Platts - Thursday, December 08, 2005
http://www.platts.com

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New nukes question raises concerns for UK power market: S&P

London (Platts)--8Dec2005

Building new nuclear power plants in the UK could "significantly affect
the future structure of the country's liberalized generating industry,"
Standard & Poors, the ratings agency owned by Platts parent company
McGraw-Hill said Thursday.

In a new report, "UK security of supply fears spark renewed interest in
nuclear energy," S&P said concerns over high energy commodity costs and
security of supply, as well as the long term impact of climate change
abatement programs, meant that nuclear was back on the agenda.

"If new construction of nuclear power is to become a reality in the UK,
we have significant concerns over the future structure of the generating
industry," said S&P's credit analyst Paul Lund.

S&P said that of particular concern were the potential for increased
regulation of the liberalized generating industry, a higher level of political
interference in the market structure, and the ongoing prospects for nuclear
power in a competitive power market.
    "We expect that investment in nuclear power will rely on the long-term
sustainability of high electricity prices in the UK energy market," said Lund.

S&P warned that the biggest obstacle to the long-term profitability of
nuclear power stations was the uncertainty about the future costs of storing
radioactive waste, decommissioning power stations, and processing spent fuel.
The ratings agency warned that these costs were not easily factored into the
cost of nuclear power and could be much higher than estimated.

"The bulk of nuclear liabilities and asset-retirement obligations in
Europe are on balance sheet, but are unfunded. The obligations usually have no
impact on day-to-day cash flows, and are very long-dated. Nevertheless, the
legal obligation to finance decommissioning costs creates significant future
liabilities, the ultimate cost of which can be higher than that provided for,"
the ratings agency warned.

It added that the liberalized nature of the UK generation market could
deter private companies from investing in new nuclear: "Ultimately,
investor-owned utilities will not get involved in investing in any form of
infrastructure unless risk-adjusted returns on capital meet internally set
hurdles. This becomes even more of an issue where the investment is exposed to
a fully competitive wholesale power market, particularly where predictability
is an issue."

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UK at http://www.platts.com/Request%20More%20Information/

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India joins ITER project as full partner

Washington (Platts)--7Dec2005

India joined the International Thermonuclear Experimental Reactor (ITER)
project as a full partner yesterday following a meeting of ITER partners on
Jeju Island, South Korea. U.S. support for India was "instrumental" in
ensuring other ITER partners--the European Union, Russia, Japan, South Korea,
and China--agreed to accept India, the U.S. Embassy in New Delhi said in a
press statement yesterday. President George W. Bush had pledged to consult
with ITER members about India's accession following the signing of the
U.S.-India Joint Statement in July. The embassy said the ITER action
represents "the first tangible and concrete step toward greater cooperation
between the U.S. and India in the nuclear field," as envisioned in the joint
statement.

Constellation taps Vanderheyden to lead new nuclear plant program
Washington (Platts)--7Dec2005

Constellation Energy Wednesday named George Vanderheyden, site vice
president of the company's Calvert Cliffs nuclear plant in Maryland, to head
its new program aimed at developing and building a new nuclear power plant.

Baltimore-based Constellation said Vanderheyden will be responsible
for leading the company's efforts to develop and deploy new nuclear facilities
and will report to executive vice president of Constellation Energy, Michael
Wallace, who also is president and CEO of Constellation Generation Group and
serves as co-chief executive officer of UniStar Nuclear, the company's joint
venture with AREVA Inc. Vanderheyden also will hold the position of president
of UniStar Nuclear, reporting to Wallace and UniStar co-chief executive
officer Thomas Christopher of AREVA.

James Spina, currently site vice president of Constellation's Nine Mile
Point Nuclear Station in Oswego, New York, will succeed Vanderheyden at the
Calvert Cliffs facility, the company said.

Succeeding Spina at the Nine Mile Point plant will be Timothy O'Connor,
who currently serves as plant general manager at the facility.

For more information, take a trial to Platts Electricity Alert at
http://electricityalert.platts.com.

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