January 8, 2006
Just when the two governments are more or less singing from the same hymn sheet on the North, Ireland and Britain are on the brink of the mother and father of all rows. The issue is nuclear power, Sellafield and the likelihood that Tony Blair is going to signal huge investment in Britain’s nuclear power programme for the first time since the 1960s.
According to one of the most senior British diplomats in Dublin, the only major remaining faultline between the two nations is Sellafield and, if Britain goes ultra-nuclear in May, this problem will get much worse.
Before this week, many in London regarded more nuclear investment as almost a sure thing. In its New Year forecast, The Financial Times suggested that a new nuclear drive was practically guaranteed.
The events of recent days have greatly enhanced the credibility of the pro-nuclear argument. Russia’s bellicose decision to block gas supplies to Ukraine and, as a result, to undermine the stability of gas supplies to the EU, sent shockwaves through western capitals – even if the cracks were papered over in a deal between the two.
The main geopolitical reason for Britain and others renewing their love affair with nuclear power is the instability of global supplies of energy. Areas with mineral resources, particularly oil, are more volatile than ever.
From Iran to Venezuela, many of the world’s major oil producers are at best unfriendly to the west and, at worst, openly hostile. Russia, on the other hand – which will hold the presidency of the G8 in February – is keen to present itself as a supplier that the west ï¿½could do business with’ï¿½.
That proposition has been greatly weakened by its move against Ukraine last week, which has more to do with adolescent smarting over Moscow’s loss of influence in Kiev following the Orange Revolution, than the profits of Russia’s gas giant Gazprom. This view is made more concrete by the fact that Russia still sells its gas to its pliant client state, Belarus, for half nothing.
But Russia’s behaviour only seems irrational to non-Russians. If you are sitting in the Kremlin, your world view is shaped by Napoleonic and Hitlerian nightmares of invasion from the west. So when the nice cuddly EU moves into your backyard and flirts with your former chattel Ukraine, you get nervous.
You do not see the innocent march of western democracy, you see yet another threat to Russia’s security. So you react with the only weapon you have – energy.
And you know what, the west suddenly wakes up!
Back in Downing Street, how would you read the situation? You might conclude that, with Iran threatening to ï¿½wipe Israel off the face of the earth’ï¿½, Venezuela on a collision course with Uncle Sam, and Russia now sabre-rattling on the Dnieper, securing your own energy resources has never been more critical.
Add to this the fact that the Chinese government, via its largest companies, has spent the past four years buying up major positions in global commodities organisations and you will realise that there is a new arms race on the horizon – it is the race for control of resources.
Although you denied it at the time and hid behind the charade of WMD, your move into Iraq was based on the same energy premise. So why not time your military pullout from Iraq to coincide with an announcement of renewed nuclear investment at home? In away, there is perfect symmetry between both moves, that which you could not secure abroad (dependable energy supplies), you can at least guarantee at home (through nuclear power).
Britain is not alone in going for the nuclear option. China has announced 27 new nuclear plants and, in all, 50 new nuclear power plants have been announced worldwide in the past two years.
We have also seen 60 new uranium plants opening in the same period. Even when these 27 new Chinese plants come online, uranium will only provide 4 per cent of China’s energy needs.
China’s moves are prompted by the same fears that are driving the British. By 2030,China expects to be depending on unstable oil imports for 82 per cent of its energy needs.
India’s position is even more precarious – on present trends it will be importing 94 per cent of its oil by 2030.
Other countries, such as environmentally friendly Finland, are citing environmental rather than geostrategic reasons for a new-found love affair with nuclear power. The depletion of the ozone layer is well known and caused by the illegal use of CFCs. Estimates vary, but most indicate that ozone depletion over the North and South Poles ranges from 45 per cent to 20 per cent. Skin cancer, the rampant killer of the past 20 years would be considerably less common had this not been the case.
And what about global warming?
Have you ever experienced a Canadian winter? Apparently, it gets very cold for long periods. And yet here in balmy Dublin, we are actually further north than freezing Montreal. However, as we all learned in ï¿½nature class’ï¿½ in national school, the warm gulf stream keeps us toasty in winter. This is now threatened.
The gulf stream is a large conveyor belt that drags warm Caribbean water up to us and a crucial part of the process that displaces cold with warm water is the ocean’s salinity.
Because of global warming, resulting from the burning of fossil fuels, the polar ice caps are melting. Oceanographers are worried that, as the polar ice caps melt, the resulting increases in freshwater into the seas will affect the sensitive balance that drives this oceanic conveyor belt.
So what are we to do? Having written on this subject before, I realise that it prompts significant emotions, all of which are legitimate. However, debate is not served by sticking our heads in the sand and pretending that the world is not re-examining nuclear power as a real option.
There is equally little point in trying to influence an argument that frequently moves from the narrow parameter of whether nuclear power is an option to a full-on shouting match about so many ancillary issues that the core point tends to get lost. Suffice to say that all sides on the Sellafield issue are girding their loins for an explosive barney when Britain, as expected, unveils its new nuclear programme in May.
One angle worth exploring is the personal financial implications of this new nuclear age. In the financial markets, the price of spot uranium has risen from a low of $8 in 1999 to a high of $35. Uranium stocks are rising rapidly and they have, from the investor’s perception at least, the advantage of being largely based in Canada, the US and Australia.
The market is clearly signalling a boom in nuclear-related stocks and, given that it takes so long for plants and demand to come on-stream, this may go on for some time. So it may well be worth a punt. There’s one home for your maturing SSIA cash that you might not have thought about!