1. Big Powers, Iran Hold Nuclear Talks as Time Runs Out
Justyna Pawlak and Yeganeh Torbati
(for personal use only)
World powers began two days of talks with Iran on Monday to try to end a decade-long stand-off over Tehran's nuclear program and avert the threat of a new war in the Middle East.
In Iran, President Mahmoud Ahmadinejad said Tehran would be prepared to stop enriching uranium to a higher level - a process that could be used to make nuclear arms - if the six powers agreed to meet its needs for the fuel. But it is not clear how much influence Ahmadinejad has over the negotiations and whether his remarks reflect Tehran's position in the talks.
Experts and diplomats said a breakthrough was unlikely at the meeting in Moscow, where the world powers are wary of making concessions that would enable Tehran draw out the talks and give it more time to develop a nuclear weapons capability.
Iran strenuously denies it has any wish to obtain such weaponry and says it only wants nuclear technology to generate electricity.
Israel has threatened to bomb Iran if no solution to the dispute is found, oil markets are nervous over the prospect of intensifying regional tensions and the frail world economy can ill afford a further increase in crude prices.
"The atmosphere was fine, business-like and good. We hope this translates into a serious political commitment by the Iranians to address our proposals," a European Union spokesman said after the talks started in the Russian capital.
But a Western official made clear the United States, Russia, China, Britain, France and Germany were ready to deepen Iran's diplomatic and economic isolation if no deal is reached.
"If Iran remains unwilling to take the opportunities these talks present, it will face continuing and intensified pressure and isolation," a Western official said.
The Moscow talks follow two rounds of negotiations since diplomacy resumed in April following a 15-month hiatus.
The United States wants to halt Iran's enrichment of uranium to 20 percent purity, a level which some experts consider to be a dangerous step towards achieving the ability to create the explosive material required to make a nuclear bomb.
Ahmadinejad's comments on enrichment appeared intended to ease pressure from the world powers and encourage them to make concessions at the talks.
"From the beginning the Islamic Republic has stated that if European countries provided 20 percent enriched fuel for Iran, it would not enrich to this level," Ahmadinejad stated in comments published on his presidential website.
But the Iranian president, who stands down at elections next year, has fallen out of favor with Supreme Leader Ayatollah Ali Khamenei, the man who has the ultimate decision-making power over the strategic nuclear program.
New U.S. and European Union sanctions are due to come into force in two weeks, tightening economic pressure on Iran.
Without progress to ensure Iran does not develop nuclear arms, Israel "could find itself facing the dilemma of 'a bomb, or to bomb'," Vice Prime Minister Moshe Yaalon said on Sunday.
"Should that be the choice, then bombing (Iran) is preferable to a bomb (in Iran's hands)," he said. "I hope we do not face that dilemma."
The six powers - led by EU foreign policy chief Catherine Ashton - hope at least to win assurances that Tehran is willing to discuss concrete solutions, opening the way to progress.
The six nations want a substantive response to their offer of fuel supplies for a research reactor and relief in sanctions on the sale of commercial aircraft parts to Iran.
At the last talks, in Baghdad last month, they asked Tehran in return to stop producing higher-grade uranium, ship any stockpile out of the country and close down the underground Fordow facility where such work is done.
But Iran's chief negotiator, Saeed Jalili, has indicated the incentives on offer are insufficient. Iranian officials said Tehran would express dissatisfaction there were no preparatory talks for the Moscow meeting and that progress was possible only if the six powers acknowledged its right to enrich uranium, something they have refused to do until Tehran agrees to in-depth U.N. inspections of its nuclear sites.
Iran is seeking an end to increasingly tough economic sanctions which have in recent months directly targeted its ability to export oil, its economic lifeblood.
But international concern is growing. The International Atomic Energy Agency failed to persuade Iran, in talks this month, to let it inspect the Parchin military site where it suspects nuclear bomb-related research took place.
Last week, EU officials said Jalili had agreed to give serious consideration to the six powers' proposal. Russia's determination to avoid diplomatic defeat may increase hopes of agreement to at least meet again.
But U.S. and European diplomats have given no public indication of any willingness to scale back economic sanctions. An EU embargo on Iranian oil takes full effect on July 1 and new U.S. financial sanctions some days before that.
Measures including the EU ban on Iranian crude are already taking a toll. Iran's exports have fallen by some 40 percent this year, according to the International Energy Agency. Iran says it has no problem replacing customers that choose to boycott its crude.
Available at: http://www.reuters.com/article/2012/06/18/us-iran-nuclear-talks-idUSBRE85H0C420120618
President Mahmoud Ahmadinejad appeared to indicate that Iran would be prepared to stop high-grade uranium enrichment - a demand of the United States and its allies - if world powers agreed to meet its needs for the fuel.
"From the beginning the Islamic Republic has stated that if European countries provided 20 percent enriched fuel for Iran, it would not enrich to this level," Ahmadinejad stated in comments published on his presidential website.
Meeting to discuss Iran's nuclear program in Moscow on Monday, world powers are to push for the suspension of its high-grade uranium enrichment activities over fears Iran is seeking to develop nuclear weapons capability. Tehran denies this.
Available at: http://www.reuters.com/article/2012/06/18/us-iran-nuclear-idUSBRE85H0EM20120618
Foreign and defense ministers of the United States and Republic of Korea (ROK) on Thursday urged Pyongyang to end its provocative behavior, saying a path for the North to "rejoin the international community" remains open.
US Secretary of State Hillary Clinton and Defense Secretary Leon Panetta also vowed to defend ROK "through the full range of US military capabilities" after concluding the so-called "two-plus-two" security talks with their ROK counterparts Kim Sung-Hwan and Kim Kwan Jin in Washington.
"The ministers urged North Korea to cease its provocative behavior, live up to its obligations and commitments, and abide by the terms of the 1953 Armistice Agreement," said a joint statement released after the one-day talks.
"North Korea's pattern of defiance and provocative actions, combined with its pursuit of nuclear weapons and ballistic missiles, constitutes a serious threat to the alliance, Northeast Asia and international peace and security," said the statement, referring to the Washington-Seoul alliance "a linchpin" of stability, security and prosperity in the Asia-Pacific region and increasingly around the world.
The US and the Democratic People's Republic of Korea (DPRK) reached an agreement in late February, under which the latter agreed to suspend its uranium enrichment, nuclear and long-range missile tests and allow UN inspectors back to the country in return for 240,000 tons of nutritional assistance by Washington.
DPRK's decision to press ahead with a launch of an "earth observation" satellite on April 13 prompted Washington to suspend its planned food aid.
Speculation was rife about a third nuclear test by Pyongyang following the failed satellite launch. However, DPRK said last week that it has no plans to conduct a third nuclear test "at present".
"Sharing grave concern over recent provocative behavior by North Korea, the United States reaffirmed its continuing commitment to the defense of the Republic of Korea through the full range of US military capabilities, both conventional and nuclear," said the joint statement.
"The ministers called on North Korea to fulfill its commitments under the 2005 Joint Statement of the Six-Party Talks and choose a path toward peace," the statement said, referring to the mechanism that involves Japan, Russia and China.
"The ministers noted that a path for North Korea to rejoin the international community remains available if it refrains from provocations and complies with its international obligations and commitments, which include taking concrete actions toward denuclearization," the statement added.
Addressing a joint press conference, Clinton said DPRK "must abandon its nuclear weapons and all existing nuclear programs, including programs for uranium enrichment."
Naval forces of ROK, the US and Japan are scheduled to stage a joint drill next week in waters off ROK's southern island of Jeju, while Seoul and Washington are set to launch a separate, three-day drill on June 23 in waters off the west coast of the Korean Peninsula.
Available at: http://usa.chinadaily.com.cn/world/2012-06/15/content_15503848.htm
1. UK to Order Reactor for Nuclear-Armed Submarine
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Britain will order the first reactor for a new generation of nuclear-armed submarines next week as part of a 1 billion pound ($1.6 billion) contract with Rolls-Royce, a defense ministry source said on Sunday, in a move that could strain the coalition government.
The deal will include an 11-year refit of Britain's sole submarine propulsion reactor factory at Derby in central England, said Defence Secretary Philip Hammond, who will formally announce the plans to parliament on Monday.
"This is sustaining a sovereign capability in the UK and some very high end technical skills in the UK for the next 40 or 50 years," he told BBC television, without giving further details of the contract.
The investment will protect 300 jobs at the Rolls-Royce factory and many others at suppliers elsewhere, the source said.
The 1 billion pound value of the deal will be shared between Rolls-Royce and its other industrial partners, a source close to the company said.
The two-party coalition government is split over plans to replace Britain's four Vanguard submarines at an estimated cost of 25 billion pounds when they retire from service in the 2020s.
Prime Minister David Cameron's Conservative Party - to which Hammond belongs - wants a new fleet of submarines that will continue to carry the Vanguard's Trident missiles, maintaining Britain's independent nuclear capability.
Their smaller Liberal Democrat partners are pushing for cheaper and less potent alternatives, arguing that the current capability - the ability to obliterate Moscow - is an outdated hangover from the Cold War.
The two parties have postponed a final decision till 2016, after the next parliamentary election, while agreeing in the meantime to fund the advance work needed to allow the submarines to be built on schedule should they be commissioned.
The Liberal Democrats insist that the advance contracts do not represent a commitment to a like-for-like renewal, but some analysts say it is unlikely that cashapped Britain would lay out huge sums on design and equipment that it would later ditch.
Hammond insisted the government had not yet made up its mind about Britain's future nuclear deterrent.
"The government's policy is very clear. We are committed to maintaining a credible nuclear deterrent and we are placing orders now for the long-lead items that will be necessary to deliver a successor to the Vanguard class submarines in the late 2020s," Hammond said.
"But the actual decision to go ahead and build them won't have to be taken until 2016 and what we are doing at the moment is ordering the things that have to be ordered now to give us that option."
The government said last year it expected to spend 3 billion pounds by 2015 on preparatory work for the new submarine fleet.
The Rolls-Royce deal also includes a contract to build the reactor for the last of seven Astute class nuclear-powered attack submarines that Britain already has on order.
The nuclear propulsion plant for the Vanguard's successor will be the more advanced Pressurised Water Reactor 3 (PWR3) system, the government said last year.
Last month Hammond announced 350 million pounds of contracts, mainly with defence contractor BAE Systems, to design the Vanguard's successor submarines.
Available at: http://www.reuters.com/article/2012/06/17/us-britain-submarine-idUSBRE85G0D720120617
2. Pakistan Boasted of Nuclear Strike on India Within Eight Seconds
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Pakistan could launch a nuclear strike on India within eight seconds, claimed an army general in Islamabad whose warning is described in the latest volume of Alastair Campbell's diaries.
The general asked Tony Blair's former communications director to remind India of Pakistan's nuclear capability amid fears in Islamabad that Delhi was "determined to take them out".
Britain became so concerned about Pakistan's threat that Blair's senior foreign policy adviser, Sir David Manning, later warned in a paper that Pakistan was prepared to "go nuclear".
The warnings are relayed by Campbell in a section in his latest diaries, The Burden of Power, which are being serialised in the Guardian on Saturday and Monday. The diaries start on the day of the 9/11 attacks and end with Campbell's decision to stand down in August 2003 after the Iraq war.
The nuclear warnings came during a visit by Blair to the Indian subcontinent after the 9/11 attacks in 2001. Campbell was told about the eight-second threat over a dinner in Islamabad on 5 October 2001 hosted by Pervez Musharraf, then Pakistan's president.
Campbell writes: "At dinner I was between two five-star generals who spent most of the time listing atrocities for which they held the Indians responsible, killing their own people and trying to blame 'freedom fighters'. They were pretty convinced that one day there would be a nuclear war because India, despite its vast population and despite being seven times bigger, was unstable and determined to take them out.
"When the time came to leave, the livelier of the two generals asked me to remind the Indians: 'It takes us eight seconds to get the missiles over,' then flashed a huge toothy grin."
Blair visited Pakistan less than a month after the 9/11 attacks as Britain and the US attempted to shore up support in Islamabad before the bombing of Afghanistan, which started on 7 October 2001.
Campbell writes that the Pakistani leadership seemed to be keen for Britain and the US to capture Osama bin Laden, though he added it was difficult to be sure.
Relations between Islamabad and Delhi plummeted after the Blair visit when terrorists attacked the Indian parliament on 13 December 2001, killing seven people. Five of the attackers died.
India blamed Pakistan-based militants for the attack by Lashkar-e-Taiba and Jaish-e-Mohammed terror groups fighting Indian rule in Kashmir. The tensions became so great that Richard Armitage, the US deputy secretary of state, was sent to the region in May 2002.
Blair returned to the Indian subcontinent in January 2002, shortly after the fall of the Taliban in Afghanistan, amid one of the tensest nuclear standoffs between Indian and Pakistan since independence in 1947.
In the preparations for the visit, Manning prepared a paper for Blair that warned of the real threat of a nuclear conflict. In an extract from his diaries for 4 January 2002, Campbell wrote: "DM had a paper, making clear our belief that the Pakistanis would 'go nuclear' and if they did, that they wouldn't be averse to unleashing them on a big scale. TB was genuinely alarmed by it and said to David 'They wouldn't really be prepared to go for nuclear weapons over Kashmir would they?' DM said the problem was there wasn't a clear understanding of strategy and so situations tended to develop and escalate quickly, and you couldn't really rule anything out."
A few days after the visit, the India-Pakistan standoff was discussed by the British war cabinet. In an extract for his diaries on 10 January 2002, Campbell wrote: "CDS [chief of the defence staff Admiral Sir Michael Boyce] said if India and Pakistan go to war, we will be up the creek without a paddle. Geoff [Hoon] said there may have to be limited compulsory call-up of Territorial Army reserves. TB gave a pretty gloomy assessment re India/Pakistan, said [the Indian prime minister Atal Bihari] Vajpayee was really upset at the way [Pakistan's president] Musharraf treated him. Military dispositions remained the same, with more than a million troops there [in Kashmir]. He assessed that the Indians believed that they could absorb 500,000 deaths. Pakistani capability was far greater than the Indians believed." Relations between Delhi and Islamabad have eased in recent years, though they still remain tense because Delhi believes that elements in the Pakistan state encourage Kashmiri terror groups. During his first visit to India in 2010 David Cameron famously accused Pakistan of exporting terrorism.
Campbell also relays another nuclear threat a year later when George Bush told Blair he feared that Ariel Sharon, the former Israeli prime minister, was planning to launch a nuclear attack against Iraq. In an account of a conversation with Bush at a Nato summit in Prague in November 2002, as diplomatic pressure intensified on Saddam Hussein, Campbell writes: "[George Bush] felt that if we got rid of Saddam, we could make progress on the Middle East. He reported on some of his discussions with [Ariel] Sharon, and said he had been pretty tough with him. Sharon had said that if Iraq hit Israel, their response would 'escalate' which he took to mean go nuclear. Bush said he said to him 'You will not, you will not do that, it would be crazy.' He said he would keep them under control, adding 'A nuke on Baghdad, that could be pretty tricky.'"
1. Japan Approves Renewable Subsidies in Shift from Nuclear Power
Yuko Inoue and Leonora Walet
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Japan approved on Monday incentives for renewable energy that could unleash billions of dollars in clean-energy investment and help the world's third-biggest economy shift away from a reliance on nuclear power after the Fukushima disaster.
Industry Minister Yukio Edano approved the introduction of feed-in tariffs (FIT), which means higher rates will be paid for renewable energy. The move could expand revenue from renewable generation and related equipment to more than $30 billion by 2016, brokerage CLSA estimates.
The subsidies from July 1 are one of the few certainties in Japan's energy landscape, where the government has gone back to the drawing board to write a power policy after the Fukushima radiation crisis, the world's worst nuclear disaster since Chernobyl in 1986.
The push for renewables is aimed at cutting reliance on not only nuclear, but pricey oil and liquefied natural gas for energy needs.
The scheme requires Japanese utilities to buy electricity from renewable sources such as solar, wind and geothermal at pre-set premiums for up to 20 years. Costs will be passed on to consumers through higher bills.
Utilities will pay 42 yen (53 U.S. cents) per kilowatt hour (kwh) for solar-generated electricity, double the tariff offered in Germany and more than three times that paid in China.
Wind power will be subsidized at least 23.1 yen per kwh, compared with as low as 4.87 euro cents (6 U.S. cents) in Germany.
Subsidies have spurred explosive growth in renewable energy in countries such as Germany, which has nearly tripled its output in less than a decade.
Still, Japan's aim to accelerate investment in safer, cleaner and self-sufficient energy is starting from a low base: renewable sources apart from large hydro-electric dams account for only 1 percent of power supply in Japan.
Nuclear power accounted for almost 30 percent of Japan's electricity supply before an earthquake and tsunami on March 11 last year triggered the Fukushima disaster.
About 60 percent came from oil, coal and gas, but that share has risen to almost 90 percent as safety concerns led to all of Japan's 50 reactors being shut. The rest of Japan's electricity comes mostly from hydro.
The government estimates capacity from renewable energy will increase to 22,000 megawatts by the end of March 2013, up from 19,500 MW now, with 2,000 MW of that from solar panels.
But Japan has huge potential to generate renewable energy from the sun, wind and geothermal, analysts say.
CLSA Asia-Pacific predicts solar capacity will jump to about 19 gigawatts by 2016 from about 5 GW or less now, while wind capacity may reach 7.6 GW in four years.
The subsidies will benefit solar panel makers Panasonic Corp and Sharp Corp and solar project installer Sekisui Chemicals, along with wind farm developers such as Toyota Tsusho and Japan Wind Development.
But foreign makers of solar panels - including Chinese equipment maker Suntech Power Holdings, Trina Solar and Canadian Solar - are also targeting Japan's market.
"We believe the biggest change in market dynamics in the coming year will be a flood of cheap foreign panel manufacturers into Japan," said CLSA analyst Penn Bowers.
Near Sendai on Japan's northeast cost, which was devastated by the earthquake and tsunami, memories of power cuts are fresh, prompting a drive for self-sufficiency.
"People had to queue for hours several times a week to charge their cell phones during the blackouts, which lasted for up to three weeks," said Naoaki Ando, the manager of an office near Sendai of Sekisui House, Japan's biggest home builder.
In a suburb of Sendai, Sekisui plans to complete a block of 431 houses fitted with solar panels within two and a half years.
Odawara, a city of 200,000 south of Tokyo, is setting up its own power company that will install solar panels at public facilities and sell electricity to Tokyo Electric Power Co, the operator of the Fukushima Daiichi nuclear plant that was wrecked in the disaster.
Residents who want to install panels on their homes will also get subsidies.
"The high purchasing price under the feed-in-tariff system is great news for us," said Kazuhiko Katano, an official in Odawara's Energy Promotion Division. "The higher the price, the faster the penetration of panels will be."
Available at: http://in.reuters.com/article/2012/06/18/us-energy-renewables-japan-idINBRE85H00Z20120618
Prime Minister Yoshihiko Noda ended Japan’s month-long freeze on nuclear power, approving a reactor restart that combined with a tax increase may undermine his political support.
Two reactors at Kansai Electric Power Co.’s Ohi nuclear plant can be operated safely, Noda declared June 16 after meeting with three Cabinet ministers who share approval authority. The utility, which serves the $1 trillion economy of Japan’s second-biggest urban region, said it would immediately begin work to start one reactor.
Japan is reopening nuclear plants that provided about 30 percent of its energy before being idled after the March 2011 meltdowns at Tokyo Electric Power Co.’s Fukushima station. The decision followed by one day a deal with opposition parties to abandon some campaign pledges in return for agreement to double the nation’s consumption tax. Majorities in public opinion polls oppose both the restarts and the tax increase.
Noda “could end up like all his predecessors in the dustbin of history very quickly,” said Robert Dujarric, director of the Institute of Contemporary Asian Studies at Temple University’s Tokyo campus. “The dustbin is waiting for him.”
Seventy-one percent of respondents to a Mainichi newspaper poll published on June 4 objected to a speedy restart of the reactors in Ohi. In a separate poll released June 5 by the Pew Research Center, 70 percent of Japanese said the country should reduce its reliance on nuclear energy and 52 percent feared they or their families may have been exposed to radiation.
“We have sufficient safety measures in place to protect the plant’s fuel and prevent a large-scale leak of radioactive material into the environment, even if the plant were to be struck by an earthquake and tsunami like the one that hit Fukushima,” Noda said in a written response on June 15 to questions from Bloomberg News. Public mistrust of the nuclear power industry soared after the Fukushima reactors leaked radiation that forced 160,000 people to evacuate.
Noda, who took office in September, vowed to stake his career on doubling the nation’s 5 percent sales tax to fund welfare costs and lower the world’s largest debt. Earlier this month the one-time finance minister reshuffled his Cabinet in an effort to win opposition backing for his bill.
Noda’s Democratic Party of Japan agreed to shelve plans for a minimum guaranteed pension as part of a deal on the tax increase with the opposition Liberal Democratic Party and the New Komeito party. LDP lawmaker Nobutaka Machimura said the parties hope to pass the legislation in the lower house of parliament before the Diet session ends on June 21.
The tax legislation is also unpopular, with 56 percent of respondents expressing opposition in a poll published in the Asahi newspaper on June 6, up from 51 percent a month earlier. National elections must be held by August 2013. None of Japan’s previous five premiers served much more than a year.
The nation’s biggest business lobby had warned power outages would lead to factory shutdowns at companies including Sharp Corp. and Panasonic Corp., threatening an economic recovery in the cities of Osaka, Kyoto and Kobe.
Companies including Komatsu Ltd. and NEC Corp. have said the nuclear restarts are needed to avert power shortages. Both Komatsu Chairman Masahiro Sakane and NEC Chairman Kaoru Yano have talked about moving their production overseas if there is insufficient power for their factories.
The decision to restart the Ohi reactors was “supportive of the financial profile of the utilities sector in Japan” because it showed that authorities were beginning to develop a long-term approach to regulating the power industry, Moody’s Japan K.K. said today in an e-mailed statement.
The move was insufficient to restore Kansai Electric’s profitability or change its rating outlook because of remaining uncertainties, such as how long reactors will be allowed to operate, Moody’s said.
Noda’s “under intense political pressure from the banks and the utilities” who want reactors restarted, said Andrew DeWit, a professor at Tokyo’s Rikkyo University who focuses on energy policy. “They want to get those income streams back in operation.”
Once the world’s biggest nuclear power generator after the U.S. and France, Japan shut its last operating reactor on May 5. Kansai Electric said it aims to restart the Ohi No. 3 reactor in early July, and the No. 4 unit as early as mid-July.
Japan’s utilities are running stress tests to assess whether reactors can withstand the earthquake and tsunami damaged that caused the meltdowns at Fukushima. Utilities have submitted reports on the first phase of testing on 22 reactors, according to the Nuclear and Industrial Safety Agency website.
Further restarts will probably be delayed until after Japan’s winter season, as a new regulatory panel will have to review stress-test results, the Nikkei newspaper said yesterday. Reactors at Hokkaido Electric Power Co.’s Tomari plant, Kyushu Electric Power Co.’s Sendai plant, Shikoku Electric Power Co.’s Ikata facility and Hokuriku Electric Power Co.’s Shika plant are likely the next to return to operation, the paper said.
With summer approaching, the government set power-saving targets in areas supplied by seven of 10 regional utilities, including Kansai Electric, which is most dependent on nuclear power. Homes and companies supplied by Kansai Electric should cut consumption by more than 15 percent from 2010 levels on weekdays July 2 through Sept. 7, the government said on May 18.
“The conservation target will change only after we are certain of the electricity supply from the plant,” Trade and Industry Minister Yukio Edano told reporters in Tokyo after the June 16 decision. “We only decided to restart the plant, and that doesn’t guarantee it can supply power.
Available at: http://www.bloomberg.com/news/2012-06-16/japan-nuclear-freeze-ends-as-voter-backlash-begins-for-noda.html
RWE AG, Germany's second-biggest utility, is abandoning plans to build new nuclear power plants outside its home market, where the government decided last year to phase out nuclear power. "We will not invest in new nuclear power plants," incoming Chief Executive Peter Terium said.
Like E.ON and peer EnBW, RWE has been hit hard by the German government's decision to phase out nuclear power generation, forcing it to reinvent itself by shedding assets and tapping new growth areas such as renewable power.
"We can no longer afford the financial risks and the surrounding conditions for nuclear power plants," Terium, who is due to take the top job on July 1, said.
Three months ago, RWE and E.ON pulled out of a 15 billion pound ($23.5 billion) plan to build new nuclear power stations in Britain.
The companies said at the time that Germany's sudden decision to phase out nuclear power, the high running costs of their Horizon joint venture and the long lead times required for nuclear plants resulted in the decision to sell the venture.
RWE also owns a stake in a nuclear power plant in the Netherlands, and Terium said there were no plans to add more plants there.
Dutch utility Delta and its partners EDF and RWE earlier this year postponed plans to build a second nuclear power plant in the Netherlands because of the poor investment climate and low electricity prices.
Terium said RWE would continue to operate its plants in Germany until their planned shut-down.
Available at: http://www.reuters.com/article/2012/06/17/rwe-nuclear-idUSL5E8HH8ZI20120617
4. Analysis: Japan Reactor Restarts Could Spark Uranium Rally
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Signs that Japan is ready to restart a pair of reactors idled in the aftermath of last year's Fukushima nuclear meltdown could spark a rally by uranium-mining shares, which have languished since the March 2011 disaster.
Recent steps to bring the first of 50 shuttered reactors back online have already bolstered long-term uranium prices, which rose last month for the first time since January 2011.
Analysts say the reactor restarts, expected to be approved on Saturday, will likely soothe equity investors, who pulled out of Cameco Corp (CCO.TO) and other uranium stocks en masse following the worst nuclear accident since Chernobyl.
The sector's shares have remained sluggish since then, even though China, India and Russia have given every indication of pushing ahead with ambitious plans to expand their capacities to generate nuclear power.
"If Japan restarts reactors, that goes some way towards derisking nuclear power and therefore also the uranium sector," said BMO Capital Markets mining analyst Edward Sterck.
"Two reactors would just be a signal that Japan isn't abandoning nuclear power altogether," he added. "That could be a positive catalyst for uranium stocks."
Shares of Cameco, the world's largest listed pure play uranium miner, are down more than 40 percent since March 2011, when a massive earthquake and tsunami struck Japan, causing a meltdown at the Fukushima Daiichi power plant. The two reactors set to be turned back on are in Ohi, about 550 kilometers (340 miles) from the Fukushima plant.
Shares of Uranium One Inc once the darling of the uranium space, have lost half their value, while shares of explorers such as Fission Energy Corp and UEX Corp are down more than 65 percent.
Seemingly contradictory comments by Japan's prime minister, caught between a nuclear-wary public and power-starved manufacturers, have not helped build confidence. While the long-term price has risen, the spot price remains little changed at $51 a pound and the stocks just aren't moving.
Uncertainty over Japan has countered strong growth in demand for uranium to fuel new reactors, along with a pending supply gap as a pact to downgrade weapons-grade uranium ends next year.
"Quite frankly I'm surprised it hasn't gotten back to where it should be at this point," said Rob Chang, a mining analyst with Versant Partners, an investment bank in Toronto.
"I thought, within a year, uranium equities would be higher than where they were before."
Prior to Fukushima, some 30 percent of Japan's power came from nuclear generation. After the disaster, the nation gradually idled its entire fleet of 50 operable reactors. Nuclear's energy share has now bottomed out at zero.
To make up for the shortfall, resource-poor Japan has turned fossil fuels. Utilities burned 22 percent more natural gas in May than the year before, and petroleum consumption rose 157 percent in the same period.
With summer looming, the country's already struggling manufacturing sector is bracing for a potential power crisis. That has put pressure on politicians to turn reactors back on or risk crippling blackouts.
Last week, Prime Minister Yoshihiko Noda said two reactors owned by Kansai Electric Power Co must be restarted to ensure jobs and the "survival of society.
But on Friday he appeared to backtrack, telling Reuters that Japan should reduce its reliance on nuclear power in the medium and longer term. Noda and key ministers are expected to approve the Kansai restarts on Saturday.
Even if the reactors are turned back on, challenges remain. It will take weeks to reconnect them to the grid and Japan will only have a fraction of its former nuclear capacity. If Japan makes it through summer on limited to no nuclear energy, it could bolster arguments against turning more reactors back on.
Even so, many industry observers expect Japan eventually to restart about two-thirds of its reactors, tempering negative sentiment in the near term and pushing equities higher.
"It's going to be back to business as normal," said John Kinsey, a portfolio manager at Caldwell Securities in Toronto. "I think the bad news for uranium is over now."
With the tide turning, Kinsey points to Cameco as a potential winner. The blue-chip producer - with projects in Canada, Kazakhstan, Australia and the United States - has an ambitious plan to double uranium production to 40 million pounds a year by 2018 - just in time to capitalize on a massive nuclear push by China.
With 26 reactors under construction and 171 in the planned and proposed stages, China is on track to be a top generator of nuclear power within the decade.
The Asian nation suspended approvals of new nuclear plants after Fukushima, but last month it endorsed a nuclear safety plan that is likely to get the approval process back on track.
"That last hurdle that needed to be jumped over has been crossed, so it's now a matter of weeks, maybe days, maybe months," said Chang. "They are in full on growth mode."
China is not alone. Russia has 10 reactors under construction and another 41 in the planned and proposed stages, according the World Nuclear Association. India is building seven, with another 56 planned and proposed.
At the same time, a major source of nuclear fuel is running dry. The so-called Megatons to Megawatts pact, through which Russia pumps some 25 million pounds of downgraded uranium into the market each year, ends in 2013. That means about 17 percent of global supply will exit the market next year.
While investors are still hesitant after being burned by risky uranium in 2007 and then again in 2011, restarts in Japan could mean the time is right to get back into uranium equities.
"I think it's a fantastic opportunity for investors with long-term viewpoints," said Chang. "We're seeing catalysts coming up and I'm fairly certain we're going to exit this year significantly higher than we are right now."
Available at: http://www.reuters.com/article/2012/06/15/us-miners-uranium-idUSBRE85E1BE20120615
1. Fukui Governor Calls for Greater Safety at N-Plant
The Daily Yomiuri
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Fukui Gov. Issei Nishikawa on Friday called on Kansai Electric Power Co. to boost safety measures at its Oi nuclear power plant in the prefecture.
At a meeting with Kansai Electric President Makoto Yagi, the governor said he wants a quake-resistant building at the plant that would serve as a base in the event of a nuclear accident to be available as soon as possible.
Yagi said his company will continue working to establish the world's most stringent safety measures at the plant.
Nishikawa is expected to notify the central government of his approval for the restart of the plant's No. 3 and No. 4 reactors after assessing Kansai Electric's safety policy.
Available at: http://www.yomiuri.co.jp/dy/national/T120615005305.htm
2. Japanese Nuclear Plants Yet to Get Quake-Proof Buildings
The Daily Press
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Of Japan’s seventeen nuclear power plants, nine still have yet to build earthquake-proof emergency response buildings, according to a survey by Kyodo News, which reveals the inability of the electric utility companies to improve safety even in the wake of the Fukushima nuclear crisis. The electric utility companies decided to build the new emergency response buildings after an earthquake off the coast of Niigata Prefecture in 2007 put Tokyo Electric Power Company’s (Tepco) Kashiwazaki-Kariwa plant temporarily out of commission. The buildings are designed to withstand earthquakes registering even at the top of Japan’s seismic intensity scale, include electric generators and video conference rooms, and shield occupants against radiation.
Kansai Electric Power Co.’s (Kepco) Oi, Mihama and Takahama plants, in Fukui Prefecture, are included in the quake-proof building-less number. Kepco covers the western Japan area that includes Osaka, and says it plans to use existing emergency response rooms in basements at existing facilities until the quake-proof buildings are constructed. It plans to have the buildings finished at the Oi plant by March 2016, and to have them constructed at the Mihama and Takahama facilities in the following year.
Hokkaido Electric Power’s Tomari plant, Tohoku Electric Power’s Higashidori plant in Aomori Prefecture, and Chugoku Electric Power’s Shimane plant intend to have quake-proof buildings erected between March 2015 and March 2017. Hokuriku Electric Power’s Shika plant in Ishikawa Prefecture should have their new emergency response building before the end of March next year. Kyushu Electric Power Company has yet to get as far as making plans for constructing the improved building at its Genkai plant in Saga Prefecture, or its Sendai plant in Kagoshima Prefecture.
The quake-proof emergency buildings at the Fukushima Daiichi nuclear plant continue to play a very important role in the managing of the nuclear disaster there. If not for those buildings workers would be at risk of exposure to high levels of radiation in the event of further radiation releases. Tepco’s Fukushima Daiichi and Daini plants were among those to receive the new emergency buildings in the aftermath of the 2007 Niigata earthquake.
Available at: http://japandailypress.com/9-japanese-nuclear-plants-yet-to-get-quake-proof-buildings-164430
3. Asia-Pacific Statesmen Call for Improved Global Nuclear Security
Global Security Newswire
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A group of statesmen from Asian and Pacific nations this week called for providing greater funding for the International Atomic Energy Agency and other measures as a means of improving the protection of nuclear materials around the world (see GSN, Dec. 13, 2011).
"It is as matter of serious concern that the IAEA’s regular budget continues to be insufficient for its nuclear security activities, and that most funding for this area comes from voluntary contributions. This is despite the agency’s increasing responsibilities in nuclear security," according to a statement from the Asia Pacific Leadership Network for Nuclear Nonproliferation and Disarmament. "The IAEA’s nuclear security funding should be regularized at the level needed to meet new demands. Governments should also look constructively at giving the IAEA a stronger role through concluding agreements with the agency covering nuclear security functions" (see GSN, June 13).
The 23 signatories to the document include former New Zealand Prime Ministers Geoffrey Palmer and James Bolger, ex-Japanese Prime Minister Yasuo Fukuda, one-time Pakistani Foreign Secretary Humayun Khan, and former U.N. Undersecretary General for Disarmament Nobuyasu Abe.
The APLN participants called for universal membership in the 1980 Convention on the Physical Protection of Nuclear Material and its 2005 amendment, along with the 2005 International Convention for the Suppression of Acts of Nuclear Terrorism (see GSN, June 6).
The international community must also set guidelines for defending nuclear materials that are not just recommendations, according to the statement.
The Convention on the Physical Protection of Nuclear Material "establishes broad security standards. More detailed standards are set out in the International Atomic Energy Agency’s (IAEA) nuclear security recommendations, but these are only recommendations, with no binding force," the signatories asserted. "With no binding standards, security practice varies considerably from state to state. With no requirement for reporting and external review it is difficult to identify which states need support in improving their security performance. Establishment of binding nuclear security standards must be given high priority."
Nations should consider these and related matters of "transparency, reporting and accountability" as they look toward the third Nuclear Security Summit, set for 2014 in the Netherlands (see GSN, May 1). "If the summit process is unable progress these issues, there will be a need for a group of states willing to provide leadership on these matters. Governments in the Asia-Pacific region should consider developing a regional approach that could set an example for others" (Asia Pacific Leadership Network for Nuclear Nonproliferation and Disarmament release I, June 13).
The former officials -- minus Fukuda -- also signed a separate statement calling for increased openness on "arms control and disarmament."
"Transparency, in an arms control and disarmament context, means the sharing of information about security interests, concerns, expectations and capabilities with the objective of enhancing prospects for peaceful co-existence at the lowest possible level of armaments," according to the document. "Transparency is fundamental to building confidence and trust. Whether it involves facts, assessments, interests, intentions, doctrines or internal processes, transparency lies at the heart of every confidence and security building measure ever devised."
Among the recommendations from the signatories are that all nations in possession of nuclear weapons "seriously review whether their present postures in respect of nuclear transparency adequately address both their interests and their responsibilities" and that the five nuclear powers recognized under the Nuclear Nonproliferation Treaty -- China, France, Russia, the United Kingdom and the United States -- "set an example by undertaking national audits of their historical production of fissile material, as a basis for later discussions amongst them, and in due course with other nuclear-armed states, on problems encountered and how they might be addressed" (Asia Pacific Leadership Network for Nuclear Nonproliferation and Disarmament release II, June 13).
Available at: http://www.nti.rsvp1.com/gsn/article/asia-pacific-statesmen-call-improved-global-nuclear-security/?mgh=http%3A%2F%2Fwww.nti.org&mgf=1
4. Japan to Get New Atomic Regulatory Body Within 3 Months
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Japan will set up a new nuclear regulator around September under a law approved by parliament's lower house on Friday after months of delay as part of a drive to improve safety and restore public trust after the worst atomic disaster since Chernobyl.
The 2011 Fukushima disaster cast a harsh spotlight on the cosy ties between regulators, politicians and utilities - known as Japan's "nuclear village" - that experts say were a major factor in the failure to avert the crisis triggered when a huge earthquake and tsunami devastated the plant, causing meltdowns.
The legislation, however, swiftly came under fire for appearing to weaken the government's commitment to decommissioning reactors after 40 years in opration, even as it drafts an energy programme to reduce nuclear power's role.
Under a deal ending months of bickering by ruling and opposition parties, the new regulatory commission could revise a rule limiting the life of reactors to 40 years in principle.
"Does this reflect the sentiment of the citizens, who are seeking an exit from nuclear power?" queried an editorial in the Tokyo Shimbun daily. "Won't it instead make what was supposed to be a rare exception par for the course?"
Public opposition to building new atomic plants is strong, so extending the life of Japan's aged reactors is one key to maintaining a role for nuclear power. More than a dozen of the country's 50 reactors are at least three decades old, with three already operating for about 40 years.
The new law, expected to be approved by the upper house, would create a five-member independent nuclear regulatory commission and a nuclear regulatory agency to do the work of the trade ministry's heavily-criticised Nuclear and Industrial Safety Agency (NISA) and the cabinet's oversight commission.
Some local authorities had cited the new regulator as a precondition for restarting Japan's idled reactors.
Nuclear power supplied nearly a third of the country's electricity before Fukushima, but all reactors have since gone offline for checks or maintenance.
The government is expected to approve, as early as Saturday, the restart of two reactors operated by Kansai Electric Power Co at the Ohi plant in western Japan, before a potential summer power crunch.
Industry minister Yukio Edano told a news conference that until the regulator was functioning, safety checks required before restarts would be handled under existing procedures. That was likely to fan charges that Prime Minister Yoshihiko Noda's government is too pro-nuclear.
Ohi is seen as a special case as Kansai relies heavily on nuclear power, Tetsuro Fukuyama, a member of a group within the ruling Democratic Party calling for the abandonment of nuclear power by 2025, told Reuters recently.
"But for other reactors, we need to set up the regulatory agency, set new safety standards, assess the supply-demand situation and the age of reactors ... and the possibility of earthquakes, and then make a comprehensive decision," he said.
"If the government does not do that at a minimum, they will not be able to gain public understanding."
Available at: http://www.reuters.com/article/2012/06/15/japan-nuclear-regulator-idUSL3E8HF1C420120615
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