Stakes Rise for U.S.-ROK Nuclear Energy Talks

Miles A. Pomper is a Senior Research Associate at the James Martin Center for Nonproliferation Studies in Washington, DC.

When South Korea and the United States negotiated their last nuclear cooperation agreement in the early 1970s, the talks were a low-key affair. As a poor economy lagging behind its Northern neighbor, South Korea did not have a single operating nuclear power plant, let alone piles of spent nuclear fuel. It seemed impossible that a South Korean company would one day be able to design and export nuclear reactors.U.S.nuclear nonproliferation efforts remained in their infancy. The United States had not yet attempted to clamp down on sales of sensitive fuel cycle technology and supplied most of the world’s enriched uranium. Pyongyang and Seoul had not yet pledged not to pursue uranium enrichment or spent fuel reprocessing—which can be used for nuclear weapons or nuclear energy—and Pyongyang had yet to violate that agreement. Iran was still a U.S.ally. Not surprisingly, little political attention or concern was attached to the U.S.-South Korea nuclear pact.

With the current agreement set to expire by March 2014, Seoul and Washington, DC, are gearing up to negotiate a new nuclear agreement within a radically changed economic, political, and diplomatic context. As a major economic power, recognized globally for its innovative technology, South Korea now boasts one of the world’s largest and fastest growing nuclear power reactor fleets that it hopes will help reduce dependence on foreign fossil fuel sources and limit emissions of greenhouse gases. South Korea has just beaten out leading American and French nuclear exporting firms to win its first major nuclear export agreement—a four-year $20 billion deal to export nuclear reactors to the United Arab Emirates—and aims to capture 20 percent of the world market for nuclear reactors by 2030.

Meanwhile, since India’s “peaceful “ nuclear test in the 1970s, the United States has grown increasingly concerned about nuclear proliferation and has attempted to prevent the spread of enrichment and reprocessing technologies to new countries. These concerns led the United States to block the sale of reprocessing technology to South Korea in the late 1970s, push for the inter-Korean joint denuclearization agreement in 1992, and more recently to engage with Seoul and Pyongyang in Six Party Talks aimed at ending North Korea’s nuclear weapons program.

Changes in the strategic context meant that renewed U.S.-South Korea nuclear talks would involve greater conflict and receive far more public scrutiny and high-level political attention. South Korea’s United Arab Emirates (U.A.E.) deal and another smaller deal to supply a research reactor to Jordan have only raised the stakes even higher. In winning the contract, a consortium led by the state-owned Korea Electric Power Corporation (KEPCO) beat out General Electric, which now has a nuclear partnership with Japan’s Hitachi. The blow to U.S. firms has been softened by the fact that Westinghouse will participate in the KEPCO-led consortium. Still, the emergence of a new sales competitor is bound to alarm U.S.industry and lawmakers, especially at a time when U.S.-South Korea free trade talks remain stalled partly because of some Congressional views that Seoul doesn’t play fair when it comes to trade.

The destination of South Korea’s initial sales will also raise concerns. U.S.experts have been worried for some time that Iran’s nuclear program could lead other countries in the Middle East to launch nuclear programs, as discussed by Chen Kane in a recent Foreign Policy article. When Congress considered the U.S.-U.A.E. peaceful nuclear cooperation agreement last year, the U.A.E. managed to assuage many of those concerns by agreeing not to engage in enrichment and reprocessing and by accepting an additional protocol to its safeguards agreement with the International Atomic Energy Agency. While making no such binding promises on enrichment and reprocessing,Jordan also has an additional protocol to its safeguards agreement. But these deals are likely to raise U.S. concerns that other countries in the region may not follow suit—and whether in those cases South Korea would still sell them reactors.

To win U.S.support for a nuclear cooperation agreement,South Korea may have to be willing to take on new global nonproliferation commitments commensurate with its new role as a major global nuclear technology supplier, or in some cases be more public about doing so. Seoul has supported U.S.efforts to make the additional protocol an international requirement for any reactor sales, but may now have to be more forceful in advocating this approach and encouraging other countries to follow the U.A.E.’s example in promising not to engage in enrichment and reprocessing. And as Egypt and other countries in the Middle East call on the United States to honor its pledge toward making the region free of weapons of mass destruction, South Korea may need to play a role in making that admittedly remote prospect somewhat less distant.

Closer to home, Seoul may need to take a second look at its support for pyroprocessing, the most contentious issue in negotiations with the United States on a new nuclear agreement.South Korea sees this reprocessing technology as a technical means of addressing a pressing problem: an accumulation of spent nuclear fuel that will soon outstrip the country’s storage capacity for highly radioactive waste. It wants to test the economic and technical feasibility of pryroprocessing as Seoul officials believe that this process would effectively reduce the ultimate storage capacity for spent fuel and help convince South Koreans than any interim storage measures would only be temporary.

But reprocessing has two very different uses: it can recycle the plutonium (and sometimes other elements in the spent fuel) to be used again as fuel, or separate out the plutonium to provide the fissile material for nuclear weapons. U.S. governmental and nongovernmental experts differ from their South Korean counterparts on how easily pyroprocessing can be diverted to weapons uses, and the United States has a crucial say because of the way South Korea’s nuclear program has developed. The majority of Korean nuclear reactors have been fueled with uranium enriched in the United States, imported from the United States, or based on U.S. technology. Under the current agreement, the United States can decide whether South Korea can take U.S.-supplied spent fuel and reuse the plutonium in it.

More than three decades ago, the United States ended its own large-scale reprocessing efforts (based on an older technology) because it found the technology uneconomical and feared that it was providing a poor example to other countries. As South Korea’s nuclear practices draw greater attention on the international stage, Seoul may face new pressures to do the same.