Will the West Let Russia Dominate the Nuclear Market?
What the Westinghouse Bankruptcy Means for the Future
Sometime this fall, a U.S. federal bankruptcy judge in New York will decide the fate of Westinghouse, the venerable nuclear power company that failed financially earlier this year. When the decision is made, it will determine something far more important: whether the West will play an active role in mitigating the twin threats of nuclear proliferation and climate change, or instead cede the global market for nuclear energy to Russia. But to succeed, a reorganized Westinghouse will need a management team capable of breaking from the past and adopting a different, well-tested nuclear plant design; as well as the long-term, low-interest financing required to compete with the Russians.
RUSSIA'S GROWING NUCLEAR DOMINANCE
Westinghouse was founded in 1886, but was reorganized in the mid-1990s and owned by various companies until it was finally bought by Japanese conglomerate Toshiba in 2006—at a time when natural gas prices were high and nuclear energy’s prospects looked bright.
Westinghouse declared bankruptcy earlier this year after long construction delays stemming from building an entirely untested new design, the AP-1000, which resulted in significant and ongoing cost overruns during the building of two U.S. plants, one in South Carolina and the other in Georgia.
The greatest risk is that Westinghouse emerges out of bankruptcy proceedings in the hands of an owner who pulls the company out of the nuclear construction business entirely so that it can focus on its lucrative refueling business, and then sells off the remaining assets. Such an outcome would significantly undermine U.S. and Western national security interests, as well as global climate mitigation efforts.
Moscow views nuclear reactor sales as a vehicle for expanding and enhancing its influence. Russia’s state-owned nuclear corporation, Rosatom, is currently offering to not only build but fully finance and operate nuclear plants abroad, a deal that many cash-strapped and electricity-poor nations are finding hard to refuse.
Russia’s Build, Own, Operate (BOO) contracts are rightly raising flags within Western national security communities. Beyond establishingRead the full article on ForeignAffairs.com