Global Energy Intelligence: nuclear

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Westinghouse sale to Brookfield for US$4.6bn complete (US)

The sale of the bankrupt US nuclear technology company Westinghouse to the financial services firm Brookfield Business Partners has been completed as previously announced in January 2018. The transaction has become effective and enables Westinghouse to successfully emerge from Chapter 11 bankruptcy protection file submission, which was submitted in March 2017 by Westinghouse's former parent company Toshiba. Toshiba had been seeking a buyer for more than a year.

Westinghouse is in charge of all AP1000 nuclear projects worldwide, including four in the United States (two units at VC Summer in South Carolina and two at Vogtle, in Georgia), and four in China (two at Sanmen and two at Haiyang). Toshiba purchased Westinghouse in 2006 from British Nuclear Fuels (BNFL), expecting a significant growth of the global nuclear power generation and a 130 GW growth of the global nuclear capacity between 2006 and 2020. However, only a fourth of this figure was achieved between 2006 and 2017 (+28 GW), which means that Westinghouse's growth potential was not that high.

TEPCO targets 7 GW of renewable energy capacity in Japan and overseas

The Japanese utility Tokyo Electric Power (TEPCO) plans to develop between 6 GW and 7 GW new renewable energy capacity both in Japan and overseas. The group plans to focus on offshore wind power (2 GW of which to be built in Japan, including floating wind projects, and 2 GW overseas) and on hydropower operations in Japan and South East Asia.

TEPCO aims to gain a competitive advantage and will pursue new renewable energy projects instead of nuclear power. Renewables currently account for only 15% of its power output, which is less than any other Japanese power company. The company is seeking partners and expects to build its first wind park in Japan.

EDF delays Flamanville EPR project startup by another year (France)

The French utility EDF has completed in-depth examination of 148 out of the 150 welds in the main secondary system of the 1,650 MWe Flamanville-3 EPR reactor (France): 33 have quality deficiencies that have to be repaired, while 20 fail to meet high quality requirements and will be reworked. The schedule and the construction costs of the project have been revised accordingly. The loading of nuclear fuel is now scheduled for the fourth quarter of 2019 instead of the fourth quarter of 2018, while the construction costs will increase to €10.9bn from the €10.5bn expected previously (up from a December 2012 estimate of €8bn).

The project is facing other challenges and even though the French nuclear watchdog (ASN) cleared the reactor pressure vessel (RPV) of the unit, it will have to be replaced by 2024 at the latest. Even if the reactor comes onstream in 2019 as planed, a planned maintenance will have to be scheduled before this date to replace the RPV once a new one has been produced.

The Flamanville project was initially expected to be commissioned in 2012 at a cost of €3bn; it will now start at least 7 years behind schedule, posting a cost escalation of nearly €8bn. This delay will also postpone the planned closure of the Fessenheim nuclear power plant by one year.

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Belgium establishes a capacity market system to offset nuclear phase-out

The Belgian government has agreed to subsidize new electricity capacity to offset the country's nuclear phase-out in 2025. A capacity remuneration mechanism (CRM) has been approved and is set to replace the strategic reserve program, which was implemented since the winter 2014-2015. A two-tier auction system should be implemented by 2021, to give enough time to project developers to build new gas-fired power plants (based on an average 4-year construction length) before the nuclear phase out of 2025. Both existing and new power plants will be able to participate in the scheme and no technology is excluded except nuclear power. According to the government, foreign capacity may also participate but under well-defined conditions.

The first auction should be organized in 2021. Besides, the government will also organize yearly auctions to adjust fluctuating needs for capacity. This scheme will enable the government to subsidize capacity in a bid to guarantee security of supply. By 2025, the scheme is estimated to cost Belgian consumers an annual €345m. According to a study unveiled by the domestic grid operator Elia, 3.6 GW of new thermal capacity will be needed to offset the closure of the country’s nuclear plants.