Options for Creating a Nuclear Fuel Stockpile for Assured Nuclear Fuel Supply

Rising world demand for fossil fuels, in conjunction with their decreasing availability, continues to drive a steady increase in the relative price of fossil energy. This increasing price of fossil fuels, compounded by environmental concerns about the release of carbon dioxide, is causing a surge of interest in nuclear power as an economic and dependable source of clean energy. Complete indigenous nuclear fuel cycles, however, are not attractive economic investments unless very large in scale; additionally, they pose substantial proliferation risks. In order to help persuade countries to develop nuclear power plants but to forgo development of indigenous nuclear fuel cycles, mechanisms to assure nuclear fuel supply must be developed. Assurances of nuclear fuel supply and spent fuel take-back can provide a means for States to confidently implement nuclear energy programs while insuring that an increased level of proliferation resistance is maintained. This paper examines the economic and political implications of a scenario in which a stylized deal for the continued blend-down of Russian highly enriched uranium (HEU) is used to supply a low-enriched uranium (LEU) stockpile that is used as part of a system for fuel supply assurance. We present and offer exploratory analysis of a series of questions for both government and industry regarding the assurance of this nuclear fuel supply. Key questions, including the impact on the market of an LEU stockpile, are raised and considered.