Platts - Friday, February 06, 2004 http://www.platts.com ------------ US nuclear industry group says plants' output 762 bil kWh in 2003 Washington (Platts)--6Feb2004 The Nuclear Energy Institute Friday said the US nuclear power industry contributed 762 bil kWh at an average capacity factor of between 89% and 90% from 103 facilities in 2003. Those numbers are a decrease from record-high levels of 780 bil kWh and a 91.9% capacity factor in 2002, NEI said. NEI told Wall Street analysts today in New York that it expects the average production cost for nuclear power in 2003 will be relatively flat from the year before at 1.7 cts/kWh. Don Hintz, president of Entergy Corp and chairman on NEI's board of directors, said the dip in output was due to extended plant shutdowns. He said nuclear capacity increased 2,000 MW over the past three years as a result of plant uprates and he expects another 2,000 MW in the next several years to be added. Hintz also added between the end of this year and the terrorist attacks of Sept 11, 2001, the industry will have invested about $1-bil in improving plant security. ------------ UK audit office slams DTI's handling of nuclear liabilities risks London (Platts)--6Feb2004 The UK National Audit Office (NAO) on Friday slammed the Department of Trade and Industry's handling of the decline of troubled generator British Energy. The NAO, which audits the government's financial performance, said the department was aware of the risks BE faced following its privatization in 1996 and had clearly identified them. However, the department had failed to monitor the risks closely enough on an ongoing basis and therefore it had had to take over responsibility for meeting the costs of handling the decommissioning of the UK's nuclear liabilities. BE was supposed to take responsibility for its nuclear liabilities, but the department's "light touch" as BE's financial position declined meant the DTI was unable to evaluate the effects of increased competition and poor business decisions by the company. "The department did not evaluate the effect of these changes of BE's ability to meet the costs of its obligations," the NAO said. The collapse of BE and its subsequent call on government aid as well as the transfer of the nuclear liabilities back to the state meant that government departments had to be more rigorous when dealing with the risks of privatization, the NAO said. Departments should, in future, ensure their risk management plans and processes include a "full cycle of proactive activities." They should also evaluate the risks and monitor them effectively before and following a privatization. In addition a department must make a decision prior to privatization whether obligations would return to haunt the state and whether this should prohibit the whole process. Once the okay is given, then they must insist on full financial disclosure to the privatized entity's banks and the state. The NAO also said that the risks of policy decisions to the state, such as the New Electricity Trading Arrangements introduced in 2001, must be analyzed in greater detail. DTI projections showed a likely price fall by 10-15% rather than the 40% as was the case, which in the end bankrupted BE. ------------ Kaiser-Hill cited for Rocky Flats safety violations Washington (Platts)--5Feb2004 A preliminary notice of violation (PNOV) was issued against Kaiser-Hill for nuclear safety rule violations at Rocky Flats. DOE proposed levying a $522,500 civil penalty against the contractor. A statement DOE issued Feb. 4 said the PNOV involved a glovebox fire at the shuttered nuclear weapons plant in May, a ventilation airflow reversal in March that spread radioactive material through several rooms, and a radioactive contamination, also in March, involving an inadequately secured sleeve. Several workers, DOE said, received radiation doses, but they were below federal limits. DOE said its investigation identified deficiencies with radiological controls, procedural compliance, and worker training, as well as a failure to implement effective corrective actions to address similar problems that occurred earlier. The department is taking the enforcement action under the Price-Anderson Amendments Act of 1988. Kaiser-Hill Co. has 30 days to contest the PNOV. ------------ Pakistan, China may soon sign new reactor deal Islamabad (Platts)--5Feb2004 Pakistan and China could sign a deal for a second 300-MW reactor at Chashma within a month, Pakistan Atomic Energy Commission (PAEC) Chairman Pervez Butt told Platts. He said financial and technical details have been finalized and PAEC is waiting for a signal from the government to sign the agreement with the China National Nuclear Corp. (CNNC). During the 1990s, the CNNC built the 300-MW PWR now operated by the PAEC at Chashma. There have been negotiations since then for a second unit, but reports have said financing was a barrier. The PAEC also operates an older 137-MW Candu at Karachi, and Butt said the PAEC also plans to build a 600-MW nuclear unit there, but plans are in a preliminary stage. ------------ SCE removed 6.7 tons of sardines from San Onofre Washington (Platts)--4Feb2004 Southern California Edison Co. (SCE) removed roughly 6.7 tons of sardines from San Onofre intake structures Feb. 2-3, according to an NRC event report issued Feb. 4. The influx of sardines may be related to winter storm conditions near the plant, which is on the California coast, SCE said in the report. Roughly 6,940 pounds of sardines were removed from water intake tunnels at San Onofre-2 and 6,650 pounds from those at unit 3. NRC does not have a reporting limit for an unusual fish kill, but SCE has internally defined the quantity to be 4,500 pounds. Both units are at full power today. ------------