The United States has promoted nuclear energy for decades while also seeking to mitigate its inherent risks. In addition to cost, safety, waste and security issues are concerns that the spread of dual-use technologies like uranium enrichment and spent fuel reprocessing pose risks of nuclear weapons proliferation.
The following is transcription covering the time period: 01:12:00--01:36:00 (Transcription by Toshiki Mashimo and Caitlin Stronell)
SQUASSONI:　It seems that with certain states it seems that we have in the past had incredible leverage and we sought not to use it and I'll give one example here Japan and the decision to provide advance consent when they were working on Tokai right so this is going back to the Carter administration (I've been doing a lot of reading lately). 1977, right. The Carter Administration. This may be the example you are thinking of when we marched off in the wrong direction. We said "thou shalt not reprocess." This is a bad idea. Even Henry Kissinger said "plutonium, a bad idea." This is a risk we know we really hadn't understood the full complexity of this. Right, so the Carter administration, at the time Japan was about to start Tokai, but hadn't and the classified documents that have been declassified showed that we developed three options. One was to say okay well you can only reprocess our stuff at Tokai if you only do co-processing, right, so this is the technical solution. Co-processing, you don't separate out the plutonium and Ambassador Mansfield at the time said "no, no, that's a terrible idea. The Japanese will never buy that." So the other two options... we finally decided on the second one. The other two options were: well you can operate Tokai on just as a safeguards test bed. Well, not so bad, but not so great. Option 2, the one we decided on was we let Tokai go forward. Just as it's been done, because of commercial reasons, cost reasons, all those things... they'd put the plant together and you know they were anxious to demonstrate the capability, and we'll limit what it can do. Just like we're doing with Iran, right? We're going to limit, we're going to say Iran can't enrich to HEU. We're going to say Tokai capacity only seventy tons whatever, and we'll throw in some safeguards. Well, all of the arguments, 10 years later when we were negotiating the 123 agreement, was that Japan's going to go down this road, they're going to do what they're going to do anyway, we don't have any leverage, all we can do is sort of urge them. When you look back on that 40 years later, it seems to me maybe we had more leverage than we thought and we missed an opportunity and in that 123 agreement, which exists into perpetuity now, right? it does not need to be renewed even though the 30 year term ends in 2018. Japan has carte blanche to reprocess forever even though it has nowhere for that plutonium to go right now, so I wonder, you know, I mean, hindsight is always 20/20 right, but what the real critical questions I would love to see us discuss here in conjunction with the audiences. What are our real sources of leverage? You know are there technical, something new in the technical field Ed, that you've been working on that we haven't heard about or are there diplomatic approaches? Maybe this new thrust towards transparency to level the playing field across suppliers...maybe that's helpful. I just think that we don't really use the leverage when we have it. Taking into account, Bob, what you said that, you know, when you're sitting in the negotiating room, it's tough.
COUNTRYMAN:　I'm happy to listen to thoughts on this, but I think it was Robert De Niro who said if you have to talk about your leverage, then you don't really have it. So, I'm happy to hear other folks' comments though.
SQUASSONI:　Alright, so maybe we have some questions about leverage or certain cases in the audience. So our rule is, identify yourself, your affiliation and try to make it into a question, even if it isn't. And there are two microphones coming around it's coming it's coming. Well, since we're webcasting this, we like everybody to hear what you're saying.
AUDIENCE QUESTION 1:　Henry Sakolsky, Nonproliferation Policy Education Center. On 16 March, the Secretary of Energy said "we don't support large-scale reprocessing" and in regard to China's latest announcement that it would proceed to commercial scale reprocessing, he noted that it certainly is not positive in terms of non-proliferation. Someone else, who actually is present here, Thomas Countrymen, when asked about what his thoughts were about taking a timeout in commercial plutonium East Asia, said "I would be very happy to see all countries get out of the plutonium reprocessing business" and went on to note that there are genuine questions were is important that the US and its partners in Asia have a common understanding of the economic and nonproliferation issues at stake before making a decision about the renewal of the 123 civil nuclear cooperation agreement, for example, with Japan. Now the question I have is some commentators and journalists downgraded and sort of said well that there's nothing there. I'm wondering if you would be interested in expanding in any way on those comments, to make it clear to them that maybe there is something that should be said.
COUNTRYMAN:　Yes, I've attempted to do that with Japanese journalists and I'll attempt to do it again. I've made two different statements about Japan's policy. I do not believe the two statements are in any way contradicting each other, but some folks only want to hear one of the statements and some folks only want to hear the other of the statements. One statement that I made on March 17 to the Senate Foreign Relations Committee is absolutely true from a nonproliferation stand point, it would be better if no countries were in the plutonium separation business. The other statement I made, which is equally true is that Japan's choice of a fuel cycle is a decision for Japan and it is not the job of the United States government to endorse or to oppose that choice. Those two things to me are entirely consistent, but if somebody is having a problem with that we can talk about it. What I've said further applies not only to Japan but to other partners, which is that any country that wants to be in that business must have, not only with the United States, but with its own people, a complete and transparent discussion of the economic and nonproliferation and national security issues involved in such a choice. I think that's clear.
GALLUCI:　So I understand the proposition that Japan is a sovereign country. This is a decision about how it will meet its energy needs, and it has the right to make that decision. Got it, but what we've been talking about here is that that decision by Japan about how it will meet its energy needs and this is an energy decision, it's not a national security issue, this is an energy question, affects the national security of the United States and its neighbors in Northeast Asia. It is a matter of international security. So I think this gets down to how governments relate, one to the other. It gets down to internal debates about what will be said in the instruction cable to the ambassador or to the assistant secretary who is going to go out there or to whom ever is going to deliver the message. How strong and how clear do you want to be that you sacrifice our interests if you decide one way rather than another? That we will care about this, that this is a problem for us. There's a continuum, as you both know, of where you go on this and that's something you struggle with, but if I could put it this way, if I had a complaint here, it is really one that follows from not knowing exactly, and I should not know exactly, I do not work for government right now....not knowing exactly how clear, how forceful we've been. I would note so that you don't have to, that this can be counterproductive. If you're not careful and the United States of America says something that doesn't seem to respect the sovereignty of another country, you can get precisely something which you would rather not get. I get that , but I think what we're really talking about here, because we have not had three people you know appear and who then went to the podium who disagree fundamentally about reprocessing or enrichment. This is not, forgive me, the Bush administration and so you don't have to go through this like we did before. Got that, we're really talking about how we manage this situation with, in this case, one ally, treaty ally, Japan, and something other than a treaty ally China, a competitor, another ally France and another ally, the Republic of Korea, so I think it's the way you engage and express your interest over how they make this sovereign energy choice.
McGINNIS:　Just for the sake of advancing the discussion, let me add a different perspective, from a commercial civil nuclear perspective. First of all, as we know, the US has a direct national disposal approach. We have great faith in dry cask storage. We believe that dry cask storage gives us many different benefits and options including time to further explore other potential technical pathways that could be possibly validated by DoE, and at some time may be, policymakers consider. Ones that really try and go at the issues of safeguard ability, transparency and other issues, but the fact is we have a direct national disposal program. In fact, from a business perspective, in my view, it makes a lot of business sense. We have, particularly when you look at the market and you look at the sustainability perspective. As I said you got an expansion going on. It is very, very important in my view, that we offer a commercially incentive rational approach. A commercially rational approach for a country that has plans to build reactors. First of all, is not going to be to build indigenous facilities. In fact, they may not have any desire even to build the repository. Ultimately they do have to have responsibility for whatever they plan to do. But there is a strong market, in my view, ready to be tapped, that would be to the benefit of non-pro by industry for consolidated multilateral disposal. That, in my view, is a long term systemic positive approach to addressing the concerns for development of reprocessing and even with regards to having a robust multiple supplier, fuel supply market slew uranium- the whole front end. The best answer, in my view, to address the risk of proliferation, is to remove the incentive, to remove the incentive by making clear with transparency, that you can rest, as an energy planning authority in a country, confident that if you rely on the commercial market for long-term you can rest assured with the multiple suppliers with the competitive nature with the transparency, you can rest assured on behalf of your citizens, that it's a good way to go. A reliable way to go.
McGINNIS:　IFNEC is one of the few, now I would say IAEA is now starting to look at it more as well, but IFNEC has really been working on it for about five years or so and we flipped the entire approach. Rather than trying to start at the site and start with the name of a country and the location and community, we decided maybe that's not such a good way to go. Let's look at first of all, bringing together the suppliers and the potential countries, most of which are represented in IFNEC, let's bring them together and start top-down. What are the necessary architecture elements? bilateral/multilateral agreements, third country transfers, liability issues, regulatory, who owns the title? what's the market? how large of a market would you need? how many reactors for 40 years each... if you get about a lifetime of 800 metric tons of spent nuclear fuel, what is the business? how many would you need... maybe 20 units lifetime? to really have this business become self-sustaining with the appropriate margins and again there is a non-pro(liferation) benefit because you're consolidating. We're looking at all of that, France and actually the United Arab Emirates are the co-chairs of this working group at this time and we'll be meeting in Paris. In fact, we're going to be receiving a briefing from our Australian colleagues who will tell us what they're doing with regards to this, the very interesting work that they're looking at for potential multilateral disposal there from an economics benefit perspective. So we are working hard to try and get some harmonization, politically and from an energy business perspective, if and when the day comes when a country decides collectively with the citizens that they are interested in fulfilling that most interesting and potentially most important from a non-proliferation perspective role.
SQUASSONI:　So when that becomes the norm, I'll keep my fingers crossed, maybe in my lifetime, then will we be more negative about reprocessing?
McGINNIS:　This is my US perspective. You don't need re-processing right now. Dry cask long-term storage works perfectly fine. There's a lot of good work out there being done to try and advance the technology and business-wise, think about it, like you said, who knows in the next 15, 20 years, there could be one or more countries which say, I got it I get it, my public, my citizens, my colleagues get it in X country, we see it as a win-win-win. When we can perform a very important non-proliferation perspective, it can be great for community, jobs, revenue and we're ready to be that location. But the one thing that we learned is that you cannot, what is the worst thing you can do, this is the wrong way to lead, I think, is try and tell a country they should do it. It cannot be that, it needs to be a country and the stakeholders decision, they need to believe it. They need to come up with that decision on their own. That's why it's very interesting to see what's happening in Australia and there's been no involvement, it's just been organically developed as a consideration.
AUDIENCE QUESTION 2:　Stephanie Cook, Nuclear Intelligence Weekly. I've been covering the industry for quite a while now, off-and-on, and it seems to me that since Presidents Ford and Carter came out with the anti-reprocessing, anti-breeder policy, our policies have kind of changed, kind of seesawed over the decades and for example, this led to the Bush administration in the early 2000's coming up with this idea of pyro processing and MOX use and then this led subsequently to the PDMA in the protocol in 2010, actually saying that we're committed to MOX. So from an international perspective, and certainly from my own perspective, I get quite confused about where we stand on this, sometimes. I can see that the administration has come out with some strong statements about reprocessing of late, but for a while, especially in the first half of the administration, I was confused about where it stood and what the message was, messaging to Japan was, and I wonder, I just think that this seesawing is creating a problem and I wonder if someone perhaps could address that.
McGINNIS:　I appreciate your point with regards to how we communicate with Japan on this and I would defer to Tom, but again just to elaborate one other point on the potential incredibly important nonproliferation role that could be performed by the commercial market. In my view, there have been some incredibly innovative very successful convergences of industry and national security -- the HEU purchase agreement is a prime example. And I think there other innovative concepts and ideas that reflects leadership, waiting to be had. I think the multilateral approach is a very important. Look at the uranium market. It is very low right now, the price is at an extreme low. There's plenty of uranium out there. There's some very interesting technology activities happening, R and D. Uranium extraction from seawater, that would be ground-breaking, that would be a game changer if that were proven out at economy of scale. I believe it is now as I understand it, maybe 15 times the price of current market. If you can get close to maybe 7, 8 times factor, the market price, that can be very very significant. Time is our ally when it comes to these issues right now this first technology development using dry cask storage as an ally and pushing the envelope in other ways, as far as what we've been and what we would say said to Japan. I'll defer to Tom.
COUNTRYMAN:　The first point about the PMDA (Plutonium Management Disposition Agreement between the US and Russian federal federation) and the efforts to implement it, underline, a point that Ambassador Gallucci made and to rephrase his point slightly, plutonium's value is negative. It is not an economic good. It costs an incredible amount of money to do away with it, to store securely and finding the least cost way to dispose of the ridiculous amounts of plutonium that the United States and the Russian Federation possess, is what leads to a change in direction as decided by the Department of Energy.
Now our relationship with Japan: first Japan has always been our best partner globally in every major nonproliferation forum. Japan has not violated any of its nonproliferation commitments ever. It has all of its facilities, including reprocessing facility, MOX burning reactors under all safeguards of the IAEA. It has adopted a clear policy of not possessing plutonium whose use is not anticipated and they've stuck to that policy in a transparent manner. For all those reasons our bilateral discussion with Japan is confidential, respectful, and on the basis of equality .We don't have better partners in this field and we don't do our negotiation at roundtables. That's how I describe our discussion with Japan.