The Russian nuclear sector has been steady developing this year, despite the ongoing hostilities in Ukraine and growing isolation of the country in the international arena. In fact, the nuclear industry is one of the few industries in Russia, which – so far – has not been included in the EU and US sanctions lists. This has ensured its generally good level of development in 2022 and the first half of the current year. Still, despite this, further prospects of the industry remain cloudy.
Currently the development of the industry in Russia is mainly carried out within the existing state programme: ‘Development of equipment, technologies and scientific research in the field of the use of atomic energy in the Russian Federation’ (RTTN) – which is designed to run until 2030.
The programme was launched in 2020, being designed by Rosatom together with the National Research Center the ‘Kurchatov Institute’, the Russian Academy of Sciences and the Ministry of Science and Higher Education. Initially, it was designed to run until 2024, but was extended by another six years. The programme consists of five major federal projects.
The first project – ‘New Nuclear Energy’ – is aimed at creating new types of next-generation reactors. Last year, for example, Rosatom completed technical design for the RITM- 200N reactor, which will become the basis for its low-power nuclear power plants (LNPPs).
As part of the second project, work is currently ongoing on the multi-purpose fast neutron research reactor MBIR. It will become the world’s most powerful reactor of its type considering the existing, under construction and projected fast neutron installations. In April 2022, the reactor unit – a unique product 12 m long, 4 m in diameter and weighing more than 83 tonnes – was delivered to the MBIR construction site ahead of schedule. In January 2023, its installation in was completed. Rosatom plans to complete construction works in 2026, a year ahead of the planned schedule.
In the meantime, particular attention is also being paid to work in the field of thermonuclear fusion and plasma technologies. As part of the project, so far, Rosatom R&D enterprises – the State Research Center of the Russian Federation TRINITI (Troitsk Institute for Innovation and Fusion Research) together with AO NIKIET (Research and Design Institute of Power Engineering) – have developed and manufactured an in-chamber protection element for the first wall of the Russian T-15MD tokamak, Russia’s largest thermonuclear plant at the Kurchatov Institute. Under the terms of the project programme on the small tokamak T-11M, located in TRINITI, specialists have conducted experiments to study the effect of injection of finely dispersed lithium on plasma parameters. The technology under development will be used for the design of the Russian Fusion Power Demonstration Reactor.
In the case of TRINITI, recently its scientists have also made progress on the development of a prototype plasma rocket engine. After completion of all works, scheduled for 2024, the institute will produce a prototype engine with increased thrust, they say.
In the meantime, another promising area of development for Rosatom in years to come will involve work in the field of accident tolerant fuel. This was recently confirmed by Viktor Ilgisonis, director of the R&D department at Rosatom. For this purpose, Rosatom plans to accelerate its R&D work in this field with the aim of increasing safety and efficiency of nuclear power plant operation. Among other developments that involves a switch from zirconium as a material for fuel assembly cladding to silicon carbide. Alexey Dub, First Deputy General Director of JSC “Science and Innovations” (management company of “Rosatom’s R&D division) in an interview with Russian Rossyiskay Gazeta business paper said that Rosatom has achieved some progress in this field. “In 2022 we obtained silicon carbide samples with a very low oxygen content as an impurity, which is extremely important for the operation of this material in nuclear reactors. Moreover, we were able to obtain quasi-viscous condition of silicon carbide with the high level of strength and elasticity, which, according to specialists of the High-Technological Research Institute of Inorganic Materials will meet the necessary requirements during the manufacture of shells for the so-called tolerant fuel,” Dub explained.
Currently NII NPO ‘LUCH’, part of the R&D division of Rosatom, is working on the technology for manufacturing products with complex geometry from silicon carbide with dimensions of up to 900 millimeters. “In terms of silicon carbide, we are not just on the highest global level, we are moving faster than foreign competitors,” Dub reportedly noted.
The fifth federal project of Rosatom focuses on the development of technologies for the serial construction of nuclear power units. As part of this programme, the biggest hopes of the company rest with the construction of power units with VVER-TOI reactors. This design is widely considered the basis for Russian exports of nuclear energy technologies in the near future.
The annual volume of investments in the implementation of these plants varies across the range of RUB100-125 bn (US$1.3-1.5 bn), most of which is allocated from extra- budgetary sources.
On a separate note, the company has also plans to continue its developments in the field of nuclear floating plants. Recently Rosatom has made a proposal to establish nine clusters in the Arctic for the extraction of gold, silver, copper, lead and zinc, that will be operated on the basis of energy, produced by floating and small nuclear power plants. In addition, the company plans to accelerate its research in the field of floating power units (OPEB).
According to earlier statements, made by Vladimir Aptekarev, Director for Shipbuilding and Optimized Floating Power Units at Rosatom’s Atomenergomash, the concept of the OPEB project is based exclusively on the supply of electric power, in contrast to the Akademik Lomonosov FNPP, which performs the function of “cogeneration”, that is, it simultaneously supplies both electric and thermal energy.
According to him, the OPEB will have increased capacity due to the use of a new type of reactor, which has been named RITM-200M. Such a power unit with an extended fuel cycle duration of up to 10 years, is capable of generating more than 100 MW of electrical energy. It is also possible to use cogeneration at the power unit – when thermal and electrical generation are simultaneously produced.
According to Rosatom, currently the company is 7-8 years ahead of some major foreign rivals in some areas, while further successful implementation of the programme will allow the company to increase this gap and will contribute to increased exports of Russian nuclear products.
Ukraine and Russia’s nuclear business
Ukraine and related sanctions regimes have seen Russian nuclear exports avoid any serious problems in the short term. In 2022, the growth of Russian nuclear exports amounted to more than 20%, which means that the country remains one of the world leaders in the global nuclear energy market.
Still, despite this, Rosatom currently faces serious risks of losing some important contracts in key international markets and an on-going threat of potential sanctions. That may even take place this year, as pressure grows among the international community to tighten the sanctions regime further.
Nonetheless, one of the recipes of success for Rosatom in the international arena in the past has been related to its status as a ‘universal» nuclear company’, which constructs power units, trains personnel, supplies fuel and provides other services. More importantly, the company traditionally builds nuclear power plants under a system of preferential state-backed loans provided by the Russian government. This facility allows its major foreign customers to build their nuclear power facilities in debt on preferential conditions for them.
As a result, Rosatom has achieved significant success across the majority of its activity areas. For example, Russia’s current share of the global uranium enrichment market is about 30%, which makes it the leader in this segment. In the European Union, utilities that generate electricity for 100 million people rely on the supply of Russian nuclear fuel, according to the Royal United Defense Research Institute (RUSI).
Looking ahead though, the 24 February, 2022 invasion changed the landscape for Rosatom which does face significant problems in some of its major markets. As a state-owned corporation, Rosatom is wholly controlled by the Russian government, which is prompting many countries to reduce cooperation with it or even abandon projects. The situation continues to deteriorate too.
In particular, immediately after the beginning of hostilities in Ukraine countries including Germany and Sweden abandoned plans for the further purchase Russian nuclear fuel. They also said that they would not place new orders in Russia.
Moreover, countries including Bulgaria, Slovakia, Finland, and the Czech Republic have begun to take similar steps, despite the fact that they have 18 nuclear power plants on their territories built using the Soviet pressurized water reactor (VVER) technology.
Earlier, the Finnish design company Fennovoima terminated a contract with Rosatom for the construction of the Hanhikivi-1 nuclear power plant. While Finland currently continues to buy nuclear fuel from Russia, it has declared its intention to switch to VVER fuel supplies from Westinghouse Electric.
In the meantime, the Czech Republic and Bulgaria have already reduced the volume of fuel supplies for nuclear power plants from the Russian Federation, while Slovakia – where another VVER-type power unit was recently commissioned at Mochovce with the participation of Rosatom – also has similar plans.
Among the EU states, only Hungary still has plans to build two more nuclear units at the Paks nuclear power plant.
The contract for the completion of the station, for which Moscow provided a US$10bn loan to Budapest, was signed back in 2014. However, it is not entirely clear whether this project will be implemented. At the end of April, it was reported that the Hungarian government is now searching for alternative contractors for the project.
In recent years, Ukraine has also been trying to replace Russian fuel. It is expected that starting from next year all power units of Ukrainian nuclear power plants remaining under the control of Kyiv, will switch to Westinghouse products.
However, despite moves to ramp up production of alternatives to Rosatom’s TVEL fuel the transition of European countries to alternative sources may be delayed for years (according to various estimates, from 7-10 years). The Czech Republic, Bulgaria and Finland have already signed agreements with Westinghouse for future nuclear fuel deliveries. Prague and Sofia report they will be able to switch to American supplies as early as 2024-2025, while Helsinki will follow in 2027-2030.
At the same time, it is difficult to overcome dependence on Russian imports of enriched uranium and services for its conversion and enrichment. Rosatom provides about 20% of the enriched uranium for the United States. In 2022, the United States imported US$829.8m-worth of Russian uranium (about the same amount it purchased in 2021), and in January 2023 another US$70m. France, which also has its own enrichment facilities, imported uranium from Russia to the sum of US$377.5m, which is about 3.5 times more than in 2021. State subsidies, cheap electricity and lower environmental standards make the Russian nuclear products very attractive to foreign customers.
Routes to replacing Russia
Currently Russian nuclear sector in general and Rosatom in particular is not a subject of sectoral sanctions by the EU and the US. At the end of February, however, the UK imposed personal sanctions against Rosatom CEO Alexei Likhachev, other top managers of the state corporation, as well as several research institutes that are part of the structure of the state corporation. In April, the United States joined the targeted sanctions movement by the inclusion of Rusatom Overseas, which is responsible for promoting Rosatom projects abroad. The restrictions affected the Kovrov Mechanical Plant and Tochmash, which produce centrifuges for uranium enrichment.
Following US sanctions, five G7 countries – the UK, Canada, the US, France and Japan – have agreed to withdraw from cooperation with Russia in the nuclear energy market as part of moves to weaken the country’s hold on the nuclear sector. Specific plans have not been announced yet, but it is expected that the alliance primarily plans to replace the supply of uranium fuel, as well as reduce the overall dependence of other countries on Russian technologies, equipment and materials.
The prospects for Rosatom in the East and South look better than in the West. In addition to exporting fuel and fuel components, Rosatom continues to build nuclear reactors in China, India, Turkey, Bangladesh and Egypt (these countries have not announced their own sanctions against Russia, but they try not to violate the restrictions imposed by other states). The state corporation also plans to expand its presence on the African continent.
In the case of Africa, currently the company continues to build El Dabaa, the first nuclear power plant on the African continent with generation III+ reactors. “This nuclear power plant will provide 30 TWh per year to Egypt and will prevent the emission of 15 million tons of carbon annually – a huge contribution to the country’s green energy future,” said as Kirill Komarov, Director of the Department of International Business of Rosatom.
China and other non-Western countries are also unlikely to fully replace Russia with the Western market for in terms of contracts and their volumes. Most analysts, also believe that Western countries are currently not ready to eliminate all nuclear products from Russia.
In the event of interruptions in Russian nuclear exports to Western markets, there may be a shortage of cobalt-60 or cesium-137 in both the EU and the US, for example. These isotopes are used for radiation therapy, the sterilisation of medical equipment and foodstuffs, and industrial seam welding.
Problems with the supply of actinium-225 and tungsten-188 may also pose a threat to radionuclide therapy for cancer patients. The cessation of Russian exports of californium-252 will delay the launch of a nuclear power plant in France, since californium is used in reactors as the initiator of a chain reaction. Even the United States depends on the supply of 44 isotopes from Russia. In particular, technetium-99 is produced from Russian molybdenum-99, which is used annually in millions of medical imaging procedures in the United States. Russia is currently the only supplier of barium-132, which is used in oil and gas processing. Moreover, Russia supplies iridium-192, which is used to check for leaks in pipelines.
Ultimately though, despite the importance of the nuclear sector, Rosatom’s external projects do not bring Russia nearly as much profit as the oil and gas industry. In 2021, Rosatom transferred RUB250 billion (US$2,67 billion) in taxes to the state budget, while revenues from gas and oil at the same time amounted to RUB9 trillion (US$90 billion).
Despite the complex geopolitics and the growing pressure on the Russian economy, Rosatom hopes that implementation of the majority of its key projects will continue and it will retain its status as one of the world’s leading corporations in the field of nuclear power.
Author: Eugene Gerden
