Platts - Friday, January 26, 2007 http://www.platts.com ------------ NRC plans major revision of its enforcement policy London (Platts)--26Jan2007 NRC said it is planning a major revision of its enforcement policy, chiefly to clarify the use of terms and enforcement issues that have changed or did not exist when the agency's policy was first published in 1980. In a January 25 Federal Register notice, NRC said it also is considering removing material from the policy that is no longer applicable. The enforcement policy is not a regulation, but it has been updated several times. NRC said it wants to update terms that were originally crafted for conventional enforcement and that are now also used for the significance determination process under NRC's reactor oversight process. NRC said it wants to consider enforcement issues associated with the construction phase of new reactors and new requirements in relation to safeguards and security. Public comments are due by March 26. ------------ Russia, India sign nuclear cooperation agreement New Delhi (Platts)--25Jan2007 India and Russia signed a pact to expand cooperation in nuclear power. The memorandum of intent was signed January 25 between India's Department of Atomic Energy and Russia's Federal Atomic Energy Agency. The agreement envisages Russia supplying additional reactors to India. Russia nuclear export company Atomstroyexport is supplying two 1,000-MW VVERs at Kundankulam in southern Tamil Nadu state. The two agencies signed the memorandum on the first day of Russian President Vladimir Putin's visit to India. ------------ US FTC schedules April meeting to review US, world energy issues Washington (Platts)--25Jan2007 The US Federal Trade Commission has scheduled a three-day conference in Washington beginning April 10 designed to "explore a range of energy issues of importance to American consumers and to the United States and world markets." The agency on Wednesday said the conference, "Energy Markets in the 21st Century: Competition Policy in Perspective," will bring together experts from the government, energy industry, consumer groups and academia to exchange ideas about issues related to energy development, transportation, marketing, and use. "Few issues are more important to American consumers and businesses than the decisions being made about current and future energy production and use," FTC Chairman Deborah Platt Majoras said in a statement. "Among a number of government agencies involved in law enforcement and oversight of the US energy sector, the FTC plays a key role in maintaining competition and protecting consumers in energy markets. This conference will provide a forum for informed discussions and data sharing that will assist in fact-based decision-making." Majoras said the meeting will explore topics relevant to maintaining competition and protecting consumers in energy markets. The conference will address issues arising in a number of energy sectors, potentially including petroleum, natural gas, biofuels (such as ethanol and biodiesel), coal, nuclear, electric power and others. The agency said panelists will discuss, among other topics, the current implications of the world energy situation for US energy supplies, whether the nation is more vulnerable today to energy supply and demand shocks. ------------ US regulators look to harmonize processes on grid reliability Washington (Platts)--24Jan2007 The US government's two primary energy regulatory agencies last week continued to discuss ways of ensuring that the anticipated next wave of nuclear generation assets has access to, and can freely flow power across, the transmission grid. Nuclear Regulatory Commissioner Jeffrey Merrifield raised the idea of an industry workshop "to take a look at the integration between our process -- which is more focused on the combined operating license application process -- and the transmission issues that will be dealt with" by the Federal Energy Regulatory Commission "to see if in the planning regimen we can all get on the same page as to what the expectations are going forward and areas where we may be able to have some further successes." NRC Commissioner Gregory Jaczko noted that while the agency has been "putting a lot of effort and focus on new nuclear construction, and it seems that this piece, the transmission, is really missing. We may go through the process of doing a lot of work on these nuclear units and find that there is no socket to plug the plant into." FERC Chairman Joseph Kelliher agreed the US has "fallen behind in transmission investment," but said his agency is doing what it can to help ensure that adequate infrastructure gets built. As for assuring grid security, a senior FERC official reported the commission is on track to have reliability standards "mandatory and enforceable by June 2007." --Craig Cano, craig_cano@platts.com ------------ GE interested in building nuclear plant in Lithuania Stockholm (Platts)--24Jan2007 General Electric wants to bid on building a new Lithuanian nuclear plant, Prime Minister Gediminas Kirkilas's office said in a statement January 23, after he met with representatives from the US company. Lithuania hopes to have a plant operating around 2015, which would be jointly owned by the three Baltic countries and Poland. The size of the plant will depend on the number of investors; if Poland participates, as much as 3,200 MW of capacity could be built. ------------ French presidential candidate Royal favors closure of Fessenheim London (Platts)--24Jan2007 French presidential candidate Segolene Royal favors closure of Fessenheim "as soon as possible," Royal told the association Stop Fessenheim in a letter dated January 15 and made public January 23 by the regional newspaper Est Republicain. A spokesman for the Socialist Party, which elected Royal as its candidate last month, told Platts Royal had said that with implementation of energy efficiency and energy savings, she considered it "possible and desirable to proceed as soon as possible with the definitive closure" of the two 900-MW-class PWRs. Royal, the spokesman said, is "concerned about the safety" of the reactors, France's oldest, which "have already been operated beyond their initially planned lifetime." Fessenheim-1 began operation in 1977 and will undergo its third decennial outage in the near future. Electricite de France has applied to continue operation of the two units. In principle, French nuclear regulators issue permission for a decade's forward operation. EDF has said studies indicate all 58 of its reactors are good for at least 40 years' operation. ------------ Baxter announces his resignation from TVA board Washington (Platts)--23Jan2007 Bill Baxter announced his resignation from the Tennessee Valley Authority's board of directors January 22 in a resignation letter to President George W. Bush, in what Baxter called the spirit of the modernization of the utility's governance structure. Baxter was chairman from 2005 until the new board was sworn in last March and elected new member Bill Sansom as chairman. Baxter, who joined the board in November 2001, retained a seat on the part-time board and had 4.5 years left on his term. Baxter said that the agency has accomplished the transition to the new governance structure smoothly and effectively. "TVA is well positioned operationally, financially and strategically to successfully navigate the coming competitive marketplace in wholesale electricity," he said. ------------ NRC's McGaffigan says US should start over on waste disposal Washington (Platts)--22Jan2007 The US government should start over in its effort to develop a long-term solution to nuclear waste disposal by turning over management of the project to a government-owned corporation, Nuclear Regulatory Commission member Edward McGaffigan said Monday. Speaking at the Platts Energy Podium, McGaffigan said there are so many problems plaguing the US Department of Energy's proposed high-level nuclear waste repository at Yucca Mountain, Nevada, that the agency should begin looking at alternative sites. He said his comments were his personal views and did not represent the NRC's position. As a he first step to reforming the nuclear waste program, McGaffigan suggested that a group of experts be appointed to develop recommendations, similar to the recent Iraq Study Group. He said a government-chartered corporation with a bipartisan board--like the Tennessee Valley Authority model--would be the best way to run the program because it would eliminate the frequent turnover of political appointees that currently head DOE's civilian nuclear waste office. "Things nuclear have to be stable across presidencies and across Congresses because they take so long" to implement, he said. --Jenny Weil, jenny_weil@platts.com Listen to a recording of the Platts Energy Podium at http://www.platts.com/energypodium/index.xml?src=story ------------ USEC says 2006 net income jump on higher uranium prices, margins Washington (Platts)--22Jan2007 Bethesda, Maryland-based USEC Monday said it expects its 2006 net income to be roughly $105 million, up sharply from its previous guidance of $65 million to $75 million. USEC, which enriches uranium fuel for commercial nuclear power plants, attributed the the improvement in earnings to higher uranium prices realized in contracts with market price adjustments, higher gross margin for enriched uranium as the average price billed to customers was higher and cost of sales was lower than expected, and the timing of expenditures for the American Centrifuge project. This net income reflects expense for the American Centrifuge project in 2006 of approximately $103 million, the company said. USEC said it ended the year with a cash balance of approximately $170 million and had no short-term borrowing on its bank credit facility beyond letters of credit for financial assurance requirements. "Our strong 2006 financial results reflect improving market conditions for nuclear fuel and cost-cutting actions taken by USEC management in recent years," said John Welch, USEC president and CEO, said in a statement. "Nonetheless, we know that only a few months of the substantial increase in our electric power costs in 2006 are now reflected in our cost of sales, and we face tremendous financial challenges in 2007 and beyond. We are taking steps to attempt to partially mitigate the higher power costs, but we know our profit margins will be under significant pressure in upcoming quarters," Welch said. USEC said expects to release its fourth quarter and full-year 2006 earnings in late February, when it also will provide earnings and cash flow guidance for 2007. ------------ ANS wants increased funding for university nuclear education Washington (Platts)--22Jan2007 Congress should increase funding for university nuclear education programs, the American Nuclear Society said in a report released January 19. Other recommendations in the "Nuclear Human Element" report include that DOE undertake a detailed nuclear science and engineering workforce demand survey. ANS said the report's recommendations are critical to sustaining the faculty, students and infrastructure needed to support a healthy US nuclear education system and future workforce. The report is on the ANS web site (www.ans.org/pi/fine). ------------