EDF
Energy CEO Vincent de Rivaz denied the company was trying to recoup
construction cost risk via the “strike price” for power for its two
planned EPR reactors at Hinkley Point C.
But
a colleague at a rival nuclear company said construction risk for the
reactors it plans to build would have to be accounted for either in the
strike price or via some sort of “adjustment mechanism.”
Speaking before the House of Commons Energy and Climate Change Committee earlier this
week de Rivaz said that EDF is not asking for construction cost overrun risks to be included in the “strike price.”
The
strike price comes through a long-term contract with a guaranteed price
for power from the reactors. EDF is currently negotiating the strike
price for the Hinkley Point C reactors in Somerset, England with the
Department of Energy and Climate Change.
De
Rivaz’ answer contrasted sharply with that from his colleague at the
NuGen consortium, which is currently the only other active consortium
planning to build new reactors in the UK.
NuGen
is owned by GDF Suez and Iberdrola. The latter owns Scottish Power.
NuGen is planning to build new reactors at its Moorside site near
Sellafield in northwest England.
Rupert
Steele, director of regulation, Scottish Power/Iberdrola, told the
committee that construction risk would have to be allowed for either in
the strike price or through some kind of adjustment mechanism.
“These
are large projects working with relatively new designs which Europe has
a relatively limited track record in building. To the extent that there
is uncertainty, it will either be necessary to allow for that in the
strike price or to have some kind of adjustment mechanism,” Steele told
the committee October 23.
“Our
view at the moment is that it’s too early to tell which of these two
routes has the better outcome for consumers and investors,” Steele said.
NuGen
isn’t looking to take an investment decision until 2015, whereas EDF
plans to take it’s investment decision by the end of this year.
Managing Construction Risk
De
Rivaz told the committee that the way to deal with construction risk is
to reduce that risk from the start. “The key issue is to have a
stabilised design before we start construction,” de Rivaz said, “to make
all the engineering studies in detail before starting construction.”
But
with a 2013 construction start looming, EDF and Areva still have 22
outstanding generic design assessment (GDA) issues to resolve on the UK
EPR before the end of the year.
EDF
and Areva are co-applicants for design certification for the UK EPR
under the Office for Nuclear Regulation’s (ONR) GDA program.
The
GDA issues are generic safety issues that were unresolved when ONR and
the Environment Agency issued their interim design acceptance
confirmation (I-DAC) and interim statement of design acceptability,
respectively, last December.
EDF and Areva have
recently revamped
their programs in an effort to speed up closure of the outstanding GDA
issues and are now planning to finish in a few months what they had been
planning to accomplish over the course of this year.
Together,
they have so far closed out only nine of the original 31 GDA Issues and
are currently at risk of extending the program into
2013.
Even
if EDF and Areva are successful in closing out the 22 remaining GDA
issues on the UK EPR by the end of the year as planned, one critic fears
they will do so only by shifting unanswered safety questions into the
licensing phase of the new reactors.
Nuclear
engineer and industry critic John Large says this could turn EDF’s
planned project for two EPR reactors at Hinkley Point C into an
“Olkiluoto-3”-style situation with cost overruns and project delays
inevitable as regulators grapple with last minute design changes.
Shifting from GDA to construction
The ONR disputes Large’s criticism.
When
the GDA issues are closed, they often include so-called “assessment
findings” which are defined by ONR as “important safety items” needing
resolved, but which are “not considered critical to the decision to
start nuclear island safety-related construction.”
ONR
has said that it will not permit nuclear island safety-related
construction until all GDA Issues have been resolved. Assessment
findings, by definition, are not GDA issues.
There were 484 assessment findings when the ONR issued its I-DAC last December for the UK EPR.
Since then more assessment findings are being generated as part of the close-out process for the remaining GDA Issues.
An
ONR spokesman told i-NUCLEAR earlier this month that there is nothing
nefarious about the assessment findings. They are issues that are
site-specific rather than generic safety issues and by identifying them
now, the regulator is giving any future licensee a heads-up on what it
will have to deal with during the site licensing stage.
The
assessment findings are “part of the process for transferring findings
from GDA to the nuclear site licensing phase,” the spokesman said.
“These
findings will, rightly, be considered during the site licensing stages
as normal regulatory business,” the ONR spokesman said.
But
Large is not convinced. He says that of the 41 assessment findings
related to structural integrity that were included in the original list
of 484, 10 of them on structural integrity “are certainly not
site-specific issues.”
Contrary
to ONR’s earlier definition, these assessment findings “do relate to a
fundamental nuclear safety function,” Large said, because they refer to
the reactor pressure vessel, “which is a generic, high-integrity
component,” he said.
Resolving
some of these assessment findings “could result in not insubstantial
design changes being required” to the reactor pressure vessel, Large
said.
But if the vessel has already been manufactured and installed, there
may be no practicable redress other than modifying the safety assessment
instead, Large said.
Large
says that what is more worrisome is the assessment findings that could
be generated as both EDF and Areva, on the one side, and ONR, on the
other, rush to finish GDA by the end of the year.
With
only about two months to go before planned completion of the GDA
program, there are still 22 of the original 31 GDA Issues outstanding,
with the potential for even more assessment findings.
By
deferring unresolved issues to the construction/commissioning phase,
ONR is running the risk of compromising safety, Large says.
“This
problem confronted the Finnish nuclear safety regulator, STUK, at
Olkiluoto[-3], for example, with the reactor concrete basemat, the
primary containment steel liner, and, now very much overdue, the central
instrumentation and control system,” Large says.
EDF
Energy did not respond by press time to a request for comment regarding
the contrast between EDF's comments and those of NuGen on construction
cost risks, nor on Large’s criticism and the GDA process.—David Stellfox
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