research and development programmes for safer and more efficient nuclear technology, and purposeful commitments to non-proliferation and moves towards nuclear disarmament are essential building blocks for public confidence. In each of these areas strengthened international co-operation is key to meeting the challenges of the new millennium. This is a task to which the IAEA remains fully committed.