The 20 percent of Britain's energy that is produced by nuclear power seems a pittance, compared with much higher proportions in the Soviet Union, France and West Germany. Yet the nuclear industry here has been the subject of nearly constant controversy since it began nearly four decades ago.

Clement Atlee's decision that Britain should have its own bomb brought nuclear engineers to this isolated, rural region and a site they called Windscale. In a secret Defense Ministry project in the late 1940s, they built two nuclear "piles" to produce weapons-grade plutonium.

On the same site, in 1956, Britain built and opened the world's first industrial-scale nuclear power station, called Calder Hall. Its four reactors, together with 22 other reactors built at 10 sites around the country by 1971, are called "magnox" stations.

The name comes from the magnesium alloy casings inside which the natural uranium fuel rods are housed. Inside the reactor, the fuel is placed in a graphite moderator, cooled by carbon dioxide.

More recently, Britain has turned to advanced gas-cooled reactors (AGRs,) which burn more efficiently. AGR fuel is composed of uranium-oxide pellets encased in stainless steel. Five AGR stations, each with two reactors, are now operating in Britain, and two are under construction.

Britain also operates an experimental fast reactor in Dounreay, in Scotland, and is party to an agreement for joint development of fast reactors with France, West Germany, Italy and Belgium.

A government proposal to build a pressurized-water reactor, in the far southeast at Sizewell, was the controversial subject of a two-year public inquiry whose results are due in September.

After a few years, nuclear fuel loses its efficiency. But spent, or irradiated fuel is not waste, and typically contains up to 96 percent unburned uranium and a small amount of plutonium, in addition to various useless but highly radioactive fission products. The uranium and plutonium must be separated out, or reprocessed, for reuse.

In the 1950s, Windscale became a commercial reprocessing facility for magnox fuel. The reprocessing cycle consists of first cooling the hot rods for several months under water, then stripping the magnesium casings off of them.

The bare irradiated fuel rods are then put through a series of acid baths that dissolve and separate them into what ultimately are powdered forms of uranium and plutonium, which can be stored before they are put through an enrichment process that turns them back into fuel.

But the existing Windscale facility cannot reprocess spent fuel from the newer AGR reactors. For this process, Britain decided in 1977 to build a new thermal-oxide reprocessing plant, dubbed THORP, at the Windscale Calder Hall site -- now called Sellafield. When it is completed, in the mid-1990s, it will be the largest such facility in existence. The other is on the north coast of France.

In recent years, most other countries, including the United States, have at least temporarily halted their reprocessing plans as concern about the radioactive waste such facilities produce has coincided with a drastic fall in the price of newly mined uranium. All have had to deal with storage problems for spent fuel.

Britain decided to go ahead with reprocessing because the country has no naturally occurring uranium and because it has become a lucrative business. Although other countries have opted against it, they still need to do something with their own spent fuel.

At least $2.5 billion of THORP's $4 billion price tag is in effect being paid by Japan, which together with six other countries has contracted with Britain to reprocess fuel.

Three years ago, spent fuel from abroad began arriving here, and is being stored, along with that coming from Britain's own AGR reactors, at Sellafield pending THORP's completion. Profits from foreign contracts totaled $188 million last year.

The problem with reprocessing, from the environmental point of view, is that it produces more radioactive waste than the spent fuel constitutes itself. The cooling water and the liquids used in the process are affected by leftover fission products and the scraps of fuel-rod casings.

Although Britain's foreign contracts provide for waste to be shipped back to its country of origin, this is not considered a practical option. In addition to the stored, irradiated fuel, the overwhelming bulk of radioactive waste in Britain currently is generated by, and stored at, Sellafield.

Solids comprising what the industry calls low-level waste, such as contaminated protective clothing and paper products used by the industry, are dumped in a nearby landfill. The landfill soon will be full, but recent government proposals for four other sites around the country have run into heavy local opposition.

Water used in Sellafield operations is purified to low-level contaminaton and run into the Irish Sea.

The most long-lived and dangerous substances, a relative minority known as high-level waste, primarily the liquid byproducts of reprocessing, are kept in protective storage at Sellafield.

Critics focus on the issue of intermediate-level wastes. These used to be encased in concrete and dumped at sea. But in 1983, the Seamen's Union refused to cooperate. Now, Britain has no policy for permanent disposal of these solids, such as casing scraps.

The intermediate-level wastes are stored here, too, for lack of another site.