Energy is an essential driver of every economy. It enables formation of businesses, jobs and the possibility of prosperity. Ironically, because we are so richly blessed with energy we tend to take it for granted. But what if your electricity were provided by an authoritarian government such as Russia or China? Before long that could well become the case for much of the world.
More than 1.2 billion people in the world have never had access to electricity. They live in harsh, brutal settings often governed by corrupt unaccountable leaders who are susceptible to seductive offers from Russia and China to build, own and operate power plants under apparently reasonable terms. Before the ink is dry, those terms veer quickly toward extortion and indebtedness but with no means of expelling the invader.
In this century as the world population grows from 7 billion to 10 billion, the unmet demand for electricity could grow to at least 5 billion people (half the population of the world). That scale of unmet demand for electricity has led Russia and China to develop enormous capacity to build nuclear power plants and they have cooperated toward becoming the leading bidders to supply power throughout the world — and to garner the political power that goes with it.
Thus far, Russia has contracted to build four plants in Egypt, two more in Jordan, another two in Turkey, and they hope between two and 17 in Saudi Arabia. China has built 44 plants at home and plans to add at least that many more as it builds out its expansion through South Asia, the Middle East, Africa, Europe and beyond.
As for the United States, since 1953 we have built the largest fleet of nuclear power plants in the world but haven’t completed a new one for more than 30 years, and the difficulties inherent in doing so have constrained investment and made new construction a daunting challenge.
In sum, energy is literally the life-blood of every country and the key factor in determining its stability and control over its own future. But the key question is “who controls it; the host country or Russia and China?”
We are about to see explosive growth in the global power sector, and today you’d have to say that most of that business will go to Russia and China. The construction of plants to meet the needs of half the world’s population will represent the largest infrastructure project in human history.
And it’s not just the business. With ownership and control over the generation of electricity goes huge political power; for example, power to influence the price of oil in Saudi Arabia, or of cobalt in Congo, or to control traffic through the Suez Canal, or, or, or … Thus far the United States has not been competitive.
Still, it remains plausible that the United States could rally companies here at home and engage partners from among other traditional nuclear power producers. Such a consortium could lead the competition against Russia and China and ultimately rebuild our own industry. Energy Secretary Rick Perry and the Department of Energy are doing all that they can to enable the recovery of our nuclear power industry. We must do that. If we fail, we will lose the leading role that includes the right to set the standards and make the rules that have foreclosed the enrichment of nuclear fuel and the launch of clandestine nuclear weapons programs.
Four years ago, our country participated in the negotiation of an agreement with Iran that was designed to constrain the development of its nuclear weapons program. Whatever one may think of that agreement it has clearly stimulated a determination among the Gulf Arab States to achieve an equivalent nuclear power capability. Saudi Arabia has issued an invitation to five countries, including Russia, China, to compete to build the first two of up to 17 nuclear power plants.
The winner of that competition is expected also to win the right to build the full 17-gigawatt fleet in the Kingdom, and very likely several others in the Gulf states who will follow the Saudi lead. Notwithstanding the reasons cited here to expect Russia or China to prevail I’m optimistic toward the U.S. team’s chances of winning this bid for three reasons.
First, Mr. Perry and his staff at the Department of Energy have focused for two years on both streamlining its processes and in their vocal advocacy in foreign countries for the solid cadre of U.S. nuclear power companies. The U.S. team includes the best plant operators in the world as well as the best providers of nuclear fuel services, security and safety, human capital development and overall project management. Second, the president has made clear his commitment to the rebuilding of the U.S. industrial base; and third, the promising signals being sent for enacting a one-time tax cut for companies that repatriate the trillions of dollars now deposited in foreign banks that will be needed to finance this industrial renaissance.
It is essential that a U.S.-led team win the competition to provide nuclear power internationally. Failure to do so would signal an historic shift in the global balance of power. But there is an even larger reason for us to recognize the importance of this moment in our history. It concerns our values and sense of purpose.
Since achieving victory in the Cold War we have taken a 27-year peace dividend and rested on our oars as leaders of the free world. Today we have an opportunity to turn away from that false vision. We are facing both determined adversaries and a historic need for energy among emerging markets throughout the world. What better way to reassert U.S. leadership and rekindle confidence in us than for our president to rally allies to come together and commit to providing electricity for everyone in the years ahead.
• Robert McFarlane served as President Reagan’s national security adviser.
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