Platts - Thursday, April 06, 2006 http://www.platts.com ------------ EC closes formal probe into BNFL's asset, liabilities transfer London (Platts)--6Apr2006 The EC has closed its formal investigation into BNFL's planned transfer of nuclear assets and liabilities to the UK's state-run Nuclear Decommissioning Authority, or NDA. The European Commission launched its investigation in December 2004 and the full transfer of assets and liabilities has been on hold since then. The commission concluded yesterday that British Nuclear Fuels plc had complied with the polluter-pays principle by covering the costs of decommissioning its plants and therefore had received no state aid. The commission noted, however, that the NDA will continue to operate commercially some of the assets it has received from BNFL, such as the four operating magnox stations. So the commission imposed strict conditions on such assets' operations. In particular, the NDA will have to ensure that it does not use aid to undercut wholesale prices when selling the magnoxes' electricity directly to business consumers, said the commission. In the cases of the Thorp and Sellafield Mixed-oxide Plant, if NDA enters any new contracts to operate them longer than planned, it must make sure all incremental nuclear liabilities generated by such contracts are covered. For more news, request a free trial to Platts Nucleonics Week at http://www.platts.com/Request%20More%20Information/ ------------ Final environmental report issued for Grand Gulf ESP Washington (Platts)--5Apr2006 No environmental impacts would prevent NRC from issuing an an early site permit, or ESP, to Grand Gulf, the agency staff concluded in a final environmental impact statement (EIS). In an announcement today, NRC said the staff also determined that there were "no environmentally preferable or obviously superior sites" for a possible new nuclear power plant. Entergy subsidiary System Energy Resources Inc., or SERI, submitted an ESP request to NRC in October 2003. If approved, the permit would allow SERI up to 20 years to decide whether to build another unit at the Mississippi site. A final decision is expected in early 2007. The EIS is on NRC's web site (www.nrc.gov/reading-rm/doc-collections/nuregs/staff/sr1877/index.html). ------------ French nuclear safety "rather satisfactory" in 2005: Regulator London (Platts)--5Apr2006 2005 was a "rather satisfactory" year for nuclear safety in France, the country's chief nuclear regulator said today, noting it was the first time safety authorities had expressed such a "positive feeling" in that respect. Andre-Claude Lacoste, director general of nuclear safety and radiological protection agency DGSNR, said at a press conference that nuclear safety at Electricite de France was "in general satisfactory" last year and that Cogema operated its facilities, notably the La Hague reprocessing complex, with "discipline and professionalism." The state of safety at the Commissariat a l'Energie Atomique, the country's third big operator, was "more nuanced," Lacoste said. Last year, only one incident was declared above Level 1 on the International Nuclear Event Scale: a generic incident involving safeguards systems pumps on EDF's reactors, classified at Level 2 (incident). Safety authorities said this year they will focus on the increase in the number of contaminated spent fuel transport convoys because the percentage of convoys with surface contamination exceeding standards crept back up last year to 5% of shipments. For more news, request a free trial to Nucleonics Week at http://www.platts.com/Request%20More%20Information/ ------------ Yucca Mt bill excludes interim storage language: DOE Washington (Platts)--4Apr2006 The Department of Energy left interim storage language out of a draft bill on a nuclear waste repository at Yucca Mountain, Nevada, it plans to send to Congress early Wednesday, Bush administration officials confirmed Tuesday. The bill, Deputy Secretary Clay Sell said during a press conference Tuesday, seeks to provide the department with "stability, clarity, and predictability" in moving the repository program at Yucca Mountain, Nevada forward. Earlier Tuesday, sources told Platts the interim storage language would be left out of the draft bill. BILL WOULD REPEAL 70,000 MT DISPOSAL LIMIT Provisions in the draft bill would repeal an existing statutory requirement limiting Yucca Mountain's disposal capacity to 70,000 metric tons, allowing the repository to be licensed up to its full technical capacity, which some officials have said is at least double the current cap. It retains the current three- to four-year statutory requirement for a Nuclear Regulatory Commission decision on whether to give DOE authorization to construct a repository, but adds a requirement giving NRC up to 18 months extra to act on a license amendment to allow DOE to receive and possess waste at the disposal site. Under the DOE proposal, non-nuclear facilities associated with the repository, such as a planned rail spur to Yucca Mountain, could be built before NRC authorizes construction of the repository, DOE acting waste program director Paul Golan said. The draft bill also would deem that the US will have adequate disposal capacity for utility spent nuclear fuel, eliminating the need for periodic NRC waste confidence reviews. REID SLAMS BILL; SAYS IS 'DEAD WHEN IT GETS HERE' Meanwhile, Senate Minority Leader Harry Reid, Democrat-Nevada, predicted Tuesday the legislation will fail. He said the proposal would add billions of dollars to the cost of handling nuclear waste. DOE has indicated the repository may not open before 2020, 22 years later than lawmakers originally intended to start storing waste there. "They know that it is not even on a life support system," he told reporters. "It is dead when it gets here." For more information, take a trial to Platts Nucleonics Week at http://nucweek.platts.com. ------------ GAO questions US NRC plan for protecting nuclear power plants Washington (Platts)--4Apr2006 The US Nuclear Regulatory Commission's process to boost nuclear power plant security after the September 11, 2001, terrorist attacks on New York and Washington "created the appearance" that changes were made based on what industry "considered reasonable...rather than on an assessment of the terrorist threat itself," the Government Accountability Office told Congress Tuesday. In a report submitted to the House National Security, Emerging Threats and International Relations subcommittee, GAO said an April 2003 revision to the NRC's so-called design basis threat -- a document that describes the kinds of threats nuclear power plants must be prepared to defend against -- followed a "generally logical and well-defined process that required plant operators to defends against a larger terrorist threat." Among other things, the revised DBT required plant operators to defend against a larger number of attackers, an expanded list of weapons and a larger maximum size vehicle bomb. GAO told Congress, however, that while key elements of the revised plan generally concur with staff's original recommendations, the agency made some changes to the document in response to public comment, including from the nuclear industry, that objected to some changes such as the inclusion of certain weapons. While NRC officials said the changes were the result of the further analysis of intelligence information, GAO said it found that the process "used to obtain stakeholder feedback created the appearance that changes were made based on what the industry considered reasonable and feasible to defend against rather than on an assessment of the terrorist threat itself." Further, the report said that while US nuclear plant have made "substantial security improvements" since 9/11, "it is too early" to conclude "that all sites are capable of defending against the DBT" because as of November 1, 2005, NRC had conducted "force-on-force" inspections at about only one-third of all plants. For more information, take a trial to Platts Nucleonics Week at http://nucweek.platts.com. ------------ Interim storage left out of DOE draft waste bill Washington (Platts)--4Apr2006 DOE left interim storage out of a draft nuclear waste bill it will send to Congress tomorrow morning. The bill, Deputy Secretary Clay Sell said today, seeks to provide DOE with "stability, clarity, and predictability" in moving the repository program at Yucca Mountain, Nevada forward. Provisions in the draft bill would repeal an existing cap that limits Yucca Mountain's disposal capacity to 70,000 metric tons. It keeps in place the current three- to four-year statutory requirement for an NRC decision on whether to give DOE authorization to construct a repository and adds a requirement giving NRC up to a year and a half to later act on a license amendment allowing DOE to receive and possess waste at the disposal site. Under the DOE proposal, non-nuclear facilities such as a planned rail spur could be constructed before NRC authorizes construction of the repository, DOE acting waste program director Paul Golan said. The draft bill also would declare that the US has adequate disposal capacity for utility spent nuclear fuel, eliminating periodic NRC waste confidence reviews. The draft bill will be posted on the DOE web site (www.doe.gov) tomorrow. ------------ ANALYSIS: Ground rules set out in Germany's long-term energy plan Cologne (Platts)--4Apr2006 After months of political discussions, papers and statements on the many aspects of Germany's current and future energy supply, last night's energy summit with Chancellor Angela Merkel, federal ministers, the big utilities and manufacturers as well as consumer representatives could hardly live up to expectations. There was no dramatic change of course on nuclear or renewables, nor was there any official statement on rules for CO2 trading, either for Phase Two or beyond 2012. On the contrary, a lot more talking is to come. "The future of our country depends on an economic, secure and environmentally friendly energy supply," said Merkel, heralding an "energy policy framework concept" for mid-2007 which will set the course to 2020. The aim will be "to reduce dependency on imports, prevent a further price increase and keep an eye on environmental-political challenges." Nuclear power was touched on. In developing a sustainable energy concept including the nuclear phase-out law, "the question of how nuclear power can be replaced must be answered," said Merkel. "The details of nuclear closures will be discussed, probably with much controversy." Until now Merkel, of the conservative CDU party, has held to the letter of the post-election coalition government agreement. Because of a lack of agreement with coalition partner the Social Democrats, the agreement ring-fences the nuclear phase-out law from debate during this legislature period. Economics minister Michael Glos, of the CDU's Bavarian sister party CSU, stressed that the coalition agreement runs only until 2009, while the future energy concept is to run until 2020, so the nuclear phase-out "has to be discussed." Glos, a nuclear proponent, and federal environment minister Sigmar Gabriel, a nuclear opponent who champions renewables, found common ground by underlining the importance of containing energy costs. But this summit was just the first in a number of such meetings. The next will take place in September, when the picture should become a little clearer. For more news, request a free trial to Platts Power in Europe at http://www.platts.com/Request%20More%20Information/ ------------ ANALYSIS: Ground rules set out in Germany's long-term energy plan Cologne (Platts)--4Apr2006 After months of political discussions, papers and statements on the many aspects of Germany's current and future energy supply, last night's energy summit with Chancellor Angela Merkel, federal ministers, the big utilities and manufacturers as well as consumer representatives could hardly live up to expectations. There was no dramatic change of course on nuclear or renewables, nor was there any official statement on rules for CO2 trading, either for Phase Two or beyond 2012. On the contrary, a lot more talking is to come. "The future of our country depends on an economic, secure and environmentally friendly energy supply," said Merkel, heralding an "energy policy framework concept" for mid-2007 which will set the course to 2020. The aim will be "to reduce dependency on imports, prevent a further price increase and keep an eye on environmental-political challenges." Nuclear power was touched on. In developing a sustainable energy concept including the nuclear phase-out law, "the question of how nuclear power can be replaced must be answered," said Merkel. "The details of nuclear closures will be discussed, probably with much controversy." Until now Merkel, of the conservative CDU party, has held to the letter of the post-election coalition government agreement. Because of a lack of agreement with coalition partner the Social Democrats, the agreement ring-fences the nuclear phase-out law from debate during this legislature period. Economics minister Michael Glos, of the CDU's Bavarian sister party CSU, stressed that the coalition agreement runs only until 2009, while the future energy concept is to run until 2020, so the nuclear phase-out "has to be discussed." Glos, a nuclear proponent, and federal environment minister Sigmar Gabriel, a nuclear opponent who champions renewables, found common ground by underlining the importance of containing energy costs. But this summit was just the first in a number of such meetings. The next will take place in September, when the picture should become a little clearer. For more news, request a free trial to Platts Power in Europe at http://www.platts.com/Request%20More%20Information/ ------------ FP&L tells NRC it plans to build new plant in Florida Washington (Platts)--3Apr2006 Florida Power & Light might build a new nuclear power plant in Florida, the company announced today. FP&L said it has not selected a site or reactor technology yet, and a decision whether to build is not expected for several years. FP&L said it notified NRC today that it intends to submit a combined construction permit-operating license application in 2009. ------------ Senate confirms Spurgeon to restored DOE nuclear position Washington (Platts)--3Apr2006 The Senate has confirmed Dennis Spurgeon, a former USEC Inc. executive, as DOE's first assistant secretary for nuclear energy in more than a decade. Spurgeon was confirmed March 27 in an 88-0 vote nearly two weeks after the Senate Energy & Natural Resources Committee approved the nomination. Energy legislation enacted last year re-created the assistant secretary position. The post was downgraded in 1993, putting nuclear within the Office of Nuclear Energy, Science and Technology under the leadership of an office director. Senator Pete Domenici, a staunch supporter of nuclear power and chairman of the Energy and Natural Resources Committee, this week said the confirmation restored the position to the level of importance it deserves. "We are on the cusp of a nuclear power renaissance in this country," the New Mexico Republican said. "I think Mr. Spurgeon's leadership and expertise come at a critical time." Spurgeon assumes office as the country faces the need for new baseload generating capacity. "By DOE's own projections, electricity demand will grow 45% by 2030," said Alex Flint, Nuclear Energy Institute senior vice president of governmental affairs. Flint said that the industry, as well as NEI, looks forward working with Spurgeon to maximize nuclear energy's role in meeting the growing demand for electricity. Spurgeon will be sworn in once President George W. Bush signs the necessary paperwork, DOE press secretary Craig Stevens said March 28. Spurgeon has a master's degree in nuclear engineering from the Massachusetts Institute of Technology. Most recently, Spurgeon was vice president and chief operating officer of USEC. Positions he held before that included chief operating officer for UNC Resources Inc. and assistant director for fuel cycle in the Energy Research and Development Administration, an energy R&D organization and DOE's predecessor. Elaine Hiruo, Washington For more information, take a trial to Platts Nucleonics Week at http://nucweek.platts.com. ------------ AEP chief sees little future demand for merchant power in US Las Vegas (Platts)--3Apr2006 The successful utility of the future will have a balanced mix of generation, transmission and distribution, blended with clean coal, new nuclear plant and some renewables development, American Electric Power Chairman, President and CEO Michael Morris told a Platts conference today in Las Vegas. Costs within this successful utility will be averaged to allow customers to benefit from older, less expensive infrastructure, Morris told the 21st Annual Global Power Markets conference. He forecast significant interest in new coal-fired generation--especially plants using coal gasification and emission control technology, adding that he does not see "a strong role for merchant power plants." The US has enormous sources of indigenous coal reserves and it would be "ludicrous for this country not to take advantage of coal," Morris said. Merchant power could become a more significant contributor to the US electric energy mix, but two developments must come first. "Merchants must sign long-term power purchase agreements, allowing projects to obtain financing," Morris said. Secondly, there needs to be a significant discovery of natural gas on the US Outer Continental Shelf to supply new gas-fired power plants. If merchant peaking plants were to run more than 20% of the time, US annual gas demand could be pushed to 24 Tcf, from the current 22 Tcf/year. But peak domestic supply, said Morris tops out at 18 TCF. Morris also predicted that nuclear and IGCC technologies will dominate new baseload generation. IGCC is about "five years ahead" because of the regulatory and other hurdles involved with nuclear power. Renewables, said Morris, "is part of the answer, not the answer. Fuel diversity is essential and energy efficiency is needed." ---Theo Mullen, theo_mullen@platts.com For more information, take a trial to Platts Megawatt Daily at http://megawattdaily.platts.com. ------------