A quick look at what to expect in 2010
Every year at this time your faithful correspondent swings for the fences with fearless prognostications of what will happen in the field of nuclear energy in the next 12 months. These are big hairy audacious guesses and should not be confused with sober reality or nor should anything in this column be used to make investment grade decisions. You’ll get better odds flipping a coin to see who buys lunch. That said, here we go.
. . . It will be fish or cut bait time for Sec. of Energy Steven Chu and the Obama Administration to award loan guarantees to at least two or more new nuclear reactor projects. Sec. Chu began his term with a reference to the great Wayne Gretzky’s comment about “skating to where the puck will be.” With Congress getting impatient about delays in awarding the loan guarantees, the game plan is to get the decision out of OMB’s hands and into the business end of the ice rink. The result will be that while you are out drinking eggnog this holiday season, Chu may quietly get the first one out the door, possibly to Southern’s Vogtle site.
. . . USEC will not get a loan guarantee for its American Centrifuge uranium enrichment plant. The firm still has to prove its technology works and fix its finances. It’s in a classic bind and the government’s due diligence says there is no way out unless you look at it as a rescue mission rather than an insurance policy. Areva gets the nod by two lengths and go on in 2011 to get its NRC license and break ground in Idaho.
. . . India’s nuclear renaissance will finally open its doors to deals with American firms, but they will be based on substantial commitments to manufacture nuclear reactor components there. This development over time will turn India into a low cost center supplier to the global nuclear industry. However, NPCIL will not give up its monopoly on who has the right to own and operate nuclear reactors. It will insure that achieving a goal of 20-30 GWe in new electricity supply will take longer than the careers of the current generation of leadership.
. . . Areva will dig itself out the cost and schedule hole at its in at Olkiuoto3 site in Finland making peace with state regulators, its partners, and suppliers. The drive to complete the first-of-a-kind 1,650 MW EPR reactor will produce important lessons learned for the firm’s project in Flammanville, France. It will improve its prospects of breaking ground at Calvert Cliffs III in Maryland in 2012. Failure to finish the Finnish reactor could put many other new nuclear builds at risk with perceptions that no one knows how to bring in one of these deals on time and within budget.
. . . After provincial elections in 2010 in Germany, Chancellor Andrea Merkel will make peace with the owners of 17 nuclear reactors over tax issues. She will also admit the obvious which is the country’s need for baseload electricity won’t come from renewables. Germany will eventually decide to build new nukes rather than be held hostage to the vagaries of the Russian gas combine.
. . . Vermont Yankee will get its license approved by the NRC regardless of what the State of Vermont legislature thinks about its say in the matter. Entergy will offer state utilities a rate package that undercuts other sources of fossil fuel generated electricity in New England by as much as $0.06-0.09/KwHr. Green groups, heedless of the impact of their opposition to nuclear energy on ratepayers, will mount noisy protests, but the utilities will sign the deals.
. . . The United Arab Emirates will award the first of as many as five new nuclear reactor projects worth upwards of $40 billion. Two cents says it will split the award with the reactors going to Areva/EDF and the construction tasks going to a consortium from South Korea. American expatriate EPC firms will not prosper in this environment, but the UAE may source some of its supply chain from U.S. based manufacturers.
. . . Eskom’s financial collapse in South Africa will not respond to conflicted government attempts to revive its new nuclear build tender for at least two new 1,000 MW nuclear power stations. The Pebble Bed reactor project will find a home at the Idaho National Laboratory merging its with R&D work on the high temperature gas cooled reactor work scope for the “Next Generation Nuclear Plant (NGNP).
. . . AEHI, which still has its stock in the under a dollar price range, will not file a license application with the NRC for a nuclear reactor anywhere in Idaho.
. . . Luminant will ponder selling off its Comanche Peak reactor as well as its planned new build there with a giant 1,700 MW Mitsubishi reactor. However, the prospect of having an enormous cash cow for the next six decades will be too good to let go of, and its parent firm will find other ways to resolve its financial future.
. . . Congress will pass legislation funding NRC reviews of small reactors opening the way for several new markets for American grown nuclear reactor technologies and the high paying jobs that come with them.
. . . TVA will decide this April to do nothing at Bellefonte finding no good way to build a new AP1000 with its current debt ceiling and no economic justification to try to restart construction of two mothballed and gutted reactor projects from the 1980s. At some point Tennessee Sen. Lamar Alexander will stop making speeches about 100 new reactors and get focused on getting at least two built in his home state.
. . . TVA will reclaim its mantle as a center of innovation in the field of nuclear energy by being the first customer for small reactor, as a replacement for a coal-fired boiler, and by testing MOX fuel in one of its operating nuclear plants.
. . . The new nuclear build in the U.K.will survive a change in governments because North Sea gas is running out and new coal plants are not an option. Blackouts are not an option as older nuclear plants are taken out of service.
. . . China will unveil two indigenous nuclear reactor designs based on the Westinghouse AP1000. However, these units will come in 1,400 and 1,700 MW profiles making China the most committed nation on the planet to cutting the growth of greenhouse gases with nuclear energy.
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7 comments:
Dan-
I was pretty good with your predictions until that last one. China is a decade away from rolling out their own reactor designs. Yes, it is only a question of "when" not "if" but they have along way to go.
Dan, I disagree with you about the NPCIL is talking to a number of potential local ownership partners, initially with minority stakes in Indian reactors, but there is a clear interest in concerns like the Oil Company of India eventually owning reactors outright. As for TVA, I think that TVA will eventually complete at least one incomplete Bellefonte reactor.The reason I say this is that the spot market coal for china is now going back up and Indian coal imports are are up 28% this year. Both the Chinese and Indians have dollars to trade for coal and will eventually drive TVA's coal prices up to the point where completing al least one of the Bellefonte reactors will look good for TVA.
I like the prediction about the small reactor order at TVA.
Good optimistic list, thanks Dan.
On Chinese AP1000 derivatives.
From WNN
Reactor derivatives for China
18 December 2009
Demonstration of a Chinese AP1000 derivative moved a step closer with a joint venture project company. Construction of the first CAP1400 is scheduled for April 2013....
Might be optimistic, but they seem to be doing what they plan.
Concerning the mPower reactor for TVA, the design has not even started design certification with the NRC and the NRC has also already stated that it will take extra long to review it because it is so different from the other reactors. They are at least 5 years away from someone even considering the reactor. Also, the TVA involvement is current just to allow he reference design to be considered for the clinch river breeder reactor site, there is no real commitment. In general small reactors make absolutely no sense economically, so I doubt that mPower will go all that far. Completion of BLN1 is more or less a done deal though.
Dan, remember talking about an "AP1700" about 3 years ago with you. Seems finally from napkin to plans are in the works, even if the diminutive 'C' (for CHINA) is stamped on front.
David
UAE award goes to South Korea.
http://www.ft.com/cms/s/0/5b5bb014-f351-11de-a888-00144feab49a.html
Bit of a shocker - As you say, other firms and countries may pick up supply chain work.
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