Turkey’s Akkuyu Nuclear Project to break ground in early 2018

  • akkuyu nuclearTurkey has issued a power generation license to Rosatom’s Akkuyu Project
  • But to use it Rosatom has to get a construction permit and build the reactors.

(NucNet/WNN)): Turkish Energy Market Regulatory Authority (EPDK) has issued a power generation license to Akkuyu Nuclear, the joint stock company developing Turkey’s first nuclear power station project. The license will be valid for 49 years from June 2017 until June 2066.

The company said it applied for the generation license to EPDK in February 2017. The €20bn ($22bn) Akkuyu, near Mersin on Turkey’s southern Mediterranean coast, is to be built in cooperation with Russian state nuclear corporation Rosatom under a contract signed in 2010.

The station will have four 1,200-MW VVER units expected to come online in 2023. Once on the grid it is expected to provide about seven percent of Turkey’s electricity. The estimated $22bn cost indicates the reactors will come in at $5.5 billion each or about $4,600/Kw as an “overnight cost.”

These numbers do not include upgrades to local infrastructure to support the construction effort nor significant improvements to the regional and national grid to deliver the electricity from the reactors to customers.

If built the project will be the second largest nuclear power station in the Middle East following the construction by South Korea of four 1400 MW PWR for the United Arab Emirates.

In March 2017, Akkuyu Nuclear applied for a construction license to the Turkish Atomic Energy Authority. Akkuyu Nuclear said it expects to obtain in the “nearest future” a limited construction permit. It will allow start of works on the non-nuclear phase of the project. Akkuyu Nuclear said the main construction permit and first concrete pouring at Akkuyu are expected in March 2018.

Financing remains an issue with Rosatom looking for international investors for shares in its 49% equity stake in the project.

Financing

When Rosatom first committed to the project almost seven years ago, the price of oil was on its way to over $100/ bbl. However, by 2015 it had dropped to just half that amount.

With Russia depending on its oil and gas revenues to support its generous financial terms for nuclear reactor exports, the market downturn poses a big problem. Where will the money come from for all of its nuclear export commitments?

Rosatom has inked numerous deals for nuclear reactors to be built in developing countries under a model by which Russia finances, builds and operates the nuclear plant and sells power to its customer – a model that has also raised questions about Russia using energy policy as a means to political ends.

In Turkey Russia’s plan has always been to initially build and operate the plant, but to eventually sell it to equity investors. Rosatom has hopes that Turkish construction companies might take early equity stakes in return for getting the contracts to build the plants. So far these firms have been cautiously interested in making these kinds of commitments.

(NucNet)(Updated for 20 June 2017): Russia’s state-owned nuclear corporation Rosatom has agreed to sell a 49% stake in Akkuyu Nuclear, the joint stock company developing Turkey’s planned Akkuyu nuclear power station project. The stake will be acquired by a consortium consisting of three large Turkish industrial holding companies

  • Cengiz Holding
  • Kolin Insaat Turizm Sanayi ve Ticaret, and
  • Kalyon Insaat

Akkuyu Nuclear said the value of the sale will not be disclosed until the signing of a final investor agreement, expected before the end of 2017. The Akkuyu plant is to be built near Mersin on Turkey’s southern Mediterranean coast for €20bn ($22bn).

The site will have four 1,200-MW VVER units expected to come online in 2023. Six Rosatom subsidiaries, including Rusatom Overseas and Rosenergoatom, together own 100% of the Akkuyu project. Last week, the Turkish Energy Market Regulatory Authority (EPDK) issued a 49-year power generation licence to Akkuyu Nuclear. The company said at the time that the main construction permit and first concrete pouring at Akkuyu are expected in March 2018.

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Turkey has plans to build two other nuclear power stations. These sites are Sinop on Turkey’s Black Sea Coast and Igneada on the western edge of the Black Sea.

Sinop

According to the World Nuclear Association (WNA) preparations have been underway since 2008 at Sinop on the Black Sea coast to build a second nuclear plant there, along with a €1.7 billion nuclear technology center. A 4400 MWe nuclear plant there is expected to cost about $22-25 billion.

A feasibility study is due for completion in mid-2017, and the announced timeline is for construction start sometime later in 2017 and with start of operation from 2023. These are likely to be the first Atmea1 units built. The reactor is a scaled down Areva EPR and is a joint effort of the French state owned nuclear giant and Japan’s Mitsubishi Heavy Industries (MHI).

WNA notes that the four reactors would be designed for load-following and use the same steam generators as Areva’s large EPR (but three instead of four). Cost is projected at $4.89 billion for the reactors alone.

MHI has set up a new business unit, the Turkey Nuclear IPP Development Department, to handle the feasibility study, negotiate contracts, prepare financing and undertake other functions in Turkey. MHI will lead the engineering-procurement-construction (EPC) consortium.

Financing arrangements have not been announced for the project. Neither Areva nor Mitsubishi are likely to be interested in taking equity positions in the reactors which means either Turkey must pay for them or find investors to take on some of the costs.

Igneada

According to the World Nuclear Association Turkey has plans to build further nuclear capacity at another site, as part of 100 GWe required by 2030. TAEK has identified Igneada in Kirklareli province on the Black Sea, 12 km from the Bulgarian border, and this was confirmed in October 2015.

In November 2014 the Turkish energy ministry signed an agreement with the State Nuclear Power Technology Corporation (SNPTC) of China and Westinghouse to begin exclusive negotiations to develop and construct a four-unit nuclear power plant in Turkey.

Two AP1000 and two CAP1400 are included in the agreement which also covers all lifecycle activities including operations, nuclear fuel, maintenance, engineering, plant services and decommissioning. SNPTC was the agent introducing Westinghouse AP1000 technology into China, and has developed it further to the CAP1400.

Eight AP1000 units are under construction in China and the USA, and the first CAP1400 is due to start construction at Shidaowan in China.

Turkey has an opportunity to seek financing from China which is looking for a place to show success with export of the CAP1400.

Argentina and China Sign Contract for Two Reactors

(WNN) China is to supply Argentina with two nuclear power reactors – one a Candu pressurized heavy water reactor (PHWR), the other a Hualong One pressurized water reactor (PWR). The contract was among 19 agreements in Beijing during a meeting of Chinese president Xi Jinping and Argentinean president Mauricio Macri.

In November 2015, Argentina signed deals with China for the construction of its fourth and fifth nuclear power plants: a third Candu PHWR at the Atucha site and a PWR at an unspecified site. The projects were said to be worth around $15 billion, with China contributing 85% of the required financing. The favorable terms undoubtedly contribute to the decision by Argentina’s government to accept the as yet unproven Hualong One reactor design.

According to the agreement, construction will begin in 2018 of a 700 MWe Candu-6 PHWR and work will begin to start building a 1000 MWe Hualong One PWR in 2020. CNNC will provide goods and services under long-term financing. The accord provides for Argentina to be designer, architect-engineer, builder and operator of the new reactor.

China is building two Hualong One units in Fujian Province. Fuqing 5 and 6 are scheduled to be completed in 2019 and 2020, respectively.

Construction of two Hualong One units is also under way at China General Nuclear’s Fangchenggang plant in Guangxi province. Those units are also expected to start up in 2019 and 2020, respectively.

These units will be the reference designs for exports to other countries including the UK. Once operational, the units will be available to train reactor operators for work on export units. The experience gained building four Hualong One units will facilitate more cost effective construction of exported units.

China’s CGN Forms Three Companies To Manage UK Projects

(NucNet) Chinese state-owned nuclear developer China General Nuclear Power Corporation (CGN) has set up three companies in the UK to manage its proposed local projects.

  • Bradwell Power Corporation will be responsible for developing the twin-unit HPR1000, or Hualong One, reactor project at Bradwell B in Essex.
  • General Nuclear System Limited will be in charge of facilitating the five-year UK licensing process for the Hualong One technology.
  • The third company, General Nuclear International, will manage CGN’s projects in the UK.

CGN’s chairman He Yu was quoted by China Daily as saying that the new companies will help growing CGN’s nuclear technology business in the UK.

CGN will invest £6bn ($7.6bn, €6.8bn), or a 33.5% share, in the Hinkley Point C EPR project in southwest England under an agreement signed with France’s EDF in 2016.

CGN also signed a number of agreements related to plans to build two 1000 MW Hualong One reactors at Bradwell B. Additionally, it has signed on as an equity investor in two Areva EPR units at Sizewell C in Sussex. CGN will have a 66.5% stake in Bradwell B and a 20% stake in Sizewell C. All remaining stakes in the three projects will be held by EDF.

Rolls-Royce Unveils Some of its SMR plans

(WNN) Small modular reactors (SMRs) offer the UK socio-economic benefits that would last 100 years, said John Molyneux of Rolls-Royce, but today’s government must make its mind up how it wants to proceed. World Nuclear News reported his remarks to a conference of nuclear energy organizations held in the UK.

Molyneux said a team of about 150 people have been working on it for around two years. A group of ten UK companies have been recruited over the last year, including operators, turbine island designers, civil engineers, researchers and engineering consultants.

The first months were taken with major design decisions including the use of a light-water as coolant and moderator and to select the close-coupled arrangement of steam generators as opposed to integrating them into the reactor vessel, or adopting a more spread out design similar to today’s large reactors. According to World Nuclear News Rolls-Royce’s design is a PWR type in a close-coupled four-loop configuration.

The UK SMR program stalled in the face of the Brexit vote a year ago, while uncertainty has continues even after last week’s general election. This is a source of frustration for all SMR developers in the UK.

“Government needs to decide whether it wants SMRs; if they do, what technology solution they are after, ” Molyneux said.

For Rolls-Royce, the primary market would be the UK where up to about 7 GWe of small units could be deployed, probably at existing nuclear power sites.

“The UK market is important,” Molyneux said “but to really make them fly you have to look internationally so support from the UK government to international markets becomes really important” requiring further long-term political commitment.

Molyneux said he expects strong competition from Chinese, Russian and US offerings to mean that Europe and the Middle East would be more likely sales targets for Rolls-Royce.

The firm has not said much about customers or financing of construction of the SMRs. While the reactors will cost less to build, they are not likely to be significantly costly to operate than larger versions of PWR type reactors.

The savings for customers will come when firms like Rolls-Royce and others like NuScale, which has opened a UK office, can get enough ink ink their order books to justify building factories to turn out SMRs rather than custom construction on each site.

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ANS President Announces Nuclear Grand Challenges

American Nuclear Society (ANS) President Andy Klein announced nine ANS Nuclear Grand Challenges (PDF file) that need to be resolved by 2030 at the society’s Annual Meeting in San Francisco today. They are:

1. Establish the scientific basis for modern low-dose radiation regulation.
2. Transform the way the nuclear technologies sector thinks about public engagement.
3. Close the nuclear fuel cycle.
4.  Ensure continuous availability of radioisotopes.
5.  Rejuvenate the nuclear technology infrastructure and facilities.
6.  Accelerate development and qualification of advanced materials.
7.  Accelerate utilization of simulation and experimentation.
8.  Expedite licensing and deployment of advanced reactor designs.
9.  Expedite nuclear education and knowledge transfer.

“America’s nuclear sector stands at a crossroads. Our organization aims to address some of the major technical nuclear challenges, so we can continue to enjoy the economic, political and social benefits from this vitally important technology for decades to come.”

“We received nearly 300 suggestions, and countless others were discussed within our professional divisions,” said Klein at a media briefing during the ANS Annual Meeting in San Francisco on June 12.

Andy Klein(left) ANS President Dr. Andy Klein (right) at the ATR complex at Idaho National Labs (INL)  with Dr. Sean O’Kelly (left), INL Assistant Laboratory Director for the Advanced Test Reactor.  Rejuvenating nuclear technology infrastructure and facilities is one of the ANS Nuclear Grand Challenges that was announced on June 12 during the ANS Annual Meeting.

The results described in the ANS Nuclear Grand Challenges report provide focus for those who will continue the mission to share information and engage with the public and policymakers to foster advancements in nuclear technology.

“The nuclear industry faces an exciting future as evidenced by the large number of private companies forming, all desiring to commercialize an advanced nuclear product,” stated Todd Allen, professor of engineering physics at University of Wisconsin and Third Way senior visiting fellow.

“In many cases, the performance of advanced materials is critical to making a concept commercially attractive. The material science nuclear grand challenge asks ANS members to use the most advanced tools to support the pace demanded by commercialization,” he continued.

The ANS Nuclear Grand Challenges will form a basis for ANS research and policy recommendations to government officials and agencies, partner organizations, and others interested in the future of nuclear technologies.

Media Contact:

Tracy Marc
Communications Manager, American Nuclear Society
Ofc: 708.579.8224
Mobile: 630.710.8216
tmarc@ans.org

Established in 1954, ANS is an international professional organization of engineers and scientists devoted to the peaceful applications of nuclear science and technology. Its more than 10,000 members represent government, academia, research laboratories, medical facilities and private industry.

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Zero Emission Credits for First Energy Out of Reach for Now

FirstEnergy_logoThe effort by the giant nuclear utility to get Ohio legislators to create new regulations enacting zero emission credits (ZEC) for the Davis-Besse and Perry nuclear power plants has stalled out according to news media reports.

Over the past year Ohio state legislators in both the House and Senate have held multiple hearings on the request by First Energy to put its nuclear power plants under a regulated regime to give them credit for not emitting CO2. If enacted the new arrangement could produce more than $300M/year for the financially troubled firm.

Outlook Dim

Legislative leaders in both chambers have made it clear that despite hearing hours of testimony they are in no mood to call for a vote either to bring a measure to the floor or ask for a full vote on such a measure. Neither committee considering the legislation in either the House or Senate reached a conclusion.

With other legislative matters pending it could be that any further consideration of the proposal could be put off until Fall 2017.

In an effort to broaden the basis for the ZEC legislation, on June 1 Exelon Corp VP for government affairs Joseph Dominguez said in testimony to the Ohio Senate’s Public Utilities Committee that six nuclear reactors in five states have shut down and another seven nuclear reactors will shut down prematurely by 2019, because electricity markets are not properly valuing the benefits that baseload electricity power plants provide.

“These markets do not address many environmental externalities, the need for fuel diversity, or concerns about grid resiliency arising from terrorism or operational catastrophes that threaten the natural gas infrastructure system that supplies gas-fired power plants. As a consequence, traditional baseload resources are not valued for their contribution to fuel-mix diversity or for the increased resiliency they provide by virtue of having a 30-day supply of fuel at the plant,” Dominguez said.

The key reason that legislators in the House and Senate are gun shy about calling for a vote is not that they don’t understand the issue. What has then frozen in their tracks is the intensity of the opposition.

aarp logoIn addition to industry, consumer groups and interest groups like AARP mobilized to stop the proposal. AAREP called the ZEC a “subsidy” designed to “prop up a failed business model.”

Also, AARP pointed out that ZECs have been handled in different ways in other states and asked why Ohio was considering a direct subsidy by rate payers. It called ZEC “a scam.”

“FirstEnergy should sell its power to other buyers at a premium price instead of seeking a ratepayer subsidy. In Illinois, Exelon recently announced it would sell power from its Byron nuclear plant to Michigan and other states, rather than seek a bailout. Several other states voluntarily let their aging, uneconomic power nukes close without debating a bailout. Court filings across the country- including Illinois-are challenging similar zero-emission credit scams because they interfere with the wholesale energy market and distort favorable pricing that results from healthy competition in the supply and demand.”

AARP reminded the legislature that it has 1.54 million members in Ohio and that the over 50 crowd votes out of proportion to its numbers compared to other age cohorts.

Absent First Energy making good on its threat to close the reactors if it does not get ZECs, the legislature’s response to this kind of opposition is to bottle up the proposal without reporting it out of committee.

In Fall 2016 First Energy said it would get out of the business of competing for market share for electricity generated by the reactors within 18 months.  That puts the deadline in late winter 2018.

Financial Report Gloomy in 2016

For 2016 First Energy (NYSE:FE) recorded a loss of $14.50/share. The firm was profitable for the three years prior to 2016 recording earnings of $1.36/share in 2015. The company paid dividends of $1.44/share for the past four years.

The stock price has not been particularly volatile over the past year, but has recorded a downward trend from a 52-week high of $36.51/share in July 2016. Market close on June 9, 2017, was $29.11 and the 52 week low was just slightly below that at $27.93. The market cap is $13 billion with 444 million shares outstanding.

First Energy’s reactors – Davis-Besse located near Toledo and Perry located northeast of Cleveland – operate at a disadvantage in bidding wars for power in highly competitive wholesale electricity markets. Companies that sell power in these markets get it from natural gas turbine plants that generate power at about half the cost of getting the power from nuclear reactors.

The utility has threatened to close the two reactors if the change to authorize ZECs is not made. The firm has also threatened to file for bankruptcy though it has not formally filed any paperwork with a court.

chart (1)

Why ZEC is a Legislative Headache

State legislators complain that they get a case of cogitative dissonance about First Energy’s request for higher rates for power from nuclear plants. The utility fought air pollution rules for years, but now wants financial support for its plants that don’t emit CO2. If granted, ZEC would take money from rate payers in proportion to the amount of CO2 emissions avoiding by keeping the nuclear plants open.

According to the legislative proposal, the utility would get a zero emission credit, or ZEC, of about $17 for every ton of CO2 the nuclear reactors do not produce for the equivalent amount of electricity if generated by a coal fired power plant.

For instance, the Gavin coal plant located in Cheshire, OH, which was operated by the American Electric Power Co., emits 18.7 million tons of CO2 per year.  The plant produces 2600 MW of electricity a year.

Note: In January 2016 American Electric Power sold the Gavin coal plant and three others, for a total of 5200 MW, to Lightstone Generation LLC, a joint venture of Blackstone (NYSE: BX) and an affiliate of ArcLight Capital Partners LLC (ArcLight), for approximately $2.1 billion.

The two First Energy nuclear plants produce a combined 2128 MW of ZEC power (Davis Bess 900 MW, Perry 1269 MW).  That’s 81.8% of the power produced by Gavin which would be equal to 15.3 million tons of CO2 in a year. The ZEC for First Energy, based on this hypothetical comparison, would be equal to $260.2 million.

The actual rate case would be a good deal more complicated but this example illustrates how the system would work in principle.

Residential customers might not feel much of a bite from this system, but industrial users of electrical power could see significant increases in their costs. The bottom line is no one wants to pay for reductions of CO2 emissions.

First Energy Nuclear Plants Survive PJM Auction

For the moment there isn’t much of a threat that First Energy will close the reactors even if they don’t see legislative progress this year. A recent auction for power to be delivered in 2020, run by the PJM Interconnection firm that operates the high voltage wholesale grid in the Midwest, included the two plants.

By making commitments to provide power First Energy gets cash from PJM whether it buys the power or not. What First Energy must do when called on is to provide the power when other plants go offline. The success with the PJM auction means First Energy has an incentive to keep the reactors running through May of 2021.

The NRC license for Davis-Besse was renewed for 20 years in December 2015. The current NRC license for the Perry Plant is good until 2026.

Energy Production and Use in Ohio

First Energy is not exclusively a nuclear utility. It operates coal and gas plants, as well as nuclear, in six states. What’s interesting about Ohio is that the largest segment of the state within the state is serviced by gas plants.  Taken together the two reactors provide about 14 percent of the electricity used in Ohio.  See map below of service areas and links to generation facilities. 

first energy generateion map

The eastern end of the state is a hotbed of natural gas production based on fracking and the state has a long history as a major coal producer.

The renewable energy sector is so small in terms of production that it barely registers on the chart below. Requests by wind and solar energy producers for ZECs would have an even harder time with the legislature than nuclear.

chart (2)

chart

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Japan’s METI Divided About Future of Nuclear Energy

Over the course of two days the Japanese government’s powerful Ministry of Economy, Trade, and Industry (METI) endorsed development of new nuclear power stations and then denied that it had ever said such a thing.

If you are reading the English language news media reports coming out of Japan about the future of the nation’s fleet of nuclear reactors, and the question of whether it will ever build any new units, you might want to take a deep breath.

  • On June 8th METI told the Nikkei wire service that it was setting up a expert panel this month to “discuss new or updated capacity” for the nation’s fleet of nuclear reactors. Significantly, the wire service report did not cite a named spokesperson for the ministry.
  • On June 9th METI told the Reuters wire service there are no such plans. METI Chief Hiroshige Seko said, “we are not thinking of new construction or replacement at all.”

Now news speak by government officials in Japan may be different there than in the U.S., but when a high level government official calls a media report he doesn’t like “groundless,” it’s usually because someone let a very confidential cat out of the bag before its time.

The root of this appearance of a split personality at METI appears to be the government’s strategic energy plan which has the role of defining the nation’s path to establishing a stable energy supply over the long term.

According to Energy World, a trade journal, overall Japan’s energy use of all types of fuels has been declining and reached new lows for 2016.

energy use in Japan

Rising supplies of renewable energy and the return of some nuclear power plants, amid falling demand as Japan’s population declines, mean the world’s third-largest economy has more diversity in its sources of energy. Thermal coal imports declined to just below 110 million tonnes in 2016, down from a record-high 113.84 million tonnes in 2015 according to the Ministry of Finance.

Japan is the world’s biggest importer of LNG, gas chilled to liquid form for transportation on ships, and demand had surged to successive records after the March 2011 meltdowns at the Fukushima Daiichi nuclear plant led to the eventual shutdown of all reactors in the country. Shipments of liquefied natural gas (LNG) dropped for a second year last year, down 2 percent to 83.34 million tonnes, while their value fell 40 percent.

japan gas imports

Despite these trends, the METI statement released on June 8th said that the strategic plan would focus on nuclear energy and would position it as an “important base-load power source” that is stable and and inexpensive to operate.  How much nuclear energy would be needed over time is open to debate given the trend of declining energy use in the nation.

Back in 2014 the Japanese government scrapped the goal of eliminating nuclear power entirely, announced in 2012, but remained silent on the issue of new construction.

According to the World Nuclear Association, in September 2010 Tepco, Japan’s biggest utility, said it planned to invest $30.5 billion long term in nuclear energy. The profile also lists nuclear reactors that are under construction as well as plants slated for life extension beyond 40 years. The listing is too extensive to go into here, but the bottom line is that there is no shortage of opportunities for Japan to strengthen its energy security with investments in nuclear power. (World Nuclear – large JPG image;  status of nuclear energy in Japan)

Another driver of nuclear power in Japan is that under the Paris climate change accord, Japan targets an 80% reduction in greenhouse gas emissions by 2050.  Every year the government dithers over the future of nuclear energy makes it harder to meet that goal. The major nuclear power utilities have complained to the government that a lack of clarity makes it difficult to commit to long term strategies.

A key item is that Japanese nuclear firms who want to export nuclear technologies to countries like India, the UK, and elsewhere would see an erosion of their capabilities, and workforces, if future investments in domestic nuclear power are frozen in the government’s long term plan.

Even if the government called for new investment in nuclear energy, it would likely face strong public resistance. In 2015, according to Reuters, a METI statement that nuclear energy should provide 20% of of the country’s electricity by 2030 met with “widespread criticism.”

Japan Nuclear Export Strategy Stalls Out

According to the Nikkei wire service, efforts by Toshibia to export Westinghouse nuclear technology to India has stalled due to the bankruptcy filing by that business unit. The plan, first agreed to in 2010, and since modified, was until recently focused on building six 1150 MW AP1000 reactors at site in Andhra Pradesh on the country’s east coast.

Even if Westinghouse had not filed for bankruptcy, Toshiba, the parent firm, was plunged into financial turmoil when it was revealed it had falsely claimed $1.2 billion in earnings.

“Conditions have changed due to Toshiba,” Takeo Kitsukawa, a professor at Tokyo University of Science told the Nikkei wire service.

“The first issue is to get the nuclear reactor manufacturers back on their feet.”

In the Japanese Diet, opposition to nuclear technology exports continues to muddy the waters. Some members of the Diet say that the agreement may offer insufficient legal guarantees that would limit their use to peaceful purposes. They point out that India is not a member of the Treaty on Nonproliferation of Nuclear Weapons and has refused to consider doing so.

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Toshiba Caps Liability for Vogtle at $3.68 Billion

  • It covers about 60% of the total liability for Vogtle and V C Summer
  • Toshiba is still in talks with SCANA

Japanese YEN

The Financial Times reports that Toshiba has agreed a deal to cap its liability for the Vogtle reactor project managed by its nuclear engineering unit Westinghouse, but this agreement does not address the future of the SCANA plant which remains in doubt.

Georgia Power (Southern Nuclear)  has entered into a new agreement with Toshiba, the parent company of Vogtle’s contractor Westinghouse. The agreement confirms the value of Toshiba’s guarantee at $3.68 billion.

The agreement has been approved by the U.S. Department of Energy (DOE). The agency has a stake in the outcome of the negotiations because it approved an $8.3 billion loan guarantee for the Vogtle project. SCANA did not apply for and does not have loan guarantees from the federal government.

Additionally, Georgia Power and Westinghouse have completed a new service agreement which allows for the transition of project management at the Vogtle expansion from Westinghouse to Southern Nuclear and Georgia Power. The service agreement is subject to approval of the Westinghouse Board of Directors and the bankruptcy court. This agreement could be a model for SCANA.

Southern CEO Thomas Fanning said in a prepared statement he approved the agreement because it provides additional protections for Georgia electric customers following Westinghouse’s March bankruptcy.

“We are happy to have Toshiba’s cooperation in connection with this agreement which provides a strong foundation for the future of these nuclear power plants.”

Meanwhile, there are efforts by both the Vogtle and V C Summer projects to bring new EPC contractors onboard to manage the completion of construction of all four reactors. Bechtel and Fluor are reported to be preparing bids to separately manage the Vogtle and V C Summer nuclear reactor projects. Bids are expected by mid-August.

  • It’s a question whether either utility has firm “walk away” numbers regarding their negotiations for costs and schedules that might be submitted in the proposals nor have the utilities announced timelines for reviewing and deciding whether to accept the bids. In any case working out the terms and conditions of projects this large is never a quick process.
  • Southern CEO Thomas Fanning says he wants to see the bids before deciding on a course of action. SCANA’s management has been more outspoken about the risks of deciding to complete their two reactors, but it also wants to consider the EPC bids.
  • The combined cost overruns for all four reactors are estimated to be $13 billion and the delays for both projects are in the range of three years from the original completion dates.
  • The expected cost at completion of both projects is now estimated to be about $30 billion. More than 10,000 workers are employed at these sites.

Paul Bowers, chairman, president and CEO of Georgia Power said in a prepared statement that the next step will be to engage the Georgia Public Service Commission.  It will be expected to review the EPC costs and schedules as input to future rate cases for covering the construction costs of the two Vogtle reactors.

“We are continuing to work with the project’s Co-owners to complete our full-scale schedule and cost-to-complete analysis and will work with the Georgia Public Service Commission to determine the best path forward for our customers,” Bowers said.

In addition to affirming the value of $3.68 billion in parent guarantees from Toshiba, the new agreement also adds clarity on the timing and form of payments for that obligation. Toshiba guarantees were put in place to protect Georgia electric customers as part of the original contract and the first payment under the new agreement is due from Toshiba in October 2017.

The scope of the service agreement with Westinghouse includes engineering, procurement and licensing support, as well as access to Westinghouse intellectual property needed for the project.

The agreement will take effect after approval of the bankruptcy court. The interim assessment agreements with Westinghouse, which has allowed progress to continue at both  construction sites, have been extended to June 26th. Additional extensions are expected as both utilities grapple with one of the most complex construction projects in the nation.

The Financial Times noted that Mr Fanning suggested on a call with analysts last month that US government support might be available to help complete the new reactors.

“This is a national security issue,” he said “If the United States wants nuclear in its portfolio for the future, we’ve got to figure out a way to be successful here.”

If the reactor projects cannot be salvaged, it could influence decisions by other utilities to put off projects which have received NRC licenses but which do not have construction commitments by their respective utilities. These projects include Duke’s William States Lee III, Dominion’s North Ana, and DTE’s Fermi III.

Under the umbrella of the “prudent investor” paradigm, all of them will have to take into account the outcomes, whatever they may be, of current negotiations at Vogtle and V C Summer. Failure to craft credible and sustainable plans to complete the reactors could cripple the future of the nuclear industry in the U.S.  The country’s energy security would be at risk.

So far this risk has not been accepted by the government. Efforts to obtain congressional approval of $2 billion tax credits for Vogtle and V C Summer against future revenues, assuming the reactors are completed, have failed to gain traction. An effort to attach the measure to an omnibus appropriations bill did not work out as expected. A new effort to tie the measure to a future tax reform bill will have to wait for that legislation to be introduced in Congress.

Meanwhile, talks continue over the two new reactors under construction at VC Summer. Toshiba said in its statement that it is in talks with the plant owners, led by South Carolina-based utility SCANA, about its guarantee obligations and the payment schedule for completing the project.

On May 15, Toshiba said it had set aside a provision of ¥670bn for the cost of its parent company guarantees to Westinghouse for both Vogtle and VC Summer. The $3.68 billion cost cap for Voglte is about ¥400bn, or about 60 percent of the total provision. This would leave an estimated $2.21 billion for SCANA

Both utilities have said previously they have to agree their settlements with Toshiba are acceptable. The public utility commissions in both states have to agree as well. There’s a long way to go.

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NRC license to be sought for GEH PRISM Advanced Reactor

  • prismFour U.S. nuclear energy firms have teamed to develop the basis for seeking an NRC design certification under 10CFR50 for the GE-Hitachi (GEH) PRISM advanced nuclear reactor. (PDF slide deck)
  • Team members plan to seek DOE funding as part of a public / private partnership. If the team receives an award of the federal funding, it would be focused on the technical preparation of an NRC application.
  • The effort is being led by High Bridge Energy Development Co. with participation by GE Hitachi Nuclear Energy (GEH), Exelon Generation, and AEDCOM subsidiary URS Nuclear LLC
  • This is the second teaming arrangement by GEH for the PRISM reactor.  In November 2016 GEH and Southern Nuclear agreed to work jointly on the development and licensing of the sodium-cooled fast reactor.

PRISM is a sodium-cooled, high-energy neutron (fast) reactor design.  The PRISM design has benefited from the operating experience of EBR-II, an integral fast reactor prototype, which was developed by Argonne National Laboratory, and operated for more than 30 years at the Idaho National Laboratory near Idaho Falls, Idaho. (PDF Technical Brief)

“We believe that no U.S. fast spectrum reactor technology has more testing, design or operational basis than PRISM. PRISM is well positioned to provide a regulatory path for licensing and deployment of advanced reactor technology in the U.S,” said Steve Maehr, CEO of High Bridge Energy Development Company. (PDF Press Release)

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On the webLicensing the Integral Fast Reactor / ANS Nuclear Café  11/02/2011

“What we know now is that there are no technical gaps that would preclude a licensing application if using known technology. Gaps might arise if a developer chooses to use a new fuel which would need testing. That process could be completed faster if simulation and modeling tools could be brought to bear on the problem.”  – John Sackett

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Timeframe for Licensing Process & CNSC Effort

The press statement by GEH and High Bridge did not specify a time frame for submitting a license application to the NRC.  A spokesman for High Bridge told this blog in an email that licensing discussions have not yet started with the NRC.

Without having details on the schedule to seek a license, one could assume that even if the partnership has all of the technical data it needs, the effort could still take a year or longer to put it into an electronic format that could be accepted by the agency.  If the data is incomplete, that timeline would be difficult to estimate. The NRC’s review cycle would likely be longer than the 42 months usually set for LWR type reactors.

Separately, on March 13, 2017, GEH and ARC Nuclear announced they will jointly develop and license an advanced small modular reactor (aSMR) based on their sodium-cooled reactor technologies.

GEH and ARC Nuclear plan to enter the Canadian Nuclear Safety Commission’s Vendor Design Review process, the companies said in a joint statement.

“This collaborative commercialization program also includes the near-term goals of confirming projected construction and operating costs, as well as the identification of a lead-plant owner/operator for the joint aSMR,” the companies said.

GEH and ARC Nuclear have been  developing separate advanced reactor designs based on the EBR-II, an integral sodium-cooled fast reactor prototype.

The ARC-100 is a 100 MWe aSMR designed for efficient and flexible electricity generation and can operate for up to 20 years without refueling. GEH’s PRISM reactor is a 300 MW+ reactor designed to refuel every 12 to 24 months and has primarily been focused on closing the fuel cycle by, among other things, consuming transuranics.

PRISM Technology Profile

In its report on the GEH partnership with Southern Nuclear, World Nuclear News noted that Prism is a sodium-cooled fast neutron reactor design built on more than 30 years of development work. It benefitedng from the operating experience of the EBR-II prototype integral fast reactor which operated at the USA’s Idaho National Laboratory – formerly Argonne National Laboratory – from 1963 to 1994. According to GEH, the history, testing, design and operational experience underlying Prism makes the design well positioned to continue the licensing process. (Power MagHistory of the PRISM Concept)

PRISM Conceptual Image

Each Prism reactor has a rated thermal power of 840 MW and an electrical output of 311 MW. Two Prism reactors make up a power block, producing a combined total of 622 MW of electrical output.

Using passive safety, digital instrumentation and control, and modular fabrication techniques to expedite plant construction, the design uses metallic fuel, such as an alloy of zirconium, uranium, and plutonium. It can therefore be used to close the nuclear fuel cycle, recycling used nuclear fuel to generate energy.

According to GEH, commercialized Prism technology could be used eventually to consume all the nuclear material contained in the world’s used nuclear fuel. Assuming 178,000 tonnes of nuclear material are contained in worldwide stocks of nuclear fuel and a per household consumption of 3400 kWh per year, the company claims this could provide enough energy to power the world’s households for up to 200 years.

Reducing the UK Plutonium Stockpile

GEH has proposed the Prism reactor as a possible option for managing the UK’s plutonium stockpile. In 2013 The Engineer, a UK publication, provided its readers with a detailed walkthrough of the PRISM proposal to the Nuclear Decomissioning Authority (NDA).

The UK has a lot of plutonium — the largest civil stockpile in the world, totaling some 112 tonnes, most of it from reprocessing spent fuel over the years. The question of what to do with Britain’s plutonium has vexed subsequent governments for decades.

GE offered PRISM technology to the UK because it believes it offers a better way of treating the plutonium than converting it into MOX. Britain’s plutonium stockpile is complicated as not every storage canister contains the same isotope of plutonium.

Different reactor processes produce different isotopes; and this poses problems for converting the fuel into MOX, because isotopes have to be selected carefully.

The article goes on to describe the fuel fabrication process as proposed by GEH. According to an interview with Eric Loewen, Chief Consulting Engineer for the PRISM reactor project, the plutonium oxide would be mixed with uranium oxide, then reduced to a metal by electrolysis. This is made into an alloy with zirconium, then cast into slugs that would be stacked in a stainless steel case to form a fuel pin.

Readers are referred to the cited URL above for a longer explanation of the process.

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Nuclear Technology Innovation Panel Lights Up NEI Conference

Advanced Reactor Pioneers at NEA Sound Bright Notes

  • Holtec CEO: Future of industry depends on “relentless innovation”
  • TerraPower: China and Russia are not standing still and neither should we

nea assembly(NEI) A measure of the momentum that is building in new and innovative nuclear energy technologies is the fact that panelists from the world of advanced reactor designs were seen this year at both NEI’s Nuclear Energy Assembly (NEA) and at the preceding day’s conference of the North American Young Generation in Nuclear (NAYGN).

The panel observed that young people will continue to bring fresh perspectives to help lead that future. The NAYGN panel pointed to how a new generation of engineers, entrepreneurs and practitioners is defining the future of the nuclear industry.

“It is up to us young people to make sure that nuclear energy makes up as big a piece of a non-fossil energy future as possible,” said Jacob DeWitte, founder and chief executive officer of small reactor design company Oklo Inc.

“As you prepare yourselves for the future, get involved politically too. That’s where a lot of decisions are made about incentives and policies that affect our industry,” said Jeff Harper, X-energy LLC’s vice president of strategy and business development.

Dave Schumacher, director of the upcoming movie “The New Fire,” (You Tube Trailer) added,

“As young people, you didn’t grow up with Cold War stigmas about nuclear energy. Start fresh with your conceptions, get conversations started—you’re the vanguard of new energy.”

The movie will premiere in September, with wider distribution to follow shortly after.

Bookending the NAYGN panel, NEA’s last day featured another group of speakers who spoke about the global demand for nuclear innovation.

The youthfulness of the audience at NEA impressed Kris Singh, founder, president and chief executive officer of Holtec International. “It’s wonderful that young people are coming to this conference—that means there is a future for nuclear energy,” he said.

Singh mentioned the SMR-160 small modular reactor his company is developing, for which it will be submitting a license application at the end of next year.

“We hope to sell a bunch of them to countries that need them,” including Saudi Arabia, he said, which is looking for electricity generation sources to replace the oil it is now burning at a rate of 30 percent of its annual production.

“At the rate their electricity demand is increasing, Saudi Arabia will be a net importer of oil by 2035,” he noted.

“China and Russia are not standing still in bringing innovative reactor technologies into operation. And neither should we,” TerraPower LLC Chief Executive Officer Lee McIntire noted.

“That said, I notice a big difference in attitude at this year’s NEA, compared to previous years—you guys are feisty! I sense you’re ready to go out and do something …”

NRC begins technical review of TVA application

(News Courier) The Nuclear Regulatory Commission’s technical review of the Tennessee Valley Authority’s small modular reactor (SMR) early site permit (ESP) application is underway.  Several steps remain before TVA would commit to constructing SMRs and placing them at the Clinch River site. SMRs, which are between 50-300 MW, are a next-generation nuclear technology.

SMRs are being developed using conventional light water reactor technologies (LWR) and some entrepreneurs are working on fast reactors. TVA has not committed to a specific design as part of its ESP application, but if it does move forward to apply for a COL to build one, the odds favor an LWR option.

The technology could offer TVA more flexibility while offering low-cost clean energy to residents, said Dan Stout, TVA senior manager for small modular reactors.

Development of the ESP application was made possible through the continuing support of the Department of Energy’s SMR Licensing Technical Support program, which has provided cost-shared financial assistance through an interagency agreement.

According to TVA, there are several evaluations and business decisions that remain before the utility would commit to building SMRs at the Clinch River Site; a decision that is still  years away.

Previously, TVA partnered with BWXT to design and license that firm’s 180 MW mPower SMR. The effort ended in 2014.  BWXT tried to revive the effort in a partnership with Bechtel, but it also ended due to the lack of a customer.

TVA has not been bullish on new nuclear reactors and its Integrated Resource Management Plan does not contain any plans for new reactors for the next 20 years.

At best it appears TVA is seeking an ESP to keep its options open without having to commit to any specific design or timetable.

CNL invites input on SMR technology

(WNN) Canadian Nuclear Laboratories (CNL) launched a request for expressions of interest in small modular reactors (SMRs). The nuclear science and technology organization aims to demonstrate the commercial viability of SMR technology by 2026.

CNL has now launched a request for expressions of interest in SMRs. It is seeking input from SMR technology developers, potential end-users, and any other interested parties and stakeholders, including potential host communities, unions, the nuclear supply chain, and research and academic institutions. The request is open until July 31st.

The organization said, “This request for expressions of interest aims to build an understanding of the existing capabilities, technology gaps, needs and requirements both from technology developers and other stakeholders, and overall market interest, so that CNL can position itself as a key partner to the development and deployment of SMRs.”

CNL said it aims to demonstrate the commercial viability of SMR technology by 2026 “with a view to positioning Canada to take a leadership role in this emerging nuclear technology [and] with CNL recognized globally as a leader in SMR prototype testing and science and technology support”.

According to its strategy document, CNL’s long-term vision is to be a recognized hub for SMRs, where multiple vendor-supported prototypes are built and tested.

Kathryn McCarthy, CNL vice president of R&D, said: “We intend to begin the generic site selection and licensing process for the first demonstration or prototype reactor later this year. At this preliminary stage, these activities will be technology neutral, and inclusive of all potential technologies. We need to hear from the broader SMR development community, to ensure that their needs are being captured.”

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