Turkey, Nuclear Energy and the Remarkable Power of Money

All friends again. Recep Erdogan and Vladimir Putin at the Akkuyu Nuclear Power Plant ground-breaking ceremony this month

By Martin Cohen

This week saw Turkey officially 'launching' it's first nuclear reactor, Russian-designed, with specailly invited guest, that country's president, Mr Putin. Which in itself is quite a turn-around since it was only on the 24 November 2015 that a Turkish combat aircraft shot down a Russian jet on the Turkish-Syrian border. After this incident, President Putin spoke of  'a stab in the back by the accomplices of terrorists' and warned that it would have 'significant consequences including for relations between Russia and Turkey. And yet, and yet...  two and a bit years on all is smiles and sunshine again in the relationship.

What could have created such harmony from discord? And the answer, as ever in international and domestic politics alike, is money. For the Russians, the rapprochment has other strategic benefits too, yet for Turkey, the nuclear deal looks at first glance odd. But I wrote a book* a few years back about nuclear energy and in the process of researching it, I realised that with nuclear power nothing is as it seems.

And in Turkey, nuclear politics is really about money. Or perhaps we should say the lack of it. Because Turkey has made four attempts to start a nuclear power program, beginning in the 1960s, and still is nowhere near to generating any nuclear electricity.

The problem is not about the political will - Turkish governments whether civilian led or military-led have long hankered after the idea of being a 'nuclear power', and it certainly is not due to any respect for safety or the environment. The complete deafness to safety considerations is shown very clearly by the fact that the signed and sealed plan for Turkey's first nuclear reactor at Akkuyu Bay on the Mediterranean coast is located smack bang in the middle of an earthquake danger zone. If the plant is built (see below) and if it ever starts operating, then it is highly likely to be the first one destroyed by an earthquake.

Should the Turkish government care? Yet environmental factors have always counted for little in that country's drive for hydro-electric power.. Thus, the massive Ilisu dam project on the Tigris river, was after an international outcry over the flooding of the ancient city of Hasankeyf and yet the Ilisu dam is dwarfed by the Beyhan project on the Euphrates, also in the Kurdish south-east, where fears of the forced evacuation of the local population evoke particularly bitter memories. Here an energy project is in reality part of amore sinster destruction of that much-oppressed stateless people.

No, the big questionmark and problem that dogs the nuclear industry in Turkey is simply that (behind the smokescreen) both the reactors and the electricity produced are very, very expensive. Thus the only way the Turkish government can afford nuclear plants is to get outside countries to pay for them - and then let the foreign investors charge premium prices to the power consumers for years to come. A similar foolish contract has recently been entered into by the British in order to persuade someone to fund a new nuclear reactor for the UK.

The UK had great difficulty persuading anyone to sink money into nuclear - but got around the doubts by making the taxpayers ultimately liable for all the risks. Alas, from the perspective of the nuclear industry, Turkey does not provide what the professionals like to call 'a secure environment' for risky, multi-billion dollar, investment. Inflation is high, the economy is in deficit each year, about half of it due to energy imports, and the country's debt is well over $100 billion. 

In Western countries governments change, but contracts once signed are sacrosanct. However, in Turkey, political change is more violent. There is the history of military coups d'état in recent years - in 1960, 1971, and 1980 - while the forced resignation of Necmettin Erbakan in 1997 did not do much to reassure investors either. On the other hand, the Turkish electricity sector is effectively a state monopoly,  and  the possibility of Turkey being allowed to join the European Union, remote though it ever seemed, barely threatens that these days, even over a timescale of 40 years which is the time-scale necessary for the moneymen who fund nuclear plants to feel confident they can make their profits.

All of which is to say again that Turkey's nuclear program is about cash, not to say wheeling and dealing. The energy minister, Berat Albayrak, who is also Erdogan's son-in-law, just fancy that! called the start of work on Akkuyu the realisation of a national dream. Not to say that the vast sums of money involved in unuclear projects tend to stick to the hands of all those involved.

Turkey is located at the centre of transport routes between the vast oil and gas reserves of the Middle East and Central Asia, and the markets of Europe. Logically speaking then, it would seem that the country would is in a unique position to benefit from low-cost fossil fuels, without even mentioning its own hydroelectric, fossil, and renewable energy resources. Yet somehow Turkey has ended up being dependent on cheap gas imports from Russia and Iran, the arrangements with whom (in the manner of all bargain basement deals) have in recent years proved 'unreliable'. At one point Turkey even broke off one contract with Russia, its biggest gas supplier. If the plant is ever built, Turkey will be dependent on Russian support to fuel and run it.



At least there seems to be no real sense that Turkey is still working towards a nuclear bomb. Indeed, there is the strange historic role of Turkey as a conduit of nuclear secrets from the US to Pakistan and - of all people - Israel, a country which the government regularly rails against for having driven the proverbial truck through the principles of non-proliferation. Commenting on this, one CIA operative told the London newspaper, The Sunday Times:

"We have no indication that Turkey has its own nuclear ambitions. But the Turks are traders. To my knowledge they became big players in the late 1990s,"

More 'wheeling and dealing' has resulted in several cases of highly toxic nuclear waste turning up in Turkish industrial zones, apparently brought in surreptitiously in return for corrupt payments.

Over the years, Turkish nuclear power projects (as with nuclear projects in many countries) have come and gone, announced with a fanfare only to disappear without trace. Yet it looks like things are more serious now. Russia’s President has promised to back the project with more than $20 billion, while Turkey’s prime minister planned to borrow another $2.5 billion on the financial markets.

How can such extraordinary sums be repaid? The project represents a ball and chain being tied to the Turkish economy, a burden on the many that likewise will make the governing clique fantastically wealthy.

The Turkish public are apprehensive about nuclear, looking warily over their shoulders at the plants run in Armenia and Bulgaria which are generally thought of as dangerous. And Turkey is the one of the countries which was affected by the disaster of Chernobyl, even if the accident has always been kept out of the public debate about energy policy. Instead, the discussion has been focussed on the economic arguments. But here too, nuclear power has a lot of explaining to do.

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* The Doomsday Machine: The High Price of Nuclear Energy, the World's Most Dangerous Fuel