This is the first of a two-part series in response to Kompas´ article ¨Nuclear Power Plant will be built in North Coast, Banten¨ dated 5 August 2008. Kompas is the most widely read newspaper in Indonesia and it has a reputation for high quality writing and investigative journalism. The next article in this two-part series will cover Implication for Singapore, Strategic Opportunities.

Donaldson Tan / Guest Writer

The Governor of Banten Province, Ratu Atut Chosiyah, revealed in August 2008 that the Indonesian government is planning to build a 4,000 MW nuclear power plant in Banten Province. Indonesia‘s national agency of nuclear energy (BATAN) is currently undertaking a study to verify the right location for the power plant whereas the provincial government has already indicated full support. Construction is expected to start in 2010.

However, Indonesia is not alone in ASEAN in the pursuit of nuclear power. Vietnam‘s civilian nuclear power program dates back all the way to 1976, and it aims to have an operational 4,000 MW nuclear power plant by 2020. Malaysia foresees two nuclear plants by 2020, and Thailand began feasibility studies for nuclear power in March 2008, with the apparent aim of having a plant operational by 2020. The Philippines completed construction of the 621 MW Bataan Nuclear Power Plant in 1984 but it was never commissioned.

Why nuclear power for ASEAN?

Why Indonesia and other energy resource rich ASEAN states would need a nuclear power plant might look baffling to some. Despite Indonesia being the second biggest LNG exporter in the world, Indonesia‘s LNG export volume has been showing strains from growing domestic consumption. Natural gas is an extremely popular fuel for electricity generation at home and internationally. It is clean-burning and also much more energy efficient as a fuel than fuel oil and coal.

There is a substantial demand for natural gas from countries such as the EU-27 and the United States who are committed to reduce its green house gas emissions. One has to balance the needs of foreign investors who invested heavily into the domestic oil industry and the energy needs of the non-hydrocarbon domestic industries. On the other hand, diversifying domestic energy sources for energy security is also important in managing the nation’s exposure to volatile energy markets.

From a financial perspective, the price of fossil fuel in a conventional power plant accounts for 77.93% of the total generation costs while the price of fuel in a nuclear power plant accounts for 27% of the total generation costs. This means a nuclear power plant is much less susceptible to fluctuations and skyrocketing of commodity prices in the global energy marketplace. Yet at the same time, nuclear power does not contribute to global warming and acid rain. Studies from University of Chicago have shown that even if the price of uranium went up, total power generation costs would increase by at most 7%.

Coincidentally, Indonesia has somewhat of a domestic buffer against the supply uncertainty in the international uranium market. There are 2 established uranium mines in West Kalimantan and since 1991, Indonesia has been able to fabricate nuclear fuel elements from its domestic uranium ores. Indonesia is the most advanced ASEAN country in implementing the nuclear fuel cycle.

Remember the Chernobyl Disaster

Given Singapore‘s limited land area and high population density, the Ministry of Trade & Industry (MTI) has concluded that nuclear power is not feasible for Singapore. However, our proximity to our ASEAN neighbours does not shield us from nuclear plant accidents and environmental fallouts arising from the disposal of nuclear wastes.

The 1986 Chernobyl Disaster is the biggest nuclear power plant accident in the world. It provoked a radioactive cloud that originated from modern day Ukraine and floated all over continental Europe and the United Kingdom. The health and ecological aspect of the Chernobyl Disaster is widely published but the incident is a social disaster too. Former residents from Chernobyl were regarded as dirty and were socially rejected in many places for a variety of reasons such as increased competition within the localised job market and that a good number of them were visually sickly due to the radiation. This has created a generation of psychological trauma and inferiority complex amongst the former Chernobyl residents and their children. The City of Chernobyl remains uninhabited today.

Nuclear geopolitics in ASEAN

The collapse of the Soviet Union in 1991 raised much concern amongst the ASEAN community for the proliferation of nuclear weapons. Looking back into history, it is interesting to note that Indonesia, under President Sukarno, had a shortlived nuclear weapons programme led by Brigadier General Hartono of the Army Ordnance Department in the 1960s. In view of the dualuse nature of nuclear technology, the Secretary General of ASEAN said “while countries are free to address their energy needs, it would help to reassure nervous neighbours.”

These concerns were finally amalgamated in the Treaty of Bangkok which came into force in 1997. The treaty declares Southeast Asia as a Nuclear Weapons Free Zone (NWFZ) while it reaffirms the right of each state party to use nuclear energy for peaceful purposes. Notably, concerns over the safety of nuclear power plants and nuclear waste management were addressed. A full-scope safeguards agreement with the International Atomic Energy Agency (IAEA) is required for the pursuit of a civilian nuclear power program.

The sensitive nature of nuclear technology would require regional cooperation to cover its security, technological, economic and environmental aspects. It is a platform for fostering closer ties among ASEAN member states. Perhaps this could be the catalyst for ASEAN integration. After all, Southeast Asia is among the most densely populated region in the world. Embracing nuclear technology in ASEAN would be tying the entire region’s future together. There has been no objection to nuclear power among ASEAN governments and support for nuclear power was reiterated in the Cebu Declaration on East Asian Energy Security and the Singapore Declaration on Climate Change, Energy and the Environment.

Future Challenges

Given the emerging role of nuclear power in ASEAN, there are many future challenges ahead. Nuclear power represents a new age of energy security in ASEAN. It introduces uncertainty to regional security and environmental protection, all which may have economic implication. The capacity to enforce domestic environment regulation is also lacking among ASEAN governments. The question on how Singapore will adapt to a shared nuclear future with ASEAN remains unanswered.


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