A Taiwanese Nuclear Revival

Abstract

Desperate to increase its energy independence and decrease its carbon emissions, Taiwan could make a big bet on nuclear energy. The world should be ready.

A confluence of foreign energy dependence and environmental degradation in Taiwan may be pushing the island nation to reconsider its decision to back away from nuclear power. Previous efforts by Taipei to develop nuclear weapons and to build a domestic reprocessing and enrichment capability during the 1970s and 1980s raise serious questions about the scope and nature of any future nuclear program.

That Taiwan would consider reinvesting heavily in nuclear power is due to its dire energy needs. Taiwan has one of the highest energy dependency rates in Asia. In 2006, imported fuels met 98.2 percent of its total energy demand of 138.4 million kiloliters of oil equivalent. This rate increased to 99.32 percent in 2007.1 As of mid-2007, Taiwan had an installed power capacity of 37,371 megawatts, of which, 74 percent was derived from burning fossil fuels, roughly 14 percent from nuclear power, and the remaining 12 percent from a mixture of hydroelectric and other renewable sources including wind and solar.2

Apart from the impact of fluctuating oil prices, Taipei's utter dependence on foreign sources of oil and natural gas is highly problematic. Oil makes up more than half of its energy imports, originating primarily from Saudi Arabia and Kuwait, and liquefied natural gas makes up more than one-third, with 80 percent shipped from Indonesia and Malaysia.3 Any fluctuation in this supply has the potential to endanger Taiwan's economy and national security.4 An associated concern for Taiwan arising from fossil fuel reliance is the resulting impact on its environment and public health. Taiwan has the highest carbon dioxide emissions per capita in East Asia (11.8 tons per person in 2006).5 The emissions growth rate in Taiwan is three times higher than the global average and is higher than India and second only to China, which recently overtook Taiwan in this dubious race.6

Taiwan's carbon emissions became a major issue during the 2008 presidential campaign, eliciting reduction pledges from candidates.7 The winner of that election, President Ma Ying-jeou, the Kuomintang (KMT) Party candidate, has proposed new energy guidelines for the country. President Ma led Taiwan's policy-making body, the Executive Yuan, to approve a set of draft guidelines on June 5, 2008, World Environment Day, which would increase the percentage of electricity generated from low-carbon fuel from 40 percent to 55 percent and from carbon-free sources from 5 percent to 8 percent by 2025.8 The plan also aims to reduce carbon dioxide emissions to 2008 levels by 2020 and to 2000 levels by 2025 and to reduce the contribution of imported energy to 92.2 percent by 2025.9

An unusual aspect of the new guidelines is the inclusion of nuclear energy under a list of potential carbon-free sources. It is unusual because the KMT was part of the Legislative Yuan that passed the Nuclear-Free Homeland agreement, jointly signed by the legislative and executive branches of government on February 13, 2001. The two major political parties–the KMT and the Democratic Progressive Party (DPP)–agreed upon this concept while struggling to end a political stalemate over construction of a fourth nuclear power plant at Yen-liao (Gongliao Township), located at the northeastern tip of Taiwan. The objectives of the Nuclear-Free Homeland include “ending the threat of nuclear weapons; reviewing the various uses of nuclear power for peaceful non-violent purposes; developing renewable energy; and eliminating nuclear waste pollution.”10

If Taiwan wants to achieve its ambitious targets to reduce carbon emissions and achieve energy security, it must either make huge investments in renewable energy (most likely hydroelectric, wind, and solar power), or back away from the Nuclear-Free Homeland agreement and reenergize its nuclear industry. Although both nuclear and renewables could play a role as clean-energy sources, non-nuclear renewable energy has certain limitations. For Taiwan, hydroelectric power is limited due to the island's dependence on seasonal rains, which have shifted from their historic patterns resulting in increased flooding. These changes have affected reservoir storage and electricity production.11 Moreover, according to some government officials, Taiwan has already utilized almost all of its potential hydroelectric sites.12 Beyond the huge financial requirements and the need for large tracts of land, solar technologies have not yet demonstrated a capacity to replace large fossil fuel plants.

Thus nuclear energy could become Taiwan's only answer to its search for clean and abundant energy. The recognition of these limitations may be why the new government included nuclear energy in its energy guidelines. The KMT-led government, however, has not been very vocal in its support for nuclear energy, owing perhaps to apprehension among the Taiwanese to nuclear energy and the fact that the KMT was part of the Nuclear-Free Homeland agreement. Taiwanese Environmental Protection Administration officials have downplayed the possibility of renewed nuclear power, calling it only a “last resort.”13

Taiwan has the highest carbon dioxide emissions per capita in East Asia and its emissions growth rate is three times higher than the global average and is higher than India and second only to China, which recently overtook Taiwan in this dubious race.

Yet there are indications that leaders in Taipei might be changing their attitude toward nuclear energy, compared to the previous staunchly anti-nuclear DPP-led government. A Ministry of Economic Affairs spokesperson admitted in the Taipei Taiwan News that the government was evaluating whether to establish a fifth nuclear facility.14 Taipower, the state-run power utility, reportedly has stated that the country's fourth nuclear facility, where two 1,350-megawatt light water reactors are under construction, could accommodate up to 12 additional units.15 Such discussions, including interest in building a dry cask storage facility for spent fuel at the Chinshan nuclear power plant located in northern Taiwan, may signal renewed interest in nuclear power. They also raise questions regarding Taiwan's past efforts to develop the full nuclear fuel cycle and a weapons program, and what its future intentions might be.16

Taiwan's existential insecurities. In 1949, the Republic of China was moved to Taiwan by Chang Kaishek's Nationalist government (also known as the Kuomintang, the same as the modern Taiwanese political party) following its defeat by the Communists and the establishment of the People's Republic of China on the mainland. Since then, the KMT and the Communist government on the mainland have struggled for suzerainty over the mainland and Taiwan, leading to occasional skirmishes. In 1954, the United States signed a defense pact with Taiwan, which included military aid, and became the primary deterrent against a Chinese invasion of the island.

Taiwan's security is guaranteed by the United States, whose commitment exists without any formal treaty. The U.S. relationship with Taiwan is guided by the 1979 Taiwan Relations Act, which was passed by Congress following the unilateral abrogation of the 1954 defense pact by Washington. The Carter administration's decision to scrap the defense pact was the culmination of efforts initiated in 1971 by the Nixon administration to open up China to the world. Furthermore, in 1979 the Carter administration severed diplomatic ties with Taiwan and recognized the Communist government in Beijing as China's rightful government. The process of recognizing the Communist government, starting with the entry of China into the United Nations in 1971, slowly pushed Taiwan out of all major international organizations. The U.S. reorientation toward Beijing and Taipei's growing international isolation, further compounded its existential fears and encouraged its interest in developing nuclear weapons.

Historically, Taipei has been able to maintain a qualitative military advantage, especially in air superiority, over China. Moreover, Beijing has lacked the ability to undertake an amphibious assault against the island. That has not changed, however, signs of a relative decline in Taipei's conventional deterrence is evident. This decline is due to the rapid modernization of the Chinese military, the slowing of Taiwan's economy, the increase in Taiwan's social welfare-related expenditures, and finally, the preoccupation of the United States with other exigencies. Washington's increasing need for cooperation with Beijing has created further ambiguities in the level of U.S. commitment to defending Taiwan against threats from China.17

Taipei's willingness to refrain from developing nuclear weapons is largely dependent on the credibility of the U.S. security commitment to Taiwan against any unprovoked military aggression by China. Any perceived weakness in this commitment, along with nervousness regarding China's growing military capabilities, could rekindle Taiwan's interest in pursuing nuclear weapons-related research.

Taiwan's nuclear history. Over the last 50 years, domestic politics and international restrictions imposed mostly by the United States have been the primary influences limiting the scope and nature of Taiwan's nuclear program. Taiwan's nuclear program has been civilian for most of its existence, although during the 1970s and 1980s it explored weapons development. During its early years, Taipei desired to develop the whole gamut of nuclear technologies–from enrichment to reprocessing. Currently, however, the country is limited to operating its three existing nuclear power plants, constructing the fourth, and pursuing non-weapons nuclear research such as nuclear safety, spent fuel storage, radioactive waste management, nuclear medicine, and other industrial applications.

Taiwan has a long history of cooperating with nuclear inspection regimes. Taiwan and the United States signed an agreement in 1955 on the peaceful uses of atomic energy, and subsequently the United States conducted safeguards inspections in Taiwan. After the International Atomic Energy Agency (IAEA) established its international safeguards inspection mechanism, Taiwan signed a trilateral agreement between itself, the IAEA, and the United States in 1964, thereby transferring responsibility for safeguarding Taiwan's nuclear materials from the United States to the IAEA. Although it is not a signatory to the Nuclear Non-Proliferation Treaty (NPT), currently nuclear safeguards are applied to it as if it were an NPT non-nuclear weapon state party.18 In 1998, Taiwan's domestic Atomic Energy Council (AEC) agreed to implement measures provided for in the Model Protocol additional to its trilateral safeguards agreement. The implementation of the IAEA Comprehensive Safeguards Agreement and the Additional Protocol have allowed Taiwan's nuclear program to be scrutinized so that any anomalies or diversions within its civilian nuclear program can be detected.

If Taiwan wants to achieve its ambitious targets to reduce carbon emissions and achieve energy security, it must either make huge investments in renewable energy (most likely hydroelectric, wind, and solar power) or reenergize its nuclear industry.

Taiwan initiated its nuclear program in the 1950s as part of the U.S. Atoms for Peace program and through IAEA-sponsored training activities. The establishment of the Tsing Hua open pool reactor in 1961 bolstered the country's nuclear education and research efforts and resulted in the emergence of National Tsing Hua University as the country's premier nuclear research center. Some U.S. officials initially speculated that Taiwan joined the Atoms for Peace program to pursue nuclear weapons. A 1998 Bulletin article by David Albright and Corey Gay and declassified U.S. State Department documents indicate that it was only after the 1964 Chinese nuclear test that Taiwanese security officials pushed for a domestic nuclear weapons program.19

In 1967, the Ministry of National Defense drafted the $140 million Hsin Chu Program, which proposed that Taiwan acquire a heavy water reactor, a heavy water production plant, a plutonium separation plant, and a ballistic missile production capability. Subsequently, President Chiang directed his scientific advisor Ta-You Wu to review the plan and make recommendations. Wu recommended rejecting the plan due to its enormous financial requirements (almost 15 percent of the government's annual expenditures) and its political costs, specifically Taiwan's relationship with the United States (since at this point the United States still recognized Taiwan as the official government of mainland China). Wu instead proposed strengthening the civilian nuclear program and creating a civilian nuclear oversight body.20

In 1968, the Taiwanese government established the AEC, and nuclear-related research was subsequently transferred from the military to the newly created Institute for Nuclear Energy Research (INER). As a compromise to the 1967 plan, Taipower acquired light water reactors for power generation, and INER procured a 40-mega-watt heavy water research reactor (known as Taiwan Research Re-actor-1) from Canada, the same type of reactor that India used to produce fissile material for its 1974 “peaceful” nuclear explosion.21

Although Taipei created the AEC and separated nuclear research from the military, efforts to develop nuclear weapons-related technologies continued until 1987, albeit without explicit government approval. A 20–30 ton pilot-scale fuel-fabrication plant began operating sometime between 1972 and 1973 at INER with 100 tons of natural uranium supplied by South Africa.22 During the 1970s, Taiwan also established a reprocessing laboratory, allegedly had a uranium enrichment program, and tried to procure reprocessing technologies from Europe.23 Under intense U.S. pressure, Taiwan declared in 1976 that “it [had] no intention whatsoever to develop nuclear weapons” and dismantled the laboratory as a goodwill gesture.24 Despite the proclamations, however, it appears that Taiwan continued fuel reprocessing until 1987, which resulted in further U.S. pressure and the eventual closure of the Taiwan Research Reactor-1 at INER and its on-going conversion to low-enriched uranium fuel.

Taiwan's fissile material produced to date has either been returned to the United States, its country of origin, or is under constant monitoring by the United States and the IAEA. In 1999, Taiwan returned 4 kilograms of highly enriched uranium (HEU) to the United States and currently has 3–10 kilograms of HEU, which is not enough to manufacture nuclear weapons, according to the IAEA. Taiwan also lacks any known uranium enrichment or spent fuel reprocessing facilities. Although its ability to build or operate such facilities is unknown, it is limited by funding constraints and the fact that its nuclear scientists, who worked on the weapons program, are retiring.

Although Taiwan doesn't have a declared uranium conversion facility, its scientists studied techniques to convert uranium from yellowcake to uranium hexafluoride between 1988 and 1993. In addition, during the 1990s Taiwan unsuccessfully attempted to produce uranium 233 from thorium, according to reports in Nucleonics Week. If the program had been successful, it would have had huge implications because uranium 233 can be used to make nuclear weapons. According to Taiwan's Council of Economic Planning and Development, the country has around 45,000 metric tons of thorium-rich monazite ore in southwestern and northern parts of the country.25 The council further noted that these reserves could contain 1.3–2 percent pure thorium.26 In 2005, the chairperson of the AEC, Ouyang Min-shen, revealed that Taiwan had conducted research to produce uranium 233 by irradiating thorium 232 in a reactor. The program, however, was unsuccessful and was terminated.27

A nuclear power revival? Taiwan's three nuclear power plants, each with two operating nuclear reactors, have an installed capacity of 5,144 megawatts.28 In 1999, Taipower initiated the construction of a fourth nuclear power plant, whose two reactors were scheduled to go critical in 2004 and 2005. On October 27, 2000, however, the government headed by the DPP halted the project, despite it being one-third completed.29 Legal intervention by the Taiwanese constitutional court restarted the project the following year, and according to revised estimates, the project will be completed by 2010.30

In 2005, Taipower in collaboration with National Tsing Hua University carried out a feasibility study for uprating the capacity of the six operating nuclear power reactors by almost 10 percent or 500 megawatts.31 In 2006, Nucleonics Week reported that Ouyang Min-shen, then the DPP minister for nuclear energy, advised the cabinet to “consider building new nuclear units in the national interest.”32 Tai-power had also undertaken an internal feasibility study to look into building additional nuclear reactors at the three existing nuclear power plants (and at the as-yet-uncompleted fourth). Sources close to the company have stated that up to 14 additional reactors could be added at existing sites.33 Even if Taipei were to install only half of these additional reactors, it would be a huge investment in Taiwan's nuclear power industry. Taiwan could emerge as one of the leading markets for nuclear energy with enormous possibilities for investment and technical cooperation.

Any perceived weakness in the U.S. security commitment to protect Taiwan against “unprovoked” military aggression by China, along with nervousness regarding China's growing military capabilities, could rekindle Taiwanese interest in pursuing nuclear weapons-related research.

In this scenario, the crucial question is whether Taiwan would opt for turnkey nuclear power plants from foreign suppliers or request that foreign companies source part of their equipment needs from Taiwanese companies, resulting in some technology exchange. A request for the complete transfer of technology would raise eyebrows. Attempts to develop the full nuclear fuel cycle in Taiwan would raise even more concerns internationally, especially given the lack of clear information related to Taipei's past nuclear activities.

If government funding is any indication of Taiwan's interest in nuclear power, interest is very low. Between 2005 and 2007, the AEC budget increased to $10.34 million from $10.14 million, and funding for INER increased to $75.38 million from $69.56 million.34 Although the KMT-led government might consider steeper increases in the future, this level of interest doesn't exist in the government at present.

An area that is of concern to some Taiwan watchers is Taipei's expressed interest, albeit informally, in joining the U.S.-led Global Nuclear Energy Partnership (GNEP), which could offer a more long-term solution to its spent fuel management problem by allowing it to ship spent fuel to other countries.35 Taiwan's potential participation in GNEP is politically sensitive to China, which itself joined GNEP in 2007, due to the mainland's preference that Taiwan not be recognized as an independent state. Taipei's involvement with GNEP would also raise nonproliferation concerns regarding its possible access to reprocessing-related technologies and its potential access to mixed-oxide fuel. Taipower has proposed informally that spent fuel processed outside Taiwan could be exchanged for fresh nuclear fuel.36 To avoid angering China and to avoid Taiwan acquiring reprocessing-related technologies, the United States might prefer to initiate a bilateral spent fuel management program with Taiwan outside GNEP.

If Taiwan still wanted to acquire nuclear weapons-related technologies, IAEA safeguards would stand in the way and give Taiwan very little room to manage or hide a clandestine weapons program. Due to Taiwan's nebulous international status, however, utilizing these nonproliferation tools might be difficult.

For example, in 2007 the IAEA allegedly listed Taiwan on its “non-compliance list,” because the country had failed to produce complete documentation of its past nuclear activities. The IAEA also allegedly contemplated submitting Taiwan's case to the U.N. Security Council for further deliberations. Given Beijing's likely disapproval of letting Taiwanese personnel address the Security Council, the IAEA reportedly changed its stance to prevent an international incident.37

If true, these events demonstrate the difficulties were Taiwan to violate its IAEA safeguards. This is an extreme scenario, especially given the United States' ability to pressure Taiwan to roll back any weapons-related activities, yet it offers a cautionary tale for the international community and those opposed to the development of nuclear weapons in Taiwan.