The nuclear industry is in terminal decline. Poor economics, an appalling safety record, mounting piles of radioactive waste and the ever-present threat of nuclear weapons proliferation have eroded public confidence and seen orders for new plants dry up. One of the industry’s last hopes is exploiting global concern over climate change by promoting itself as a carbon-free energy technology. It is hoping to be made eligible for the Kyoto mechanisms – the Clean

Development Mechanism and Joint Implementation – thus gaining access to a potentially significant new source of financing and public credibility. The decision on whether it is eligible for the CDM will be taken this November in The Hague at the 6th conference of the Parties to the Climate Change Convention (COP6). To allow this would be a disaster. It would risk not only a new dawn for this polluting and dangerous industry, but undermine efforts to combat climate change.

The CDM needs to be truly clean. It should focus positively on renewable energy technologies, not unsafe and environmentally polluting ones like nuclear power.


In November 2000, the Parties to the Climate Change Convention will meet in The Hague for further negotiations on the shape of the Kyoto Protocol. Among the most important decisions that will be made is that on the rules and structure of the Clean Development Mechanism (CDM). The CDM is one of the Kyoto Protocol’s so-called "flexible mechanisms. It is intended to allow industrialized countries to offset their greenhouse gas reduction targets by funding projects in developing countries that lead to reduced emissions.

One of the most important issues, is what technologies and practices should be eligible for the CDM, and in particular whether nuclear power should be eligible. At the last meeting of the Conference of Parties (COP5) in Bonn last November, a majority of European Union (EU) members, and key developing countries such as Indonesia, ruled out nuclear power [see p 4]. Among the notable exceptions were Britain and France from the EU, and developing countries such as India and China. Recent reports indicate that China is waiting to see if it will receive CDM credits for new nuclear plants before deciding how many to build, and that China and India have made the inclusion of nuclear in the CDM non-negotiable. This will clearly be one of, if not the most controversial issue under negotiation in The Hague.

Softly-softly – the nuclear industry’s stealth tactics

In contrast to its high profile lobbying of recent years, the industry is currently pursuing a softly-softly approach to getting nuclear into the CDM. In the lead-up to COP5, the industry urged supportive governments not to openly endorse nuclear for fear of a backlash, especially just after the Tokaimura accident in Japan. Their new tactic is to shape the rules of the CDM so that no technology or practice is excluded, thus allowing nuclear to gain eligibility for the mechanisms by default. Parties to the Climate Change Convention must not allow this stealth tactic to work – nuclear power must be explicitly excluded from the CDM.

What it will mean if nuclear becomes eligible – quantifying the threat

Developing countries are the key to the nuclear industry’s future, yet to date orders for new reactors have been scarce. The main barrier is economic. The huge capital cost of a new reactor and the long repayment period are significant deterrents. But if CDM credits were factored in, this could change.

For example, a 700MW coal fired power station emits about 4.5 million tons of CO2 a year. If a nuclear reactor was built instead, it could be claimed that it offsets this amount of CO2. Estimates of the value of CO2 per ton vary but for a CDM project an amount of approximately $10-30 a ton is likely. Thus, the carbon offset by this nuclear reactor over a 10-year period would be valued at between $450 million and $1.35 billion (less when future credits are discounted). An agreement between the western supplier of the reactor and the developing country in which it was being built to subtract the value of the carbon credits from the initial capital cost of the reactor would greatly improve the economics. A 700MW nuclear reactor costs approximately $2.5-$3 billion. The CDM credits it generates could cut the capital cost by 10-40%.

Undermining of domestic action by industrialized countries

Aside from the economic implications there is also great potential for nuclear plants to undermine domestic action to reduce greenhouse gas emissions. If, for example, Canada were to secure another contract to build two 700MW reactors in China it could potentially claim 9 million tons of carbon reduction credits per annum– equivalent to approximately 6% of its 1998 carbon dioxide emissions.

The case of China

China’s nuclear plans graphically demonstrate the potential threat of a CDM that includes nuclear power. Its 10th five-year plan is currently being finalized by Beijing, and may include plans for up to 6 new nuclear reactors. According to a report in the industry journal Nucleonics Week, China is waiting to see if it will get CDM credits for new nuclear plant before it finalizes a decision on how many additional units to build. The final decision will be made within six months of COP6. A decision to allow nuclear power to be eligible for CDM credits at The Hague could rapidly see the mechanism become a subsidy for nuclear power in China.

Not surprisingly, the industrialized countries that are most firmly in favor of nuclear being eligible for the CDM are also those that stand to gain most from China ordering new nuclear plant. With its growing economy and rocketing energy demand, China has long been the great hope of the western nuclear industry. The French Government’s nuclear company Framatome already has built two reactors in China, at Daya Bay, and is now building two more at Yangjiang. Atomic Energy of Canada Ltd (AECL) is building two reactors – Quinshan 4 and 5. Both will be frontrunners if any new units are ordered. Recent reports have also suggested that China is now seeking to develop a standardized reactor design in conjunction with western nuclear vendors, a decision that will favor Westinghouse (UK owned through British Nuclear Fuels Ltd), Japan’s

Mitsubishi, and Framatome. The UK and France are blocking attempts within the European Union to exclude nuclear from the CDM, while Japan and Canada are among the strongest supporters of the nuclear case.

Win-win for nuclear; lose-lose for the environment

If nuclear power becomes eligible for the CDM, these countries and their nuclear industries stand to gain considerably. Indeed, for them it will be a win-win situation. The CDM will provide a new subsidy for their ailing nuclear industries, while the carbon reduction credits from new nuclear plants will help them meet their emission reduction targets.

But it will be a lose-lose for the environment. Not only will there be an expanded nuclear industry, with increased production of radioactive waste and the constant risk of catastrophic accidents, but every dollar spent on nuclear power will be diverted from the development of sustainable energy systems and effective measures to combat climate change. As Denmark’s environment minister, Svend Auken, said at COP5: "the CDM is about Clean Development and nuclear energy has no place here".

Nuclear proliferation is not clean development

If nuclear power is made eligible for the CDM, the Kyoto Protocol will be contributing to the threat of nuclear proliferation. All nuclear power plants produce weapons-usable plutonium. A sphere of plutonium smaller than a tennis ball can be used to make an explosive device that can kill many thousands of people. Two of the developing countries lobbying most aggressively for

CDM credits for nuclear projects are China and India, both of which have active nuclear weapons programs. Other likely candidates for nuclear credits under the CDM, like South Korea, have only recently halted clandestine programs to develop a nuclear arsenal.

The threat to global security posed by nuclear proliferation is equal to that of climate change. For the Kyoto Protocol to exacerbate this threat through its mechanisms would be a truly perverse, and dangerous, outcome for the Climate Convention negotiations.

Nuclear credits will drain resources from non-nuclear developing countries

Many developing countries, particularly those in the Pacific and Africa, are concerned that investment in CDM projects will mirror current investment flows and be biased towards high-growth countries like China and South Korea. They are rightly seeking an assurance that the CDM will be structured to ensure an equitable distribution of resources among all developing countries.

Allowing nuclear power in the CDM will undermine their efforts. It will see CDM credits sucked in by nuclear mega-projects in countries like China, India and South Korea, further reducing the resources available for sustainable projects in non-nuclear developing countries.

The ‘Kyoto stamp of approval’

Allowing CDM credits for nuclear power will be seen as an endorsement of the nuclear industry’s argument that it has a role to play in combating climate change. It will be, in effect, the ‘Kyoto stamp of approval’. This could encourage developing countries to go down the nuclear road, and help those developed countries who cling to the nuclear dream justify further subsidies for their domestic nuclear power programs, extension of reactor operating lives, and even new build.

The legitimacy it would give to the nuclear industry could also jeopardize phase-out plans, legislated or de facto, in a number of countries. As a Swedish delegate at COP5 said: "If Sweden were to allow nuclear in the CDM, that would make political trouble for the nuclear phase-out at home". In short, CDM credits would help legitimize a dying industry that has no other arguments left.

The AOSIS text – part of a simple and effective solution

The Association of Small Island States (AOSIS), whose members have perhaps the most to lose from climate change, has proposed the following text: that CDM projects "Not support the use of nuclear power". If the CDM is to be an effective instrument for sustainable development, and advance the goal of greenhouse gas reductions, then support for this text from all parties to the Climate Change Convention is essential. Otherwise, a key mechanism of the Kyoto Protocol will become just another nuclear subsidy.

Positive list for a positive outcome

Ultimately, the only way to make the CDM an effective vehicle for clean development and global climate protection is to restrict CDM projects to renewable energy technologies. These technologies should be specified in a "positive" list that is made part of the rules of the CDM to be agreed at COP6. Technologies and practices that are not on this list – such as sinks and ‘clean coal’ – would not be eligible for CDM credits.

For more information contact:

Nuclear issues:

ph. ++ 31 20 524 9563

ph. ++ 31 20 523 6218

Renewable Energy issues:

ph. ++ 31 20 523 6291

Climate policy and the CDM:

ph. ++ 49 30 446 78765

To sign a petition or otherwise become more involved in this issue, contact:

"> (Nuclear Information and Resource Service, Washington, DC)

"> (World Information Service on Energy, Amsterdam, Netherlands)