Vendors’ views ABB Atom

1 October 1998

The coming decade is a vital one for the nuclear power industry. With many old plants coming to the end of their operating lives, decisions will soon have to be made regarding what form of power generation will replace them. NEI asked the major vending companies to answer questions addressing the issues most likely to effect the industry’s future.

1. ABB will continue to provide new pressurised water reactor and boiling water reactor plants, systems – including retrofits, services to operating plants, nuclear fuel and core components. Services include steam generator repair and inspection, instrumentation and control upgrades, power upgrades, plant life extension, licence renewal and decommissioning.

2. Distinct possibilities exist in the People's Republic of China, the Republic of Korea, and the Democratic Republic of Korea, and Finland. China’s nuclear programme makes it the largest potential market for new plants. In the Republic of Korea five additional ABB plants of the System 80 design are under design and construction, in addition to three in operation. We expect to be involved in future 1000 MWe units in Korea as well as the development of the 1400 MWe Korea Next Generation Reactor programme. We also expect to be involved in the KEDO project in North Korea. In Finland the environmental impact of building a new nuclear power plant is being studied for the two existing sites.

3. Nuclear power plants generate safe, environmentally sound and cost-effective electricity. Economic growth creates a need for energy of all kinds. Nuclear energy is more attractive where there is a lack of natural energy resources.

4. Asia is the largest market for new plants and services. The US and European markets will continue to grow in the area of fuel, services and decommissioning of older plants.

5. Long term growth, particularly in the Asia region, is still the major force behind our business. The majority of our business will continue to be in fuel and services, less in new plant construction.

6. The economic recovery in Asia is key to the long term development of new projects. Services and fuel business will be impacted to a small degree by the situation in Asia. In China it will be a key to building their local capabilities through technology transfer and localisation. Outside of Asia, plant life extension and plant modernisation will be key opportunities for the near term. In the long term, we will need to introduce technology improvements, reduce regulatory uncertainty, and implement new business arrangements, to make new nuclear plants more economically competitive in the US and Europe.

7. We have many reasons to believe that nuclear power will continue to be an important option for the generation of electricity in many parts of the world. In regions of the world where fossil fuels are less abundant and more expensive (eg, Asia), nuclear energy is still very competitive. In addition, the growing pressures to reduce greenhouse gas production are forcing many nations to consider ways to encourage the deployment of energy alternatives that do not produce greenhouse gases. Although wind and solar are the alternatives that are first mentioned, nuclear energy is still the most economical option among the non-greenhouse gas emitting technologies.

8. The work with the BWR 90+ and the System 80+ advanced plant designs provides a solid basis for the retrofit and modernisation projects; advanced BWR and PWR fuel types have been introduced; and instrumentation and control systems are being replaced by modern, advanced ones such as the ABB Advant product line. In addition, the US Department of Energy is planning to launch the Nuclear Energy Research Initiative; we believe it will play a major role in developing new technology applications to make new nuclear plants more competitive in a deregulated power marketplace. We hope to participate in the DOE programme.

9. ABB is concentrating its efforts on improving the LWR designs. We see no market opportunities for non-water based reactor technologies over the next twenty years. Without a significant rejuvenation of the new plant market based on light water reactor technology, there will be no industry in place – and, therefore, no long-term opportunity – for deployment of these more advanced reactor concepts.

10. Yes. The discussions about global warming and its causes have increased in intensity and attracted greater attention from media, environmental groups, and government officials. In the recent UN conference in Kyoto nuclear power was mentioned as one of the means of CO2-free power generation. Environmental organisations are beginning to recognise that it is important to keep the current fleet of nuclear power plants operating in the US and Europe. To meet reduced greenhouse gas goals, some nations are starting to consider establishment of financial incentives for constructing power generation plants that do not produce greenhouse gases.

Each company received the following questions:

1. What activities are likely to be the most important to your business in the next decade? 2. In which parts of the world, if any, do you see expansion of the industry? More particularly, where is there potential for new plant construction? 3. What are the reasons why there is likely to be expansion in these regions and not in others? 4. What other markets are there likely to be for your products and services? 5. In 2010, what proportion of your business is likely to be in construction of new plant, compared with other activities? 6. What issues do you think are likely to be most important in shaping your future business and what do you consider to be the greatest uncertainties? 7. Are you optimistic or pessimistic about the future of the industry? 8. What new technologies and projects are you working on which could help nuclear power to compete in privatised markets? 9. How likely is it that advanced reactor concepts, such as fast reactors, will become competitive? What factors will be important to their development? 10. In 1990 a number of vendors cited increasing environmental concerns, in particular the connection between fossil fuel power and the greenhouse effect, as an important factor in encouraging new reactor orders around the world. Are there signs that this is happening?

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