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POWERING UP
BY GEOFFREY CRAIG
As the cost of traditional fossil fuel-based energy
increases, Egypt is searching for cheaper alternatives. Nuclear
power promises abundant, cheap energy. But there’s more to
it than simple economics.
It was a nuclear bombshell. On September 19, Gamal
Mubarak, the son of President Hosni Mubarak and the head of the
ruling National Democratic Party’s influential policies secretariat,
shocked reporters covering the NDP’s annual conference by
announcing Egypt’s intent to pursue nuclear energy. Government
officials later confirmed plans to build a 1,000-megawatt power
station at Dabaa on the Mediterranean coast about 140 kilometers
west of Alexandria to be operational within 10 years.
Egypt’s nuclear program began in the late 1950s and was halted
and resumed a number of times before it was finally frozen in 1986.
Two small reactors at Inshas, 60 kilometers northwest of Cairo,
are still used for research purposes – one a two-megawatt
reactor built by the Soviets in the early 1960s and the other a
22-megawatt reactor constructed by Argentina in 1998. The ageing
reactors are used for research in the fields of agriculture, medicine,
biotechnology and genetics.
Gamal Mubarak said Egypt’s decision to restart its nuclear
energy program was intended to reduce its dependence on fossil fuels.
“We will continue using our natural resources, but we should
conserve these resources for our future generations,” the
Associated Press quoted him as saying. “The whole world is
looking at alternative energy and so should Egypt, including nuclear.”
Egypt’s 70-plus million citizens consumed 78.2 billion kilowatt
hours of electricity in 2003, the last year for which statistics
are available. Population growth and industrial development are
expected to increase this need by 7 percent per annum over the coming
years. The Aswan High Dam supplies about 15 percent of this electricity,
while the remaining 85 percent is generated in power plants that
run on natural gas as their primary fuel.
Natural gas production has soared since foreign companies began
active gas exploration in the early 1990s. Egypt is now the world’s
sixth largest LNG producer, with 66.7 trillion in proven gas reserves.
But a quarter of this is slated for export, and experts predict
the wells will begin to run dry within the coming two decades. “Current
energy sources are not enough,” warns Tarek Selim, a professor
of economics at the American University in Cairo (AUC). “If
we stay with the status quo, there will be an energy crisis.”
Selim recently completed a forecasting model simulating different
energy scenarios and found that gas reserves will be depleted by
2025 unless Egypt pursues alternative energy. But before that happens,
the country will run out of oil. “Egypt could be a net importer
[as early as] next year, but certainly no later than 2008 to 2009,
assuming no additional proven reserves,” he told Business
Monthly. He explained that since peaking in 1996, oil production
has declined while consumption has risen due, in part, to fuel subsidies.
Record high world oil and gas prices have pushed the cost of Egypt’s
fuel subsidies to around $4 billion and made imports more expensive.
One benefit of nuclear energy, Selim explains, is that it would
slash subsidy costs by reducing the consumption of fossil fuels.
It would also make Egypt less susceptible to volatility in the global
energy market, which is only expected to increase in the coming
years as worldwide oil reserves decline.
The benefits of nuclear energy must be weighed against the costs.
Egypt expects to spend $1.5 billion to build a 1,000-megawatt nuclear
reactor, about twice what it would cost to construct gas-fired power
plants with the same power-generating capacity. However, it could
recoup the capital outlay in the long run.
In an April 2006 report entitled “Nuclear Energy and Sustainable
Development,” the International Atomic Energy Agency (IAEA)
compared seven studies, all of which found the construction costs
for nuclear energy to be substantially higher than gas-fired plants.
Yet the study found no clear-cut winner when comparing total costs
over a power station’s lifespan because the higher capital
costs were offset by lower operating costs, making the differences
negligible.
Economics aside, analysts see political motives behind Egypt’s
decision to relaunch its nuclear program at this critical juncture
in international affairs [see sidebar, page 38]. Some have argued
that the government’s intention is to develop its nuclear
energy program to counter the growing power of Iran in the region.
Iran’s refusal to bow to international pressure, and particularly
its defiance of Washington, has played on popular sentiment and
given it considerable political clout in the region. “Iran
looks to be the main regional power and to spread its influence
from Sudan to Lebanon,” explains Emad Gad, a political analyst
at the Al-Ahram Center for Political & Strategic Studies.
DIFFERENT ISOTOPES
Egypt’s announcement comes at a time of heightened
concern about the proliferation of nuclear technology. In
late October, the UN Security Council was still discussing
possible economic sanctions against Iran due to its failure
to suspend uranium enrichment. Critics argue that demanding
Iran halt its nuclear energy program, while giving the go-ahead
to other countries, such as Egypt, is a double standard. However,
important differences do exist.
The international community’s beef with Iran dates back
to 2003, when it was revealed that Iran had been hiding a
uranium enrichment program for 18 years. Iran claims it needs
nuclear power for energy and will not use the technology to
make a bomb. The international community has its doubts. In
August, International Atomic Energy Agency (IAEA) inspectors
reported they were unable to “confirm the peaceful nature
of Iran’s nuclear program.”
For its part, Egypt has a long track record of transparency
and compliance with inspectors, in addition to being a vocal
proponent for the removal of nuclear weapons in the region.
Combined with close US ties, the effect has been to bolster
its claim that a nuclear energy program will not be diverted
for military purposes. That confidence, it appears, was not
significantly eroded by an IAEA report last year that found
previously undisclosed experiments performed by Egyptian scientists,
including an ongoing project to acquire uranium ore in the
Sinai desert. |
He says Egypt can siphon away some of the momentum from Iran by
asserting its right to develop a nuclear program and creating the
perception that, like Iran, it is defying the US to pursue nuclear
ambitions, albeit peaceful ones. It’s a ploy to appeal to
popular sentiment, Gad argues, who says he is certain “the
Egyptian regime discussed the issue with the US administration and
got the green light to announce it.”
He continues: “The government is trying to convince people
that it will be an Egyptian program and that we refuse to receive
[help] from America. The political elites know it will be an American
program, but the message will be, ‘we are an independent and
regional power, no less than Iran.’”
Washington was indeed quick to offer its support. US ambassador
to Egypt Francis Ricciardone announced on September 20 in an interview
with Egyptian television that the Bush administration would have
no objection to Egypt’s budding nuclear program because “the
United States encourages the peaceful use of nuclear power for civilian
purposes throughout the world.” He added that the US was prepared
to provide technical expertise to Egypt to develop its program.
During a visit to Cairo in early October, Secretary of State Condoleeza
Rice also offered American support provided Egypt acquires its fuel
abroad. “We are supporters of states that may wish to go this
way and we would be pleased to discuss this with Egypt,” she
said. Rice explained that US president George W. Bush feels “the
way to diminish proliferation risk is to have the provision of fuel
for states from outside” its territory, so that a country
does not enrich and reprocess uranium on its own.
The motives for Washington’s backing are opaque. Some have
suggested that the Bush administration is trying to deflect criticism
from its recent agreement to ship nuclear technology to India despite
Delhi’s refusal to sign the Non-Proliferation Treaty (NPT).
Others feel the US recognizes that Middle East countries are increasingly
likely to pursue nuclear energy programs to offset foreseen energy
shortages and any attempt to block its allies in these endeavors
would only alienate them.
Walid Kazziha, a political science professor at AUC, believes the
Bush administration has calculated that in exchange for its support
Egypt will allow it to closely monitor its nuclear program. “Instead
of opposing the nuclear energy program, the US will ride the wave
and then have more control of the process,” he says. “If
they oppose it, there is also a danger it will get out of hand.”
ENERGY PLANS REVISITED
Ambassador Mohamed Shaker, Egypt’s former International
Atomic Energy Agency (IAEA) representative, feels the government
may have been too hasty in its decision to pursue nuclear
power. He says Egypt should first get an economic assessment
from the Vienna-based watchdog, which can recommend whether
or not to pursue nuclear energy in light of alternative sources.
He says the study would help “convince people who are
hesitant within Egypt” and also “show the world
that Egypt needs to invest in nuclear energy.”
In the 1960s, the Egyptian Atomic Energy Corporation (EAEC)
outlined a program for Egypt’s energy needs through
the year 2000. The agency recommended that Egypt should have
eight nuclear power plants with a combined capacity of 5,400
megawatts. A revised study in 1974 projected the need for
6,600 megawatts of nuclear energy by 2000.
In 1981, then president Anwar Sadat signed an agreement with
France to supply Egypt with two 1,000-megawatt reactors at
a cost of $1 billion each to be located at Dabaa on the Mediterranean
and Zaafarana on the Red Sea. Egypt also signed agreements
with the US and Germany to provide two reactors each, as well
as fuel. However, following the assassination of Sadat in
October 1981, all three countries reneged on their agreements
and put Egypt’s nuclear program in jeopardy. The program
was scrapped altogether following the Soviet nuclear disaster
at Chernobyl in 1986, which highlighted the risks involved
in splitting the atom. |
Some European countries have also indicated their willingness to
fund the program provided it stays under the guidelines of the IAEA.
Without such funding, and particularly foreign technical support,
Egypt will not be able to get its program off the ground, insists
Ambassador Mohamed Shaker, vice chairman of the Egyptian Council
for Foreign Relations and Egypt’s former IAEA representative.
Yet he’s not convinced with the idea of relying entirely on
one country for this. “We don’t want to put all our
eggs in one basket,” he says. “Maybe the first time
we get a reactor from the US, but maybe the next one [should come]
from France, Germany or Canada.”
By awarding bids to companies from different countries, Shaker explains,
Egypt could diversify its nuclear program to include both light-
and heavy-water reactors. Most reactors in use today are light-water
reactors, which use ordinary water as the primary coolant and moderator,
and slightly enriched uranium as fuel. They are simpler and cheaper
to construct, but require expensive enrichment facilities. Heavy-water
reactors use water containing a greater proportion of heavy hydrogen
atoms to ordinary hydrogen as their moderator, and natural uranium
as fuel. While heavy-water is more expensive, countries that operate
these reactors can utilize their indigenous uranium supplies without
the need for enrichment facilities.
International involvement will inevitably bring foreign experts
and technologies, which will create opportunities for Egypt’s
nuclear specialists to gain experience. After Egypt froze its nuclear
program, many nuclear scientists left the country to work on foreign
programs, while those who stayed were restricted to conducting research
experiments.
Karima Korayem, a professor of economics at Al-Azhar University
and a former consultant to a government study on alternative energy
in the 1970s, says foreign expertise will help get Egypt’s
nuclear program off the ground, but the goal should be to ensure
that Egyptians acquire the technical know-how so they are able to
comprise a growing percentage of the labor force. Those percentages
should be stipulated in the cooperation agreements signed with foreign
countries, she says.
Egyptian nuclear scientists have been waiting a long time to turn
their theoretical knowledge into practical application. That day
may be approaching soon. But as Egypt’s history of thwarted
nuclear ambition shows, external political events can disrupt the
best-laid plans. Relying on foreign countries has been necessary
both technically and financially, but it has also left Egypt’s
nuclear program vulnerable. So far, at a minimum, the US is on board.
As the political leadership mulls over its strategy, perhaps it
should ask itself, how it will respond if that changes.
GREEN ENERGY
In Egypt’s search for alternative energy, nuclear would
seem an odd option. After all, isn’t it desert blessed
with year-round sunshine? And doesn’t the wind seem
to blow all day long on its coasts?
Solar and wind power would seem to offer a quick and easy
way to reduce fossil fuel dependence without all the environmental
and safety hazards of nuclear energy, and without being subject
to the scrutiny of international inspectors. The main drawback
– they cost a fortune.
The capital and operating expenses to generate electricity
from wind and solar energy, although declining, are still
deemed greater than for nuclear and gas-fired plants. Another
complication is the intermittent nature of wind – which
can stop blowing for days on end – and sun – which
disappears each night and on cloudy days.
Egypt has certainly been slow to adopt these clean energies.
Already in some developed countries such as Denmark, for instance,
wind energy generates about 20 percent of electricity consumption.
Egypt does have some foreign-financed solar and wind projects
on the Red Sea coast at Kureimat and Zaafarana respectively,
but the power-generating capacity of these experimental projects
is relatively small. As costs fall and incentives climb, expect
to see more of these alternative energies in Egypt. |
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