Point Lepreau nuclear station – a heavy financial burden that keeps getting heavier.

Point Lepreau has become a heavy financial burden

the station will remain at risk of unplanned outages because of aging equipment.

NB Power’s latest financial plan forecasts its debt will continue to grow. In the utility’s base case model, debt will keep rising for the rest of this decade, reaching nearly $6.3-billion by 2029. It keeps rising even in more optimistic scenarios.

Point Lepreau station is among North America’s worst-performing nuclear power plants. Can New Brunswick Power turn it around?

Globe and Mail, MATTHEW MCCLEARN , July 29, 2024

In the early hours of Dec. 14, 2022, New Brunswick’s Point Lepreau Nuclear Generating Station lost power after an electrical fault. Just hours later, at 4:40 a.m., an alarm sounded: The plant had suffered a small coolant leak and NB Power, the facility’s owner, detected radioactivity. The station was locked down to prevent that radioactivity from escaping, and an emergency response team was readied.

Somehow, two unrelated pieces of equipment had failed simultaneously, touching off a costly and time-consuming recovery. Workers needed to bring the reactor to a guaranteed shutdown state. They had to regain entry to the reactor building and decontaminate it. And they needed to find the leak and stop it. The station would remain out of service for 42 days.

This outage was just one of several in recent years that, in combination, point to severe reliability problems at Atlantic Canada’s only nuclear power plant. The latest, which was planned to end after 100 days on July 12 and cost more than $100-million, included installing a new 9,000-horsepower primary heat transport pump and motor, which moves heat generated by the reactor to the station’s steam generators.

But NB Power spokesperson Dominique Couture said workers discovered a problem with the station’s main generator, which provides electricity to the province’s grid. At a rate hearing before the New Brunswick Energy and Utilities Board, company officials said the plant is expected to remain offline until at least September. And the station will remain at risk of unplanned outages because of aging equipment.

It will be many years before we have put those risks behind us,” said Jason Nouwens, the station’s director of regulatory and external affairs.

Point Lepreau is one of North America’s worst-performing nuclear stations. Intending to keep it running until at least 2039, NB Power has struggled unsuccessfully for the past several years to rehabilitate the station and expects to spend hundreds of millions of dollars more on it in the next few years.

The utility is not too proud to ask for help: It wants Ontario Power Generation to effectively incorporate the plant into OPG’s large fleet of Candu reactors. Key senior leadership positions at the station are now held by OPG employees.

But there’s no guarantee OPG will agree to take over the stricken station on favourable terms, or at all. And it’s not clear NB Power can afford the steep repair bill.

New Brunswick’s dilemma points to challenges that other provinces, such as Alberta and Saskatchewan, should consider as they look to build new reactors………………………………………………………………………….

According to NB Power, Point Lepreau has roughly 115,000 components. The December, 2022, outage illustrated how the failure of just one of them, however inconsequential it may seem, can knock it out. The culprit for the water leak turned out to be a crack in a small instrument line near the reactor core, about the diameter of a finger. This line had been deemed necessary for the plant’s commissioning more than 40 years earlier, but was useless thereafter.

NB Power concluded that when the station lost power, other systems fired up that increased vibration throughout the plant. “This was essentially the final straw that propagated the crack to a failure point,” Mr. Nouwens explained to the federal safety regulator during a hearing after the incident. “It had been coming for some time.”

Outages are expensive. Point Lepreau’s 900 workers must be paid regardless of how much electricity the plant generates. Each day it’s out of service, NB Power also incurs hundreds of thousands of dollars in overtime costs.

NB Power must purchase energy to cover the shortfall as well, at an average cost of $900,000 a day.

Repeated outages have forced NB Power to divert capital to the station. This thwarted efforts to repay debts, most of which were incurred at Point Lepreau. This year’s extended outage also forced the utility to delay work at other power plants…………………………………………………………………..

NB Power’s latest financial plan forecasts its debt will continue to grow. In the utility’s base case model, debt will keep rising for the rest of this decade, reaching nearly $6.3-billion by 2029. It keeps rising even in more optimistic scenarios.

Heeding nuclear’s siren song

When Point Lepreau was still being planned, some experts doubted how suitable nuclear power was for a small province. Andrew Secord, an economics professor at St. Thomas University, found a March, 1972, memo by Myles Foster, an official at the federal Finance Department, that said that NB Power’s decision to go nuclear was “the equivalent of a Volkswagen family acquiring a Cadillac as a second car.”

Since then, Point Lepreau has become a heavy financial burden. At various times, the province has considered shuttering it or selling it. Ultimately, though, NB Power’s board of directors decided in 2005 to double down and extend the station’s life.

Refurbishments compel utilities to make crucial decisions about which equipment to replace, and what to keep. Pressure tubes, the Candu’s main life-limiting components, are a given, but many other components must be carefully assessed. Misjudgments can be costly.

Point Lepreau’s refurbishment began in March, 2008, and was scheduled to wrap up by October, 2009, at an expected cost of $845-million. According to a 2002 NB Power document, even if all two dozen of the worst disasters the utility could envision came to pass – everything from delays to strikes to unexpected additional work – it would add up to a combined maximum overrun of $623-million.

But things went worse – far worse – than NB Power imagined possible. It called in OPG to assist. The reactor finally returned to service in November, 2012, three years late and massively over budget.

Even this might have been salvageable had the plant operated reliably thereafter. NB Power was counting on Point Lepreau reaching a capacity factor of 89 per cent. Instead, NB Power found itself playing a game of Whac-A-Mole with recurring maintenance issues…………………………

NB Power has acknowledged that while the 2008-12 refurbishment focused on the reactor itself, equipment in the rest of the plant – sometimes referred to as the “conventional” side – typically was not replaced. Some of that equipment, such as the problematic generator that recently delayed the station’s return to service, is now breaking down. The utility made bad calls and is now paying a terrible price.

Recovery plan

NB Power is now drawing up a recovery plan for its ailing station, which features greatly increased maintenance spending: more than $87-million in 2025, tapering off thereafter.

But according to ScottMadden, this likely won’t suffice. Spending less than $80-million a year is “slightly more likely than not to result in performance declines,” whereas spending $100-million to $120-million is expected to deliver “the highest marginal returns in expected improvements.” Under current plans, ScottMadden warned, Point Lepreau’s performance will likely decline again beginning in 2030.

OPG sent a delegation to the stricken station last year to assess its condition, examine maintenance plans and interview NB Power employees. Last September, the utilities signed a three-year agreement under which OPG has seconded staff to the Point Lepreau station. NB Power says it has received support from OPG’s chief nuclear officer, a vice-president who’d supervised refurbishments and outages, and a chief nuclear projects officer.

OPG and NB Power are now in talks that might lead to Point Lepreau becoming part of OPG’s reactor fleet. At a hearing before the New Brunswick Energy and Utilities Board in June, Ms. Clark said OPG would likely assume majority ownership and would bring “some capital to the table to help with some of the investments that are required in the station over the longer term.”

She added, however, that given the difficulty of reaching “even general agreement on things,” a deal likely wouldn’t be reached before late 2025.

Even as NB Power officials struggle to fix Point Lepreau, they continue to offer their services to provinces such as Alberta and Saskatchewan, which possess little prior experience with nuclear technology. At an industry conference in Calgary in April, officials offered to help such provinces evaluate new reactor technologies and work with regulators…………..

They did not share any sense of the pitfalls of nuclear power – a topic for which NB Power has unfortunately gained formidable expertise.  https://www.theglobeandmail.com/business/article-point-lepreau-station-is-among-north-americas-worst-performing-nuclear/

July 30, 2024 Posted by Christina Macpherson | business and costs, Canada | Leave a comment