Platts - Friday, February 08, 2008 http://www.platts.com ------------ Bodman says GIPP projects not supporting Iran's nuclear program Washington (Platts)--7Feb2008 DOE-funded projects in Russia are not supporting Iran's nuclear program, Energy Secretary Samuel Bodman told a House Energy and Commerce Committee hearing February 7. The panel said in a February 6 statement that two Russian institutes that have received funding from the National Nuclear Security Administration's Global Initiatives for Proliferation Prevention have performed work on the Bushehr power plant in Iran. NNSA is a semi-autonomous agency in DOE. Committee Chairman John Dingell and Bart Stupak, chairman of the investigations subcommittee, both Michigan Democrats, asked Bodman in a February 6 letter for more information. Bodman told the hearing that the GIPP-funded projects "are not enhancing the Iranian nuclear program," and that all GIPP projects "are vetted through a very vigorous [internal] process." Bodman said he and NNSA head Bill Austinthorpe would report back to the committee with more information. The GIPP program was launched in 1994 to employ ex-Soviet weapons scientists. It came under fire in a December 2007 Government Accountability Office report. The committee held a hearing on the issues in January. DOE has asked for $24 million for GIPP in fiscal 2009. ------------ Entergy focuses on two downed sections of 500-kV Arkansas line Birmingham, Alabama (Platts)--7Feb2008 Entergy Arkansas is concentrating all its restoration efforts on a 500-kV transmission line knocked offline by storm damage that transports power from the Arkansas Nuclear One station, company spokesman James Thompson said Thursday. The company late Wednesday identified damage to a second portion of the line. Originally Entergy said a section of the line from the nuclear plant to the Pleasant Hill substation was down, but further investigation found the line was down between Pleasant Hill and Mayflower, Arkansas. Entergy officials said Thursday that it could take as little as a day or as long as two weeks to repair the damage. Difficult terrain and the length of damaged spans are the major factors in the varied estimates of restoration time, the company said. The company has also identified seven 161-kV transmission lines that were damaged as a result of severe storms and tornadoes that raced through the US Southeast late Tuesday. Entergy Arkansas still has 12,500 customers without power. About 7,700 of those are in the region affected by the damaged transmission line from the nuclear plant, Thompson said. The Tennessee Valley Authority still has two 500-kV transmission lines and nine smaller lines -- eight of which are 161 kV in size and one of which is 69 kV -- out of service as a result of the storms, it said. About 27,800 customers on the TVA system were without power early Thursday, John Moulton, a TVA spokesman said. The federal power producer has completed its damage assessment and is working to repair the lines, but it does not have an estimated time of completion, Moulton said. ------------ German regulators reject RWE's petition to extend Biblis A's life London (Platts)--7Feb2008 Germany's regulators on February 6 rejected RWE's petition to extend Biblis A's lifetime by transferring allotted kilowatt-hours to it from the newer Emsland plant, German regulatory sources said. Environment Minister Sigmar Gabriel rejected the petition based on a safety comparison between the two reactors, done by his BMU ministry using technical information provided by Gesellschaft fuer Anlangen- und Reaktorsicherheit, GRS. GRS, which is BMU's technical support organization for reactor safety, had refused to rank Germany's reactors based on safety. RWE is expected to sue the federal government and the case will probably come to court toward the end of 2008. This is the first of several pending cases where Gabriel must decide whether to allow older reactors to operate for longer lifetimes based on safety comparisons between older and newer units from which KWh are to be transferred. It is expected that other utilities' requests, which Gabriel has not yet decided, will also be rejected during the coming 18 months. ------------ Rio Tinto rejects buyout offer from BHP Billiton Barcelona (Platts)--6Feb2008 Uranium producer Rio Tinto rejected a new buyout offer from BHP Billiton. Rio Tinto has resisted talks with BHP, and on February 6 BHP launched a direct appeal to Rio Tinto shareholders in its bid to buy Rio Tinto and merge the two giant resource companies into one. Rio Tinto was the world's second largest uranium producer in 2006 after Cameco according to the World Nuclear Association, while BHP was the sixth largest. Rio Tinto said the same day that the offer, while better than an earlier offer, "significantly undervalues" the company. BHP said it is offering Rio Tinto shareholders 3.4 BHP shares for each Rio Tinto share they own, giving Rio Tinto shareholders about 44% of the enlarged group. Both companies have significant stakes in numerous commodities, including uranium, coal, iron ore and metals. ------------ US nuclear plants set output, efficiency records in 2007: NEI Washington (Platts)--6Feb2008 US nuclear power plants posted all-time record highs in electricity production and efficiency in 2007, according to preliminary figures released Wednesday by the Nuclear Energy Institute, an industry group. US nuclear plants generated about 807 billion kWh in 2007, exceeding by more than 2% the previous record-high of 788.5 billion kWh of electricity set in 2004, NEI said. The organization also said the US' 104 nuclear plants achieved a record-setting average capacity factor -- a measure of on-line availability of power -- of 91.8% in 2007, surpassing the 2004 record of 90.1%, according to preliminary figures. Capacity factor is the ratio of electricity actually produced compared with the theoretical maximum electricity a power plant can produce operating at full power year-round. NEI said the industry's average electricity production cost, including expenses for uranium fuel and operations and maintenance, also set a record low in 2007. The average production cost was 1.68 cents/kWh in 2007, besting the previous low of 1.72 cents/kWh, set in 2005, the group added. In addition, NEI said 2007 marked the ninth straight year that the industry's average electricity production cost has been below 2 cents/kWh, and the seventh straight year that nuclear plants have had the lowest production costs of any major source of electricity, including coal- and natural gas-fired power plants. Electricity production from nuclear power plants was bolstered by the refurbishment of Browns Ferry-1 in Athens, Alabama, which was returned to service in May 2007. ------------ Storm knocks out 500-kv power line from Entergy Arkansas nuke Birmingham, Alabama (Platts)--6Feb2008 A series of severe storms and tornados that ripped through Arkansas, Tennessee and Kentucky late Tuesday knocked down four structures carrying a 500-kV transmission line from the Entergy Arkansas' Arkansas-1 nuclear power plant, the utility's parent company said Wednesday. Three other transmission towers sustained significant damage, the utility added. In a notice on Entergy's transmission web site, the company said that while it has inspected the damage from the air, it has been unable to get crew on the ground because of difficult terrain. The loss of the line forced the nuclear plants to cut it output to 37% of capacity. Entergy added that it expects it will take about two weeks to restore the damage. The utility also has sustained damage to its distribution system and reported that about 22,000 of its customers were without power at about 11:30 EST, down from 42,000 at the peak. The remaining restoration will be difficult, Entergy spokesman James Thompson said. "Whole towns are destroyed in central Arkansas," he said. The company is still assessing damage, which is spread throughout the state, Thompson said. The company has about 350 workers coming to help with restoration, 100 each from Entergy companies in Texas and Louisiana and 115 outside contractors, Thompson added. The storms killed more than 40 people in the three state, according to media reports. ------------ SCE&G plans to submit COL application by end of March Washington (Platts)--5Feb2008 South Carolina Electric & Gas is "still going forward" with plans to submit a COL application to NRC and hopes to do so by the end of March, Senior Vice President for Generation and Chief Nuclear Officer Stephen Byrne said February 5. SCE&G said last month it was reviewing its plans to submit a combined construction permit-operating license, or COL, application, which had been scheduled to be delivered to NRC by the end of last year. In an interview February 5, Byrne said he first wanted to conclude negotiations with vendors. In part, he said, because many of the people involved in the vendor talks also were working on the COL application, and he wanted to remove that "distraction." But he also said there was a chance the vendor talks "might not come to fruition," in which case it would not make sense to apply for a COL. He said he anticipated wrapping up the vendor talks successfully in time to deliver the application by the end of March. ------------ Building new nuclear plants is top priority: US DOE official Rockville, Maryland (Platts)--5Feb2008 The number one priority of the US Department of Energy is to get new nuclear plants under construction, DOE Assistant Secretary Dennis Spurgeon said Tuesday at a Platts Nuclear Conference in Rockville, Maryland. Spurgeon called the Nuclear Power 2010 a "success story" that shows how government and industry can work together to "jump start" the nuclear industry. He cited the Bush administration's fiscal 2009 request for $241.6 million, more than double the previous year's allocation, to bring Nuclear Power 2010 to a successful close. To keep the share of electricity from US nuclear power at its current 20% will take construction of at least 45-50 new nuclear units by 2030, Spurgeon said. He noted that DOE and the US Nuclear Regulatory Commission are jointly sponsoring a February 19-21 conference, "Life Beyond 60," to explore extending operations of today's nuclear units. --Margaret Ryan, margaret_ryan@platts.com ------------ Constellation nuke CEO says loan guarantees essential to buildout Rockville, Maryland (Platts)--5Feb2008 Constellation Nuclear Energy President and CEO Michael Wallace on Tuesday said his company is planning to break ground for a new nuclear unit at Calvert Cliffs in Maryland in December if federal loan guarantees are put in place this year. Speaking to the Platts Nuclear Conference in Rockville, Maryland, Wallace, whose career included completing the Braidwood station for Commonwealth Edison in the 1980s, said the loan guarantees are the sole issue standing between Constellation and a decision to order a new nuclear plant. Wallace said Constellation has its loan-guarantee application ready to go, and is hoping the US Department of Energy will being soliciting proposals by May. He called the Energy Policy Act of 2005 "a watershed" bill and said the nuclear industry, after years of not building a new plant, needs about a decade of assistance to get started. After that, he said, nuclear "needs no federal subsidy." He said Constellation is concerned about the risk of rising commodity prices and global supply chain constrictions, and knows nuclear costs will be above $3,000/installed kW. But, he said, given expected future energy prices, he believes that nuclear will come in in "the acceptable zone." Constellation is in a joint venture, knowns as Unistar, with France's Areva to build a unit of the same design being built in France and Finland, a 1,650-MW advanced reactor. --Margaret Ryan, margaret_ryan@platts.com ------------ NRC's FY-09 budget request exceeds $1 billion Washington (Platts)--4Feb2008 NRC's FY-09 budget request exceeds the billion-dollar mark for the first time. The $1.02-billion requested budget authority, released February 4, is a $90.9 million increase over NRC's fiscal 2008 budget as enacted, the agency said. NRC is requesting $786.6 million in FY-09 for nuclear reactor safety activities, up from the $740.6 million it received in FY-08. That request includes $237.5 million for activities related to new reactors, up from $234.4 million the agency received in FY-08. The agency also is requesting $184 million for nuclear materials and waste safety activities, up from the $147.7 million it got in FY-08. Additionally, activities related to a proposed high-level waste repository at Yucca Mountain are budgeted for $37.3 million, up from $29 million in FY-08. The NRC is obligated under law to recover 90% of its budget authority from licensee fees, resulting in a net budget authority of $161.5 million for FY-09, up from $147 million in FY-08, the agency said. NRC's FY-09 budget request is online at www.nrc.gov/reading-rm/doc-collections/nuregs/staff/sr1100/. ------------ US DOE asks for hike in funds to spur new-reactor construction Washington (Platts)--4Feb2008 The US Department of Energy is requesting an increase of more than $100 million in fiscal 2009 to encourage the construction of new nuclear reactors. DOE requested $241 million for Nuclear Power 2010, a joint government-industry cost-sharing program testing the US Nuclear Regulatory Commission's licensing process and developing new standardized reactor designs and bringing them to market. Congress provided $135 million in fiscal 2008 for the effort. The Advanced Fuel Cycle Initiative, which covers research and development on advanced reprocessing and fast-reactor technologies as part of the department's Global Nuclear Energy Partnership, would receive $302 million under the request. Congress provided $179 million for AFCI in the current fiscal year. Generation IV Nuclear Energy Systems Initiative, on "next-generation nuclear energy concepts," would get $70 million in fiscal 2009. For fiscal 2008, Congress provided $116 million for Gen IV. DOE requested $17 million Nuclear Hydrogen initiative, a program that got $10 million in the current fiscal year. --Daniel Horner, daniel_horner@platts.com ------------ US NRC's proposed 2009 budget exceeds $1 bil mark for first time Washington (Platts)--4Feb2008 The US Nuclear Regulatory Commission's fiscal 2009 budget request exceeds the billion-dollar mark for the first time. The $1.008-billion request, released by the White House Monday, is up from $917 million in fiscal 2008. NRC is requesting $782 million in the next fiscal year for nuclear reactor safety activities, including the review of applications for new reactor licenses, up from $736 million last year. The agency also is requesting $220 million for nuclear materials and waste safety activities, up from $175 million in the current fiscal year. NRC, which is obligated under law to recover 90% of its budget authority from licensee fees, is expected to release its draft fisal 2009 fee recovery rule for public comment later this month. NRC will release its detailed budget requests for specific programs later today. --Steven Dolley, steven_dolley@platts.com ------------ Carl-Magnus Larsson named as SSI's new director London (Platts)--4Feb2008 SSI's new director will be Carl-Magnus Larsson, the Swedish government said in a statement February 1. Larsson, who is head of the agency's department of preparedness and environmental protection, will take over from Lars-Erik Holm who is leaving the agency March 1. However, Larsson will be director only until June 30, since the Swedish Radiation Protection Authority, or SSI, and the Swedish Nuclear Power Inspectorate are scheduled to be merged after that under a new director. ------------ US,France,Japan sign MOU on sodium-cooled fast reactor technology London (Platts)--4Feb2008 The US, France and Japan have signed an MOU that expands their cooperation on the development of sodium-cooled fast reactor technology. The US DOE reported February 1 that the memorandum of understanding establishes a collaborative framework aimed at the deployment of sodium- cooled fast reactor prototypes. No target date for deployment was given. These countries already cooperate as part of DOE's Global Nuclear Energy Partnership, aimed at closing the nuclear fuel cycle through the use of advanced reprocessing and fast reactor technologies, as well as DOE's Generation IV International Forum for the development of next-generation reactor technologies. France's Commissariat a l'Energie Atomique added in a February 1 statement that the three are committed to developing fast reactor prototypes to meet their own national programs' objectives and have agreed to avoid duplicating work on sodium-cooled fast reactor technology, allowing them to optimize use of their resources. A steering committee has been created to coordinate work defined by the MOU, it said. ------------ PSEG Nuclear's 2007 fleet capacity factor below forecast Washington (Platts)--1Feb2008 The capacity factor for PSEG Nuclear's fleet was 91.4% in 2007, parent company Public Service Enterprise Group, said February 1. That figure was slightly below the forecast of 92%, PSEG said. The capacity factor for fourth-quarter 2007 was 83.6%, PSEG said. For both fourth-quarter 2006 and full-year 2006, the capacity factor was about 96%, PSEG said. PSEG cited Hope Creek's 33-day outage in fall 2007 as a main reason for the dip in capacity factor. During a conference call with reporters, Chairman, President and CEO Ralph Izzo said the outage was about eight days longer than planned. PSEG reported 2007 net income of $1.34 billion, up from $739 million the previous year. ------------ US DOE to seek largest budget request in five years: Bodman Washington (Platts)--1Feb2008 The Bush administration's fiscal 2009 budget proposal contains the largest requested increase for the US Department of Energy in five years, Energy Secretary Samuel Bodman told the agency's personnel on Friday. The administration is scheduled to release the proposal on Monday. "The funding increase will give us the support we need to continue to promote America's energy security by encouraging the development of reliable, clean and affordable energy supplies and to strengthen US competitiveness by leading in innovation and scientific discovery," Bodman said in a letter to employees. "It will allow us to continue to strengthen our vital role in national security and to continue providing responsible resolution for our environmental legacy," he said. That environmental legacy refers to cleanups at retired DOE nuclear weapons facilities. Congress provided DOE with $24.6 billion in fiscal 2008. ------------ Senegal becomes 20th nation in Global Nuclear Energy Partnership Washington (Platts)--1Feb2008 The Republic of Senegal in western Africa Friday signed onto the Global Nuclear Energy Partnership. Senegal's membership brings to 20 the number of countries in the Bush administration program, which was designed to spur the use of nuclear energy in the US and abroad while also ensuring that its spent fuel and other byproducts do not fall into the hands of terrorists. GNEP's "statement of principles" espouses the idea of international nuclear fuel supply frameworks to reduce the risk of proliferation, as well as the goal of a closed fuel cycle featuring reprocessing and recycling techniques that do not separate pure plutonium. Another goal is to develop proliferation-resistant small- to medium-sized power reactors appropriate for the grids of developing countries and regions. Senegal's ambassador to Germany, Austria, and the International Atomic Energy Agency signed GNEP's statement of principles at an IAEA ceremony in Vienna, in which US Ambassador Greg Schulte presided. Schulte is Permanent Representative of the US to the UN Office in Vienna, the IAEA and other international organizations in Vienna. "Senegal is currently considering nuclear power as a way to meet their growing energy demands and they recognize GNEP as a valuable forum in which to explore the benefits of safe and emissions-free nuclear energy," said Dennis Spurgeon, the Department of Energy's Assistant Secretary for Nuclear Energy. --Dipka Bhambhani, dipka_bhambhani@platts.com ------------