- China General Nuclear to build two reactors in Romania
- Chinese government expresses interest in supporting a bid for new tender at Temelin
According to wire service reports China General Nuclear (CGN) will partner with Romania’s state-owned nuclear utility to build two new reactors at its Cernavoda site. The deal is the latest to be proposed for the project. A previous effort to finance the $8 billion effort in 2013 collapsed under the weight of the economic downturn in Europe.
There’s a possibility that CGN will engage SNC Lavalin of Canada to be the vendor to provide two 700 MW CANDU-6 reactors for the project. Romania already has two 700 MW CANDU units at the Cernavoda site. Construction is likely to take six years for the first unit to come online.
The Romanian government will have to provide rate guarantees for the project to insure that its investors will recover the enormous sums needed to build the plants. This action will likely set off a new round of protests within the European Union with anti-nuclear Austria being the most strident voice against the project.
CGN is also a partner in the investor pool for the new build at Hinkley point in the UK which is being led by France’s EDF. That project is expected to complete two 1650 MW Areva EPR reactors. Hinkley Point, which is expected to cost more than $24 billion to complete, passed a review by the European Union for rate guarantees for the project.
The rate guarantees, which can peg the price of electricity above market rates, are seen as a form of subsidy for nuclear energy. Similar rate guarantees have been offered for solar, wind, and tidal energy projects in the UK. For the UK, with North Sea fossil resources nearing their end, and having to replace an aging fleet of reactors, the new nuclear build needs these price supports to attract investors for the massive efforts and to prevent power shortage in future years.
The on-again-off-again effort to build new reactors at a cost of $15 billion at the Czech Republic’s Temelin site got new life with an announcement of a new government energy strategy. Significantly, what gave new impetus to the project was the European Union’s decision on rate guarantees for the UK’s Hinkley Point project.
Until now the Czech government, which nominally supports nuclear power, was not inclined to offer rate guarantees for units at Temelin. The result is that progress on a tender for new reactors stalled out. Now it has reopened consideration of that issue. In addition to the EU decision in Hinkley Point, Czech government officials also point to rate guarantees for solar and wind projects as a justification for authorizing them for nuclear projects.
Renewed interest in the tender brought forth interest from Chinese, South Korean, and American firms.
Chinese Deputy Prime Minister Zhang Gaoli said that nuclear firms from his country would like to participate, but he didn’t say what form that participation would take or which firms would submit offers.
Chinese nuclear firms have been developing a reactor design for export. In September the Chinese nuclear regulatory authority approved a preliminary safety analysis of the CAP1400, which is a 1400 MW version of the Westinghouse 1150 MW AP1000. Chinese firms might also seek roles as equity investors in the project.
The South Korean government also said it was interested in being a vendor for the project offering its 1400 MW reactors. The strength of the South Korean bid would be market acceptance since four of their new units are under construction in the United Arab Emirates.
In addition to offering its 1150 MW AP1000 reactors, Westinghouse also sweetened the pot with a proposal to provide financing for new reactors at Temelin. The deal would follow the model Westinghouse is using to finance reactors in the UK and in Bulgaria,
Westinghouse will build three reactors in the UK at the NuGen nuclear project in Cumbria. It will take a reported 60% equity stake in the project. The reactors at the Cumbria site will have a generating capacity of 3.4 GWe and the first unit is expected to be operational by 2024. In Bulgaria Westinghouse has proposed to take a 30% equity stake in new reactor construction at the Kozloduy site.
Areva and Roastom have been eliminated from further consideration for bids for new reactors at Temelin. Significantly, Roastom offered to finance 100% of the project. However, due to mostly to political considerations, Czech officials don’t want to have Russia build and operate its reactors. Areva, which recently avoided a “junk” rating of its stock by S&P, is no longer in a position to offer financing for new reactor projects.
Demand for electricity in Europe is growing including from customers in Germany and the Ukraine. Germany shut down half of its reactor fleet a few years ago. The Ukraine, which depends on Russia gas to generate electricity, is vulnerable to shut off of supply over political differences. Both Germany and the Ukraine are cited by Czech state-owned power firm CEZ as likely customers for new nuclear powered electricity generation from Temelin.
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