Wednesday, November 24, 2010

OECD Nuclear Energy Agency:

At a New Crossroads?

A recent news item has reported that the OECD Nuclear Energy Agency (NEA) just gained a new member country, Poland, but at the same time, has been informed that one of its earliest and most active member countries, the United Kingdom, intends to leave the agency as a budget-tightening measure within their government. As a former Deputy Director-General of the NEA, I felt that I might be able to shed some light on what these membership changes might mean.

First, the loss of one member and the gain of another is not a zero-sum game. Poland is just starting its nuclear power program while the UK has had a long and active history in nuclear power. The UK has contributed greatly to NEA over the years through its membership in the NEA's standing technical committees and in important positions on the NEA staff. Perhaps most important, the funding for the NEA is provided by its member countries roughly in proportion to the sizes of their economies. Since the UK is a bigger economy than Poland, the financial contribution of Poland will not be equal to that lost from the UK. Rather, the budget for the Agency will have to be reallocated among all the remaining members, resulting in a slightly higher cost for each of the other member countries.

I should emphasize that UK's decision has so far not been formally confirmed. Countries usually have to give international agencies significant notice of intent to withdraw membership, so this announcement could be viewed as a way of keeping options open as the UK budget evolves. The announcement was made verbally by UK representatives at a recent NEA meeting, and NEA was told that a formal letter would follow. So far, the letter has not been received. In the meantime, those from the UK who have been involved with the NEA are trying desperately to find alternatives to continue their membership in the Agency. These measures could include support from a different UK agency or agencies. Other measures are also being discussed.

There have been previous cases where member governments have questioned the value of their NEA memberships or encountered budgetary problems supporting the NEA. In at least one case, the member country that questioned the role of NEA was persuaded of its value to them and retained its support; in another case, the country's budget obligation for the NEA was indeed transferred from one agency to other agencies within the member country. Therefore, it is too soon to write off the UK as a member of NEA.

However, there may be some differences in the environment this time that may make it more difficult for the NEA to survive unscathed. The first issue, obviously, is that we are in the middle of a world-wide economic recession. Several of NEA's member countries, including Ireland, Spain, Portugal, and Greece, are in worse financial shape than than is the UK. If they see the UK questioning their membership in the NEA, surely that will raise questions within their capitols. Furthermore, the fact that all the member countries will see a budget increase at a time when even a constant budget may be a strain may set off alarm bells among the remaining members.

Secondly, one of the values of the NEA has always been that it included almost all the major suppliers and users of nuclear power. For many years, Russia was the only major nuclear power country that was not in the NEA. However, with the growth of nuclear power in other countries, especially China, and with a number of new countries poised to begin using nuclear power, NEA will no longer hold that position. While the NEA reaches out to non-member countries by involving them as "observers" on their technical committees, that involvement has generally been limited, and may not be a sufficient solution for the future.

It has always been difficult to explain the different roles played by NEA and IAEA in the nuclear power area. While the two agencies really try hard to exploit the different strengths and advantages they each have, one of the major differences has always been that the NEA is a much smaller organization, but still included the countries operating most of the world's nuclear power plants. As this situation changes, it may be more difficult to convince member governments that both agencies are needed. Since IAEA is the more inclusive organization and has the important non-proliferation role, a choice between the two agencies would always favor IAEA.

In the past, I think having both agencies has been useful. NEA, with its smaller membership, has been able to develop a number of programs that IAEA has adopted and expanded to more countries. I am, of course, hopeful that both agencies will continue to have different and complementary values to their members and to the global nuclear power community. However, I do see significant challenges ahead for the NEA in assuring that outcome.

[For anyone interested in the history of the NEA, I prepared a document, available as a review draft, covering the first 50 years of the agency as background for the celebration of that event several years ago.]


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