By Santiago Pimentel, contributor to Zirconio. He is an electronics engineer and Head of the Level 2 and 3 Probabilistic Safety Assessment Division at Nucleoeléctrica Argentina (NA-SA), where he has worked for over a decade.

This article uses two related acronyms that should not be confused. Pressurised heavy water reactors are known by their English acronym, PHWR, and CANDU is the PHWR model developed by Canada, the one used at Embalse. Atucha I and II are also PHWRs, but of a German design (Siemens-KWU). In short, every CANDU is a PHWR, but not every PHWR is a CANDU.

Introduction

Argentina holds a singular position within the nuclear world. From the middle of the twentieth century it built a technological strategy aimed at combining industrial autonomy, the training of highly qualified professionals and an in-house design capability. On that foundation it raised a sector spanning uranium mining, fuel fabrication, heavy water production, research reactors, power plants and specialised engineering firms.

Brought into commercial operation in 1984, the Embalse Nuclear Power Plant (CNE) uses CANDU technology (Canadian Deuterium Uranium), a Canadian design within the family of pressurised heavy water reactors, or PHWRs. These reactors differ from the PWRs (pressurised water reactors) that dominate the world today in one key respect. A PWR uses light water as both moderator and coolant and requires enriched uranium, whereas a PHWR such as the CANDU uses heavy water and can run on natural uranium. That difference, seemingly technical at first glance, carries consequences that shape nuclear policy in our country.

For decades, much of the Argentine nuclear sector argued that the experience accumulated with Embalse gave the country strategic advantages over the alternative of adopting PWR technology. That view fed the idea of building a new CANDU-type plant with strong participation from local industry, an initiative known informally as the “National Project.” For many of its champions, a new CANDU plant could represent an exceptional opportunity to consolidate national capabilities.

That plant, however, was never built. Hence the purpose of this article. If the technology was technically suitable and strategically valuable for the country, why did the National Project never materialise? The answer involves technical, industrial, economic and political questions that are best taken apart one by one, starting with what a CANDU reactor really is and which capabilities Argentina gained through Embalse.

CANDU technology

The CANDU acronym (Canadian Deuterium Uranium) captures the two features that define the design: the use of heavy water (D₂O) as moderator and coolant, and the use of natural uranium as fuel.

Heavy water differs from ordinary water in that its molecules contain deuterium instead of hydrogen, a stable and heavier isotope. From a nuclear standpoint, deuterium absorbs far fewer neutrons than ordinary hydrogen. In a reactor, the neutrons released in each fission are what sustain the chain reaction, and the fewer of them lost to absorption, the better the fuel is used. That neutron economy is what allows the reaction to be sustained with natural uranium. While a PWR needs fuel enriched to 3 to 5 per cent of ²³⁵U, a CANDU-type reactor can run on natural uranium, which contains barely 0.7 per cent of ²³⁵U.

As for the architectural differences between the two technologies, in a PWR all the fuel is concentrated inside a single steel vessel at high pressure. That vessel is filled with light water, which performs two functions at once: cooling the core, that is, carrying away the heat, and moderating the reaction, slowing the neutrons down so that fission is sustained.

In a CANDU-type reactor, those functions, cooling and moderating, are divided differently. The fuel is not held in a single vessel but distributed across hundreds of thin, sturdy horizontal tubes called pressure tubes. The coolant, hot pressurised heavy water, flows through the inside of each tube, surrounding the fuel and carrying away the heat. These tubes run through a large tank, known as the calandria, filled with more heavy water that performs the other function: moderating the reaction. This second mass of heavy water is kept cold and at low pressure, separate from the coolant flowing inside the tubes.

In short, a CANDU replaces the single vessel of the PWR with an array of many individual tubes, and keeps the cooling water and the moderating water apart. It is this arrangement, and not the mere use of heavy water, that distinguishes the CANDU from PWRs and from other designs within the PHWR family.

This design difference affects numerous operational, economic and maintenance aspects of the plant.

Embalse’s arrival and the capabilities it left in place

The CNE was built in the province of Córdoba and began commercial operation in 1984. Until then, Argentine experience in nuclear power generation was concentrated in the Atucha I Nuclear Power Plant, a reactor of German design (Siemens-KWU) which, although also part of the PHWR family, houses its fuel in a pressure vessel rather than in tubes. Embalse thus added a second technological line to the country.

Its operating performance was solid, and over four decades Embalse sustained a capacity factor close to 80 per cent.¹ In other words, it generated electricity around 80 per cent of the time, establishing itself as one of the firm assets of the national power system. Between 2016 and 2019 it underwent a life extension, a project of around 2.15 billion dollars that replaced critical components and added close to three additional decades of operation, the largest of its kind ever carried out on a CANDU-6 plant.

The incorporation of Embalse was not merely that of a plant, but of an entire industrial chain of national suppliers around it. During its construction and operation numerous national firms took part, devoted to heavy metallurgy, engineering, instrumentation and control, automation and specialised services. This was possible because the agreement with Canada included the transfer to Argentina of the reactor technology and of the fabrication of its fuel elements, for use on Argentine territory without payment of royalties. Over the years, that chain of suppliers around Embalse consolidated, and today, for example, the plant’s fuel is fabricated by CONUAR (Combustibles Nucleares Argentinos), a company jointly owned by the Pérez Companc group and the national government through the National Atomic Energy Commission (CNEA).

To that capability was added the domestic production of heavy water, the input a reactor of this type needs as moderator and coolant. In the town of Arroyito, province of Neuquén, Argentina built the Heavy Water Industrial Plant (PIAP), which at its peak produced some 200 reactor-grade tonnes per year. To put this in perspective, the Argentine nuclear plants together (Atucha I, Atucha II and Embalse) consume barely 15 to 20 tonnes per year, so the plant far exceeded domestic demand and came to export, above all, to Canada. The PIAP has nonetheless been shut down since 2017, and the country must now import the heavy water.

Embalse inserted the country into the international community of the technology. Since 1986 the plant has been part of Conexus Nuclear Inc. (formerly the CANDU Owners Group, COG), a non-profit organisation that brings together the operators of CANDU reactors worldwide to share operating experience, technical solutions and joint research and development programmes.² As of today, 26 CANDU reactors are in operation,³ distributed across Canada (17), South Korea (3), China (2), Romania (2), India (1) and Argentina (1).

The advantages of CANDU, on two levels

With the technology and the ecosystem already described, it is possible to consider why so many specialists saw the CANDU as a suitable option for Argentina. To begin with, it is worth separating two planes that are often blurred together: the technical advantages, intrinsic to the physics and engineering of the reactor, and the strategic and industrial advantages, tied to the country’s autonomy and productive development.

Technical advantages

• Neutron economy: as explained, heavy water absorbs very few neutrons, which gives the CANDU a neutron-use efficiency higher than that of a light water reactor. That economy underpins several of its distinctive features, since it is what allows the reaction to be sustained with natural, unenriched uranium, and what makes it possible, in principle, to operate with low-enrichment fuels and to extract more energy from the same quantity of uranium.
• On-power refuelling: another feature that distinguishes it from the PWR is the ability to replace fuel with the reactor in operation. A PWR must be shut down periodically to refuel; a CANDU, thanks to its design of individual pressure tubes, allows refuelling machines to insert and extract fuel elements online, without shutting the plant down.
  This point, however, should not be overstated. The Atucha plants, also part of the PHWR family, share this capability, and in practice a modern PWR optimises its scheduled outages so well that the final capacity factor ends up comparable. The advantage over the PWR is therefore real in operational flexibility, but it does not translate automatically into more generation.

• Fuel flexibility: in theory, the CANDU is one of the most versatile commercial reactors in this regard. Besides natural uranium, it can run on slightly enriched uranium, reprocessed uranium, MOX fuel or even thorium in certain configurations. In Argentine practice, however, that flexibility was more potential than real. Embalse always ran on natural uranium and, although a switch to slightly enriched uranium was assessed at one point, it was concluded not to be cost-effective. It is an advantage of the CANDU line in the abstract, rather than a lever the country has actually used.

Strategic and industrial advantages

• Natural uranium and independence from enrichment: this is probably the most cited advantage. A country operating PWR reactors needs enriched uranium, a service supplied by a small handful of nations and companies worldwide. A CANDU, by contrast, runs on natural uranium and removes that critical link from the chain. To the extent that Argentina does not enrich uranium at commercial grade and scale, a CANDU translates into a far smaller external dependence.
• Accumulated experience: around its plants, Argentina developed expertise and a chain of suppliers that today give it a certain degree of technological sovereignty. This is borne out by decades operating Embalse and Atucha, fabricating their fuel, producing heavy water and, above all, executing with its own capacity a project as complex as the CNE life extension. That know-how is, in itself, an asset that is not easy to replicate.

• A boost to national industry: it is often pointed out that a plant of this kind energises local industry. Numerous Argentine firms in heavy metallurgy, engineering, instrumentation and specialised services took part in the construction and operation of Embalse. It is worth being careful with this argument, however. Any large nuclear plant, as seen with Atucha II, mobilises a similar industrial fabric. The most concrete and specific point is the Embalse life extension, which showed that the country could execute a nuclear project of high complexity. How much of that industrial benefit holds up in real economic terms is a question worth leaving open, and one to which we will return at the end.

Safety and non-proliferation

For a long time the CANDU technology carried the label of being “unsafe.” It is worth taking that label apart, because it conflates two concerns of a different nature: one about nuclear proliferation and another about reactor safety.

Proliferation: the first concern, dominant during the Cold War, was proliferation. Some analysts were troubled that a natural uranium reactor might be adopted by countries with limited nuclear infrastructure and produce plutonium that could be separated through reprocessing for non-peaceful uses. The most cited case is that of India. The plutonium for its first nuclear test, in 1974, came from CIRUS, a heavy water moderated research reactor that Canada had supplied years earlier. The episode led Canada to cut nuclear cooperation with India, including the CANDU power reactors then under construction, and to tighten its export controls drastically.⁴

Today, any power plant operates under international safeguards that make that scenario incomparably more controlled. Beyond that, Argentina has driven its nuclear programme for peaceful purposes from the outset.

Reactor safety:

• The void coefficient: CANDU reactors have what is called a positive void reactivity coefficient. To understand it, the design distinction noted earlier must be recalled. In a CANDU, the coolant and the moderator are two separate masses of heavy water. If a loss-of-coolant accident occurs (known in the jargon as a LOCA, Loss of Coolant Accident), vapour bubbles appear in the coolant. Since that coolant also absorbed some neutrons, its loss leaves more free neutrons; and since the moderator is separate and is not lost, those neutrons remain moderated. The combination of both effects means that, at that instant, reactivity tends to rise rather than fall. A PWR behaves the opposite way. Because there the water is both coolant and moderator and sits in a single vessel, losing coolant means losing moderator, and the chain reaction tends to shut itself down. That is why critics compared the CANDU unfavourably with light water reactors.
  The comparison, however, omits the counterweights that the CANDU design incorporates. On one hand, it has independent and redundant fast shutdown systems, designed precisely to cut the reaction in the event of a power excursion. On the other, a physical factor works in its favour: the neutron lifetime.
• Neutron lifetime as a counterweight: in a CANDU, owing to the properties of heavy water, the time elapsing between a neutron being born in a fission and triggering the next is considerably longer than in a PWR. This has two consequences. The first is that the reactor’s dynamics are slower and more predictable: a rise in power develops in a more damped way, which gives the control and safety systems a margin of time to detect the deviation and act. The second consequence is the one that matters most for safety. When, in a loss-of-coolant accident, reactivity begins to climb through the void effect described above, it does not do so violently but relatively slowly. That more measured pace gives the shutdown systems (the injection of neutron poison and the control rods) the time they need to engage and cut the reaction before power runs out of control. Put another way, the positive void coefficient pushes reactivity upward, but the long neutron lifetime makes that push gradual enough to be checked in time.

Beyond theory, the safety performance of plants is measured and traceable. The industry uses, among other indicators, the WANO PI Index, which combines a range of operating and safety parameters on a scale comparable across plants worldwide. Embalse markedly improved its position in measurements of this kind in recent years.⁵

The “National Project”

For years, parts of the Argentine nuclear community pushed for the construction of a new CANDU plant. The underlying argument was that, after decades operating Embalse, the country was in a position to participate far more actively than before in the design, construction and supply of components of a new plant.

In the early 2010s, that idea took shape within a plan to expand the nuclear fleet that envisaged two plants: one based on Chinese technology, the Hualong One reactor, a PWR offered on a turnkey basis, which would become known as Atucha III; and another based on CANDU technology,⁶ known informally as the National Project.

The aims attributed to it were ambitious and, above all, more strategic than merely energy-related: to expand nuclear power generation, yes, but also to increase national industrial participation, sustain capabilities, generate skilled employment, consolidate the supplier chain, maintain engineering competencies and strengthen technological autonomy. The proposal sought to turn decades of accumulated learning into a new stage of development.

The most attractive feature of the project was, precisely, the high degree of local integration envisaged. The greater the share of spending that remained within the economy, the greater the multiplier effect on skilled employment, on the training of technicians and engineers, and on demand for the metallurgical and engineering industry. It should be noted that, although official local-integration figures of around 55 per cent existed for the CANDU plant⁷ (how much of the spending would take place in the country), these do not amount to a cost-benefit analysis demonstrating the project’s real economic return.

The CANDU project also had its own back-and-forth. It was cancelled in 2018, when the plan for new plants was reformulated and left it out, and recovered in 2021, when a shareholders’ meeting of Nucleoeléctrica Argentina (NA-SA) annulled that cancellation and reincorporated it into the plan. Shortly afterwards, however, it stalled again.

Why it did not materialise

If the technology made sense, why was the fifth CANDU plant never built? It was the sum of several factors, chiefly economic and financial as well as political.

The first obstacle was cost. A nuclear plant demands an initial investment of several billion dollars and, however much of the components Argentine industry could fabricate, the country needed external financing to begin the investment. In this case, while the Chinese-design plant had financing from that country’s state banking, which came to commit up to 85 per cent of a project estimated at around 8 billion dollars, the National Project had no comparable financial offer behind it.

To that lack of financing was added the Argentine macroeconomic context. Between 2010 and 2020 the country went through, in different periods, external constraints, shortages of foreign currency, difficulties accessing international credit and a high country risk. A nuclear plant recovers its investment after several decades, which forces resources to be committed over horizons far longer than a presidential term. This is a demand that is hard to sustain in Argentine conditions, an unstable economy with shifting priorities across presidential cycles.

There is also a change in the technology market itself. When Embalse was built, the CANDU had a far stronger international presence. Over time, the nuclear market consolidated around light water reactors and, as of today, more than 80 per cent of the world’s commercial reactors belong to that family. Fewer CANDUs were built, their global supply chain shrank and new projects turned towards standardised PWR designs. That makes a CANDU bet more solitary and, in a sense, against the current.

Finally, the project’s very appeal, its high local-industry participation, was also a source of complexity. Coordinating hundreds of firms, qualifying suppliers, developing components and resolving additional engineering generates very valuable capabilities over the long term, but in the short term it adds costs, timelines and coordination risks. A turnkey plant, bought from a foreign supplier, offers instead more predictable costs, more defined schedules and a clearly identified prime contractor. For a State with little financial room, that predictability carried weight.

The second obstacle was political factors. The National Project did not stall on economic grounds alone. On that basis were layered political decisions that ultimately tipped the balance, responding to different logics.

The first has to do with the geopolitical context. The financing of the new plant was, from the start, tied to cooperation with China, which was also the partner for the fourth plant. As tensions between China and the West deepened, and as the country reshuffled its international alignments, negotiations with Beijing cooled. Since the Chinese financing component reached the CANDU option as well, that cooling removed one of its financing legs.

The second logic was fiscal. The expansion of the nuclear fleet coincided with periods of sharp adjustment and of agreements with the International Monetary Fund. In that setting, committing the State to an investment of several billion dollars in public works was hard to justify against targets for deficit reduction and debt containment. The priority assigned to balancing the public accounts left little room for a project of this scale and such deferred return.

To this was added a technological paradigm shift. Sectors within the State itself argued that, rather than investing in replicating a large-scale foreign technology, efforts should be concentrated on small modular reactors (SMRs). In this field, Argentina has a prototype of its own development, the CAREM-25. Seen in that light, a new CANDU power plant appeared as a bet less aligned with the direction the world nuclear industry was taking.

Finally, the sector’s organisational model also carried weight. The National Project assumed a central role for the State and strong backing from NA-SA. As an orientation prioritising private initiative and questioning the State’s entrepreneurial role gained ground, including the possible privatisation or concession of NA-SA assets, wholly state-owned capital-intensive projects lost support within the government agenda.

To all these factors was added a structural one in Argentina: the lack of continuity in long-term policies. A nuclear project needs to be sustained for more than a decade, and the National Project spanned governments with very different priorities, alternating between promoting nuclear expansion, turning to renewables or gas, or focusing on fiscal adjustment. Each change of political colour reopened the discussion and postponed the decision.

There was, moreover, a factor that eased the urgency: the Embalse life extension. By renewing the plant and adding decades of operation, that project partly fulfilled some of the aims the National Project pursued (maintaining capabilities, preserving specialised knowledge, sustaining suppliers and developing local engineering), which weakened the argument for building a new plant.

It is worth noting, in addition, that not even the Chinese option ended up materialising. The construction contract for Atucha III was signed in 2022, but it never fully came into force, because the financing contract that was to be closed within a few months did not come through. From there followed extensions and delays, first because of financing difficulties and later because of the country’s reshuffling of priorities and international alignments, until negotiations stalled. More than a formal cancellation, what occurred was a paralysis that drags on to this day. The discussion over Atucha III has been open for nearly a decade and has spanned three governments of differing political colour.

In sum, the National Project was not frustrated by a flaw in the technology, but by the convergence of a high cost without firm financing, a fragile macroeconomy, an international market tilted towards the PWR and a succession of political decisions that, for varied reasons, gradually stripped it of priority.

Conclusion

This article has sought to trace what the CANDU technology really is, which capabilities Embalse left in place in Argentina, what advantages it offered over the PWR alternative and why, despite all of this, the so-called National Project was never built. From that account it follows that the project’s failure was not technical. The technology works and the capabilities exist; what was lacking was firm financing and a political decision sustained over time, regardless of the political colour of the government of the day.

At this point it is worth being clear, so as not to fall into easy enthusiasm. To hold that the CANDU was the suitable option is not to say that it is the only possible technology for Argentina, nor that it will be so forever. That is, if the country had to decide today on building a plant, under present conditions, the CANDU/PHWR option would be the most reasonable; simply because it is the one already known, because we have the know-how around the technology and the right to use it without paying royalties to Canada.

That does not close the door on a PWR in the future, though two dimensions are worth separating. Today, since the PWR is the most widespread technology in the world, the enriched-fuel market is broad and competitive, and most countries operating light water reactors supply themselves even without enriching on their own territory, so supply is not a constraint at present. For Argentina today, the question has to do with autonomy, because a natural-uranium CANDU fleet sustains a fuel chain with greater national participation, whereas a PWR fleet would tie the enrichment stage to external suppliers.

Looking ahead, an open question remains, because if world demand for nuclear energy grows as projected, enrichment could become a bottleneck, and not mastering the full cycle would leave the country more exposed.

All these decisions, which technology to build and when, may keep being delayed for years. In the meantime, what cannot happen is for the capabilities built around Embalse to be left waiting for a plant that may never be financed; because know-how that goes unused ends up dispersing. Perhaps the most useful discussion today is not when the next plant is built, but how that capability is kept alive, whether by sustaining projects such as the life extension or by offering services to the rest of the world CANDU fleet.

Embalse is already doing so, having recently completed Argentina’s first export of components for CANDU reactors, a set of shielding plugs with flow restrictors sold to Canada’s Candu Energy (now part of AtkinsRéalis), and it offers the experience of its life extension, the largest ever carried out on a CANDU-6 and the first to include the replacement of the steam generators.⁸

In this way, if Embalse left anything behind, beyond the electricity, it is technological capabilities. Those capabilities remain one of the most valuable assets of the Argentine nuclear sector, and although the debate over whether it is worth ever returning to a new CANDU line will stay open, what should not be in doubt is that this capability, once built, cannot be allowed to cool.

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Notes

1. According to the IAEA PRIS database, Embalse’s capacity factor across its entire history is 73.6 per cent, since that average includes the years the plant was out of service for its life extension. Measured only over the years it actually operated, it is around 80 per cent. Source: Power Reactor Information System https://pris.iaea.org/PRIS/CountryStatistics/ReactorDetails.aspx?current=4
2. For example, when the CNE needed training on fuel-handling simulators, it received support from other plants in the CANDU network through this organisation. Conexus runs one of the largest joint R&D programmes in the CANDU ecosystem. Solutions are also validated collectively and then implemented at several plants. For Argentina, this means access to developments that would be far more costly if carried out exclusively with its own resources. The accumulated experience of the entire world CANDU fleet is thus drawn upon, instead of each operator solving problems separately.
3. Counted here are the CANDU reactors of Canadian design. From that technology transferred in the 1960s, India developed its own line of PHWR reactors (the IPHWRs). It now has 18 units in operation that are not counted as CANDU. Source: Power Reactor Information System https://pris.iaea.org/pris/.
4. Hurtado de Mendoza, Diego. El sueño de la Argentina atómica: política, tecnología nuclear y desarrollo nacional. 1945-2006. 1st ed. Ciudad Autónoma de Buenos Aires: Edhasa, 2014.
5. The WANO comparative ranking is confidential among nuclear plant operators, so the individual values for each plant are not published.
6. The order of priorities shifted over time. At first the CANDU figured as the fourth plant and the Hualong as the fifth, but the order was later reversed.
7. Source: Nucleoeléctrica Argentina S.A., Resumen Plan Estratégico 2021-2030, version 1.0.
8. Embalse was not the first CANDU to have its steam generators replaced (it was the first CANDU-6), since between 2006 and 2008 the Canadian plants Bruce Units 1 and 2 removed and replaced a total of 16 steam generators (8 per unit). Bruce, however, is not of CANDU-6 design, and its steam generators are vertical “modules” connected at the top to a single, enormous shared horizontal steam dome. When Bruce 1 and 2 had their lives extended, only the lower sections were cut and removed (the degraded U-tubes), leaving the original giant horizontal dome intact and reusing it. In short, the Embalse steam generator replacement was larger in scope and the first on a CANDU-6.