Former U.S. Trade Rep. Ambassador Kirk discusses economics of technology exports

How could Section 123 agreements, which allow for civil nuclear trade between companies in the United States and the international market, boost the nuclear industry and job growth in the U.S.? During today's OnPoint, former U.S. Trade Representative Ambassador Ron Kirk makes the case for expanding these nuclear trade agreements. Kirk, who previously served as mayor of Dallas, also talks about the challenges facing local governments as the Obama administration moves forward with carbon regulations for existing sources.


Monica Trauzzi: Hello and welcome to OnPoint. I'm Monica Trauzzi. With me today is Ambassador Ron Kirk, former U.S. trade representative and also former mayor of Dallas, Texas. Ambassador Kirk, thank you for joining me.

Ronald Kirk: Thank you for having me.

Monica Trauzzi: Mr. Ambassador, you recently joined the Clean and Safe Energy Coalition, which supports the increased use and expansion of nuclear energy. Having left the administration just last year, why did you decide to join the coalition and support this push for nuclear energy?

Ronald Kirk: Well, a number of things influenced me in that regard, one having been mayor of Dallas. I come from a state that has greatly benefited from having a diverse energy portfolio; secondly, my travels as USTR. I had an opportunity to visit countries and economies all around the world that we either do business with or solve to do business, and it's pretty compelling, particularly when you visit emerging economies and are just struck by the reality of how important it is to have clean water and ample energy to grow a prosperous economy.

And then, third, when I was approached by the coalition, I was very favorably impressed by the fact that it's a wonderful coalition of 3,700 very different voices advocating for nuclear energy to be a part of our diverse portfolio and that my previous co-chair -- I mean the previous co-chair was Patrick Moore, along with Governor [Christine Todd] Whitman. So, it was an issue that resonates with me. I understand the correlation between having a stable power supply in a vibrant economy, and it was a chance to be a part of a great coalition.

Monica Trauzzi: You're focusing in on 123 agreements, which allow for civil nuclear trade between U.S. companies and the international market, and several of the agreements that are currently at play are set to expire in 2015. What are the Obama administration's plans for those agreements?

Ronald Kirk: Well, to be sure, now, I'm not here as a spokesperson for --

Monica Trauzzi: That's right.

Ronald Kirk: -- the Obama administration, and the one -- our support of the renewal of these is one element of our advocacy. I want to be clear about that, and we do not lobby Congress but we recognize that as the world and the developing and emerging world, where a lot of the job growth is going to occur, begins to put in place the infrastructure that they need, where they source that power is going to be a great competitive advantage for the United States if we can be part of helping them solve that.

The tool that we use to do that in the case of nuclear, exporting civilian nuclear energy, are these 123 agreements. We think it makes sense for Congress to keep those in place, because many of these countries have a very strong preference for U.S. technology, because we've had a 50-year track record now of designing, building, operating nuclear facilities with some of the highest safeguards and safety regimes in place. And if they aren't able to source them from here, the reality is then they're going to look to Russia or France. So we need those agreements in place to give us the opportunity to compete for that business.

Monica Trauzzi: What markets that don't currently have these agreements do you believe the U.S. should be tapping into and establish agreements with?

Ronald Kirk: Well, a lot of it, there's a reason, and I know you follow this more closely because you all are very energy-focused, but there's a reason you see so much activity around the countries that we identify as the BRICS -- Brazil, Russia, India, China, South Africa, parts of Southeast Asia -- because that's where a lot of the growth is. It's where tons of resources are being poured into these economies, where new consumers are coming of age, and we think it makes sense to look at those. Now, we mentioned specifically, for example, Vietnam is a country who's undergoing a remarkable transition. Their agreement is expiring. Vietnam is also a country that we are negotiating with for a broader trade relationship through the Trans-Pacific Partnership, and so I think it makes sense to start with those countries that we have established relationships, renew those and then be thoughtful as we look at other markets within the region.

Monica Trauzzi: Reactor technology is expensive, though. Are there cost considerations in the international marketplace that could sort of limit the reach of the technology and these agreements?

Ronald Kirk: Well, I think they are, but I also believe the world has -- I mean, is not looking at power separate from. They are looking at climate change and the responsibility and the opportunity they had to build a power infrastructure in a more thoughtful and responsible way going forward, so the world clearly understands that having nuclear power, which is the only baseload source of electricity that is non-carbon-emitting -- and so many countries understand the value of that. For example, China has already ordered and is looking to deploy four Westinghouse 1,000-watt reactors.

Now, why do Americans care about that? Those four reactors helped support 15,000 jobs here. China just ordered an additional seven, and one of the ways that we keep our nuclear facilities and those contractors and people employed and those plants here, just as we do for agriculture or we do for Boeing, you have to be able to make those sales abroad.

Monica Trauzzi: Doesn't natural gas, though, present a greater opportunity for the U.S., both domestically and internationally, and it's also a lot cheaper than nuclear?

Ronald Kirk: Listen, you're talking to a Texan. We think this is a great thing, and let me tell you. Conversations around the world, Monica, about what it means within the very foreseeable future for the United States to be truly energy-independent are fascinating. And the natural gas, the shale gas explosion in this country is a good thing, but one of the reasons I chose to be a part of this coalition is we've also learned that no country should put all of their eggs in one basket, particularly on something as critical as energy.

The natural gas revolution is a wonderful thing for our country, but we've always done best when we've had a diverse portfolio, because just as we support renewables, there are days the sun doesn't shine and the wind doesn't blow, and you go through a winter like we just did here in the Northeast -- and I know you told me you're from Queens, and both my daughters went to school in New York -- when the temperatures get that cold, it can be difficult sometimes to move gas through the pipelines, and a lot of Americans sort of don't know or take for granted one of the ways we get through those inclement-weather experiences is that nuclear operates 24/7, and you have inspectors all day. So it's a great hedge against other factors that can compromise availability and stability. So while the natural gas revolution is a good thing, we still think there's a place for nuclear as part of a basket of options.

Monica Trauzzi: I want to get your take on the Obama administration's recently announced -- its existing source standards for power plants. As a former mayor, what do you see as the biggest challenges for local governments as the administration brings on these regulations that are going to be largely in the hands of states to meet the standards?

Ronald Kirk: Well, I think it is -- and I want to make it plain. I'm here speaking for the coalition. I'm extraordinarily proud to have been a part of the Obama administration, but I'm not here sort of as a de-facto defender of them. I was pleasantly surprised that the EPA took the care and the thought that they did to obviously spend a lot of diligence looking at different states to see what they're doing, and many people have commented that it sort of feels like that the targets that the EPA set in many states were very much related to what those states are currently undergoing.

But the other reality -- and this one hurts me a little bit more -- it's at least as much a reflection of the accepted wisdom now that you just aren't going to expect Congress to be able to come together to make decisions, and it's a continuation of the devolution of policy and implementation to states and local governments. And as a mayor, I think that's a good thing. I think it is a step in the right direction. And I haven't had a chance to study all of this. We've looked at sort of the broad outlines and construct of it. Anytime you're giving states and local governments more flexibility to meet the goals the federal government mandates, I think that's a good thing, but it's going to be an opportunity for states and local government to look and say, "Look, what works best for Texas?" and understanding that may not at all be applicable to what you need to do in New York or Idaho. And so I think that's a good thing.

Monica Trauzzi: And there's a nuclear component to this as well. I mean, in her announcement, Administrator McCarthy specifically mentioned nuclear energy as a way to meet the standards. So what's the evolution of the conversation that you see surrounding nuclear and these standards?

Ronald Kirk: Well, you have to know for our coalition we were overjoyed, because part of our mission has just been to get Americans, to some degree, get over their fear or apprehension of nuclear, and I mentioned the fact that we've got almost 3,700 members. One of the things that's most impressed me is the growing acceptance in the environmental community of the need for nuclear energy to be part of our portfolio, and it's singularly related almost to the fact that while nuclear's only 20 percent of our national baseload electric supply, it contributes over 64 percent of our non-carbon-emitting electricity, and that's a good thing. And so the EPA recognized that and, in a small way, I think, provided incentive for those states, certainly those with the five reactors that are under construction now to move forward with that.

Monica Trauzzi: We'll end it right there. Thank you so much for coming on the show.

Ronald Kirk: Thank you so much for having me.

Monica Trauzzi: And thanks for watching. We'll see you back here tomorrow.

[End of Audio]



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