What do India, the Czech Republic, South Africa, and Brazil all have in common? All four countries have significant ambitions to build new nuclear reactors.  However, despite much sound and fury, along with plain old political spin, the four major nuclear deals in these countries are, for the most part, standing still in the starting blocks due to variety of factors.

If wishes were fishes, the project sponsors would be knee deep in flounder, but in these cases, the scales do not tip in favor of early progress to breaking ground in any of them.

India sees little progress to open its market to global vendors

Despite a high profile visit by U.S. President Obama last January, and blazing headlines announcing a “breakthrough,” almost nothing of any substance has occurred since then to open India’s nuclear energy market to global investors especially any from the U.S.  India’s Civil Liability Act, passed in 2010 with primary support from the now ruling BJP political wing of the current government, remains the main stumbling block with its draconian sanctions against component suppliers in the event of an operator caused accident at a nuclear power plant.

There’s more to the law than just the shadow of Bhopal. The law is a deliberate barrier that accomplishes two things for India in terms of domestic advantages, if you can call them that.

First, India’s huge coal mining firms have no interest in seeing nuclear reactors take the place of future coal fired plants. Global warming issues be damned, they will not stand in the way of corporate entitled attitudes about profits.

Second, India’s continued political stance as a “non-aligned”nation drives the government to favor construction of a domestic design 700 MW PHWR reactor to be built by Indian firms. The majority of projects on the government’s priority list for the so-called 20GWe plan reference it.

No vendor contract is ever going to overcome the requirements of the liability law which means that even sovereign nations, like France and Russia, have qualms about building new units. That said they still plan to go ahead.

Areva is at least two years away from breaking ground at Jaitapur for two of a planned six pack of 1600 MW EPRs. It recently signed a technology transfer agreements with Indian firms to supply major components for the plants.

Meanwhile, Rosatom, successfully commissioned two 1000 MW VVER’s at Kudankulam, and is poised to build two more with a milestone to break ground for the first unit in 2016.  Note that the turbines for the first two units were supplied by India’s L&T.

No American nuclear firm has near-term plans to break ground in India. Sooner or later they may come to the conclusion they are wasting there time with India until or unless it repeals or modifies the supplier liability provisions of the current law.

Czech Republic plans four reactors without a commitment to fund them

While the government knows it must replace aging coal fired plants, and Soviet era nuclear reactors, its nuclear energy strategy that envisions four new nuclear reactors lacks an essential element – funding.  The government claims that the current recession and low electricity prices in Europe make the plans unattractive to investors.

The real reasons are that the government is deeply conflicted over the issue of rate guarantees for the plants and terrified of a major dispute with Austria. That country’s government, which is aggressively anti-nuclear, sees rate guarantees as subsidies for nuclear energy. It has already sought to make trouble for the UK’s Hinkley Point nuclear project on exactly this issue by filing protests with the European Union Court of Justice in Brussels.

Cross border trade with Austria is a huge factor and so is the ability and willingness of Austria’s government to act as a surrogate for Germany’s anti-nuclear stance to suppress the Czech Republic’s plans to build reactors that would wheel power across the border.

Meanwhile, neither Germany nor Austria have any problem supporting “subsidies” for solar and wind power projects.  At some point the grids in Europe will become destabilized by variable power sources. Then there may be regrets that more baseload plants, like reliable nuclear power stations, weren’t built.

South Africa wrestles with rate issues for Eskom

When SA President Zuma announced his surprise deal with Russian PM Putin for eight 1200 VVER reactors in a deal estimated to be worth at least $50 billion, the first question in South Africa was how the country would pay for them. That question still hasn’t been answered though the government is finally stepping up to the realization that it cannot solve the problem of electricity outages without a means to pay for new generation capacity.

For investors to sign on to a nuclear deal with Rosatom, or any other investor, Eskom must sign a power purchase agreement backed by rates that are sustainable over the long-term to cover the costs of the plants and their operations.

Eskom has struggled to raise rates for its existing power generating infrastructure only to be held back to half of its requested increase due to the political posturing by elected officials who do not want to pass the increases on to voters. How it will handle the huge financial commitment associated with 10 Gwe of nuclear power is unknown.

Brazil wants to shift the cost of new reactors to the private sector

Energy Minister Eduardo Braga wants Brazil to build four new nuclear reactors, but he doesn’t want the government to be on the hook to finance them.  The country’s first three units were built as public works projects. The Angra 3 units is nearing completion after two decades of on-again, off-again, progress due to funding issues.

Funding the reactors is one thing, keeping the projects from becoming magnets for corruption is entirely another. Brazil is currently embroiled in a major scandal involving the government owned oil & gas firm Petrobas. More than 100 people, including senior executives, have been charged with giving or accepting bribes. The amounts of money involved are so large, over $100 million, that money laundering charges inevitably follow the bribery charges. Petrobas has revenues estimated to be in the range of $150-200 billion. The bribes are peanuts by comparison, but the criminal cases resulting from them have wrecked the company.

Brazil has the tenth largest economy, in terms of GDP, in the world as of 2015. Brazil’s economy is the largest of Latin America and the second largest in the western hemisphere. From 2000 to 2012, Brazil was one of the fastest-growing major economies in the world, with an average annual GDP growth rate of over 5%, with its economy in 2012. Brazil’s economy growth slowed in 2013 and had almost no growth throughout 2014. The country’s economy is expected to contract by 1% in 2015.

According to a Reuters report in April, the International Monetary Fund (IMF) said an “immediate priority” for Brazil’s recovery is swift resolution of problems at Petrobas. The wire service,  quoting the IMF, says the massive political kickback scandal at the company has forced it to cut back investment and has paralyzed work by its construction and engineering contractors

Any private sector vendor that planned to step up to financing and building four new nuclear reactors, worth $25-30 billion, might find a steep challenge in keeping the construction venues free of people with real or imagined influence emerging from the woodwork with their palms stretched out.

U.S firms, which face potential prosecution under laws that prohibit giving bribes for contracts, would need to spend serious time with their legal advisors before venturing into the Brazilian market.

Where Brazil is going to get private sector vendors to take on $5-10 billion in new nuclear reactor projects is anybody’s guess.

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