Nuclear Power in the United Arab Emirates
(Updated 15 September 2014)
- The UAE is taking deliberate steps in close consultation with the International Atomic Energy Agency to embark upon a nuclear power program.
- It accepted a $20 billion bid from a South Korean consortium to build four commercial nuclear power reactors, total 5.6 GWe, by 2020 at Barakah.
- Construction of the first unit started in July 2012, and the second in May 2013.
The United Arab Emirates (UAE) was founded in 1971, comprising seven states including Abu Dhabi and Dubai. Abu Dhabi city is the federal capital of UAE, and Abu Dhabi emirate accounts for 86% of the land area of UAE, and 95% of its oil. Dubai is the UAE's largest city.
Background: Gulf Cooperation
Since commencing studies in collaboration with other members of the Gulf Cooperation Council (GCC), the UAE has proceeded with plans to set up on its own an ambitious nuclear power program with significant capacity being on line by 2020.
In December 2006 the six member states of the Gulf Cooperation Council (GCC) – Kuwait, Saudi Arabia, Bahrain, the UAE, Qatar and Oman – announced that the Council was commissioning a study on the peaceful use of nuclear energy. France agreed to work with them on this, and Iran pledged assistance with nuclear technology.
Together they produce 273 billion kWh per year, all from fossil fuels (2003) and 5-7% annual demand growth. They have total installed capacity of about 80 GWe, with a common grid. There is also a large demand for desalination, currently fuelled by oil and gas (directly or indirectly). A 2009 report projects GCC electricity demand increasing 10% annually to 2015, and desalination demand growing at 8%, implying the need for 60 GWe of new capacity by 2015.
In February 2007 the six states agreed with the IAEA to cooperate on a feasibility study for a regional nuclear power and desalination program. Saudi Arabia was leading the investigation and thought that a program might emerge about 2009. Regional electricity grid integration is progressing, including a 3000 MWe connection from Iran by 2015.
The six nations are all signatories of the NPT and the UAE ratified a safeguards agreement with IAEA in 2003. In mid-2008 it appointed an ambassador to IAEA.
Nuclear power program in UAE
In 2009 the UAE produced 90.6 billion kWh gross, 98% of it from gas, for which it relies on some imports. It has about 19 GWe capacity. Electricity demand is growing by 9% per year and is expected to require 40 GWe of capacity by 2020. It is seeking to import some 1000 MWe from Iran. It relies entirely on electricity to provide its potable water, by desalination.
In April 2008 the UAE independently published a comprehensive policy on nuclear energy. This projected escalating electricity demand from 15.5 GWe in 2008 to over 40 GWe in 2020, with natural gas supplies sufficient for only half of this. Imported coal was dismissed as an option due to environmental and energy security implications. Renewables would be able to supply only 6-7% of the needed power by 2020.
Nuclear power "emerged as a proven, environmentally promising and commercially competitive option which could make a significant base-load contribution to the UAE’s economy and future energy security." This led to creation of a regulatory framework and selection of a site between Abu Dhabi city and Ruwais, at Barakah. Another possible site mentioned then was Al Fujayrah on the Indian Ocean coast.
Accordingly, and as recommended by the IAEA, the UAE established a Nuclear Energy Program Implementation Organization which set up the Emirates Nuclear Energy Corporation (ENEC) as an Abu Dhabi public entity, initially funded with $100 million, to evaluate and implement nuclear power plans within UAE (or specifically in Abu Dhabi emirate, which comprises 86% of the land area of UAE).
The UAE announced that it would "offer joint-venture arrangements to foreign investors for the construction and operation of future nuclear power plants" similar to existing Independent Water and Power Producer structures which have 60% owned by the government and 40% by the JV partner(s). The UAE set up a model of managing its nuclear power program based on contractor services rather than more slowly establishing indigenous expertise.
The UAE also resolved to forgo domestic enrichment and reprocessing, and "to conclude long-term arrangements …. for the secure supply of nuclear fuel, as well as the safe and secure transportation and, if available, the disposal of spent fuel via fuel leasing or other emerging fuel supply arrangements." (See Fuel Cycle below.)
The UAE invited expressions of interest from nine companies for construction of its first nuclear power plant. ENEC reduced this to a short list of three and sought bids by mid-2009. The three bidders on the short list comprised Areva, with Suez and Total, proposing its EPR, GE-Hitachi proposing its ABWR, and the Korean consortium proposing the APR-1400 PWR technology. The last group is led by Korea Electric Power Co. (KEPCO), and involves Samsung, Hyundai and Doosan, as well as Westinghouse, whose System 80+ design (certified in the USA) has been developed into the APR-1400. The UAE expressed an intention to standardize on one technology.
ENEC appointed the global full-service program management, engineering, construction and operations firm CH2M Hill to manage the UAE's plans for bringing nuclear power to the country.
In December 2009 ENEC announced that it had selected a bid from the KEPCO-led consortiuma for four APR-1400 reactors, to be built at one site. The value of the contract for the construction, commissioning and fuel loads for four units is about US$20.4 billion, with a high percentage of the contract being offered under a fixed-price arrangement. The consortium also expects to earn another $20 billion by jointly operating the reactors for 60 years. In March 2010 KEPCO awarded a $5.59 billion construction contract to Hyundai and Samsung for the first plants. The total cost of the plant including infrastructure and finance is expected to be about $32 billion.
KEPCO claimed later that the reason for their selection in the face of strong competition from France, USA, and Japan was their demonstrable highest capacity factor, lowest construction cost and shortest construction time among the bidders.
The plants will largely be financed by the state, without the need for loans, but with some Korean equity partners. By 2020 UAE hopes to have four of the 1400 MWe nuclear plants running and producing electricity at a quarter the cost of that from gas. It plans to export electricity to Gulf neighbours via the regional power grid. (The first APR-1400 units, Shin-Kori 3&4, are under construction in South Korea.)
An operating company, Nawah Energy, is to be set up about 2017 to run the four Barakah units, with 82% ENEC equity and 18% KEPCO.
From 2010 ENEC continued negotiations with the losing bidders, Arevab and GE-Hitachi, regarding cooperation in related nuclear areas.
In November 2013 the Dubai Electricity & Water Authority said that it had a target of 12% of its electricity supply capacity to be nuclear by 2030, primarily from Abu Dhabi’s Barakah plant, but also possibly from a Dubai plant at some stage. This target is in Dubai’s Integrated Energy Strategy 2030, arising from its Supreme Council of Energy set up in 2009 as an independent legal entity to oversee all matters relating to Dubai's energy sector.
Barakah power plant
In April 2010 ENEC lodged licence applications and an environmental assessment for its preferred site at Barakah (formerly 'Braka'), on the coast 53 km west of Ruwais and 300 km west of Abu Dhabi city – a little closer to Qatar than to the capital. The applications were assessed by the Federal Authority of Nuclear Regulation (FANR). This assessment, with environmental management plan, was considered by Abu Dhabi's Environmental Agency and approval was given in July 2012.
The site evaluation process for the four reactors considered ten potential sites and was based on guidance from FANR as well as the US Electric Power Research Institute, the US Nuclear Regulatory Commission, and the IAEA. The Gulf seawater at Barakah is about 35°C, which will give less thermal efficiency than the Shin-Kori 3&4 reference units, where the sea is about 27°C, so larger heat exchangers and condensers are required.
UAE nuclear power reactors under construction and planned
In July 2010 ENEC received two licences from FANR: a site preparation licence for Barakah and a limited construction licence allowing manufacture of major components for four units. A construction environmental permit from the Environmental Agency-Abu Dhabi followed them and groundbreaking took place in March 2011.
Construction licence applications were based on the safety analysis completed for Kepco's Shin-Kori 3&4 in South Korea which are the reference units for the Barakah plant. Differences relate principally to cooling, and 50Hz output instead of 60Hz.
ENEC lodged a 9000-page construction licence application for units 1&2 in December 2010 to undertake full site works and start construction of unit 1 in mid-2012 and unit 2 a year later. The construction licence for units 1&2 was issued by FANR in mid-July 2012. The 18-month review involved more than 60 FANR staff and three international consulting firms, as well as IAEA, and took in changes resulting from the Fukushima accident. Construction of unit 1 started almost immediately with first concrete, and that for unit 2 started in May 2013. Commercial operation is envisaged in 2017 and 2018 respectively, followed by 2019 and 2020 for units 3&4. Unit 1 was 55% complete in September 2014. See ENEC statement and schedulec.
ENEC submitted a 10,000-page construction licence application for units 3&4 to FANR in March 2013, based on that for units 1 and 2, and the licences were issued in mid-September 2014. Substantial work to prepare for first structural concrete had been authorised for units 3&4 in February 2014.
An IAEA integrated nuclear infrastructure review (INIR) mission to the UAE reported in January 2011 that the UAE had followed its recommended comprehensive 'milestones' approach for such countries. Areas of good practice identified by the mission included "cooperation, without compromising their independence, between the regulatory bodies and utility, human resource development, a well-structured management system, and a strong safety culture." Also ENEC has joined the World Association of Nuclear Operators (WANO) to benefit from its peer review process at the outset, to ensure high standards of safety.
The US Export-Import Bank approved $2 billion in financing for the Barakah plant in September 2012, for US-sourced components from Westinghouse and services from it and two other firms. Most of it was for coolant pumps and controls.
By August 2012 ENEC had awarded six contracts related to the supply of natural uranium concentrates, conversion and enrichment services individually, and the purchase of some enriched uranium product. A spread of suppliers is involved for each stage of the front-end fuel cycle. The company estimates the contracts are worth some $3 billion and will enable the Barakah plant to generate up to 450 billion kilowatt-hours of electricity over a 15-year period from 2017.
The contracts involve Canada-based Uranium One, UK-based Rio Tinto, France's Areva and Russia's Techsnabexport (Tenex) for supply of uranium concentrates. For conversion services, contracts utilise the USA's Converdyn, Tenex and Areva. Enrichment will be by Europe-based Urenco, Areva and Tenex. Areva said that its contract involved supply of enriched uranium worth some $500 million, and Tenex claimed to have secured half of the supply. ENEC "expects to return to the market at various times to take advantage of favorable market conditions and to strengthen its security of supply position."
The enriched uranium will be supplied to Kepco Nuclear Fuels – part of the prime contractor consortium led by Korea Electric Power Corporation (Kepco) – which will manufacture the fuel assemblies.
The UAE is committed to a “dual track” radioactive waste management strategy that involves developing a national storage and disposal programme in parallel with exploring regional cooperation options. Used fuel will be stored in reactor ponds for up to 20 years, or may be transferred to dry storage after six years. Reprocessing in France or elsewhere internationally is an option, depending on economics.
Sweden’s SKB is studying the prospects of a geological waste repository in UAE, and the Arab Atomic Energy Agency (AAEA), with a widened group of participating Middle East and North Africa (MENA) countries, is discussing regional options along the lines of EU precedents.
In August 2009 the UAE advised the IAEA that it was ready to join the IAEA Convention on Nuclear Safety, and the Joint Convention on the Safety of Spent Fuel Management and on the Safety of Radioactive Waste Management.
In October 2009 the Federal Law Regarding the Peaceful Uses of Nuclear Energy was signed into effect, providing for development of a system for licensing and control of nuclear material, as well as establishing the independent Federal Authority of Nuclear Regulation (FANR) to oversee the whole UAE's nuclear energy sector, and appointing the regulator's board, headed by a senior US regulator. The law also makes it illegal to develop, construct or operate uranium enrichment or spent fuel processing facilities within the country's borders.
ENEC was formally established as an investment vehicle in November 2009. As well as overseeing development of the nuclear program, it will act as a government investment arm by making strategic investments in the nuclear sector, domestically and internationally. This is likely to include taking a significant stake in the successful bidder, though that is not a condition or criterion in the bidding process.
In mid-2010 ENEC set up a Nuclear Safety Review Board to provide a review of the safety and effectiveness of the construction, startup and operations of the ENEC program, and to contribute to the review of ENEC’s Construction Licenses Application for the proposed Barakah Nuclear Power Plants, submitted to FANR. The Board is made up of five members, from Korea, Japan and the USA, with significant experience in all areas of civil nuclear power.
Separate from FANR, ENEC has also set up an International Advisory Board (IAB) of experts, headed by Dr Hans Blix.
In October 2012 the UAE passed legislation in line with the revised Vienna Convention so that civil liability lies solely and exclusively with the plant operator. It sets a limit of 450 million SDRs, about $694 million, 50% higher than the Vienna Convention minimum, so that the operator needs to insure to this level. The state accepts responsibility as insurer of last resort. In July 2014 the UAE ratified the Convention on Supplementary Compensation of Nuclear Damage (CSC), though it is not yet in force.
The USA signed a bilateral nuclear energy cooperation agreement1 with the UAE in January 2009 and South Korea signed one in June 2009. The UK has signed a Memorandum of Understanding on nuclear energy cooperation with UAE. France and Canada have nuclear cooperation agreements with UAE, the latter signed in September 2012, Russia in December 2012, and Argentina signed one in January 2013, then another in April 2014. Japan signed a nuclear cooperation and technical transfer agreement with UAE in May 2013, and another in February 2014. Australia and Canada signed bilateral safeguards agreements with UAE in August and September 2012, and the Australian one came into force in April 2014.
A total of 82% of people surveyed by market research company TNS in December 2012 (N=750) were in favour of nuclear power, compared with 66% in 2011, and 89% also supported a plant being built in their emirates, up from 67% in 2011, before Barakah construction started. The 2012 poll also found that awareness of nuclear energy had increased, 89% of residents now felt that peaceful nuclear energy is "extremely important, very important or important" for the UAE, and 55% viewed it as a main source of power generation, second to oil. The high support was attributed to public engagement as plans developed. The survey saw a decline in concerns related to overall safety of nuclear power plants, which TNS attributed to efforts spearheaded by the national government, ENEC and other nuclear industry bodies in the UAE. However, some work remained to be done to reassure the public about nuclear waste disposal, the company said.
The UAE is a signatory of the NPT and it ratified a safeguards agreement with IAEA in 2003. In 2009 it signed the Additional Protocol.
a. The consortium involves Hyundai Engineering & Construction, Samsung, Doosan Heavy Industries and Westinghouse, as well as KEPCO subsidiaries: Korea Hydro and Nuclear Power Co. Ltd. (KHNP), which will play a key role as the Engineering, Procurement and Construction (EPC) contractor and as operator; Korea Power Engineering Co. Inc. (KOPEC), which will provide the nuclear power plant design and engineering service; Korea Nuclear Fuel Co. Ltd. (KNF), which will provide the fuel; and Korea Plant Service and Engineering Co. Ltd. (KPS), which will be involved in plant maintenance. [Back]
b. In January 2008 three French companies Areva, Suez and Total had signed a partnership agreement to propose to UAE the construction of two EPR units there. Suez and Total would each invest up to 25% of the project with Abu Dhabi entities providing at least 50%. Suez would be operator, Areva would supply the plant and manage the fuel. Total and Suez were well established in the region and together operated a power and desalination plant for Abu Dhabi, 100 km west of Dubai. The consortium's first EPR could have been operating about 2017. In May 2009 it was reported that EdF had joined this consortium. [Back]
c. The statement and schedule is taken from the original text of an ENEC press release, Emirates Nuclear Energy Corporation Submits Construction License Application for Barakah Units 1 & 2 [Back]
1. Agreement for Cooperation Between the Government of the United States of America and the Government of the United Arab Emirates Concerning Peaceful Uses of Nuclear Energy, U.S. Government Printing Office, Washington (2009) [Back]