Trump orders ‘immediate’ action to keep reactors online; UK stake in Hitachi plant now on table

Our pick of the latest nuclear power news you need to know.

The Trump administration may invoke an old defense law to provide support to nuclear and coal-fired plants. (Image credit: JTSorrell).

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President Trump calls for "immediate" measures to stop nuclear, coal closures

President Trump has directed energy secretary Rick Perry to prepare "immediate" steps to stop the closure of nuclear and coal-fired power plants, the White House said in a statement June 1.

The statement followed the leaking to Bloomberg of a government memo which recommends the energy department uses powers under the 1950 Defense Production Act “to temporarily delay retirements of fuel-secure electric generation resources.”

Under the proposal, grid operators would be required to buy power from designated nuclear and coal plants for a period of two years.

Nuclear and coal plant operators have faced sustained pressure from low wholesale electricity prices, driven by low gas prices and rising renewable energy capacity.

More than a quarter of U.S. nuclear power plants do not earn enough revenue to cover operating costs, according to a report published by Bloomberg New Energy Finance (BNEF) on May 15.

The at-risk nuclear sites represent a total generation capacity of 32.5 GW, BNEF analysts Nicholas Steckler and Chris Gadomski, said in their report. The total revenue gap for these projects is estimated at around $1.3 billion per year, the analysts said. Nuclear operators have already announced plans to close 11 GW of nuclear power capacity by 2025, according to the U.S. Energy Information Administration (EIA).

    Forecast margins for US nuclear plants
                              (Click image to enlarge)

Source: BNEF, May 2018.

The U.S. state of New Jersey recently passed bills which provide nuclear power generators with price support and sets a target of 50% renewable energy by 2030. New Jersey's nuclear subsidies follow on from similar support mechanisms introduced in the states of New York and Illinois.

Trump's government has already tried to implement support measures for nuclear and coal-fired plants.

Proposals submitted by Secretary Perry in September 2017 would have required market operators to implement rules to allow the "full recovery of costs" of plants which provide grid reliability services and have a 90-day fuel supply on site, effectively directing the support at nuclear and coal-fired generation.

The U.S. Federal Energy Regulatory Commission (FERC) rejected the proposals, saying they failed to demonstrate that existing electricity tariffs were "unjust and unreasonable."

UK government considering direct stake in new Hitachi nuclear plant

The UK government is to consider taking a direct stake in Hitachi's planned 2.7 GW Wylfa Newydd nuclear power plant in Anglesey, Wales, energy secretary Greg Clark told Parliament June 4.

The government will consider "direct investment alongside Hitachi and Japanese government agencies," Clark said.

A government stake in the Wylfa Newydd plant would go against 40 years of privatization of energy sector assets, begun by Margaret Thatcher's government.

The Wylfa plant project consists of two ABWR boiling water reactors and is being developed by Horizon, a subsidiary of Hitachi. The plant could be completed by the mid-2020s, according to the developer.

The government has been under pressure to reduce the cost of new nuclear power plants after it guaranteed a power price for EDF's 3.2 GW Hinkley point C EPR project at 92.50 pounds per MWh (108.4 euros/MWh, $126.8/MWh), considered by many to be uncompetitive given falling renewable energy costs. Cost of capital is one reason for the high power price. EDF and its Chinese partners are bearing all construction risks for Hinkley point C, which is expected to cost around 20 billion pounds to build and is scheduled online from 2025.

In a recent report on nuclear sector productivity, the U.K.'s Nuclear Industry Council (NIC) said a 1% reduction in the cost of capital for a new nuclear project could lead to a 10% reduction in the guaranteed power price.

The government is reportedly targeting a power price of around 77.50 pounds/MWh for the Wylfa plant, the Financial Times reported.

                            Day-ahead power prices in UK, Ireland 
                                                           (Click image to enlarge)

Source: European Commission's quarterly electricity market report.

In the longer term, the government wants nuclear projects and other energy infrastructure to be financed by the private sector, Clark told Parliament.

To that end, the government will examine the viability of a regulated asset base model "as a sustainable funding model based on private finance for future projects beyond Wylfa,” Clark said.

Last November, a UK cross-party Parliamentary committee criticized the government's negotiation of the contract for the Hinkley point C nuclear plant.

The UK cross-party House of Commons Committee of Public Accounts said the government should have done more to minimize the costs of the Hinkley Point C project to UK taxpayers and ensure the benefits are felt across UK industry.

The government failed to sufficiently analyze alternative ways to finance the deal, including sharing the early stage project risk between the government and the developer rather than requiring the developer to bear all construction risks, the committee said.

The MPs also warned against future cost and schedule overruns and called on the government to publish a “Plan B” to achieve energy security and revise this plan on an annual basis.

The committee warned that the UK government has a poor track record on contract management and recommended the government ensures "on an ongoing basis" the construction partners have the skills, capacity and access rights to deliver the project effectively.

EDF Flamanville 3 project may be delayed by 'several months'

The start-up of EDF's Flamanville 3 EPR reactor could be delayed by "several months" due to pipe welding issues, the company announced May 31.

In April, EDF launched additional checks on 150 welds within the main secondary system of the 1.65 GW Flamanville-3 EPR plant project after finding "quality deviations" on the welding of pipes. EDF said it would produce a report on the causes and nature of the deviations by the end of May, in order to define corrective actions that will ensure regulatory approval.

"On the basis of the investigations carried out by EDF, discussions with the Autorite de Surete Nucleaire [safety regulator] will continue for several more weeks," EDF said May 31.

"The impact on the schedule and if necessary, on the cost of the Flamanville 3 project will be announced then," it said.

Flamanville 3 is the first EPR reactor to be built in France and is already several years behind schedule. The construction cost target is currently 10.5 billion euros ($12.2 billion).

EDF plans to close its two 900 MW reactors at Fessenheim when Flamanville 3 starts commercial operation, to comply with a national cap on nuclear power capacity.

Following the latest issues at Flamanville, EDF is preparing to operate the two Fessenheim reactors "until summer 2019," the company said.

US' Dominion Energy to help fund GE Hitachi SMR

U.S. utility Dominion Energy is to provide funding towards the development of GE Hitachi's new 300 MW small modular reactor (SMR), the companies said in a joint statement.

The BWRX-300 boiling water reactor is an evolution of GEH's 1.5 GW ESBWR model which was licensed by the U.S. Nuclear Regulatory Commission (NRC) in 2014.

The capital cost of the BWRX-300 is estimated to be up to 50% lower than other light water reactor SMRs while operations and maintenance (O&M) costs are predicted at $16/MWh, Eric Loewen, Chief Consulting Engineer at GE Hitachi Nuclear Energy, told the 2018 International SMR and Advanced Reactor conference in March.

The new compact BWRX-300 design has an estimated online capital cost of $2,250/kW for an nth of a kind plant, which is between 40% and 50% lower than PWR-based SMRs, Loewen said.

Design efficiencies in the BWRX-300 produce a total building volume that is between 50% and 90% lower than PWR-based designs, he said.

Dominion has agreed to provide seed funding to help commercialize the BWRX-300 technology and "has no plan at this time to build one at any of its commercial nuclear stations," the companies said in their latest statement.

“We believe that nuclear power has a vital role in ensuring a clean, reliable, and cost-effective supply of electricity to meet the needs of a growing economy,” Dan Stoddard, Chief Nuclear Officer-Dominion Energy, said.

“We also believe the innovations GE Hitachi is pursuing with the BWRX-300 Small Modular Reactor have the potential to make it a strong competitor in the marketplace. Our view is that a modest investment now to support further development of this technology is in the interest of both companies,” he said.

The BWRX-300 represents the 10th iteration of GE Hitachi's boiling water reactor design. The previous version, the ESBWR, introduced a simpler and safer design, using passive safety systems and fewer components.

In 2015, the NRC allocated DTE Energy the first-ever ESBWR-based combined construction and operating license for a potential plant at the Fermi nuclear complex in Michigan. Dominion Virginia Power also selected the ESBWR as its preferred technology for a potential third reactor at its North Anna facility. However, low wholesale prices continue to damage the economics of large-scale nuclear projects and the Fermi and North Anna projects have not advanced to the construction phase.

Fortum, EDF join forces on Nordic decommissioning

Finland's Fortum and Cyclife Sweden, part of EDF Group, are to jointly develop commercial nuclear decommissioning and waste management services, focusing on the Nordic market, the companies announced May 25.

Fortum and Cyclife Sweden aim to combine their experience in decommissioning and waste management to optimize costs and mitigate project risks, they said.

"Integrating Fortum's conventional dismantling technologies and methods into the nuclear industry creates cost-efficient solutions and the basis for an industrialized decommissioning platform," Anni Jaarinen, Head of Decommissioning and Waste in Fortum's Nuclear Services, said.

"Cyclife Sweden has full access to EDF group’s thirty years of decommissioning experience on its own fleet, and as such bring its large capabilities and skills on nuclear decommissioning and waste management through its local radioactive waste treatment facility," Mats Fridolfsson, Managing Director of Cyclife Sweden, said.

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