Euratom supports the initiatives of the Member States in the nuclear field, ensures equal access to resources for all users, monitors the use of nuclear materials for peaceful purposes in the European Union and strengthens international cooperation in this field. Nuclear energy makes a significant contribution to the policy of diversifying energy supply and reducing overall emissions of CO2. Supply of nuclear fuels is a matter dealt with in some depth in the Euratom Treaty [see section 2.1]. Article 52 of this Treaty stipulates that supply of ores, source materials and special fissile materials is accomplished with respect of the principle of equal access to resources and through a common supply policy. For this purpose, all practices that seek to provide certain users with a privileged position are forbidden. The Treaty set up a Supply Agency, the organisation of which is provided for in Articles 53 and 54 (EAEC). The Agency, which has legal status and is financially independent, is governed by Statutes adopted by the Council on the basis of a Commission proposal. The Euratom Supply Agency is under the control of the Commission, which issues it with policy guidelines, has a right of veto on its decisions and appoints its Director General [Decision 2008/114]. In contrast with the coal and oil sectors, the nuclear sector is endowed with a strong common supply policy, exercised by the Agency, under the control of the Commission.
Article 52 (EAEC) grants the Agency two fundamental rights: (a) an option right on ores, source material and special fissile materials produced in the Member States and (b) the exclusive right to conclude contracts for the supply of ores, source materials and special fissile materials originating inside or outside the European Community/Union. The Agency's main role is to act as an intermediary between producers and users. Under Article 60 (EAEC), possible users periodically inform the Agency of their supply needs, specifying quantities, nature, places of origin, uses, price terms and so on, which would form the clauses of a contract which they would like to conclude. Producers inform the Agency of the supplies that they can put on the market, with all their specifications and notably the duration of the contracts. The Agency informs all potential users of supplies and of the demand volume brought to its attention, and invites them to order. Once it has all the orders, it makes known the terms at which they can be satisfied. In fact, the option right of the Agency, described in Article 57 (EAEC), gives it a “de jure” monopoly on the trade of ores, raw materials and special fissile materials intended for peaceful nuclear use in the EC/EU.
The Agency, acting in the framework of agreements concluded between the European Union and a third country or international organisation, has also the exclusive right to conclude agreements whose main object is the supply of ores, source materials or special fissile materials, such as uranium, plutonium, thorium and heavy water, originating outside the EU [Article 64 EAEC]. In 1962, the Agency set this in motion by concluding a framework contract with the United States Atomic Energy Commission (USAEC) enabling European undertakings to obtain enriched uranium at good price, regularity and safety terms. Since then the contract has been renewed and simplified as regards administrative formalities for the purchase of special fissile materials and other contracts have been concluded, notably with Canada and Australia, enabling the EU to diversify its supply sources in nuclear materials.
The bulk of EU supply continues to come via multiannual contracts, but due to the fact that the requirements of electricity companies for natural uranium and short- and medium-term enrichment services are now by and large met, very few long-term contracts are now concluded. The Agency rather concludes on spot purchases and swap transactions. The EU's level of dependence on imports of natural uranium is over 70% and its main suppliers are the independent States of the former Soviet Union, and in particular Russia, but there are eight external supplier countries and none accounts for more than 25% of total supplies. Thus, the supply of the Union in nuclear fuels is quite secure. Nevertheless, the Euratom Supply Agency encourages electricity companies to diversify their sources of supply in order to avoid excessive dependence on any one particular source. The uranium enrichment market in Europe is in fact very stable, with users in the Union covering most of their needs through long-term contracts with European suppliers.