Confusing signals - part 2

India

India announced that it has begun construction of a 500MWe prototype fast breeder reactor (PFBR), which is scheduled for operation by 2009. The PFBR is a pool-type, sodium-cooled, plutonium-uranium oxide fuelled reactor, which was indigenously designed at the Indira Gandhi Centre for Atomic Research at Kalpakkam in the state of Tamil Nadu. The PFBR programme is designed to make use of India's large resources of thorium as thorium-uranium fuel in the third stage. It will be fuelled with a uranium-plutonium carbide with a thorium blanket to breed fissile U-233. Uranium resources are limited and are being used for PWRs in the first stage and plutonium-uranium based reactors in the second stage. An important development in firming up technology for the PFBR is that the design life has been raised by 10 years to 40 years.

Construction started on RAPP (Rajasthan) 5 and 6, both of which are based on the standard Indian 235MWe PHWR. There are currently seven units under construction.

International

A panel representing the governments of ten nuclear countries selected six next-generation reactor concepts for joint development. All the concepts were considered by the Generation IV International Forum to be deployable by 2030, and some might be available as early as 2020.

Reactor concepts selected include a liquid sodium-cooled reactor, very high temperature reactor, supercritical water-cooled reactor, lead alloy-cooled reactor, gas-cooled fast reactor, and molten salt reactor. Five of the concepts would involve a closed fuel cycle. The high-temperature gas-cooled reactor was the only one that would rely on an open fuel cycle.

The sizes range from 150-1500MWe. At least four of the systems already have significant operating experience in most respects of

their design.

Iran

In February 2003, Iran announced that it had begun mining uranium deposits at Saqand, as part of its programme to attain self-sufficiency in the nuclear fuel cycle. Iran plans to develop a range of facilities to exploit the uranium ore. A uranium oxide processing plant has already been completed, and an advanced supercritical gas centrifuge enrichment plant, with an expected design throughput of 10SWU/year, under construction will complement this. Work has also started on a facility to produce yellowcake, while another facility is planned to complete the fuel cycle. Iran noted that the IAEA has been kept informed of Iran's activities in respect of uranium conversion, which has been confirmed by the IAEA. A spokesman for the US State Department said: "Iran's ambitions and costly pursuit of a closed nuclear fuel cycle only makes sense if it is in support of a nuclear weapons programme."

Iran has said that it will amend its 1974 bilateral safeguards agreement to improve IAEA access to nuclear facilities. The previous agreement did not cover the centrifuge plant. The IAEA visited the site in February 2003, and will make quarterly visits.

Japan

The main event in Japan this year has been the scandal over the falsification of inspection records at Tepco's nuclear plants. Ironically, in July 2002, Tepco announced that it intended to shorten the time it spent on inspections in order to increase the percentage of capacity used at its plants from 80% to 85%.

On 17 September, Tepco admitted that there had been "systematic and inappropriate management of nuclear power inspections and repair work for a long time" at its reactors. Tepco said that employees at various levels had felt a strong sense of responsibility to keep plants on line and not extend outages. This led to a failure to accurately report the results of core shroud crack tests dating back to the 1980s. Cracking in the core shroud was the subject of extensive checks from the late 1980s. Japanese operators agreed voluntary tests with the safety authority, and in Tepco's case, General Electric was contracted to carry them out. Some 29 sets of irregularities were found at Tepco's Kashiwazaki and Fukushima plants, but the information was concealed from the safety authority.

Japan's Nuclear and Industrial Safety Agency (NISA) and the Ministry of Energy, Trade and Industry (METI) were informed of the cracking by a GE whistleblower in 2000, but it was not until August 2002 that METI admitted the concealment and that it had been working with Tepco to reconcile all the faults in the intervening months.

Additional cases of covered up crack findings were reported at Fukushima I units 1-5, Fukushima II-3, and at Kashiwazaki-Kariwa 1 and 2. The inspections at these reactors were carried out by Hitachi and Toshiba, rather than by General Electric.

Tepco admitted that its staff manipulated main steam valves to reduce leak rates during containment testing in 1991 and 1992. The company said that during the two annual inspections at Fukushima I-1, plant staff knew that the containment leak rate was too high, and when government inspectors carried out the leak tightness test, staff injected air via the main steam isolation valves to reduce the leak rate measurements.

Tepco closed down all 17 of its reactors for safety checks. The Futaba regional energy policy promotion council ­ comprising civic leaders and representatives from eight municipalities that either host or have a nuclear plant nearby ­ said the units should

be restarted subject to government approval. Tepco restarted the 1315MWe Kashiwazaki-Kariwa 6 reactor in May, after authorisation from the governor of Niigata prefecture and local mayors, as well as earlier approval from NISA. Tepco said it must have at least ten units back online soon, if it is to meet the expected peak electricity demand this summer.

Tepco presented a final inspections report to NISA in February 2003, which concluded that there has been no fraud over the last 14 years that could violate technical regulations or duties. The investigation only identified errors or omissions, as well as some minor cases of cracks that would neither cause any safety problems nor need to be reported to the authorities. Tepco has modified its approach to maintenance. It said that it would remove all cracks except very small ones. It said that it would "eliminate" cracks on the pipes of the recirculation system or replace the pipes.

As a result of the inspection incidents, the Diet has revised the country's Electric Utility Law and the Nuclear Reactor Regulation Law. The revisions provide for tougher penalties if utilities withhold information or violate other rules relevant to nuclear power safety.

In the wake of all this, a Japanese court has blocked the restart of the 280MWe Monju fast breeder reactor, which has been laid up since it suffered a secondary sodium leak in December 1995. The court said that the approval given by METI to the Japan Nuclear Cycle Development Institute was annulled because the safety case for its operation was inadequate.

Lithuania

Lithuania has agreed to an energy plan that calls for the closure of Ignalina 2 in 2009, provided that the European Union finances the shutdown. Lithuania had already agreed to close Ignalina 1 by 2005 as a condition of beginning negotiations to enter the EU. Agreement on the shutdown of Ignalina 2 was necessary for the country to be eligible for the "first wave" of new EU member states in 2004.

North Korea

Last year, the IAEA formally told North Korea that it had set two priorities to bring North Korea into compliance with the 1994 Framework Agreement: putting an isotope production laboratory under seal, and

beginning the reconstruction of the irradiation history of the graphite-moderated reactor at Nyongbyon.

In August 2002, first concrete was poured at the Korean Peninusula Energy Development Organisation's (KEDO's) project to build two 1000MWe PWR reactors. In October, North Korea admitted that it had been working on uranium enrichment, in contravention to the 1994 agreement.

As a result, the USA suspended deliveries of fuel oil. In response, North Korea said that it would refuse entry to international inspectors. In addition, North Korea restarted its programme of Soviet-designed gas-graphite reactors ­ a 5MWe research reactor and two power reactors of 50MWe and 200MWe.

With fuel oil supplies disrupted and a nuclear weapons programme in place, the Framework Agreement appeared to be in tatters. However, South Korean minister Jeong Se-hyum said that the disputes were simply part of a psychological battle between North Korea and the USA. He said that neither country had said that the Agreed Framework was over.

Russia

Novovoronezh 3, the oldest VVER-440 in operation, received a licence for another five years of operation. Previously, it had been operating on annual licences, pending completion of a major upgrade.

The modernisation of Novovoronezh 3 began in the 1980s, but has drawn the largest investment over the last three years. The current estimated core damage frequency has been assessed at 3.44x10-5, which is better than many PWRs in the West, and well below the 10-4 probability level accepted by the IAEA.

Russia plans to build a $360 million facility to store spent fuel at Zheleznogorsk in Siberia. Work on the facility would start in 2004, and it is due to be able to store 10,000t by 2007, and eventually to be able to store 40,000t in dry storage. The location was chosen to provide work for the specialists that will be available when the military reactors there are closed down.

In 2000, Russia and the USA signed the USA-Russia Cooperation Agreement, which stated that both countries would dispose of 34t of plutonium. The USA plans to either burn its plutonium as MOX fuel or dispose of it by mixing it with high-level waste before vitrification for storage. Russia plans to convert all its plutonium into fuel. However, the agreement has received setbacks. Both countries had planned to build new plutonium conversion facilities to convert the plutonium into MOX by 2007, but have both experienced delays in implementing their MOX programmes.

Prime minister Mikhail Kasyanov signed an order for the ADE-4 and ADE-5 reactors in Seversk to cease production of weapons-grade plutonium by the end of 2005. This is the first progress towards closing the reactors since 2000. However, meeting the deadline may be difficult. Senior officials in the US Department of Energy (DoE) said that the reactors might remain online for up to eight more years while fossil-fuelled plants are constructed or refurbished.

Sweden

One of the main issues in Sweden has been how long it will keep their reactors going, and the progress of the nuclear phase-out. During the Swedish election, the prime minister Goran Persson said that he is still committed to closing down Sweden's 11 remaining reactors, "with the caveat that there must be electricity which replaces nuclear so that southern Sweden is not without power." This has implications for Barsebäck 2, which was due to close in 2003. Persson said that he thought that this could be managed, but he

did not specify whether he is prepared to accept more imported electricity from Denmark. Generally, the government has been against increasing power imports.

The Swedish government granted limited permission for the loading of MOX at the three-unit Oskarshamn plant. This would allow 850kg of plutonium, from spent nuclear fuel from Oskarshamn, to be converted into MOX at BNFL's Sellafield plant. The government said that by allowing Oskarshamn to import the reprocessed fuel, Sweden was taking responsibility for handling waste that it had generated.

Switzerland

Switzerland's lower house of parliament rejected moves to introduce operating lifetime limits for their nuclear power plants. Two proposals to introduce lifetime limits of 30 years and 40 years were rejected by the National Council. Government proposals to ban the reprocessing of spent nuclear fuel as part of a new nuclear energy law were also rejected.

Taiwan

The Environmental Basic Law, passed by the legislature in November 2002, requires the government to turn Taiwan into "a homeland free of nuclear power." When asked by the Taiwanese legislature's science and technology committee about when Taiwan would be nuclear-free, Ouyang Min-Shen, the chairman of Taiwan's Atomic Energy Council, said that 2061 was the earliest date that the Lungmen plant ­ currently under construction ­ could be decommissioned.

Taipower identified control rod blades cracks at all four operating BWRs in Taiwan. Taipower replaced the cracked blades, but the root cause is still under investigation.

Ukraine

After the continuing cleanup work at Chernobyl, the main issue in the Ukraine has been that of the completion of Khmelnitsky 2 and Rovno 4 (K2R4). Both units were far advanced when work on them stopped after the break-up of the Soviet Union.

The European Bank of Reconstruction and Development (EBRD) is

considering a revised condition to release a $215 million loan that had been turned down at the end of 2001 by Ukraine because of the attached conditions. One of the four main loan award conditions of the EBRD was raising nuclear electricity rates by

2.5-2.8US¢/kWh. The EBRD was considering an option of 1.23-1.28US¢/kWh. Further progress on the K2R4 project depends on the results of monitoring and expert cost evaluation.

In November 2002, the Ukrainian parliament ratified a $44 million loan from Russia for completion of K2R4.

Ukraine's cabinet of ministers agreed in August on entering into a joint venture with Russia and Kazakhstan to produce nuclear fuel. The agreement outlines plans for cooperation by the three countries to develop and operate the joint venture as a closed joint-stock company. The venture, which will become a fully-fledged stock company in 2005, has a charter capital of $450 million.

United Kingdom

In August, British Energy (BE) and Scottish Power settled out of court their legal battle over a 1990 agreement that required the two companies to buy all of the electricity produced by BE's Hunterston and Torness plants.

Ironically, in the light of later events, BE reported a pre-tax profit of £42 million before exceptional items for 2001-2002. This comprised a £41 million UK loss and an £83 million North American profit.

BE tried and failed to meet a

September deadline to reschedule its debts and pay back an emergency government loan of £410 million, which was later increased to £650 million. BE's share price had been falling since the introduction of the New Electricity Trading Arrangements (NETA) in England and Wales in 2001. A much sharper fall was precipitated when BE's reactors at Torness and Heysham were shut for safety reasons. Over the course of the year, BE's share price had fallen by 80%. Trading was suspended when BE announced that it was seeking immediate financial support from the UK government prior to restructuring. Trading was only resumed once the government loan was in place.

The purpose of the loan was to enable BE to attempt to undertake solvent restructuring. This restructuring required BE to dispose of its interests in Bruce Power and AmerGen. BE sold its stake in Bruce Power, but has yet to find a buyer for its AmerGen stake. The restructuring plan was to meet

all uncontracted nuclear liabilities, decommissioning liabilities and historic liabilities relating to spent fuel through a nuclear liability fund (NLF).

The restructuring plan eventually received agreement from the UK government and BE's creditors. The plan has to be approved by the European Commission (EC) before the restructuring can be finalised. The EC is expected to make a decision on this by mid-2004.

As a result of the crisis, Adrian Montague and Mike Alexander replaced Robin Jeffrey as chairman and chief executive respectively of the company.

BE said that, in addition to the fall of wholesale electricity prices brought about by NETA, BNFL were partly responsible for the crisis. The two companies had been trying to renegotiate spent fuel management contracts for many years. BE argued that the fuel should be placed in long-term storage instead of being reprocessed, which would have saved BE some £200 million per year. However, this was only a part of BE's problem. BE's fundamental problem in the UK market is that it was having to sell electricity for less than the price that the electricity costs to produce.

BNFL announced a restructuring into two main business groups, nuclear utilities and government services. The nuclear utilities group includes the global fuel manufacturing, the reactor services business, transport, and reprocessing and MOX fuel fabrication. The government services business consists of the current Magnox plants, environmental services, and maintenance at Sellafield.

In February this year, the UK government produced its long-awaited energy white paper, which left deciding on new nuclear build to a future government. The government justified this by saying that a new programme of nuclear build would have destroyed the incentive for energy efficiency. A key objective of the white paper is to reduce CO2 emissions by 60% by 2050. One measure to achieve this is through an 'ambition' to increase the share of electricity from renewables to 20% by 2020 from the existing target of 10% by 2010.

In a white paper published in July 2002, the government proposed setting up a Liabilities Management Authority (LMA) with a specific remit for cleaning up the nuclear legacy. The LMA would take on the financial responsibility for all public sector civil nuclear

liabilities and assets, along with the associated legal responsibility for most of those currently belonging to BNFL. The government expects the LMA to develop competitive markets for clean-up contracts, believing that this will help stimulate innovation and improvements in safety and operating standards. While UKAEA and BNFL would have the opportunity to be suppliers of choice, the management of clean-up will be opened to competition, with a greater emphasis on competitive

procurement of decommissioning

and support services.

The OECD International Energy Agency (IEA) criticised the fact that nuclear power is not exempt from the UK's climate change levy. The IEA said: "The climate change levy is based on the energy content of the fuel rather than the carbon content. The levy could be modified to make it more effective in reducing emissions." In addition, the UK Royal Society said in a report that UK CO2 emissions were rising, and the Britain's existing climate change levy should be scrapped and replaced with a "carbon tax or system of CO2 permits."

United States

The continuing fall-out over the cracks at Davis Besse is one of the several significant aspects of the last year in the USA. FirstEnergy continued activities to replace the reactor pressure vessel (RPV) head. It acquired and used the RPV head from the closed Midland plant as a replacement, and FirstEnergy hopes to restart the plant in June 2003. FirstEnergy produced a report into the cracking, which acknowledged that plant personnel assumed that as cracking was a low probability event and the plant was relatively new, they would see the phenomenon elsewhere before it took place at Davis Besse. The NRC said that the probability of unacceptable events is always low and that FirstEnergy had assumed that cracking "couldn't happen". In its preliminary findings, the NRC said that the performance deficiencies that led to the cracking and the resulting corrosion damage were of "high safety

significance".

US nuclear operators plan to replace a total of 29 vessel heads by 2007. During last September's refuelling outage at North Anna 2, through-wall cracks in the penetration welds were discovered and Dominion decided to replace the vessel head immediately. The vessel heads at North Anna 1 and 2 have been replaced, North Anna 2 being the first US nuclear unit to successfully restart after vessel head replacement. FirstEnergy had already replaced the vessel head at Davis Besse, but is yet to receive permission from the Nuclear Regulatory Commission (NRC) to restart the reactor.

The House of Representatives approved a resolution designating Yucca Mountain as a repository for high-level waste. This was also approved by the Senate and the Bush administration. This formally brought an end to the 20-year evaluation and legal process. This enables the US Department of Energy (DoE) to prepare and submit a licence application to the NRC. The DoE is targeting 2004 for its application submittal, and 2010 for the start of disposal operations. However, the long-running debate is still not over. The issue of funding still has to be sorted out, and the Nevada state authorities have said that they will continue the fight on these grounds. However, the Bush administration signed the appropriation bill for fiscal year 2003, which included an allocation of $460 million for the nuclear waste management programme, up from the $336 million for FY2002.

Nevada has also filed several legal suits opposing Yucca Mountain, including one that argues that the DoE has violated the 1982 Nuclear Waste Policy Act because the government cannot give assurances that the site's geology will prevent radiation from seeping into the environment and that the DoE is resorting to engineered

barriers to contain the waste, in contravention of the 1982 law. The DoE said that the site is in full compliance with the 1982 requirements, as it relies on geology to contain the waste, and the engineered barriers only provide additional protection.

A side effect of the problems arising as a result of the delays in developing a high-level waste repository was seen in Minnesota. Xcel Energy is seeking

resolution of the future of nuclear

generation in Minnesota, because if Prairie Island were to continue to operate past 2007, the state legislature would have to raise the 17-cask spent fuel storage limit imposed on the plant.

The DoE signed an agreement with USEC to ensure continued supplies of Russian military-origin low enriched uranium to the USA. Under the agreement, USEC will take delivery of the LEU. In addition, USEC has decided that its Portsmouth plant in Piketon, Ohio will be the site of its American Centrifuge Demonstration Facility. Construction is scheduled begin in 2004, with operations of the lead

cascade starting in 2005.

There were several cases of licence renewal, with Turkey Point 3 and 4, North Anna 1 and 2, Surry 1 and 2, and Peach Bottom 2 and 3 obtaining 20 year licence extensions over the past year. North Anna and Surry were the first successful joint application for licence renewal.

The DoE selected Dominion Energy, Entergy and Exelon to participate in the early site permit (ESP) process, which is intended to speed up the process of obtaining NRC approval for sites for new nuclear plants. The utilities expect to submit applications by autumn 2003, for NRC approval by the middle of the decade. The DoE will share up to 50% of the cost of permit application expenses. While the DoE is trying to step up activities to enable the industry to construct new plants, it wants industry commitments before it makes steep investments.