Platts - Friday, February 15, 2008 http://www.platts.com ------------ Cost review may delay nuke filing with NRC until mid-2008: Scana Boston (Platts)--15Feb2008 Scana said Friday that, despite reports to the contrary, its South Carolina Electric & Gas subsidiary has not canceled plans to apply to the US Nuclear Regulatory Commission for a combined construction and operating license for a new nuclear unit. Instead, SCE&G has simply delayed submitting the COL application until it has updated the estimated cost of the Westinghouse AP1000 project it has been developing with Santee Cooper and reviewed whether proceeding with the nuclear project still makes economic sense, said Scana CFO Jimmy Addison. Speaking on an earnings conference call, Addison said that nuclear plant construction costs have roughly doubled since SCE&G and Santee Cooper first considered the idea of building another nuclear unit at its V.C. Summer station a few years ago. He added, however, that the cost of building new gas-fired capacity--and gas prices themselves--also have risen sharply. SCE&G, which initially had planned to file the application by the end of 2007, now expects to do so by mid-2008 "and hopefully sooner," said Addison. He added that the application delay is not expected to push back any proposed commercial startup of the new nuclear plant, which SCE&G has said it would like to bring online in 2016. SCE&G owns two-thirds of the existing 900-MW nuclear unit at the V.C. Summer station, while Santee Cooper owns the remaining third. The proposed nuclear unit would be 55%-owned by SCE&G, with Santee Cooper owning the rest. ------------ A dozen nuclear projects to be in building phase by 2015: analyst Houston (Platts)--15Feb2008 While there are between 25 to 30 nuclear power projects under discussion in the US, "we are quite certain that there will be a dozen reactors under construction in the US by 2015," an analyst with Cambridge Energy Research Associates said Friday CERA analyst Chris Hansen said at CERAWeek breakfast meeting in Houston that he expects the projects to go forward despite cost escalation. Hansen the overnight cost of nuclear 18 months ago was about $2,000/kW. Now it is $3,500/kW. Hansen, who noted that there currently are 435 reactors supplying 16% of the world's electricity, said new nuclear construction, buoyed by growing concerns over climate change and CO2 emissions, could support new nuclear builds of up to 700 GW of installed capacity by 2030. He argued that, along with other clean energy sources, nuclear can contribute to a one-third reduction of power generators' CO2 emissions. Guy Chardon, a senior vice president of nuclear industry supplier Alstom said at the same meeting that his company has been gearing up for new construction. In 2005, Alstom had a 20-person team "tendering new equipment." Today, Alstom has a 455-person team, he said. Chardon said he believes the nuclear power industry is "restarting worldwide," and that power generators are taking a "fuel portfolio approach," with nuclear making up a share of the portfolio. --Jeffrey Ryser, jeffrey_ryser@platts.com ------------ TVO submits environmental impact assessment for Olkiluoto-4 Washington (Platts)--14Feb2008 Teollisuuden Voima Oy, or TVO, submitted its environmental impact assessment for Olkiluoto-4 to the Ministry for Employment and the Economy February 14, the Finnish power company and the ministry said in separate statements. TVO management said the additional cooling water from a fourth unit at Olkiluoto would mean a larger area of thin ice in the sea near the plant during winter. The ministry has said it will look particularly closely at the effects of increased seawater temperature when assessing any application for a new nuclear plant. ------------ Nuclear, hydro and coal to lead clean energy development: CERA Houston (Platts)--14Feb2008 Against a backdrop of increasing global concern over climate change, investments in in clean energy technology -- particularly hydro, nuclear and even some coal-fired power -- is gaining momentum, Cambridge Energy Research Associates said on Thursday. "While nuclear may not be the flavor of the day, we are seeing an increasing acceptance of nuclear worldwide," Roger Goodman, a CERA senior consultant, said at CERAWeek 2008 in Houston. "A nuclear renaissance is certainly in the cards." But Goodman said it takes time to build nuclear facilities and much of the new generation is not expected to come online for several years. Public opinion, a possible economic recession, weak fossil fuel prices and the threat of terrorism all affect the construction of nuclear generation. Nuclear capacity currently accounts for about 15% of global generation, and some 700 GW of installed capacity is expected to come online by 2030, according to a recent CERA analysis. Development of new coal generation also faces challenges, but the fuel source remains critical in meeting ever-growing demand. "We cannot, in the world, live without coal," Goodman said. "We have some technological challenges ahead, and I think we can meet those. But we also have regulatory and liability issues that are at least as big as the technological challenges." Carbon capture and storage holds promise for bringing fossil fuel combustion into the clean energy portfolio, but the technology has yet to arrive. In addition, advanced coal-fired plants are expensive to build and face political, regulatory and legal issues. Because of these challenges, Goodman said carbon capture and sequestration is still at least another 10 years out. Hydro-electric generation is beginning to take on a much stronger role in the US and world-wide. Currently, hydropower accounts for 16% of global power generation and is poised to increase substantially, particularly in Asia and Latin America, where some 600 GW could be added by 2030. "We've got a large pot on undeveloped reserves," said Stow Walker, CERA associate director of global power. "Hydro generation is really catching on, and it's becoming a strong cornerstone for renewable energy." --Leticia Vasquez, Leticia_vasquez@platts.com ------------ NRC staff-time fees to decrease in FY-08 Washington (Platts)--13Feb2008 Charges for NRC staff time will decrease in NRC's fiscal 2008 fee recovery rule, the agency said February 13. The NRC's proposed schedule of fees charged to licensees and applicants to recover 90% of the agency's FY-08 budget, as required by statute, was published in the February 13 Federal Register. A rate of $238 per hour would be charged to licensees and applicants for NRC staff activities, a 7.7% decrease from the FY-07 rate of $258 per hour. This is "primarily due to a revised estimate of direct staff hours worked annually per direct full time equivalent that is used in the hourly rate calculation," NRC said. Annual fees for each operating power reactor would be $4.237 million, up from $4.043 million in FY-07, mainly due to additional workload in the area of new reactor licensing, the agency said. After accounting for carryover funds and billing adjustments, the NRC will bill a total of approximately $760.7 million for FY-08 fee recovery. The public comment period on the proposed rule runs through March 14. ------------ Nuclear power key to Exelon carbon dioxide control strategy: CEO Washington (Platts)--12Feb2008 Exelon's "low carbon energy strategy"--reducing, displacing or offsetting the company's "entire carbon footprint" by 2020--is "something we can only do because we are already a nuclear utility," Exelon Chairman, President and CEO John Rowe said Tuesday in a speech at the Brookings Institution. If competitive markets are allowed "to choose the most cost-effective demand- or supply-side solutions," using a cap-and-trade approach to carbon emission control, Exelon can "reduce and displace 12 to 15 million tons" of greenhouse gas emissions "about what we emit today in the markets we serve, at an incremental cost to customers of approximately 2.2 cents/kWh," he said. "If policymakers abandon competition, however, and insist that we invest only in uneconomic renewable resources and untested technology, it will cost three times as much, or 6.7 cents/kWh, to reduce or displace those same 12 to 15 million tons," Rowe said, adding "what is hard for us is virtually impossible for a large coal-burning utility," he said. Exelon, whose 17-unit nuclear fleet is the largest in the US, has committed $100 million to apply for a combined construction permit and operating license application with the US Nuclear Regulatory Commission for a possible new two-unit nuclear plant in Victoria County, Texas, Rowe said. The COL application would be submitted to NRC in spring 2009, Rowe told reporters after his speech. Exelon's "best guess" cost estimate for the proposed 3,000 MW plant is $10 billion, about the same as the company's "entire book equity," making federal loan guarantees indispensable, Rowe said. Unless utilities have "a very high equity percentage," it will prove "prohibitively" expensive to build new nuclear power plants, Rowe said. "While the federal government must first keep its commitment with respect to used nuclear fuel, I am convinced that we will need at least 25 to 30 new reactors by 2030 if we are to succeed in limiting greenhouse gases," Rowe said. The US Department of Energy's Yucca Mountain spent fuel repository is "not going to happen in a near-term time frame," nor is there a timetable for the availability of surface storage alternatives, he said. --Steven Dolley, steven_dolley@platts.com ------------ Nine Mile Point site confirmed by UniStar for potential reactor Washington (Platts)--12Feb2008 UniStar officially told NRC that Nine Mile Point will be the site for a potential new reactor in a combined construction permit-operating license, or COL, application that the Constellation Energy-EDF Group joint venture plans to submit in the fourth quarter of this year. In the February 8 letter and a February 12 press release, UniStar Nuclear Energy reaffirmed that the reactor, if built, would be a US Evolutionary Power Reactor. The "reference" plant for that Areva design is Calvert Cliffs-3; UniStar submitted part of the Calvert Cliffs COL application last year and plans to turn in the rest next month, the press release said. ------------ US DOE to reissue key Yucca Mountain contract tender Washington (Platts)--11Feb2008 The US Department of Energy said Monday it plans to reissue a tender for a multibillion-dollar management and operating contract for support of the proposed spent nuclear fuel repository project at Yucca Mountain, Nevada. "Securing the necessary contractor staff to accomplish our mission is critical to moving the Yucca Mountain Project forward into its next phases," DOE waste program director Edward Sproat said, adding that DOE plans to submit a repository license application to the Nuclear Regulatory Commission later in 2008. The job was last offered for tender in 2000 and resulted in Bechtel SAIC, a limited liability corporation formed by Bechtel National and Science Applications International Corp., being named the program's prime integration contractor during the program's site characterization and engineering phases. The five-year, $3.1 billion cost-plus-incentive-fee contract was the largest awarded to date in 2000 and, DOE said at the time, could swell to $8 billion if options giving BSC another five years were exercised. DOE said Monday that the contract had been extended through March 2009. DOE said that key activities proposed under the new M&O contract include managing completion of the repository design, responding to questions from the Nuclear Regulatory Commission following the submission of a repository license application to the agency, managing the construction of an NRC-licensed repository and operating the facility. ------------ Biblis-A returns from 17-month outage Washington (Platts)--11Feb2008 Biblis-A returned to service February 9 after a forced 17-month repair outage, according to owner-operator RWE Power AG. Both Biblis-A and Biblis-B were shut in fall 2006 to repair and in some cases replace several thousand defective support anchors. Biblis-B returned to service last month. The unplanned outages will assure that both units will not exhaust their remaining lifetimes under full-power operation until after the 2009 federal election, according to RWE officials. Federal regulators earlier this month rejected a petition filed by RWE to allow Biblis-A to operate beyond 2009 by transferring kilowatt-hours of lifetime from the Muelheim-Kaerlich PWR. Sources said that RWE will challenge that decision in court and that the case would likely be heard by judges before the end of 2008. ------------ Tom Coutu to head Exelon Nuclear's Midwest operations Washington (Platts)--8Feb2008 Tom Coutu is to be Exelon Nuclear's vice president for Midwest operations under an "executive realignment" that will take place over the next couple of weeks, the US Nuclear Regulatory Commission's Region III office said in the agency's Thursday report. Coutu is currently site vice president at Braidwood. Bryan Hanson, currently site vice president at Clinton, will take over for Coutu at Braidwood, and Clinton plant manager Russ Kearney will be promoted to site vice president. Mark Kanavos, formerly plant manager at Luminant's Comanche Peak, will become Clinton plant manager. Exelon Nuclear spokesman Adam Slahor said Friday that the realignment was "part of our overall talent development process." ------------