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Can the IAEA’s New Nuclear Fuel Bank Prevent a Future Iran Crisis?

A storage facility for low-enriched uranium run by the International Atomic Energy Agency is shedding new light on how another Iran standoff might be averted for future generations.

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Whether to accept or reject a deal to limit Iran’s nuclear program will be at the top of Congress’s agenda when lawmakers return to Washington next month. But a storage facility for low-enriched uranium run by the International Atomic Energy Agency is shedding new light on how such a standoff might be averted for future generations.

The globally administered IAEA nuclear fuel bank, hosted by Kazakhstan and operational in 2017, aims to provide countries with a steady and predictable supply of low-enriched uranium. It is also set up to discourage governments from building facilities that could be used to purify uranium to weapons-grade levels — an issue that has been at the heart of the deadlock between Iran and world powers for more than a decade.

The fuel bank agreement, which was signed Thursday at the Kazakh capital Astana, comes after the nuclear deal reached between Iran and six world powers in July. The deal, if enacted, will limit the amount of uranium that Tehran produces and opens the Islamic Republic’s enrichment program to international inspections, in exchange for an easing of harsh sanctions that have cropped Iran’s economy. All along, Iran has maintained its nuclear program is strictly peaceful, and necessary to meet the country’s energy and medical demands. The IAEA’s fuel bank, in theory, could negate the need for Iran or other nations to produce their own uranium in the future.

But questions remain over how the new initiative will work in practice.

Supporters view the fuel bank as a way to safeguard nuclear supplies and reduce countries’ needs to develop nuclear weapons. “If this fuel bank had existed ten years ago, perhaps Iran would not have pursued uranium enrichment even to low-enriched uranium for peaceful use in its power reactors,” U.S. Assistant Secretary of Defense Andrew C. Weber, who oversees the Pentagon’s nuclear, chemical and biological defense programs, told the crowd in Astana.

It may also help as a non-proliferation tool, said Kingston Reif, director of disarmament and threat reduction policy at the Washington-based Arms Control Association.

The IAEA repository “can serve as a fuel supply of last resort in the event that a state with civilian reactors can’t access fuel from the international market,” Reif told Foreign Policy. “In that regard, it can reduce the incentive that states might have on the basis of a fuel supply cutoff to develop their own enrichment and reprocessing.”

But the storage supply will only hold up to 90 tonnes of low-enriched uranium, enough to run one light-water reactor to power a large city for three years. An estimated 33 nations currently are eyeing building maiden nuclear power plants, according to the IAEA, and each will either need to produce fuel to operate or buy it elsewhere. With such relatively little uranium available, the fuel bank largely will serve as a last ditch reserve should supply be disrupted for any given reactor.

And that might not be enough to turn a country away from pursuing its own enrichment capacity. Moreover, the facility in Kazakhstan makes available low-enriched uranium for governments to purchase, but the uranium still needs to be fabricated into fuel — a potentially lengthy process that could make countries think twice about using the bank.

“If a government is in a situation where its supply is quickly cut, it would likely take a few years to find a country to manufacture this enriched uranium and then license this fuel for the reactor,” Pavel Podvig, the head of the Russian Nuclear Forces Project in Geneva and columnist at the Bulletin of Atomic Scientists, told FP. “It would be very difficult to resolve these problems on a practical timescale.”

With concerns about running out of fuel, the economics of nuclear energy could push a government toward building its own enrichment capacity. “For example, building a fleet of five reactors would cost a government at least $10 billion and an enrichment plan would cost a few billion more. If a country is already willing to pay this much, it might make sense to invest the extra billions on enrichment to make sure they don’t turn into pumpkins,” Podvig said.

That renders the IAEA supply bank a largely symbolic stopgap to keep nations from running out of fuel. Experts say all eyes will be on the program to see if it, in fact, steers countries away from enrichment.

The Kazakh government is also hoping its resume on nuclear non-proliferation can lend to the fuel bank’s credibility.

Most of the former Soviet Union’s nuclear tests took place in Semipalatinsk, in north-eastern Kazakhstan. By 1989, following the closure of the program due to protests, Semipalatinsk had held 30 surface, 88 atmospheric, and 340 nuclear underground tests. Since the breakup of the Soviet Union in 1991, Kazakhstan has followed a foreign policy strongly against the proliferation of nuclear weapons, voluntarily surrendering its nuclear weapons stockpiles, the fourth largest in the world at the time, which it inherited from the Soviet Union.

Nuclear fuel bank programs from the United States, Russia, and the United Kingdom already exist, but the bank in Kazakhstan is the first under international auspices. The IAEA hopes it will play a larger role in preventing proliferation by persuading countries they can afford to forgo the ability to enrich their own fuel without risking political fallout or national security.

“Countries will be watching how this fuel bank performs,” Reif said. “If it can deliver to customers in a timely fashion and ease concerns, the implications could be big.

IIPA via Getty Images

Correction, Aug. 31, 2015: According to the IAEA’s most recent report, the correct number of countries interested in building a nuclear power plant is 33. An earlier version of this article stated that the number of countries interested in building a nuclear power plant was 40. 

Reid Standish is a journalist based in Helsinki, Finland. He was formerly an associate editor at Foreign Policy. @reidstan

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