Infographics: US decommissioning market takes off as closures mount

Following a flurry of closure announcements, the nuclear decommissioning market is being shaped by new business models and joint ventures. We illustrate the growing activity in this sector through a series of infographics.

The Indian Point 2&3 reactors in New York are among 13 U.S. reactors set to come offline in 2018-2025. (Image credit: Wikimedia Commons)

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The U.S. nuclear decommissioning market is set to grow rapidly in the coming years as operators accelerate closure plans in the face of wholesale price pressures.

Exelon's Oyster creek plant retired last month, the first of 13 reactors set to close by 2025.

A handful of plants have been supported by support mechanisms introduced in the states of Illinois, New York, and New Jersey, but absent of new support measures further closures could be on the way.

The U.S. operates 98 commercial reactors and more than a quarter of these do not earn enough revenue to cover operating costs, according to a report published by Bloomberg New Energy Finance (BNEF) in May.

Announced nuclear plant closures (2018-2025)

                                (Click image to enlarge)

Source: US Energy Information Administration (EIA), September 2018.

Some operators are choosing to perform immediate decommissioning activities upon closure under the DECON process. Deferred decommissioning under the alternative SAFSTOR process allows operators to build up decommissioning trust funds (DTFs), but it also increases long-term project risks.

A growing demand for decontamination and dismantling services has spawned new decommissioning joint ventures and business models. Specialist decommissioning groups are acquiring post shutdown operating licenses as part of more comprehensive decommissioning packages which aim to reduce project timelines and cut costs.

In July, Holtec and Canada's SNC-Lavalin, created Comprehensive Decommissioning International (CDI), aiming to become the leading decommissioning contractor in the U.S. nuclear industry.

By early August, Holtec had signed agreements to purchase upon closure Entergy's 688 MW Pilgrim plant in Massachusetts, its 811 MW Palisades plant in Michigan, and Exelon’s 636 MW Oyster Creek plant in New Jersey. In addition, Holtec would take control of Entergy's decommissioned Big Rock Point Nuclear Power Plant site which hosts an Independent Spent Fuel Storage Installation (ISFSI).

Holtec predicts the U.S. decommissioning market could be valued at around $14 billion in 2018-2028.

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Last year, Orano (formerly Areva) and U.S. demolition specialists Northstar created a joint company, Accelerated Decommissioning Partners (ADP), to provide a "one-stop" final decommissioning solution for the original operator, introducing technological, regulatory and financial efficiencies.

The latest technologies and optimized strategies could see the dismantling and decontamination (D&D) of U.S. nuclear plants completed within five years of shutdown, Sam Shakir, Chief Executive Officer of Areva Nuclear Materials (ANM), told Nuclear Energy Insider in September 2017.

In another merger of expertise, decommissioning specialist EnergySolutions formed a joint company with engineering group AECOM in 2016 to win the decommissioning contract for Southern California Edison’s (SCE’s) 2.2 GW SONGS nuclear power plant.

EnergySolutions was the first non-utility company to acquire a post-shutdown 10CFR50 plant operating license in the U.S and currently operates 50% of ongoing nuclear decommissioning sites, at Zion 1&2 and LaCrosse.

AECOM has experience in the removal of contaminated components, systems and demolition of non-safety related structures and the collaboration with EnergySolutions underlined the trend towards more comprehensive decommissioning solutions supported by higher capital entities.

The below table shows the early movers in the U.S. decommissioning sector and some of the potential opportunities ahead, focusing on the ongoing DECON projects and the reactors set to come off-line in the coming years. A key driver of sector activity will be whether operators choose to enter into immediate decommissioning activities under the DECON process, or opt for the long-term plant storage option under SAFSTOR.

                          US decommissioning market snapshot

                                                       (Click image to enlarge)

Table focuses on the ongoing DECON projects and the reactors set to come offline in the coming years. 

Source: Nuclear Energy Insider. Data source: company announcements. 


Before the recent flurry of closure announcements, a number of reactors were already shut down and at various stages of the decommissioning process.

The below map shows that until recently, operators generally favored the deferred SAFSTOR decommissioning option rather than the DECON immediate decommissioning process.

                 Status of US decommissioning projects to date

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The below map shows that many of the plants either closed or announced for closure are located within fairly close proximity, which could present synergies in terms of decommissioning logistics and resource sharing.

   US nuclear plants that have closed or announced closure

                                          (Click image to enlarge)

Source: EIA, September 2018.

Benefits of large decommissioning portfolios include lower equipment and training costs and more efficient labor deployment. Key challenges include staff and equipment availability, differences between local regulations, and project management with a wide range of partners.

In Germany, GNS and Westinghouse's Zerkon consortium recently won the contract to dismantle the reactor pressure vessel (RPV) internals of six PreussenElektra reactors. Westinghouse has segmentation contracts in place at 13 power reactors in Europe and is currently performing dismantling activities at four different sites.

The first PreussenElektra plant to be dismantled is the 1.4 GW nuclear Unterweser nuclear power plant (KKU) in north-west Germany and the Zerkon partners will apply learnings from the KKU project to optimize tooling and decommissioning techniques at the other five reactors when they come off-line in the coming years, Zerkon partners told Nuclear Energy Insider earlier this year. Westinghouse will dismantle up to two plants in parallel, to maximize efficiency while conforming with schedule requirements of the operator.

“The activities of the whole program are planned in a staggered manner so that optimum program efficiency can be gained,” Joseph Boucau, Director, Global D&D and Waste Management Business Development, said.

Nuclear Energy Insider