Peace talks between the United States (US) and Iran in Islamabad have failed to produce an agreement, with one key issue proving to be the main stumbling block: Iran's nuclear program. Iran's nuclear ambitions have been the biggest obstacle to normalizing relations with the West for more than two decades and have been cited as a major factor behind joint US-Israeli bombings this year and in the summer of 2025.
Iran's nuclear ambitions: unrealistic or false?
Tehran's officially stated goal is electricity generation and energy security, not the creation of nuclear weapons. However, the available data suggests otherwise. Iran has announced plans to increase its nuclear power generation capacity to 20 gigawatts by 2041.
The Bushehr nuclear power plant, built with Russian assistance in southern Iran and commissioned in 2013, has a capacity of 1,000 megawatts and remains the country's only operating nuclear facility. It provides about 1 percent of Iran's total electricity generation, which relies heavily on natural gas and oil.
"Iran has some of the world's largest reserves of natural gas and oil, which allows it to produce electricity at a significantly lower cost than nuclear," Omood Shoukri, a senior visiting scholar at George Mason University in the United States, told DW. “In practice, the country's energy mix remains dominated by natural gas, while nuclear power has a small share from the only operating reactor at Bushehr.“ To make up for the existing 25,000 megawatt shortfall in Iran's electricity grid, about 25 power plants like Bushehr would need to be built. Bushehr took about 20 years to build.
"Economically irrational"
According to some estimates, the plant cost approximately $5 billion to complete, which experts say is five times more than originally estimated. Other estimates go even further, suggesting that even without taking into account the high costs associated with sanctions, the project may have cost Iran up to 10 times more than initially estimated. Because independent outside observers do not have access to the facility, it is extremely difficult to determine the exact cost.
This relatively low level of electricity production represents minimal benefit for a very high price. Iran's insistence that its uranium enrichment is for electricity generation has led to severe sanctions, which by some estimates amount to between two and three trillion dollars in direct economic losses.
For civilian purposes such as electricity generation, uranium must be enriched to 3-5%. According to the International Atomic Energy Agency (IAEA), Iran has accumulated stocks of uranium enriched to 60%. For nuclear weapons, uranium enriched to 90% is required. "Iran's nuclear program, viewed strictly as a civilian energy project, does not appear to be economically rational," says Shokri. Iran has also invested heavily in enrichment and fuel cycle infrastructure, “which adds significant costs but offers limited economic justification given its modest uranium resources and access to imported fuel,” says Shokri.
In addition to the political and diplomatic disputes arising from Iran’s nuclear program, the push for domestic uranium enrichment appears economically unsound in terms of costs and benefits.
Lack of legitimate civilian justification
In a 2021 joint statement to the IAEA Board of Governors, France, the United Kingdom and Germany said that Iran had no credible civilian reason to enrich uranium to 20% or 60% and that producing uranium at such enrichment levels was unprecedented for a country without a weapons program.
According to a 2013 report by According to the Carnegie Institution, Iran's uranium reserves are limited. The IAEA states that the country is not even among the top 40 in the world in terms of uranium reserves, and its known reserves are very small compared to other countries. According to 2011 data, Iran's proven uranium reserves amount to only 700 tons, with most of them falling into categories with high extraction costs. In addition to the quantity, the quality of this uranium is also low, which further increases the technological costs of its extraction.
In other words, extracting uranium from low-grade deposits is both expensive and technically difficult. Some estimates suggest that Iran's known uranium reserves could fuel the Bushehr plant for about nine years at most. At the same time, uranium mining requires millions of liters of fresh water per day. Given that Iran's uranium mines are located in arid and semi-arid regions, this raises serious environmental concerns.
Iran's international isolation further complicates the situation
The need to move away from fossil fuels has led many countries to choose nuclear energy as a relatively clean source. Many countries, such as Belgium and Sweden, have concluded that importing enriched uranium is more economically viable than producing it.
“Successful civilian nuclear programs in countries such as France, South Korea or the UAE rely on economies of scale, standardized reactor designs and integrated global supply chains,“ says Shokri. But Tehran's status as an isolated player means that these options are not available to it.
Claims by Iranian officials that nuclear power gives the country more opportunities to export gas and oil and generate revenue are also highly questionable, says Shokri. When assessed solely from an energy perspective, Tehran's nuclear program "does not fit the cost-benefit logic of conventional civilian nuclear strategies and appears economically inefficient," Shokri concluded.
Author: Efran Kasraye