Greenpeace and the Magic Documents - How they are mongering scares and totally missing the point about nuclear power - it's too expensive chuck

Readers will know we here at Forth Coming UK Energy deficit (FCUKED) have been following the construction of the new nuclear Reactor Olkiluoto 3 by Areva for a very long time . See official progress update here.

Now Greenpeace in a fine piece of mongering nuclear scares has published an article "Safety procedures in disarray at Finland’s Olkiluoto 3 nuclear construction site" under the banner

They say rather excitedly in the manner of a tabloid

..."Documents (what, where, who the authors are, source etc., unstated) seen by Greenpeace show that French company Areva is failing to implement vital safety procedures in the troubled construction of its prototype European Pressurized Water Reactor (EPR) in Olkiluoto, Finland. As well as being 2-3 years behind schedule, 70 per cent over budget, and experiencing 1,500 construction defects along with a damaging fire, the reactor’s safety cannot be guaranteed."

These magic documents they claim show that "Bouygues, an Areva sub-contractor, has had no qualified welding supervisors at the site for over a year and still does not have any. Staff are given a mere two weeks’ training instead of having the international standard university degree. The company also listed people who had not worked in the role as welding supervisors."

Then in the finest tabloid why oh why fashion they fashion questions based on these magic and unseen and inacessible to the reader documents.

"It is clear that there can be little public confidence in the construction of the Olkiluoto 3 nuclear reactor. How and why are we to believe assurances on matters of safety from the likes of Areva now and in the future? "

Then the MOnbiot calculus is brought into play ..."Think of a number ... er.. make it bigger"

" ..... why should we tolerate or allow such attitudes, incompetence and deception in the construction of a nuclear facility which, in the event of an accident, could cause massive, unquantifiable damage to our health and the environment? "

The Finnish Radiation and Nuclear Safety Authority (STUK) rejected Greenpeace's claims about serious security related flaws in welding work done at the Olkiluoto nuclear reactor construction site.

Petteri Tiippana, section head at STUK, told the Finnish News Agency (STT) yesterday that the STUK has closely monitored essential welding jobs. Some deficiencies were detected last summer in less important assembly welding, but they have been ordered to be fixed already, Mr Tiippana said.

According to Mr Tiippana the claims made Tuesday evening by a Finnish Broadcasting Company (YLE) television programme that the French Bouygues construction company would have forbidden its employees to report problems at the Olkiluoto construction site were far more serious.

"Such a working culture is not suited for a sensitive field like this under any circumstance," Mr Tiippana said.

A request for clarification has been submitted to Finnish utility Teollisuuden Voima (TVO), which has overall responsibility for the construction site.

The Finnish nation has taken immense care in developing Olkiluoto 3 and the public was allowed a referendum on the decision. Never before or since has there been so much public consultation and transparency.

STUK is a highly rational, competent regulatory authority.

Lord Patel has submitted a request for clarification of the Documents that greenpeace have seen.
Future problems with nuclear power

Safety is a continuing concern (not a problem) , good design practice, competent monitoring and regulation should ensure that problems in use do not occur.

The problem with nuclear power is one of cost of the electricity produced. see Thursday, May 29, 2008 Hutton , Brown call for "a significant expansion of nuclear power " ... well up to a point Lord Copper

In April this year two major (and well informed) Utility figures spoke about the concerns that a nuclear revival could be slowed or even halted if the current supply chain crunch ends up pricing nuclear out of the market.

Gerd Jaeger, is an engineer and Executive Vice President of RWE Power AG, he has warned vendors must "de-bottleneck the bottlenecks" at the front end of the nuclear power plant supply chain. Because of a shortage of manufacturing capacity for large forgings, vendors are asking potential customers to commit far in advance of concrete reactor projects.

Sandor Liive, CEO of Eesti Energia, the Estonian state-owned utility, said his company is considering several options for nuclear power because "nuclear is an option that any energy company that wants to be competitive in the future has to consider."

Among the options are construction, with Latvia, Lithuania and (perhaps) Poland, of a new plant at Ignalina, participation in a new reactor in Finland, and construction of a domestic nuclear plant.

Liive said Eesti Energia was "thinking about nuclear" only because the cost of domestic power production from oil shale was rising above the projected cost of nuclear power from new plants, at around €45/MWh.

HERE IS THE IMPORTANT POINT

At that level, which implied a capital cost of €2 million a megawatt, new nuclear was attractive, he said. "But if it were €3 million per MW and €65-70/MWh, there's no point" in investing in a new nuclear plant, "at least from Eesti Energia's viewpoint." (If the 1,600-MW Olkiluoto comes in at €5 million plus we are looking at well over €3 million per MW )

THAT WAS THE IMPORTANT POINT - GEDDIT ?

Material cost pressures affect all energy generating projects -- CCGTs, coal, wind, hydro, wave , not just nuclear.

RWE's Jaeger has revealed that nuclear power plant vendors are asking utilities to put down "hundreds of millions of euros" to reserve large forgings needed for the nuclear steam supply systems of modern reactors. It was "prohibitive for an investor" to commit such sums "at a very early stage of a project," when they did not know if the project would proceed.

Jaeger said that even in countries where new nuclear plants were on the agenda, "it's rather difficult to convince all the decision-makers" who need to act before a plant can be ordered and construction started.

He cited the need for public debate, time needed for regulatory approvals, and "the political environment" as uncertainties in a nuclear plant project schedule. Jaeger said "innovative approaches" were needed to finance new nuclear projects, in which risk is shared equitably among all parties.

It is evident that Gormless Gordon and his merry crew haven't a clue of the problems in even placing initial contracts for the first plants, the costs involved, the problems of manpower, especially skilled engineers. He is of busy balancing global supply and demand of the 300US$Trillion global oil market by easing the Petroleum Development Tax on 30 minor fields in the North Sea which were opened prior to 1993.

Oh Yes! He has also issued some more onshore licenses for oil which currently yields less than 1% of UK production and less than 1/2% of demand. every little helps - or the Treasury candle ends philosophy.

PS Tata of India is considering (15th August 2008) investing in new nuclear plant and they quote that General Electric of the US has developed an economical simplified boiling water reactor with a capacity of 1,500 MW per unit. Two such units will cost anywhere between US$2.75 and 3.25 billion. This represents a cost today of €4.5 to €5 billion for 2.2 MW or €2. 5 per MW.

Westinghouse of the US also has its advanced pressurised water reactor technology of 1,100 MW per unit capacity, costing US$3.5-4 billion for two units = less than €2. 0 per MW.

So Tata say " the minimum investment for us will be at least US$3 billion. We will go in for at least two units having a total capacity of 2,200-3,400 MW."

Presumably these are bang up to date costs - India has lower constructions costs, lower land costs, no planning problems etc.,

Tata made this announcement after the proposed nuclear cooperation agreement with the United States ( agrred with Dubya when he visited) cleared another hurdle, after the International Atomic Energy Agency unanimously approved the deal last week. Before coming into effect, the deal must still be approved by the Nuclear Suppliers Group and ratified by the American congress.

The controversial U.S.-India agreement would provide India with access to global nuclear fuel and technology in exchange for regulatory access to its civilian nuclear facilities. Its critics continue to attack India’s refusal to sign a nuclear nonproliferation agreement.

UPDATE : URANIUM COST

See graph above and also - "Uranium futures continue to paint a bright picture. August contracts are worth US$66, September futures are worth US$67, October US$69, November US$70, and December US$72. Looking further ahead, we find June 2009 futures worth US$74, and September 2009, December 2009, and March 2010 futures all worth US$78."

Hutton , Brown call for "a significant expansion of nuclear power " ... well up to a point Lord Copper

On the 27th June 2006 Prime Minister Tony Blair met a selection of magazine editors for a special question and answer session in the State Dining Room of Number 10.

He said in a unreported remark, " ....there is a simple stark fact that I would just like to put in front of people, which is we are going to go over the next 15 or 20 years to a situation where: one, the 20% that we get of our electricity from nuclear is going to decline to virtually zero; and two, where we are going to go from being 80 or 90% self-sufficient in oil and gas, to 80 or 90% importing it."

Tom Foulkes, the far sighted Director General of the Institute of Civil Engineers (ICE) , introduced the report The "State of the Nation 2003" (31/07/2003) which the Press Release said, "Britain will become completely reliant upon energy sources supplied via pipelines from politically unstable countries thousands of miles away. The ‘State of the Nation 2003’ report highlights a potential 80% shortfall in meeting the country’s energy demands from current supplies by 2020, and points to the possibly cataclysmic effects of becoming reliant upon unsecured, imported fuel supplies."

It is better to read the whole thing but this statement 5 years ago provides a flavour ..

"“This country has been largely self sufficient in electricity generation for the past 100 years. We have been able to ride through a succession of energy crises, such as oil in 1973, coal in the early 1980s and the self-inflicted petrol crisis of 2000. All of these had the potential to inflict serious economic damage, but this was largely avoided by the fuel mix and diversity available at the time.

This is about to change dramatically. Currently our generation mix for electricity is approximately 32% coal, 23% nuclear, 38% gas, 4% oil with 3% others and renewables. Emission constraints mean that the UK’s coal-powered generating plants will close shortly after 2016 and only one nuclear power station will remain operational beyond 2020, due to the Government’s failure to invest in maintaining and upgrading Britain’s nuclear power programme. At present, renewable energy sources such as solar, wind and wave can only provide a fraction of the total requirement.

Mindful of the outages this week ...David Anderson, chair of ICE’s Energy Board, said (remeber this was 5 years ago): “The Government simply isn’t taking on board the generation mix that will be needed beyond 2020 if security of supply and meeting our environmental commitments are both to be achieved. A return to the blackouts that marked the ‘Winter of Discontent’ and the country grinding to a halt are very real possibilities in less than 20 years time.

Here at The Forth Coming UK Energy deficit (FCUKED) HQ we have emblazoned the messages ..

The biggest waste at the moment is the waste of precious time.


Critical to the simpleton Brown's desire for a significant expansion of nuclear power offering "breathtaking" opportunities for British industry is the availability of trained and skilled engineers within th UK. A point repeatedly raised by ICE.

It is therefore worth considering the experience of Areva and Siemens in Finland in building their 5th nuclear reactor , the Olkiluoto 3 nuclear reactor at Pori in SW Finland, which was was due to commence operations in 2009.

WE have posted about this often but the post of Thursday, July 13, 2006 Short-sighted energy planning threatens bleak future highlighted the report of Finland's Radiation and Nuclear Safety Authority (STUK) when it became apparent then that production was at least 12 months delayed and cost were rising. STUK identified several problems of project management leading to delays, though they stated that none undermines or compromise nuclear safety on the site - principally because no nuclear engineering had taken place.

They did point to the major problems experienced with labour , "The total manpower on the construction site of Olkiluoto 3 is 730, with more than twenty different nationalities represented on the site. Finnish workers account for more than half of the manpower. The number of German and French employees is ca. 250 at present."

At the time we said "before our Dear Leader starts planning on a "fleet of replacement reactors" perhaps we should start checking on the engineering, manpower resources available for the task." a point raised by Lord Jenkin in March in the House of Lords , when Lord Marlesford: (Con. Life Peer 1991) asked : "My Lords, does Britain have the capability to design and construct a nuclear power station so that it can come on stream, as the Government’s target has it, in 2020? If it does not, history will judge the Government harshly for the 10 years of delay in making a major strategic decision."

Environmental and social aspects are being addressed but economic issues are being fudged.

The Prime Minister first discussed the need for nuclear power publicly on Feb 1st 2005 explaining that the Government then had no plans for nuclear power plant building.

Since then we have had much concern about the environment, green taxes,gobal warming and much discussion but fuck all has been done - resulting as panic sets in for plans next week to set up a form of administrative and bureaucratic bulldozer to override standard planningmatters, even on sites (Littlehampton on the South Coast being one such site) not curently furnished with an ageing and decaying nuclear plant.

Therefore it is worth taking another look at TVO's 1,600-MW Olkiluoto-3 EPR and at STUK's 2007 annual nuclear safety report, which appeared on the inspectorate's website May 12. It paints an unhappy picture as the plant is at least 2 years behind and way over budget with major construction concerns. "The construction of the Olkiluoto 3 plant unit has proved more demanding than expected"

Defects in welding at Olkiluoto 3 last year forced repairs to a steel liner assembled during the summer. (Page 42 has a list of problems with welding , forgings, concrete porosity and sealing,
non-conformities in the casting of the base slab etc.,)

STUK said the diameters of the cylinders welded together were slightly different; that welding conditions changed during work; and that welders had made mistakes.

The report said that audits of manufacturers and suppliers showed that some subcontractors had not taken nuclear safety requirements into account in their work.

The report also noted that time pressure in assembling components caused the manufacturer and supplier in a few cases to set a date for inspection so early that the pre-requirements for inspection were not met, and inspections had to be rescheduled. Further, the manufacture of diesel generators was begun before approval of design.

"It is a challenge in this type of project when the design is done at the same time as construction of structures and components," Gulp.

Petteri Tiippana, is responsible for regulatory oversight of Olkiluoto-3 at Finland's nuclear inspectorate STUK, as the project is entering a more complex (and critical) phase of construction.

New subcontractors would soon be arriving on site, and Tiippana highlights that "again poses the challenge to lead contractor Areva's team to adequately manage these teams so they follow the rules and principles of good working on a nuclear construction site."

Tiippana said work is about to start installing components, piping systems, pumps, valves, heat exchangers and electromechanical equipment at the world's first European Pressurized Water Reactor. The reactor pressure vessel is being made by Mitsubishi Heavy Industries in Japan and of steam generators at the factory of Chalon in France . Skoda in the Czech Republic, are manufacturing of reactor pressure vessel internals and the steel liner that ensures the leaktightness of the containment vessel is being made in Poland.

Can we be sure the lights will stay on ?

It is vital that Europe learns from Olkiluoto 3. delays add costs. The original budget of €3-3.2 billion can probably now be doubled. Areva and Siemens have been making undisclosed provisions.. but it is obviously hurting.

Long lead time and higher engineering standards required for nuclear construction make gas-fired capacity attractive. Global costs pressures are frcing costs on a novel and challenging project for the first of a kind nuclear project.There is a shortage in skilled engineering resource, and growing uncertainty on delivery dates because of bottlenecks in the supply of certain components.

In April two major (and well informed) Utility figures spoke about the concerns that a nuclear revival could be slowed or even halted if the current supply chain crunch ends up pricing nuclear out of the market.

Gerd Jaeger, is an engineer and Executive Vice President of RWE Power AG he has warned vendors must "de-bottleneck the bottlenecks" at the front end of the nuclear power plant supply chain. Because of a shortage of manufacturing capacity for large forgings, vendors are asking potential customers to commit far in advance of concrete reactor projects.

Sandor Liive, CEO of Eesti Energia, the Estonian state-owned utility, said his company is considering several options for nuclear power because "nuclear is an option that any energy company that wants to be competitive in the future has to consider."

Among the options are construction, with Latvia, Lithuania and (perhaps) Poland, of a new plant at Ignalina, participation in a new reactor in Finland, and construction of a domestic nuclear plant.

Liive said Eesti Energia was "thinking about nuclear" only because the cost of domestic power production from oil shale was rising above the projected cost of nuclear power from new plants, at around €45/MWh.

At that level, which implied a capital cost of €2 million a megawatt, new nuclear was attractive, he said. "But if it were €3 million per MW and €65-70/MWh, there's no point" in investing in a new nuclear plant, "at least from Eesti Energia's viewpoint." (If he 1,600-MW Olkiluoto comes in at €5 million plus we are looking at well over €3 million per MW )

Material cost pressures affect all energy generating projects -- CCGTs, coal, wind, hydro, wave , not just nuclear.

RWE's Jaeger has revealed that nuclear power plant vendors are asking utilities to put down "hundreds of millions of euros" to reserve large forgings needed for the nuclear steam supply systems of modern reactors. It was "prohibitive for an investor" to commit such sums "at a very early stage of a project," when they did not know if the project would proceed.

Jaeger said that even in countries where new nuclear plants were on the agenda, "it's rather difficult to convince all the decision-makers" who need to act before a plant can be ordered and construction started.

He cited the need for public debate, time needed for regulatory approvals, and "the political environment" as uncertainties in a nuclear plant project schedule. Jaeger said "innovative approaches" were needed to finance new nuclear projects, in which risk is shared equitably among all parties.

It is evident that Gormless Gordon hasn't a clue of the problems in even placing inittial contracts for the first plants, the costs involved, the problems of manpower, especially skilled engineers. he is of course busy balancing global supply and dermand of the 300US$Trillion global oil market by easing the Petroleum Development Tax on 30 minor fields in the North Sea which were opened prior to 1993.

For more on the insane plans for training nuclear workers see Tuesday, May 20, 2008 FCUKED - UK Nuclear Policy absolutely un-fucking believable Meanwhile Atomic Energy of Canada Ltd vendors of the ACR-1000 Nuclear Reactor', have withdrawn from the opportunity to supply citing that they wish ..." to concentrate on opportunities in the Canadian market."

If EDF take over British Energy as expected they will naturally choose the French state owned Areva 1600 MWe European Pressurized Water Reactor (EPR) curently being leaisurely insatlled in Finalnd. This is also the choice of German power Utility Eon should they decide to join in Gormless Gordon's grand designs.

One thing of which you can be certain , if anything is done, it is going to cost the UK taxpayer a lot of money (say the cost of Northern Wreck) although we should be minful of the wise words of Baroness Vadera in response to Lord Desai's question in the House of Lords : My Lords, I am pleased to say that that will be a risk carried by the private sector. (Like the London Underground perhaps ? In which Shreiking Lady Vadera was much involved)

...and Lord Desai's question on March 18th this year ?

"My Lords, will the Government make sure that the nuclear plants are not only delivered on time but also at the proper cost—not with the usual 300 per cent overruns —and that they produce power economically?"

Ho.Ho.Ho as we say at FCUKED

It's worth remembering there are plenty of other folks already in the queue for new plant ahead of the UK ..

BREAKING NEWS: Safety procedures in disarray at Finland’s Olkiluoto 3 nuclear construction site - but this story has nothing to do with Greenpeace

Read that headline again - "BREAKING NEWS: Safety procedures in disarray at Finland’s Olkiluoto 3 nuclear construction site" it's from the Greenpeace website under their Blog section.

Down at the bottom you will find "Dodgy Disclaimer"

Which says "inter alia" ....

"The opinions expressed on this website are the entirely personal opinions of various members of Greenpeace who should probably be busy working on some highly important and time consuming project but instead choose to make their opinions known to the rest world in the naïve belief anybody else wants to know, and those from outside Greenpeace foolhardy enough to venture into the debate. The opinions have nothing at all, absolutely, whatsoever, for all time and in any way, shape or form at all, anything to do with Greenpeace, probably never will do, definitely never ought to, and should not be construed to be so. In fact, we wash our hands of it all, completely (especially Gillo’s bits).

So when you read ...." Documents seen by Greenpeace show that French company Areva is failing to implement vital safety procedures in the troubled construction of its prototype European Pressurized Water Reactor (EPR) in Olkiluoto, Finland. As well as being 2-3 years behind schedule, 70 per cent over budget, and experiencing 1,500 construction defects along with a damaging fire, the reactor’s safety cannot be guaranteed."

So when lazy journalists post a story that kicks off.... "Environmental group Greenpeace said earlier this month that builders had not followed proper procedures for welding, prompting the government to ask for reports on inspection procedures and standards for finished work. " Bloomberg : Finnish Nuclear Agency Finds Some Flaws in Olkiluoto Safety By Diana ben-Aaron

Remember the actual source ..... The opinions have nothing at all, absolutely, whatsoever, for all time and in any way, shape or form at all, anything to do with Greenpeace, probably never will do, definitely never ought to, and should not be construed to be so.

Nuclear power plant construction capacity being swallowed up - UK waits for another Energy review - the 3rd in 4 years.

British Nuclear Fuels sold Westinghouse the American based Nuclear power engineer to Toshiba (77% - US$4.16 Bn.) and the US based Shaw group (20% - US$1 Bn.) and Ishikawajima-Harima Heavy Industries Co. purchased a 3 percent stake for US$162 million,earlier this year. This will give Toshiba nearly 30% of the world market.

Toshiba / Westinghouse have announced today they have sold 4 of their AP 1000 reactors to China in a US$8Bn. deal for installation by 2013 - two at Sanmen in Zhejiang province, with another two at Yangjiang in Guangdong.

Westinghouse said the deal will create or sustain roughly 5,000 design, engineering and manufacturing jobs in the US with additional jobs being created at US-based suppliers in at least 20 states. On top of this, AP 1000 technology has been selected for 12 projected plants in the US - which are still in the planning, regulatory approval stages.

The French company Areva and Russia's Atomstroiexport were said to be in the bidding.

As part of the deal the US company will transfer technology to the Chinese enabling them to build their own plants eventually with up to a 50% Chinese content.

Areva are experiencing highly publicised problems with the Finnish EPR plant at Olkiluoto (pic) and even though they are one year behind schedule they claim that this, the first of the so called 3rd generation reactors scheduled for completion in about five and a half years. The EPR plant is based (like the AP 1000 on a pressurised water reactor but provides greater efficiencies in using Uranium oxide fuel slightly enriched with up to 5% U235, or a mixed uranium and plutonium oxiderecycled fuel (MOX).

Areva have had to make provisions to allow for the problems at Olkiluoto which they announced last week operating income for 2006 is expected to be sharply down from that of 2005, although it will easily remain well in the black. See Lord Patel's July 13th posting on UK construction capacity and the lessons of Olkiluoto.

Atomstroiexport is currently constructing the US$800 Mn. Iranian Bushehr nuclear power plant for the Iran's Atomic Energy Organization which has been recently re - scheduled to become operational by the second half of 2007. The contract was first placed in 1995

Atomstroiexport has a total of five plants under construction, Bushehr, 2 VVER-1000 reactors at Kudankulam in India . The Chinese Tianwan NPP, which uses 2 improved VVER-1000 reactors and K-100-6/3000 turbo-generators, under the terms of a Russian-Chinese agreement signed in 1992 was successfully tested at 75% load in October 2006.

At the same time they announced this milestone, they also announced that they had successfully tendered for Bulgaria's Belene plant , near the capital, Sofia, for the national Bulgarian National Electric Company (NEK) for two 1,000 MW reactors. The first plant will be operational by 2011 and the second by 2013.

Areva and Germany's Siemens will also be involved in the construction of these plants - Westinghouse and the Czech Republic's Skoda were underbidders on the project.

Meanwhile, having sold off Westinghouse, the people who make the decisions in the UK are twiddling their thumbs for the new Energy Review in the Spring (?) as gas reserves, oil production plummet, energy demand soars and unrealistic expectations are provided about renewable energy - as domestic energy costs soar and empty boasts are made about the EU ETS market - still staggering along at the lowest level ever of €6.65 per tonne.

This is what they call my children, UK energy security.

Areva have accumulated losses of €1.7 Bn. on constructing Olkiluoto 3 - Siemens want out ... European Pressurized Reactor in trouble

France's national nuclear company Areva has produced their FY 2008 results and revealed estimated accumulatedlosses of at least €1.7 Bn. on constructing Olkiluoto 3.

The 1600 MWe EPR reactor at Teollisuuden Voima Oyj's (TVO's) Olkiluoto site which was meant to begin operation this year is now expected to start in 2012. The joint Areva-Siemens contract was worth €3 billion when signed at the end of 2003.

In October Ava announced a 4th delay to the Finnish project — Europe's first pressurized nuclear reactor. The so-called European Pressurized Reactor is meant to eventually replace aging reactors whose designs date from decades ago - such as the one's planned for the UK by EDF.

Arbitration in the International Chamber of Commerce is underway between TVO and Areva . Proceedings are secret, but it is known that the Areva-Siemens consortium would like a schedule extension and €1 billion ($1.2 billion) in compensation and late payments, while TVO has said in letters that it considers itself entitled to a whopping €2.4 billion ($3.0 billion) in damages.

OL3 is the largest construction project in Finland and one of the largest worksites in Europe with over 4,500 site workers.

Areva also announced that Siemens wants out of their joint Areva NP reactor technology joint venture. By the end of January 2012 Areva must purchase Siemens' 34% stake, which it has valued at €2.05 billion ($2.61 billion) ahead of final negotiations. This sum was added to Areva's net debt which then jumped to €5.5 billion ($7.0 billion), although this is balanced by equity of €7.3 billion ($9.3 billion).

Apart from these problems with Siemens and TVO , Areva's business performed strongly, with its order book growing to €48.2 billion ($61.4 billion), up 21% on last year. Company CEO the beautiful Anne Lauvergeon said the group's performance in the current economic situation demonstrates "the robustness of the Areva business model." In the last year, Areva has hired almost 10,000 new staff.

Areva made a net profit last year of €589 million, down 20.7 % from €743 million in 2007, while sales rose 10.4 % to €13.2 billion.

Uranium prices slide

Uranium prices fell by 40 % last year and this hurt Areva's earnings resulting in drastically cutting, then suspending, uranium trading activities in the second half. The mine in in Canada, Niger and Kazakhstanand refine the product in France.

See article on Rand Uranium for overview of cuent world Uranium m arket and currentproblems.

Areva, 2 year delay and massive cost increases on Olkiluoto 3 - Half Year profits rise

Greenpeace have been sniping at French nuclear group Areva (see postFriday, August 15, 2008
Greenpeace and the Magic Documents - How they are mongering scares and totally missing the point about nuclear power - it's too expensive chuck ) and their problems in building the world's first, next-generation pressurised water reactor , the Finnish Olkiluoto 3.

The cost of construction at Olkiluoto has risen from 3 to 4.5 billion euros (US$ 6.7 Bn.), and Areva admits the need to boost staff levels "ensure work proceeds better."

Finnish nuclear safety agency STUK launched a probe earlier this month into whether safety procedures were respected at the site after Greenpeace disclosed confidential documents indicating there were no qualified personnel supervising the welding and that the quality of the welding had not been verified.

Areva has been forced to set aside one billion euro in provisions to absorb the rise in costs, the French business newspaper Echo eports as Areva nnounce record profits of nearly 750 million euros today.

Construction delays have already forced Areva to push back the target date for the reactor to enter service to 2011 from 2009.


Should therefore EDF get into bed with British Energy (improbably incredibly John Hutton Minister of some crazy name thinks a deal is still possible), this news must impact upon the whole flawed energy planning of the UK and the forecast costs of plants and the electricity produced.

Areva produced half year results today

These show that Profits were up 14.8% and operating margin up from 3.9% to 8.7% with EPS up from 8.31 Euros to 21.45 Euros.

The Order backlog has risen 13.6% to 38.5Bn Euros

IFA 2000 - strategic link at the heart of the European electricity market.

It is of interest of course that part of that backlog includes the announcement in July that AREVA's Transmission and Distribution Division has been awarded a contract with the UK National Grid and RTE, to enhance the reliability and reinforce availability of IFA 2000, the world's largest subsea High-Voltage Direct Current (HVDC) scheme opened in 1986 which can supply electricity for 3 Mn. people.

This subsea system interconnects the French and British national power systems from Mandarins near Calais, to Sellindge in Kent and enables France to sell us electricity from the French nuclear powered grid.

AREVA will replace the existing high-voltage converter equipment and the control and cooling system, implementing its H-400 HVDC Thyristor valves and Series V control system. Learn more hereabout this critical system and Europe's closely linked electricity network.

Gormless Gordon demonstrates classic "Displacement Behaviour" as thorny decisions in UK energy needs crystallise

Lord Patel had a step mother in his early life who was an industrious, thrifty, hardworking and earnest soul. In a world of post war shortages she would carefully save paper bags, parcel string and rubber band. The tin of buttons dutifully clipped and kept from discarded clothes provided the infant Lord Patel endless fun and amusement.

A particularly thrifty habit was to save the greasepoof paper that Ministry of Supply half pound blocks of margarine came wrapped in - a nauseous product identified by children as axle grease and said to be the result of melting down grandmothers. A particular kitchen dresser drawer was used to retain these distinctive greasy brown printed paper wrappers.

The exiguous quantities of sickeningly pale margerine, left after a knife had removed everything but a few remaining nano particles would be vigorously smeared on baking trays as a release agent with remarkable energy and only despatched onto the back of the fire when she was satsified that every last remaining smear of the rare and expensive commodity had been utilised.

One imagines that such Caledonian thrift was also exercised in the kitchens of the Brown manse and was passed down along with a fever for collecting candle ends and saving sealing wax.

For such is the process that Gormless Gordon set in train in abandoning the excessive 50% Petroleum Development Tax on fields which started yielding their precious oily cargo before 1993 in the earnest hope that developers will be encouraged to pump the remaining and hard won buckets of black gold with the fervour that Lord Patel's quasi antecedent released the last monomolecular layers of hydrogenated animal fat from margarine wrappers.(see chart of the biggest N Sea oil field which will benefit - the possible output increases are nugatory - the actual list of fields affected appears to be a state secret, telephone enquiries for furtehr and better particulars is fruitless, "Why do you want to know ?" was one initial response. )

Gormless Gordon's worthless gesture politics is exposed by the clinical, brief and telling analysis by Euan Mearns at The Oil Drum " Why oil costs over $120 per barrel" - which was also, astonishingly, fairly well (if briefly) covered on BBC2 TV's Newsnight last night by someone whose name , rank and number were missed but who mentioned "Peak Oil" thus ensuring he will never be be grilled by the divinely beautiful Emily Maitlis again.

We posted about Gordon's raging enthusiasm for nuclear power on Thursday , May 29, 2008
Hutton , Brown call for "a significant expansion of nuclear power " ... well up to a point Lord Copper and the accelerating problems over delay and cost for TVO's 1,600-MW Olkiluoto-3 EPR plant.

The weekend European edition of the Wall Street Journal (page 17 - also available here) has a brief commentary by Henry Sokolski of the Washington based Nonproliferation Policy Education Centre about Italian nuclear energy plans excitedly promoted by the arithemetically challenged Senor Berlusconi last week. The genial pipe smoking Henry makes claims that :

1. German Utility company E.On who favour the Areva EPR plant for their (still hazy) plans for UK nuclear plants (see below) say that construction cost are now looking to be €6 Bn = €3.75 MW see table below). (Not including nuclear waste management cost and plant operating costs)

2. Major US Utility Florida Light and Power have arrived at similiar costs for nuclear build.

3. That this figure equals the cost of 10 modern CCGT gas fired planst each yielding the same energy output

4. Edison SPA has warned that , "the first (Italian nuclear) plant would have trouble becoming operational before 2020"

5. Italian energy "experts" see the talk of the need for State aid/guarantees as apart of a sinister European plot by major groups (E.On, RWE, EDF) arranging massive Government support to squeeze out competitors at the same time that the EU is "officially" eliminating subsidies and encouraging commercial competition.

6. He points out that both french and German subsidies for Areva and Siemens for the Finnish Olkiluoto plant have been upheld by the European Commission after several complaints.... as it supports EU carbon emission objectives.

7. Due to the post Chernobyl hiatus in nuclear generating plant building, the EU has 145 reactors (plants may have more than 1 reactor) that are scheduled for closure withing the next 17 years so that net growth in EU nuclear output is decades away.

On top of this the reader is directed to a "Spotlight" podcast available of Henry Edwards Evans Editor of Platts Power Europe discussing the dramatic slowdown in new build energy generation projects which are hit by , component bottlenecks, soaring capital costs (see chart) , longer lead times, and most important the unkowns associated with Phase III of the EU carbon trade program and beyond 2020 to the "carbon price".

He also identifes the problems that the demands of requiring carbon capture / reduction / sequestration of new coal plants (EU has plans for 12 "demonstration plants by 2015) which doubles costs, and the energy penalty which reduces efficiency, he uses the phrase .."out of the money". Viz the E.On Kingsnorth plant, the first coal fired plant proposed in the UK for 20 years , (despite local opposition) that now has planning permission but awaits approval (initially by the then Energy Minister John Hutton) to go ahead without an agreed carbon capture and storage (CCS) technology.
The current Kingsnorth coal fired plant is due to close by 2015 because of the European Union’s Large Combustion Plant Directive (LCPD), which places strict limits on emissions.

E.On has already planned to replace the aged Isle of Grain plant in Kent that is due to close with a new, gas-fired combined heat and power plant at the Isle of Grain , their ironbridge plant will shut by 2015. Meanwhile Government go-ahead for Kingsnorth remains firmly in the in-tray at BERR .

Into this heady mix E.On have also indicated they might use the Kingsnorth and Isle of Grain plants for their favoured Areva EPR nuclear plants.

...and all the while the looming UK Energy Deficit , grows larger ... and nearer. ,,, and the debate (?) over the critical importance of UK energy security is adroitly diverted to discussions about "social tariffs", "fuel poverty" definitions and "zero carbon emission" housing , "Warm Fronts" with all the energy that medieval bishops discussed the size and number of seraphims that could comfortable dance on the head of a pin... "Labour plans fuel help for the poor" .. measures to be announced ... pilot scheme to ensure people applying for Warm Front grants are referred to their energy supplier for tariff advice... £150,000 on .. rolling out of watchdog Ofgem's national Citizens Advice Bureau awareness campaign on social assistance for the vulnerable.Vulnerable 'still at risk of fuel poverty' Scotsman / Fuel poverty plan at a glance BBC News / Row erupts over new fuel poverty action plan Times

God Help us

Nuclear winter - less energy at higher cost

Chris Vernon at the Europe Oil Drum has an excellent and comprehensive review of the Government announcement about the nuclear plant program announced by John Hutton this week. He asks ."considering the nuclear cliff, (see Chris's chart below - note the assumptions are optimistic ...but Sizewell will probably last a bit longer) has the decision come too late to maintain the nuclear contribution?"

Even on the most optimistic assumptions the answer is .... yes.

"EDF Energy anticipated this decision and in September of 2007 submitted the plans for their 1.6GW EPR (Evolutionary Power Reactor) power station to the UK regulators for design assessment ( Press Release). Detailed information on this design is available from the EDF/AREVA website: http://www.epr-reactor.co.uk/. This is the same design as is being built in Finland at Olkiluoto and in France at Flamanville.

The Finland build is the first one and has had some problems. Initially it was meant to cost 3.7bn euro and be complete in 2009, construction started in 2004. Since then there has been a 2 year slip and the cost increased by 1.5bn euros. So we're looking at 7 year build time and 5.2bn euro (£3.9bn - say 14 times the commitment by BOE to Northern Wreck) . See also Lord Patel post Friday, August 17, 2007 British Energy Nuclear Fleet production down 17%, profits by 14%

Chris ends on a pessimistic note ..

UK gas production will be almost over by the end of the next decade leaving the country reliant on imports from Norway, Russia and beyond. This raises serious question marks over the long term viability of the 36% electricity the country currently generates from gas. In addition to that approximately one third of the existing coal fleet is scheduled to close under the EU Large Combustion Plant Directive.

In times of hardship EU directives will be the first thing to ignore but even the coal supply is questionable as the UK imports most of its coal and is now competing in an increasingly competitive market.

In 2006 the UK generated 394 TWh of electricity - Chris asks ...."what will the country generate in 2020? " Not to mention a looming skills gap in the UK nuclear industry.http://business.timesonline.co.uk/tol/business/industry_sectors/utilities/article2806400.ece
Essential reading for every one who votes.

PS The UK will be importing some 30% of UK gas consumption this winter.Source DBERR (UK govt Dept of Business Enterprise, formerly DTI)

Coal production in Britain has fallen to its lowest level since the industrial revolution, according to data from the Office for National Statistics. Annual production is set to fall below 15 million tonnes, a level last seen 200 years ago. See Chris's chart above for a historical perspective and the increasing reliance on imports by the UK energy industry.

Also Newcastle Coal Trades Near a Record as Demand Rises
Dec. 31 2007 (Bloomberg) -- Coal prices at Australia's Newcastle port, a benchmark for Japan, South Korea and Taiwan, traded near a record on concern that demand is outpacing supply. ...

PPS : January 31st 2005 in the early run up to the 2005 General Election, Tony Blair (then Prime Minister) discussed with Manchester Evening News readers the introductin of nuew nuclear power stations - for the first time ever in public during his presidency term of office.

"We don't have any plans to open new power stations but what you are saying isinteresting and I think there is a debate to be had about nuclear power but it has to happen in a rational way. If we suggest a new generation of nuclear powerin this country I can guarantee there will be public concern about it so wewould have to look at what is going on in other countries very carefully."

Well they have been carefully examining it for 3 wasted years - a trifle faster than the opvernight (well .... over a weekend) decision to fund Northern Wreck ( another rational decision ?) .... this was not picked up by the national / international Press / TV (who were present) at the time. The metropolitan muttering classes don't really concern themselves with what happens in Manchester.

Short-sighted energy planning threatens bleak future

A History lesson.

The Institution of Civil Engineers is the pre-eminent engineering institution in the world. Established as a learned society in 1818, it has 80,000 members and provides a voice for civil engineering, continuing professional development and promoting best practice throughout the industry.

A report published 3 years ago by the ICE revealed that, within a generation, Britain will become completely reliant upon energy sources supplied via pipelines from politically unstable countries thousands of miles away. The ‘State of the Nation 2003’ report highlights a potential 80% shortfall in meeting the country’s energy demands from current supplies by 2020, and points to the possibly cataclysmic effects of becoming reliant upon unsecured, imported fuel supplies.

Tom Foulkes, ICE Director General, introduced the report The ‘State of the Nation 2003’ three years ago (01/07/2003) which the Press Release said, "Britain will become completely reliant upon energy sources supplied via pipelines from politically unstable countries thousands of miles away. The ‘State of the Nation 2003’ report highlights a potential 80% shortfall in meeting the country’s energy demands from current supplies by 2020, and points to the possibly cataclysmic effects of becoming reliant upon unsecured, imported fuel supplies."

Tom Foulkes said, inter alia , ( but it is best to read the whole thing) said:

“This country has been largely self sufficient in electricity generation for the past 100 years. We have been able to ride through a succession of energy crises, such as oil in 1973, coal in the early 1980s and the self-inflicted petrol crisis of 2000. All of these had the potential to inflict serious economic damage, but this was largely avoided by the fuel mix and diversity available at the time. This is about to change dramatically”. Currently our generation mix for electricity is approximately 32% coal, 23% nuclear, 38% gas, 4% oil with 3% others and renewables. Emission constraints mean that the UK’s coal-powered generating plants will close shortly after 2016 and only one nuclear power station will remain operational beyond 2020, due to the Government’s failure to invest in maintaining and upgrading Britain’s nuclear power programme. At present, renewable energy sources such as solar, wind and wave can only provide a fraction of the total requirement.

Under current Government planning, the outstanding balance will have to be replaced by gas-fired power stations, importing 90 per cent of their fuel, no later than 2020. Initially, some supplies will come from Norway, but as demand across Europe exhausts supplies during the 2020s, Britain will be forced to source gas supplies from West Africa, the Middle East and the former Soviet Republics. "

David Anderson, chair of ICE’s Energy Board, says: “The Government simply isn’t taking on board the generation mix that will be needed beyond 2020 if security of supply and meeting our environmental commitments are both to be achieved. A return to the blackouts that marked the ‘Winter of Discontent’ and the country grinding to a halt are very real possibilities in less than 20 years time.

“As well as increasing investment in the full range of available fuels, the country needs far greater capability to store long-term energy reserves to see us through any future crisis. Major gas users such as Germany, France and Italy all have a gas storage capability of over 20% of annual consumption, or over 70 days worth." etc., etc., etc., etc., etc., etc.,

28 June 2006, @ a No 10 meeting Magazine Editors, - Tony Blair said

" ....there is a simple stark fact that I would just like to put in front of people, which is we are going to go over the next 15 or 20 years to a situation where: one, the 20% that we get of our electricity from nuclear is going to decline to virtually zero; and two, where we are going to go from being 80 or 90% self-sufficient in oil and gas, to 80 or 90% importing it."

Yes that's right, it took 3 years for him to get it... which is better than any of the Energy Ministers who went through the revolving door at the DTI marked energy.

The headings provide pithy and quotable statements ..

The biggest waste at the moment is the waste of precious time.

Can we be sure the lights will stay on ?

Environmental and social aspects are being addressed but economic issues are being fudged.

POSTSCRIPT

One of the issues raised, (and raised in subsequent ICE reports) was the supply of engineering skills within the UK to meet the needs of new nuclear plants and power engineering. It is therefore if interest to note what has just been reported from Finland ..

The new Olkiluoto 3 nuclear reactor(Finlands 5th) at Pori in SW Finland, was due to commence operations in 2009, Teollisuuden Voima (TVO), the nonprofit electricity generator that commissioned the plant, has admitted this week that construction is one year behind schedule. The 1,630-megawatt reactor is the first third-generation European Pressurized Water Reactor - designed for greater safety and higher thermal efficiency.(see Pic from TVO)

Finland's Radiation and Nuclear Safety Authority (STUK) says the builders , the French reva SA and German Siemens AG consortium ,have mismanaged the project because they selected subcontractors with no prior experience in nuclear power plant construction to implement the project.All in all more than 1100 subcontracts have been concluded so far half of them with Finnish companies.

"These subcontractors have not received sufficient guidance and supervision to ensure smooth progress of their work."

STUK identified several problems of project management leading to delays, though they stated that none undermines or compromise nuclear safety on the site.

TVO said, "Generation, review and approval of detailed design, manufacturing and construction solutions have taken more time than expected. The schedule has also been affected by the fact that such an intensive and demanding project has not been carried out for many years". or as they say "Asennustyöt reaktorilaitoksella ovat alkaneet. Suojarakennuksen hätäjäähdytysjärjestelmän putkistoasennukset ovat meneillään. Teräsvuorauksen sisällä raudoitustyöt jatkuvat. Reaktorirakennuksen isojen valutöiden aloitus on ajoitettu loppukesään. Turpiinilaitoksen puolella pilareiden ja seinien valut jatkuvat."

The total manpower on the construction site of Olkiluoto 3 is 730, with more than twenty different nationalities represented on the site. Finnish workers account for more than half of the manpower. The number of German and French employees is ca. 250 at present.

So before our Dear Leader starts planning on a "fleet of replacement reactors" perhaps we should start checking on the engineering, manpower resources available for the task. ( A letter from an engineering recruitment agency in the Daily Torygraph today takes up this point)

FCUKED official policy is that this task should be organised on the lines of the Manhattan project run by general Groves .. such is the importance to the economic future of the country , its economy and social well being.