nuclear-news

The News That Matters about the Nuclear Industry

As if in a department store sale day, foreign nuclear companies compete to sell their radioactive products to Britain

Foreign companies flock to build nuclear plants in the UK  A South Korean firm is just the latest to be lured by Britain’s atomic amibitions as safety concerns and cost stalk the industry, Guardian, , 26 Mar 17, Nuclear energy faces an uncertain future globally as concerns over safety and cost dog the industry. But in the UK, foreign investors are queueing up to back projects. The latest is South Korea. Its biggest power company is in talks to join the consortium backing a nuclear power station in Cumbria, in a sign of the continuing allure of Britain’s atomic ambitions to international companies. Kepco said last week it was interested in taking a stake in NuGen, which is 60% owned by Japan’s Toshiba and 40% by France’s Engie, confirming what had been an open secret in the industry for months.

Kepco’s president, Cho Hwan-eik, said that once the terms of a potential deal were ironed out, “we will be the first to jump into the race”…….

Potential investors have been drawn by the UK government’s enthusiasm and a nuclear standstill elsewhere, amid lingering safety fears in the wake of the Fukushima disaster and cost overruns at the Flamanville site in France which is using a new reactor design. As a result, South Korea has joined Japan, China and France in showing interest in British nuclear.

It’s pretty simple. We are the only people building new nuclear power stations and we have by far the biggest new nuclear programme outside China for the next 10 years,” said Peter Atherton, an analyst at consultancy Cornwall Energy. “The civil nuclear programme globally doesn’t have any orders.”

 One expert, Mycle Schneider, called the UK the “last hope” for the nuclear construction giants of the world. The Paris-based nuclear consultant said: “In Korea the political situation will dramatically change after the upcoming elections, [probably] not in favour of the nuclear industry. Success overseas will help survival at home. The Japanese industry clearly has no future at home and little prospects abroad [because of Fukushima].”

The UK has also dangled the prospect of economic support for foreign nuclear builders. French state-owned EDF, which is building two new reactors at Hinkley Point in Somerset at a cost of £18bn, struck a subsidy contract with the government that will see it guaranteed twice the wholesale price of electricity for 35 years. The deal means Hinkley would be an “absolute goldmine” when operational, Atherton said.

He said UK financial support was not dissimilar to the deal Kepco has in the United Arab Emirates, where it is building four new reactors paid for by the UAE’s state-owned utility. “The economics of the project, and the economic risks of the project, fall on the host government,” said Atherton.

There is also the prospect that the UK government could take a stake in one of the new nuclear sites. Leaks to Japanese media revealed officials in London and Tokyo had discussed the UK offering state finance to a project led by Japan’s Hitachi to build reactors next to the site of an old one at Wylfa in Wales………https://www.theguardian.com/business/2017/mar/25/foreign-firms-flock-to-build-nuclear-plants-in-uk

March 27, 2017 Posted by | marketing, UK | Leave a comment

Britain will struggle with nuclear regulatory system, after leaving European Union

Top nuclear boss advising May on protecting atomic industry from Brexit blow Energy Voice , 26 Mar 17 The German head of one of the UK’s top nuclear companies is counseling Prime Minister Theresa May’s government on what needs to be done to protect a global hub for the industry from Brexit.

With European Union leaders congregating to celebrate the Treaty of Rome’s 60th anniversary, Urenco Ltd.’s Chief Executive Officer Thomas Haeberle said he’s cautiously optimistic that new rules can be negotiated to guarantee the flow of nuclear materials in and out of the U.K. after the nation leaves the bloc.

“We are making the U.K. government, which is also our shareholder, aware of the requirements our business needs to fulfill in the context of Brexit and of leaving Euratom,” said Haeberle, referring to the European Atomic Community, a part of the EU’s bedrock agreement signed on March 25, 1957 – 26/03/20

Just as bankers have made London a global financial hub, nuclear workers have turned Britain into a central cog servicing the world’s flow of atomic materials. Urenco, the world’s second-biggest maker of reactor fuel, runs a factory in Capenhurst and oversees its global distribution network from Stoke Poges outside of London.

Owned by the U.K. and Dutch governments as well as German utilities EON SE and RWE AG, Urenco has set up a working group that “deals with all the risks and the possible mitigations,” Haeberle said. He spoke with Bloomberg a week before the EU celebrates Euratom’s 60th anniversary, his first interview since becoming CEO in January 2016.

Euratom’s main function is to safeguard nuclear fuel, making sure it isn’t diverted to make weapons. The U.K. will lose that service once it departs the EU. Nuclear fuel suppliers and power plants need certification from Euratom or whatever system succeeds it to buy material on the open market.

For Urenco’s business to continue uninterrupted after the U.K. leaves the EU, negotiators will have to seal new agreements with governments around the world setting out the new regulatory system Britain will follow after it leaves Euratom……..

Companies like Urenco face a potentially “high impact” from Brexit, Moody’s Investors Service wrote in a May 22 note saying that the overall credit impact from leaving the EU will be modest. Urenco, which has 2.1 billion pounds ($2.6 billion) of outstanding debt is rated Baa1, two grades above junk by Moody’s…… https://www.energyvoice.com/otherenergy/134874/top-nuclear-boss-advising-may-protecting-atomic-industry-brexit-blow/

 

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March 27, 2017 Posted by | politics international, safety, UK | Leave a comment

Britain’s Office for Nuclear Regulation (ONR) sounds alarm over doctored papers & security breaches at French nuclear parts supplier

UK watchdog sounds alarm over doctored papers & security breaches at French nuclear parts supplier, Rt.com  25 Mar, 2017 

The ONR report, obtained under a Freedom of Information request and seen by Reuters, gives details on the December 16 visit by an international monitoring team to a French Creusot forge, operated by the country’s state-owned nuclear supplier Areva.

In the report, the UK watchdog warned that safety procedures at Creusot were far below the required standards for a key nuclear equipment supplier. That, they said, could lead to severe consequences for EDF’s [the largest energy company in France] Hinkley Point nuclear project currently under construction in southwest Britain, which is set to receive forgings from Creusot.

“ONR should consider the adequacy of EDF’s… oversight and assurance arrangements for Areva as a key supplier to Hinkley Point, given the performance shortfalls at Creusot Forge and the associated risks to [nuclear] components manufacture,” the regulator said, as cited by Reuters.

Among the breaches was the continued use of correction fluid on documents at the foundry, despite an earlier ban.

The ONR report also inquired into why internal inspections and audits carried out in past decades at Creusor Forge had not discovered and dealt with any of the falsification activities.

Following the December findings, two EDF nuclear reactors were stopped for months, utilities worldwide started reviewing Areva-made parts, and Paris launched a probe into the suspected falsification of documents.

The inspection of the troubled facility was carried out last year by an international team from France, Canada, the US, China, Finland, and Britain…….https://www.rt.com/news/382273-nuclear-france-failure-uk/

March 27, 2017 Posted by | safety, UK | Leave a comment

Ireland demands to be consulted on potential effects of nuclear power station on England’s west coast

Ireland issues powerful demand to have say on UK nuclear plant, Sunday Times, Environment minister Denis Naughten has asked the UK to consult Ireland on the potential effects of a nuclear power station on England’s west coast, 250km from Rosslare.

The Irish government has stopped short of calling for a full environmental impact assessment (EIA) of Hinkley Point C, the first new nuclear station in the UK in more than 20 years, however. Were such a study held, the Irish public could comment on the plans.

The environment department said it was a “matter for the UK to decide” whether work on Hinkley C should be put on hold while potentially affected countries such as Ireland are consulted, as recommended by a United Nations committee.

The UK has been criticised at the UN for not consulting neighbouring countries…http://www.thetimes.co.uk/edition/ireland/ireland-issues-powerful-demand-to-have-say-on-uk-nuclear-plant-nvb7q0rf8

March 27, 2017 Posted by | environment, UK | Leave a comment

As Toshiba’s $500m nuclear bankruptcy looms, Brtitain’s Moorside project looks doubtful

Fears for Moorside as Toshiba ‘lining up’ $500m bankruptcy backstop for Westinghouse nuclear arm,Telegraph UK  21 MARCH 2017 Fears that Toshiba’s struggling nuclear business Westinghouse could be on the brink of going under have been reignited following reports that it is lining up a US bankruptcy protection finance package.

The company is reportedly reviewing proposals from financial institutions and investment firms for a so-called debtor-in-possession loan to keep the company afloat while it undertakes a bankruptcy process.

According to Reuters, people familiar with the matter have said the loan is likely to be over $500m to enable the heavily indebted company to pay employees and complete the work on four nuclear power plants in the US. The projects are the first nuclear reactors to be built in the US for thirty years, but heavy delays have saddled Toshiba with writedowns of 712.5bn yen (£5bn).

The sources warned that the talks are at an early stage and that no final decision has been made to wind down the company. A UK spokesman for the company was not immediately able to comment.

A potential bankruptcy procedure raises serious questions over the future of a key £10bn nuclear project which plans to use the AP1000 nuclear reactor designed by Westinghouse.

Toshiba is a 60pc shareholder in the NuGeneration consortium, which plans to develop the Moorside project alongside France’s Engie, formerly known as GDF Suez.An early exit from Toshiba could heavily delay the start up of the 3.2GW Moorside project while NuGen scrambles to find new investment and approve a new nuclear reactor design to use in the project……
The company said it will deliver its full year results on April 11, its third scheduled date after failing to disclose the full impact of its Westinghouse woes twice before. http://www.telegraph.co.uk/business/2017/03/21/toshiba-lining-500m-bankruptcy-backstop-say-reports/

March 24, 2017 Posted by | business and costs, UK | Leave a comment

Campaign groups mobilise against UK’s Bradwell nuclear power project

‘Take Bradwell off the nuclear list now’ – Campaigners call for review of Government proposed sites http://www.gazette-news.co.uk/news/15168807.___Take_Bradwell_off_the_nuclear_list_now______Campaigners_call_for_review_of_Government_proposed_sites/ Rebecca Creed, Chief Reporter / ,  21 Mar 17 A CAMPAIGN group fighting against a new power station at Bradwell has called for the proposed site to be removed from a Government list.

In 2011 the Government revealed a list of eight sites deemed “potentially suitable” for new nuclear stations, including Bradwell.

But Blackwater Against New Nuclear Group (BANNG), which has campaigned against a new power station, believes the list should be reviewed. It comes as the group, along with other campaigners, submitted their response to a pre-application consultation for Sizewell C in Suffolk.

Andy Blowers, chairman of BANNG, said: “The policy for new nuclear power stations is out of time and out of order and safer, less expensive and environmentally-sustainable alternatives need to be put in place.”

In January, it was announced the Government had asked nuclear regulators to begin the process of approving a Chinese-designed reactor for a new power plant.

EDF Energy signed a deal with China General Nuclear Power Corporation for Bradwell B, a greenfield site next to the former station.

The Chinese company will provide two thirds of the development costs of Bradwell B and hopes to begin construction by 2023..Up to 25,000 jobs will be created during construction, although it is unclear how many vacancies will be filled by residents.

Mr Blowers added: “In the coming months BANNG will continue its campaign to oppose the Chinese nuclear project at Bradwell, which threatens to destroy a precious environment and inflict harm on present and future generations.

“At the local level we will work with the communities around the Blackwater to thwart the project in its early stages.

“At regional level we will back Together Against Sizewell C’s legal challenge to the Government’s nuclear policy.

“And, at the national level, with other protest group leaders, we shall fight to have both Bradwell and Sizewell removed from the list of nominated sites for new nuclear power stations. The Government’s policy is misguided and in need of urgent review.”Harwich and North Essex MP Bernard Jenkin has said a new power station could threaten the eco-system of the Blackwater estuary at Mersea.

March 24, 2017 Posted by | opposition to nuclear, UK | Leave a comment

Request by UN to Britain: Pause Hinkley Nuclear Plant Work for Environmental Assessment

UN Asks U.K. to Pause Hinkley Nuclear Plant Work for Assessment https://www.bloomberg.com/news/articles/2017-03-18/un-asks-u-k-to-pause-hinkley-nuclear-plant-work-for-assessment by Grant Smith and Alex Morales March 19, 2017 

  • UN committee calls for halt to allow environmental studies
  • EDF won approval to build 18 billion-pound plant in September

A United Nations committee asked the U.K. to suspend work on the Hinkley Point nuclear power plant pending assessment of the environmental impact.

The UN Economic Commission for Europe requested the pause, it said in a document on its website. Electricite de France SA, the French state-controlled utility, won approval to build an 18 billion-pound ($22.3 billion) nuclear plant on England’s western coast in September. To help shoulder the construction costs, EDF convinced China General Nuclear Power Corp. to take 33.5 percent of the project.

The UN committee recommended the halt until it established whether “a notification under the Espoo Convention” was useful, according to the statement. The Espoo Convention sets out the obligations of countries to “assess the environmental impact of certain activities,” according to the commission’s website.

Bouygues SA and Areva SA have received contracts for work at the plant.

March 20, 2017 Posted by | politics international, UK | Leave a comment

UK plans for small nuclear reactors stalling. Bechtel pulls out.

Bechtel pulls out of mini-nuclear development, Construction News, 17 MARCH, 2017 Bechtel is to pull out of small modular reactor development, the US engineering giant has confirmed. The company said it would no longer be attempting to create its own SMR reactor after it was unable to find investment for its programme, or a utility company that would provide a site.

Bechtel’s SMR aspirations were as part of mPower, a joint venture with energy giant Babcock & Wilcox…..

Bechtel will take itself out of the government’s SMR reactor design competition.

In March 2016 the government launched its £250m SMR competition which set out to identify the preferred reactor technology to be rolled out across the UK over the next 15 years. The Bechtel team was listed as one of the 33 parties to have made it past the first round of the competition, including engineering firms such as Atkins and contractors such as Costain.

Alongside firms such as Westinghouse and NuScale Power, the mPower JV was one of the companies capable of developing the technology after its reactor design was recommended for “further government investigation” by the National Nuclear Laboratory in 2014.

The competition has stalled ever since, with sources telling Construction News that they have been largely left in the dark by the government over the next steps……

March 17, 2017 Posted by | business and costs, politics, technology, UK | Leave a comment

UK government boycotts UN nuclear disarmament talks

UN nuclear disarmament talks: UK Government not attending discussions labelled ‘reckless and irresponsible’ ‘I don’t think it’s taking nuclear disarmament seriously,’ Green Party leader Caroline Lucas tells The Independent Harriet Agerholm  @HarrietAgerholm 15 Mar 17 The Government has been called “reckless and irresponsible” after it refused to send a single representative to United Nations (UN) talks about a ban on nuclear weapons.

The Foreign Office revealed that no one from the UK attended a February meeting ahead of the negotiations and no one would go to the discussions when they take place later this month.

It was responding to a parliamentary question by Green Party co-leader Caroline Lucas, who told The Independent that it showed the Government was being “massively hypocritical” and failing in its commitment to working towards a world without nuclear weapons. …..

  • “The Government has said it’s committed to multilateral nuclear disarmament,” Ms Lucas said, adding that whenever ministers are asked to get rid of Trident – the UK’s nuclear weapons system – they “always say we’re not going to because it’s unilateral.”

    The Brighton MP said: “Now there’s opportunity to have a multinational set of negotiations and they’re not even bothering to turn up. I just think it’s mind blowing.”

    Although the talks may not immediately agree on an outright ban, Ms Lucas said they were an important step towards reducing nuclear weapons internationally.

    “Essentially what such a major global moment does is to help delegitimize the weapons,” she said, “that can’t be underestimated.

    “So although clearly we’re not going to have the nuclear weapons states signing up by June, the very existence of that treaty will make it more likely that those countries that have them will begin to negotiate to get rid of them.”

  • Ms Lucas has applied to the Backbench Business Committee to get parliamentary time allocated to debating whether the UK should be represented at the UN talks…….http://www.independent.co.uk/news/uk/home-news/un-nuclear-disarmament-talks-uk-government-not-attend-caroline-lucas-mp-reckless-irresponsible-123-a7631546.html

March 17, 2017 Posted by | politics international, UK, weapons and war | Leave a comment

Guides to nuclear war survival don’t work: “Protect and Survive” Exhibition

Why there’s no modern guide to surviving a nuclear war https://theconversation.com/why-theres-no-modern-guide-to-surviving-a-nuclear-war-73498  March 17, 2017 The risk of thermonuclear war has rarely been greater. But despite the growing threat, the general public are less prepared than they ever have been to cope with an attack. With Trump in the White house, Putin in the Kremlin, North Korea testing ballistic missiles and the perilous state of military security, nuclear war is a real possibility.

It would kill millions (perhaps billions) of people, leave many more seriously injured, coat the planet in radioactive fallout and destroy the ecosystem. The Doomsday clock, which measures how close we are to apocalypse, has been moved from five to three minutes to midnight. Time is short – but the UK is not ready.

The reason the UK is so poorly prepared can be traced back to fairly recent times. In May 1980, the government created a series of public information films, radio broadcasts and the booklet Protect and Survive, which has now been reissued by The Imperial War museum. (The museum has said this is not in response to the current political situation, but as part of the first major exhibition on the anti-war movement.)

Protect and Survive was widely mocked for its advice, which included painting windows with white emulsion to reflect the heat flash from a nuclear explosion, storing water in toilet cisterns, and guidance on how to bury and label the dead. In response, the BBC showed a bleak film called Threads which showed how useless the advice would have been for most city dwellers. The Campaign for Nuclear Disarmament produced a version called Protest and Survive.

Protect & Survive – 1970’s UK Public infommercials On Nuclear War Preparation

The failure of Protect and Survive is the reason the UK doesn’t have public information on how to prepare for a nuclear war today.

My research reveals that the Home Office repeatedly attempted to resurrect Protect and Survive throughout the 1980s. It was hoped that a new and improved public information campaign would include the use of deep nuclear shelters, make provision for vulnerable people, and promote collective planning for a nuclear attack. The Home Office even employed an advertising agency which surreptitiously attended CND meetings to keep an eye on the opposition.

The planned new version of Protect and Survive would also cover advice on preparing for a chemical or biological attack. The Home Office’s failed aim was to produce a fresh public information package, including as many as 20 new television films to be produced by 1987.

But there are three reasons why it never happened. First, other government departments, particularly the Foreign Office and the Ministry of Defence, did not want the population to be reminded that Britain was the base for a new range of US nuclear weapons. In 1982, the Home Defence committee considered that fear of embarrassing the US military would be a good reason not to issue new guidance on protection against nuclear attack. It stated in a secret memo:

In the light of experience at Greenham Common, the United States might be concerned about the further focusing of public attention on their UK installations.

Second, new psychological studies had appeared which suggested that people might not be willing to follow any government advice in the event of a nuclear war. A Home Office report, “Population response to war”, written in 1982, decided that the social and economic burden on the UK might be such that the country would never recover.

Faced with social collapse on such a massive scale, it was predicted that the population would simply not follow official advice. People would try and escape rather than staying at home and hoarding food, in line with government guidelines. It was also predicted that the majority of the population would suffer from clinical depression after a nuclear attack and be mentally unable to follow instructions.

Finally, there was deep and vocal opposition to civil defence in the United Kingdom. The advertising agency commissioned by the Home Office considered the general public to be apathetic and fatalistic with regard to their prospects for survival. Some local authorities declared themselves “nuclear free zones” and refused to consider civil defence measures. Even though a proportion of the population would have welcomed some form of advice, the critics made it difficult to produce any information that would not be immediately rejected in the media.

Ignorance is bliss

In 1989, the Berlin Wall fell and the pressing need to create a civil defence campaign disappeared along with the Cold War. Apart from some generic information on national emergencies, it is currently almost impossible to find out what we should do in the event of a nuclear attack. In some ways, this is what the government intended even before Protect and Survive, which was originally supposed to be released only if the prospect of a nuclear war looked likely.

Indeed there are good reasons for keeping us unaware. Releasing guidance may cause anxiety and even make other countries suspicious that our preparations are a sign that we intend to strike first.

On the other hand, if the government does intend to issue information at the last minute then it is taking a huge risk as to whether it can get the advice out in time. If an accidental launch, or an unexpected first strike, occurs then there may be no time. Maybe now is the right time to buy that reprinted copy of Protect and Survive – just in case.

Protect and Survive is published to coincide with IWM’s major new exhibition People Power: Fighting for Peace

March 17, 2017 Posted by | UK, weapons and war | Leave a comment

Cold War advice for nuclear attack

Draw the curtains, bury the dead: Cold War advice for nuclear attack, By Judith Vonberg, CNN March 16, 2017

 Story highlights

March 17, 2017 Posted by | UK, weapons and war | Leave a comment

UK’s Moorside nuclear project in more doubt, with Toshiba’s crisis

Toshiba delay causes further Moorside uncertainty, ITV, 14 Mar 17,  Toshiba has delayed reporting its third quarter earnings for the second time, leading to further uncertainty over the future of a major nuclear development in Cumbria.

The Japanese company owns a 60 percent stake in NuGen, the company behind the proposed Moorside nuclear project in west Cumbria.

However, Toshiba is expected to announce huge losses for 2016, and that it will pull out of nuclear projects outside Japan.

This is to do with its US nuclear unit Westinghouse, which is reported to have overpaid for another nuclear company by billions of dollars.

Westinghouse would supply three nuclear reactors to the Moorside nuclear plant in Cumbria. Toshiba first delayed announcing its third quarter financial results in February, after which the company’s chairman stepped down, and the further postponement was revealed this morning……..http://www.itv.com/news/border/2017-03-14/toshiba-delay-causes-further-moorside-uncertainty/

March 15, 2017 Posted by | business and costs, politics, UK | Leave a comment

UK’s Shadow Chancellor,John McDonnell vows to end nuclear power and nuclear weapons

John McDonnell’s vow to end nuclear power and weapons in first 100 days of a Labour government  9 MARCH 2017

John McDonnell, the shadow chancellor, has promised that Labour would bring an end to nuclear power and nuclear weapons in the first 100 days of a Labour government.

In footage uncovered by The Telegraph, Mr McDonnell said that he wanted to build on the early success of Gordon Brown, who mapped his first days in power shortly after becoming prime minister.

The shadow chancellor also said that Labour would introduce a wealth tax and a land tax, renationalise the railways and pull out of Afghanistan.

Speaking at a Labour meeting in July 2012, Mr McDonnell said: “From the Left now […] we should now be mapping out not in manifesto form but in a manual form the first 100 days of a Labour government going into power.

“The issues around energy, you immediately announce no more nuclear power. …….http://www.telegraph.co.uk/news/2017/03/09/john-mcdonnellvows-end-nuclear-power-weapons-first-100-days/

March 11, 2017 Posted by | politics, UK | Leave a comment

UK’s offshore wind farms cheaper source of electricity than nuclear power stations

Offshore windfarms set to become cheaper source of electricity than nuclear power stations
Government’s plan to turn UK into world leader in offshore wind energy receives boost as electricity price halves in five years
The Independent, Ian Johnston Environment Correspondent  @montaukian 9 Mar 17 Offshore windfarms are set to become a cheaper source of electricity than the Hinkley Point nuclear power plant and are also on track to undercut coal-fired power stations.

The Government, which has been trying to support offshore in the hope of turning the UK into a world-leader in the sector, plans to hold an auction next month in which generators will bid for a guaranteed price for their electricity, with the lowest offer declared the winner…….

  • Offshore wind in Europe cost about £190/mwh in 2012, according to Bloomberg New Energy Finance, but this figure has nearly halved in the last five years to just over £100/mwh.

    And now the industry is now predicting the UK will see offshore wind become cheaper than some of the more traditional sources of power generation.

    While the Government has an official policy against onshore wind, it has sought to promote the more expensive offshore turbines, partly because of the chance to establish a new industry in the UK based on the expertise developed by the North Sea oil and gas industry. It appears this may be starting to pay off years earlier than anyone expected…….

  • The UK auction to be held next month is open to technologies considered to be “less established”, such as offshore wind, biomass, wave and tidal schemes.

    A spokesperson for the Department for Business, Energy and Industrial Strategy said: “Offshore wind and clean growth is an important part of the Government’s industrial strategy and will be underpinned by £730m of annual support for renewable energy over the course of this Parliament, helping us meet our climate change commitments, deliver skilled jobs and drive growth across the county.” http://www.independent.co.uk/environment/offshore-windfarms-cheaper-electricity-energy-source-nuclear-power-stations-coal-a7620791.html

March 11, 2017 Posted by | renewable, UK | Leave a comment

Britain’s Failing New Nuclear Programme should be Scrapped

 financial-meltdownflag-UKNo2NuclearPower, No.93 March 2017  Toshiba’s announcement that it will not be involved in the construction of new nuclear reactors at the Sellafield ‘Moorside’ site in Cumbria has thrown into sharp relief the sorry state of the UK’s new nuclear policy which is clearly failing to deliver. It is obvious now that it can only be delivered with huge public subsidies the country can ill afford at a time when public services are under intense strain.

Toshiba announced on 14th February that it expects to book a €5.9bn write-down on Westinghouse ‒ more than it paid to buy a majority stake in the Company from the British government’s BNFL in 2006 ‒ and it expects to report a net loss of €3.2bn in the fiscal year to March 2017.Audited figures are now due on March 14.

The mess has been caused mainly by the delayed and over-budget AP1000 reactors being built in the US. The cost to complete four AP1000 reactors ‒ two each in South Carolina and Georgia ‒ will “far surpass the original estimates”. Combined, the cost overruns exceed US$10 billion. And since there is still a long way to go before construction of the four reactors is complete, there is plenty of scope for further cost overruns. (1) There is now even talk of the possibility of bankruptcy for Toshiba. Former Westinghouse boss Shigenori Shiga, appointed as chair of Toshiba following a US$1.3 billion accounting scandal in 2015, stood down from his position on February 14.

Toshiba says it would like to sell Westinghouse if that was an option ‒ but there is no prospect of a buyer. The nuclear unit is, as Bloomberg noted, “too much of a mess” to sell. And since that isn’t an option, Toshiba must sell profitable businesses instead to stave off bankruptcy. The company plans to sell most ‒ perhaps all ‒ of its profitable microchip business to prop up the nuclear carcass and avoid bankruptcy. The company might get €12.3‒16.1bn by selling its entire stake in its microchip business, said Joel Hruska from ExtremeTech. “That would pay off the company’s immediate debts,” Hruska said, “but would leave it holding the bag on an incredibly expensive, underwhelming nuclear business with no prospects for near-term improvement.” (2)

The ripple-effects of Toshiba’s latest problems will be many and varied. Japan’s ambitions to develop a large nuclear export business are in tatters. As recently as last year, Toshiba said it hoped to win 50 contracts to build new nuclear plants in India and China over the next decade. As well as Moorside reactor construction projects being planned in Turkey and elsewhere are up in the air.

But it is not just Toshiba that is in crisis. Over the past decade, international energy utilities Eon, RWE Npower, Iberdrola, SSE and Centrica have all confidently announced their commitment to building new nuclear power stations, whether at Hinkley Point, Wylfa or Moorside, but then had to pull out as they realise they cannot afford the huge levels of investment that such projects require. (3) In Europe, energy giants EDF, Engie (France), E.ON, RWE (Germany) and Vattenfall (Sweden), as well as utilities TVO (Finland) and CEZ (Czech Republic), have all been downgraded by credit rating agencies over the past year. All of the utilities registered severe losses on the stock market   http://www.no2nuclearpower.org.uk/nuclearnews/NuClearNewsNo93.pdf

March 4, 2017 Posted by | business and costs, UK | Leave a comment