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Moorside nuclear power project now at serious risk

Moorside Failing New Nuclear Programme should be Scrapped No2NuclearPower, No.93 March 2017

Doubts Plans for three new AP1000 reactors to be built at Moorside in Cumbria next to Sellafield are now at risk from the financial crisis engulfing Toshiba. Toshiba owns 60% of Nugen, the consortium working on the plans. Nugen has said it wants to take a final investment decision by the end of 2018 in order to generate the first power in about 2025. However, it already faces an uphill battle to secure financing in time. Toshiba and France’s Engie, which owns the remaining 40% of NuGen, are believed to have been in talks for months with South Korea’s Kepco and are also understood to be talking to the UK and Japanese governments about potential financial support. (11)

But Kepco told the FT that it was not in talks with Toshiba about participation in NuGen, although several people involved in the process said South Korean investment was the best chance of keeping the project alive. “It’s hard to see how Moorside can go ahead without Kepco,” said one senior nuclear industry figure. It is thought that if Kepco were to get involved it would prefer to use its own reactor design, the APR-1400, rather than Westinghouse’s AP1000. This would set the project back at least four years because the Korean technology would need approval from UK regulators, while Westinghouse’s has nearly completed the clearance process. (12)

Cumbrians may be glad to see the back of corruption-plagued Toshiba ‒ but corruption-plagued South Korean utility KEPCO wouldn’t be much of an improvement. Cumbrians Opposed to a Radioactive Environment (CORE) commented:“KEPCO is itself still emerging from a major scandal that surfaced in 2012 involving bribery, corruption and faked safety tests for critical nuclear plant equipment which resulted in a prolonged shut-down of a number of nuclear power stations and the jailing of power engineers and parts suppliers.” (13)

Engie has also sounded increasingly lukewarm about Nugen, with Isabelle Kocher, chief executive, saying last year that there was “a place for nuclear new-build in the world, but less than before”. In December it was reported that Engie would like to abandon its 40% share of Nugen. (14)

US nuclear firms can only deal with overseas companies if the countries have a nuclear cooperation agreement. The US holds such an agreement with Euratom but not with the UK, raising the possibility that Westinghouse could be unable to continue working on the project once Britain leaves Euratom until a new bilateral deal is signed.

After much speculation that Toshiba would withdraw from the NuGen consortium, it now says it will “consider” a continued role in the development, so long as it can avoid any involvement in construction. Having completed a review of overseas nuclear operations, the company said it will seek to “exclude risk inherent on construction work and focus on equipment supply and engineering” in future. (15)

If NuGen is to make a final investment decision in 2018 and get the reactors up and running by 2025 there are huge challenges still to be overcome – a timescale many in the industry already think is highly unrealistic. The fact that Toshiba will no longer take on any of the financial risk of construction means Moorside is only likely to go ahead if new investors can be found to build the plant. (16)

March 4, 2017 - Posted by | business and costs, UK

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