Economic Study Group
From warheads to electricity
The Megatons to Megawatts program shows that nuclear disarmament can deliver economic benefits as well as security gains.
Between 1993 and 2013, the United States and Russia converted approximately 500 metric tons of weapons-grade highly enriched uranium (HEU) from dismantled Russian nuclear warheads into low-enriched uranium (LEU) for commercial reactor fuel.
The result was remarkable: fuel produced through the program supplied roughly 10% of U.S. electricity for two decades.
More than energy
The economic benefits went beyond electricity generation:
- For the United States: the program provided a large, reliable supply of reactor fuel and reduced reliance on newly mined and enriched uranium.
- For Russia: it created a commercial revenue stream tied to the dismantlement of nuclear weapons.
- For both sides: converting existing weapons material into civilian fuel reduced the costs and risks associated with storing and safeguarding nuclear materials.
The broader lesson is that well-designed disarmament agreements can turn nuclear materials from a long-term liability into an economic resource.
Further reading
Marissa Quintanilla & Luna Ramirez Castellanos, Privatizing a Strategic Nuclear-Fuel Enterprise: The 1998 USEC IPO versus the Carlyle Acquisition Counterfactual, in the Shadow of the Megatons to Megawatts HEU Deal, forthcoming.
Looking ahead
Megatons to Megawatts offers a useful precedent for thinking about the economic dimensions of future nuclear disarmament. The benefits of disarmament can extend beyond government savings to include energy production, industrial activity, resource conservation, and incentives for reducing nuclear arsenals.