Nuclear suppliers must optimise resources amid limited markets

Nuclear industry suppliers in Europe and US must improve the management of their resources between projects as they respond to increased domestic competition in the Chinese market, Colin Elcoate, Vice President of Market and Business Development at SPX Flow Power and Energy, said.

By Peter Taberner

Original Equipment Manufacturers must be able to efficiently shift skilled labor and equipment between projects in the limited number of growth markets in the West, such as UK’s new build program, Elcoate said.

The UK nuclear industry has plans to construct around 16GW of new nuclear power stations in the UK by 2030, equating to an investment of around £60bn, according to the UK government.

It is estimated that 5,000 Small and Medium sized firms will need to be trained and competitive to feed the supply chain gap.

“Following the events at Fukushima new build projects in the West are still slow in coming to fruition,” Elcoate said.

“This is coupled with a declining original equipment business stream for some Western manufacturers in Asia (China in particular) where nuclear programs remain strong but increasing competition driven by national localisation policies and programs continues to increase,” he said.

 “The management of employee demographics is required to ensure people skills, knowledge, experience, capability and capacity are balanced and maintained between projects,” Elcoate said.

Retaining talent

Retention and recruitment of people with nuclear expertise must be a priority, with clear succession planning to ensure knowledge is passed on to following generations,” Elcoate said.

To account for expertise retiring, SPX uses apprenticeship and graduate training schemes to secure nuclear expertise for existing and future projects.

To achieve a wider pool of talent for the UK nuclear sector, the Nuclear Advanced Manufacturing Research Centre (NAMRC), has developed the Fit for Nuclear Program.

The aim of the scheme is to find the potential companies, and equip them to contribute to nuclear energy.

Support for Fit for Nuclear has arrived from nuclear industry companies, such as Areva and EDF Energy, and has received backing from the Manufacturing Advisory Service (MAS), plus the government backed Business Growth Service, of which the MAS is now a part.

Earlier this year, on behalf of the NAMRC, MAS hosted a free breakfast seminar in the UK city of Derby.

 “The meeting in Derby was really an information session, to companies that have the ambition to work in the nuclear industry. We want them to see what the benefits of the Fit for Nuclear program are,” Stuart Harrison, Business Development Director at NAMRC said.

“Fit for Nuclear will enable companies to assess themselves to what is needed to be a supplier for the industry, and if there are gaps between what is required, and what they can produce, then we can support them to close those gaps, and provide the necessary leadership for this to happen.”

Fit For Nuclear Journey

Tracing quality

Quality issues are an area that SMEs who wish to enter into the industry will have to address ahead of the construction of new plants.

Firms will have to meet the Nuclear Delta requirements, which define the special qualities required by firms operating in the nuclear industry.

Prospective SMEs for nuclear will have to produce material traceability.

Every single nut and bolt must be traceable and the origin of the supply line has to be visible throughout the full manufacturing process.

SMEs that have a longer track record in the nuclear sector will be able to become niche or bespoke providers, according to Harrison.

But those suppliers that are looking to build their reputation and deal activity in the nuclear sector are likely to partner with other SMEs to pool skills and capabilities to compete more effectively with more established suppliers.

“We are confident that the companies are out there to excel in this industry, and that there are enough SMEs out there. So far though not all the contracts have been put out to tender at Hinkley Point C to test that theory out at this point, only the ground works and site preparation contracts have been made public.”

French state-controlled nuclear firm EDF is developing the Hinkley Point C project which proposes to build two 1.65 GW EPR reactors at an existing nuclear site.

Hinkley Point C is the most-advanced UK new build project and Chinese state firms have agreed in principle to become shareholders, although financial closure is yet to be reached.

Domestic opportunities

Governments and utilities must provide certainty that a fleet of reactors will be built for suppliers to commit resources to local industry and manufacturing, even for global operators such as SPX, Elcoate said.

“This is even true in the United Kingdom where there are currently plans for 11 new reactors, but as the projects will only be released one at a time, there is still no real certainty for suppliers to plan the necessary investment in supporting infrastructure for the diverse reactor technologies being considered,” he said.

Companies already on the ground are seeing the value in the Fit for Nuclear Program.

For example, Brafe Engineering, a Suffolk-based company on the east of England, specialising in alloy castings for valves and pumps, has had knowledge- based support from the scheme.

Brafe is looking for opportunities in the nuclear industry now that it has been introduced to Fit for Nuclear, the company said.

Brafe has been manufacturing and exporting goods to ASME nuclear standards for many years, but that was to an overseas market, now they hope that a fresh and vibrant domestic market will be created.

Involvement with MAS has allowed Brafe to be introduced to the National Physical Laboratory product verification program.

The company then developed an action plan which focused on a number of key improvement areas, including CMM calibration arrangements, temperature controls within a physical measurement context, and a system to demonstrate this capability to customers and third parties.

Upgrading skills

A formal training program for all of its inspectors and production operatives was also devised, in a skills upgrading process.

Another company who are looking to gain full access into the Fit for Nuclear Program is CE Turner Engineering, based in Leicestershire.

They have a background participating in the plant maintenance, machine tools, and specialist machine sectors.

Trevor Kettle, sales director of the company, said CE Turner Engineering has provided an action plan and Kettle hopes this will allow the firm to gain full accreditation from the NAMRC in May.

“The next step for us is to review which nuclear opportunities are there for us to undertake, and to identify that as a case study,” Kettle said.

“We think that there are opportunities for us within the decommissioning process,” he added.

“In particular precision components that are produced at low volumes, our strategy will be to integrate what have done with other clients such as Subsea, into nuclear energy. We are also confident that we can seize other opportunities with metal fabrications,” Kettle said.

Capital will be invested to upgrade their employees’ skills set in order to compete for nuclear contracts, for example in areas such as health and safety.

Decommissioning boom

While the UK’s target of 16 GW of nuclear power by 2030 should provide plenty of opportunities for nuclear companies, potentially more lucrative is the global decommissioning market.

The global decommissioning market is estimated to be worth £50bn ($77.3 billion) per annum by 2020, with between 82 and 145 reactors retired by 2030, according to HM Government Report, Nuclear Industrial Strategy -The UK’s Nuclear Future.

Most of these planned plant retirements are in Europe.

Elcoate says that being a recognised, experienced supplier to the nuclear industry is rewarding but requires a long term commitment.

“Further progress in the standardisation of codes and regulations, the use of common reactor designs, and clear national strategies (i.e., France, China) for the development of nuclear power would help to make the supply chain more robust and secure,” Elcoate said.

“Advances in these areas would further help to lower project costs, reduce timescales and lower project risks,” he said.