Commercial operation dates for Vogtle Units 3 & 4 in Georgia (1150 MW Westinghouse AP1000s) have been pushed back again this time to December 2019 and September 2020 respectively. The units are now over three years late
Completion of two Areva 1660 MW EPR reactors under construction in Taishan, China have been delayed at least six months the China Generation Nuclear (CGN) said in a statement this week.
Southern Company Announces New Delays at Vogtle
The effort to build the first two entirely new nuclear reactors in the U.S. is coming in later than anyone expected according to an announcement this week by Southern Company. CEO Thomas Fanning said in posting 4Q2016 and year end financial results that the firm was proceeding according to a cost plan approved by the Georgia Public Service Commission (PSC) in December 2016.
That plan calls for both reactors be be done by the end of 2020. Fanning reminded stockholders and Wall Street analysts that the firm has a fixed price contract with Westinghouse for the reactors. Southern also has an $8.3 billion loan guarantee from the federal government.
Unit 3 was previously scheduled to enter revenue service in mid-2019 and Unit 4 in mid-2020. The new delays add six months to the start date for Unit 3 and another three months for Unit 4. These delays are now skating close to the edge of the deadline set by the Georgia PSC. This high resolution photo (below) dated February 2017 shows the project has a long way to go.
For an analysis of why some of these cost increases and schedule delays occur, see a recent paper by the Third Way think tank titled, “Is Nuclear Too Innovative? by Josh Freed, Todd Allen, Ted Nordhaus, and Jessica Lovering. They have three key findings related to costs.
- The AP1000 represents a fairly straightforward evolution in light-water reactor design, not a radical departure.
- Standardization is important but is not a panacea.
- Most of the proximate causes of rising cost and construction delays associated with new nuclear builds in the United States are attributable to the thirty-year hiatus in US nuclear construction, not the novelty of the AP1000 design.
Toshiba finances add to doubts about the projects
Last month Toshiba, the parent company of Westinghouse, suffered a collapse of its finances as part of an announcement of an estimated, and unaudited, loss of $6.4 billion. The firm has until March 14th to complete a financial report. At that time it will be determined whether it is is a “going concern” or essentially bankrupt.
CB&I Costs and Losses Undervalued?
New uncertainties about the ability of Westinghouse to complete the reactors in the U.S. surfaced on February 17 with numerous reports in the Japanese news media that executives at Westinghouse pressured subordinates to understate losses related to nuclear plant construction.
Toshiba Chairman Shigenori Shiga, an ex-president of Westinghouse, and U.S. CEO Danny Roderick stepped down from their positions to take responsibility for the losses. According to these reports, Roderick and other executives pressured the employees over the asset value of CB&I.
The New York Times reported that Westinghouse executives have come under intense scrutiny because of the financial calamity and related flawed business decisions that led to it. The company said it was examining whether managers had acted inappropriately when they inked a deal to buy a company (CB&I) at the center of the problems.
The newspaper said that Toshiba’s auditors determined that Westinghouse had overpaid for CB&I. Delays and cost overruns at the Vogtle and V C Summer projects, they said, meant that the construction company, CB&I Stone & Webster, was saddled with potential liabilities for which Westinghouse had failed to account.
Separately, two AP1000s under construction at the V. C. Summer site in South Carolina are expected to start operations in 2020. All four AP1000s under construction in China. Sanmen and Haiyang are expected to start before the end of 2017.
China Slips Dates to Commission Areva EPRs at Taishan
The two EPR units under construction at the Taishan nuclear power station in China’s Guangdong Province have seen their schedules to complete all construction activities and formally commission the units slip by at least six months. The new dates arte the second half of 2017 and the first half of 2018. The two reactors at Taishan (below) are the first EPRs to be build in China.
China General Nuclear (CGN) said in a February 20th statement on the Hong Kong Stock Exchange that “engineering verification” was taking longer than expected, but did not provide details.
World Nuclear News reported on February 22nd that Taishan Unit 1 is in the commissioning phase and passed several important tests in 2016. It reportedly entered the hot functional test phase, with fuel loaded, in November last year.
NuGen Boss Acknowledges ‘Funding Gap’ For UK’s Moorside Nuclear Project
(NucNet) The NuGen project to build three Westinghouse AP1000 nuclear power reactors in Cumbria, northwest England, has a “significant funding gap,” the company’s CEO, Tom Samson, has told a House of Lords committee
The economic affairs committee in its report ‘The Price of Power: Reforming the Electricity Market’ said the Moorside project is “facing difficulties.”
NuGen has said the first of the three AP1000 reactors at Moorside is targeted to come online in the mid-2020s and the station will provide 7% of Britain’s electricity.
Earlier this month Toshiba Corporation of Japan said in a statement that it remained committed to the construction of Moorside, despite the company’s plans to scale down its overseas nuclear power business.
NuGen is a joint venture between Toshiba and France’s Engie. Toshiba had committed to a 60% equity stake in the project. Its reported losses have raised concerns about where the financing will come from since Toshiba is no longer in a position to provide that capital for the project.
The House of Lords report said: “There are ongoing concerns about the Hinkley Point deal and other planned new nuclear power stations. It is imperative that the government publishes it contingency plans for how it will make up the capacity due to be provided by these plants in the event one or more does not succeed or is delayed.”
Toshiba Ends Involvement for Twin ABWRs at South Texas Project
The Nikkei Asian Review reported February 20 that Toshiba is pulling out of its plan to complete two ABWR reactors at the South Texas Plant (STP) project (Units #3 & 4). The project was touted back in 2007 as the “first mover” in what was then described as a “nuclear renaissance” in the U.S. The reactors in Texas were to debut as early as 2016.
Delays on the STP project have brought enormous costs for Toshiba, including write-downs totaling $638 million logged in fiscal 2013 and fiscal 2014. Ground has not been broken on the units. Efforts by NRG, the utility that organized the project, to get investors for it collapsed on fears by local governments that they would be saddled with cost overruns.
The City of San Antonio, TX, pulled out when it realized the scope of the rate increases its municipal power agency would have to pass on to customers to pay for the original estimate of $7 billion for each reactor. Austin, TX, pulled out because it is still paying off bonds from the excessive costs of STP Unit 1 & 2.
NRG had long since suspended the bulk of work toward construction on the South Texas Project due to heightened nuclear safety regulations, and the company said it some time ago it would end further investment.
Tokyo Electric Power Co. Holdings (TEPCO) was initially to take part in the project, but later pulled out. Japanese export credits would have paid for the investment. The Fukushima crisis that destroyed six reactors in 2011 removed all prospects for TEPCO to support investment in Toshiba’s export efforts.
Toshiba also withdrew an application in July 2016 to renew the certification of its reactor design with the NRC, a necessary step toward construction. That step effectively ends the firm’s involvement in the U.S with that design.
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