The IAEA has recognized a recent $50 million funding allocation by the US Congress for purposes of a nuclear fuel reserve under the auspices of the Agency. US President George Bush signed the funding allocation into law on 26 December 2007.
"I have long been advocating the establishment of assurance of supply mechanisms in view of increasing demand for nuclear power and to strengthen non-proliferation," said IAEA Director General Dr. Mohamed ElBaradei. "At the core of such mechanisms will be a fuel bank of last resort, under IAEA auspices. Such a bank would operate on the basis of apolitical and non-discriminatory non-proliferation criteria, and I welcome the recent action by the US Congress as a positive step in this regard. In addition to the $50 million already pledged by the Nuclear Threat Initiative (NTI), it brings such a fuel bank closer to realisation. I also have welcomed the Russian proposal for a fuel bank under IAEA control and a German initiative calling for the creation of an international enrichment centre, open to participation by all interested States."
The US contribution matches an earlier commitment of $50 million made by the NTI, an organization devoted to non-proliferation efforts. This contribution was made by NTI advisor Warren Buffett in September 2006 with the stipulation that one or more IAEA Member States contribute an additional $100 million (or low-enriched uranium [LEU] equal in value) to the reserve. With the recent US commitment, a final $50 million pledge is needed to meet the NTI's funding requirement.
Former US Senator Sam Nunn, Co-Chairman of the NTI, also recognized the US government´s $50 million pledge as further progress towards creation of a system for nuclear fuel assurances.
"An IAEA-controlled fuel bank is essential to reducing global nuclear dangers because the same nuclear enrichment technology that is used to make nuclear reactor fuel can also be used to make material for a nuclear weapon," said Nunn, in a statement. "The law signed [on 26 December] is an important step forward to help prevent the spread of this nuclear technology to dozens of countries around the world and can be used to help release NTI's $50 million contribution to a fuel bank."
The concept of a multilateral LEU supply bank is not a new one, and has in fact been discussed in past decades. Assurances of supply of nuclear fuel, including nuclear fuel reserves (or banks), could provide States confidence in obtaining nuclear fuel for electricity generation and protect against disruption of supply for political reasons. The risk of such disruptions could possibly dissuade countries from initiating or expanding nuclear power programmes or create vulnerabilities in the security of fuel supply that might in turn drive States to invest in national uranium enrichment capabilities with possible additional proliferation risks. Thus, multilateral approaches to the nuclear fuel cycle, in general, have the potential to facilitate peaceful use of nuclear energy while providing the international community with additional assurance that the sensitive parts of the nuclear fuel cycle are less vulnerable to misuse for non-peaceful purposes.
In addition to the NTI plan, several other proposals for the creation of a reliable fuel supply have been submitted to the IAEA and are currently under consideration.
A Russian proposal seeks the establishment of a joint enrichment facility at the country's pre-existing Angarsk Electrolysis Chemical Complex, which is already a manufacturer of LEU. An IAEA controlled LEU reserve would be located at Angarsk.
A German plan calls for multilateral uranium enrichment under the auspices of the IAEA and calls for a third-party State to provide an extraterritorial area for a uranium enrichment plant. The plant would be financed by countries who would act as buyers of the plant´s nuclear fuel.
As an increasing number of nations plan for the development of civilian nuclear energy, concern has grown over the potential for diversion of nuclear material and technology from peaceful to military use. The establishment of a nuclear fuel supply system has been considered as a means of not only minimizing this risk, but also in assisting nations in their peaceful development of nuclear power. Providing a reliable fuel supply to nations with a burgeoning nuclear power programme eases the economic cost and nuclear weapons-related risks intrinsic with building enrichment capabilities.
Enriched uranium provides the fuel for many of the world's nuclear power reactors, and the enrichment process is a vital process in a multi-step nuclear fuel cycle. The enrichment of uranium, while a necessary step in the creation of the fuel that power many of the world's civilian nuclear reactors, can also be employed for use in nuclear weapons. By providing a secure and reliable supply of the fuel needed for nuclear power generation, a nuclear fuel bank would limit the dissemination of enrichment technologies.