NuScale Opens Effort to Sell / Build SMRs in Romania
- Nov 7, 2021 11:06 am GMT
- NuScale Opens Effort to Sell / Build SMRs in Romania
- Bulgaria Signs MOU with Fluor for NuScale SMRs
- U.S. State Department Offers $25M to Support Using Nuclear Energy to Replace Coal
- INL – Microreactors Could Replace Diesel Generators
- Helion Fusion Secures $500M for Fusion Commercial Venture
NuScale Opens Effort to Sell / Build SMRs in Romania
U.S. Secretary of Energy Jennifer M. Granholm and Romanian Minister of Energy Virgil Popescu announced a new commercial partnership between NuScale Power and Nuclearelectrica that was signed last week on the sidelines of the 26th United Nations Conference on Climate Change Conference (COP26) in Glasgow, Scotland.
NuScale's MOU with Romania made a big splash at COP26. Is there more to it than just another garden variety agreement in principle? Like all MOUs there are a lot of "ifs, ands, or buts" associated with it turning into a real project. This report steps through the possibilities and tries to unpack what could or could not happen.
According to statements released by the U.S. and Romanian governments, the agreement in principle, which has no financial instruments associated with it at this time, could eventually result in the construction of a 462 MWe nuclear power station in Romania.
No site was designated for the project, but conventional wisdom suggests the six unit SMR project might be co-located at the site adjacent to the two currently operational PHWRs at Cenavoda. Both units produce 700 MWe of electricity. Romania’s two nuclear reactors generate about 20% of its electricity. The country’s first commercial nuclear power reactor began operating in 1996. Its second started in May 2007. Depending on grid capacity at this site, additional investments in grid infrastructure might be necessary especially if Romania proceeds separately with completion of Units #3 & #4,
The joint press announcement also noted the possibility that the project could position Romania as a potential hub for manufacturing of SMRs in the region. NuScale SMRs would produce 77 MWe and be built in packs of four, six or 12. The six unit profile described in the joint press statement would on completion produce 462 MWe of electric power or about two-thirds of the power of one of the current PHWRs.
The proposed NuScale six-module power plant is estimated to generate 193 permanent power plant jobs, 1,500 construction jobs, 2,300 manufacturing jobs and help Romania avoid 4M tons of CO2 emissions per year over their estimated six decades of operation.
Specifically, the teaming agreement outlines the next significant milestones for Nuclearelectrica and NuScale to develop safe, affordable zero-carbon baseload power technology with a focus on retired coal plant sites. It will support the Government of Romania’s National Recovery and Resilience Plan to phase out 4.59 GWe of coal fired energy production by 2032.
This teaming agreement serves as a catalyst for deployments in other Three Seas Initiative countries, such as Poland, Estonia, and Czech Republic seeking to decarbonize their energy sectors. All three of these countries have signed one or more MOUs with western nation nuclear reactor vendors for both LWR and advanced designs.
Costs / Financing of the SMRs?
In response to an inquiry from this blog, Diane Hughes, Vice President of Marketing & Communications for NuScale Power, wrote in an email statement with regard to potential financing; “The project specific cost will be an area of examination and evaluation under the agreement as part of the due diligence process. It will include determining the size of the plant, location, construction labor costs, supply chain, and other inputs specific to this project.”
Hughes added that questions about the sources of financing for the project should be directed to Nuclearelectrica. This is a clear implication that no financial commitments were made by DOE Secretary Ganholm, or NuScale, to Romanian Energy Minister Popescu about funding for the project.
In 2020 then US Secretary of State Mike Pompeo promised Romania a $8 billion in financial assistance if it would kick China out of contention for completing the the two partially built (Units #3 & #4) PHWRs at Cernavoda. In May 2020 Romania’s energy ministry cut its ties with China Nuclear General (CGN) and ended talks with CGN to complete the two partially built PHWRS.
Pompeo also promised Poland $18 billion to support its plans to build full size nuclear power plants, using western technology instead of Russia’s, to replace its coal fired power stations. Poland has Europe’s largest reserves of coal and depends heavily on that fuel for electric power generation. It has no nuclear power plants and its ambitious plans to build them have been repeatedly sidelines by a lack of investor interest. Poland has inked MOUs with several SMR vendors and a chemical firm wants build them for process heat for its factories.
In September 2021 the Biden administration, in a low key message, told Romania and Poland at a multi-nation ministerial level meeting in Europe that it was not bound by Pompeo’s promises. The meeting was a combination of ‘meet and greet’ for government officials and a delegation of US firms, including some from the nuclear energy industry, who also attended the meeting to discuss future development opportunities.
It is hypothetically possible that future actions by the US could provide export credits for NuScale’s project and the Development Finance Corp might eventually agree to also provide financial assistance to Romanian firms building non-nuclear components for the project.
However, none of the statements or fact sheets released by the two governments addressed these topics. Despite all this, Romania’s enthusiasm for the garden variety MOU with NuScale suggests it the country’s energy ministry has come to believe it will not be required to carry the burden alone of financing the project.
At COP26 in Glasgow US Secretary of Energy Granholm gave an interview (video / text) to Yahoo News Singapore on Friday 11/06 in which she said the US is "very bullish" on new nuclear energy technologies citing the Advanced Reactor Demonstration Program and support for a first of a kind small modular reactor (SMR) project in Idaho for a commercial utility.
In a separate action the U.S. State Department announced it is providing funding of $25M for assistance to a number of countries to help make plans and development management programs to decarbonize their economies. (See story below) The U.S. did not announce any other financial commitments related solely to nuclear energy at the COP26 conference.
Some observers of the US nuclear energy industry attribute the low profile for nuclear energy by the US delegation to COP26 to the influence in the Biden Administration of US National Climate Advisor John Kerry. As a US senator in the 1990s he led the effort to end funding for the Integral Fast Reactor. By comparison, both the UK and France made significant commitments to new nuclear energy reactors at COP26. For his part Kerry says for the record he is no longer hard over in terms of being anti-nuclear and recognizes it has a role in decarbonization strategies.
Timeline for the Project?
According to the joint press briefing at COP26, NuScale Power and Nuclearelectrica agreed to work toward the deployment of a NuScale SMR plant in revenue service at the site of a retiring coal facility as early as 2027/2028. The zero-carbon power source will help support the country’s plan to phase out coal-fired energy production by 2032.
With regard to a potential timelime for the project, NuScale’s Hughes wrote to this blog in an email; “A timeline for a NuScale deployment would reflect several country-specific factors. Under the teaming agreement, NuScale will help Nuclearelectrica evaluate and plan for its project, and together, the organizations will take critical steps toward deploying a first NuScale power plant in Romania as early as 2027/2028.”
The implication here is that the project could arrange for its financing, complete all regulatory reviews, and break ground by 2024 at the latest. This is an ambitious schedule and one that will likely be revisited as constraints on skilled trades labor, supply chain procurement, and the imponderables of the challenges of first of a kind construction set in.
Separately, NuScale plans to break ground in 2023 at a site in Idaho for its first of a kind US plant and complete it by 2028.
A look at a hypothetical scenario indicates that all six units could be completed by the mid-2030s for a projected cost of about $2 billion. (Neutron Bytes Table 1 below) assuming that Nuclearelectrica can finance it, perhaps with future US help, and from the EU, and NuScale’s supply chain and manufacturing capabilities are up to the task. Local suppliers of concrete and non-nuclear plant components have to deliver on time and meet quality assurance requirements
The scenario assumes NuSclae can sustain starts of two SMRs every two years beginning in 2024. It also assumes that it will take about five years from breaking ground to commissioning for revenue service for each two unit project. It is unlikely that all six units would be started at the same time. This is a “best case” scenario and actual mileage may vary.
Romania plans to reduce carbon emissions by 55% until 2030 and its import dependency on fossil fuels from 20.8% to 17.8% in 2030. Nuclear energy, which currently contributes 33% of the country’s emissions-free energy production, will have an essential role in achieving these decarbonization targets to ensure the energy transition to a carbon-free economy.
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Bulgaria Signs MOU with Fluor for NuScale SMRs
(WNN) Bulgarian Energy Holding (BEH) has signed a Memorandum of Understanding (MOU) with US engineering firm Fluor to look at the possibility of replacing coal boilers with NuScale small nuclear reactors. The country has committed to stop using coal for electricity generation by 2037 or 2040.
Fluor said it has agreed with BEH “to cooperate in evaluating potential program management services, front-end engineering, evaluation of the existing coal-fired fleet for potential nuclear small modular reactor (SMR) ‘re-purposement’ projects, and the assessment of the Bulgarian supply chain and other related services.”
BEH said the MoU covered “exchange of information and provision of preliminary assistance intended to help Bulgaria’s transition towards a zero-emission energy system.” However, Fluor was more specific and linked it to potential deployment of NuScale SMRs to replace Bulgarian coal plants.
In October the Bulgarian government notified the European Commission that it plans to stop burning coal for electricity by 2037 or 2040.
Fluor is the majority equity investor in NuScale.
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U.S. State Department Offers $25M to Support Nations Planning to Use Nuclear Energy to Replace Coal
(NucNet) The US announced at COP26 a commitment of $25M for expanding access to nuclear energy, including plans to advance large-scale nuclear generation, the use of nuclear-produced hydrogen and the deployment of innovative nuclear technologies such as small modular reactors.
The so-called ‘Nuclear Futures Package’ announced at the UN COP26 climate summit in Glasgow, Scotland, includes Poland, Kenya, Ukraine, Brazil, Romania, and Indonesia, among others, to support countries on meeting their nuclear energy goals.
Efforts will include capacity building, equipment, feasibility and siting studies, demonstration projects, study tours, site visits, technical collaboration, and more, a statement by the US state department said.
Included in the commitment are program designed to support key steps necessary for the safe, secure, and responsible deployment of emerging nuclear technologies.
In a fact sheet published online by the U.S. embassy in Romania, the US government said many countries are identifying nuclear energy as a key component of meeting ambitious climate plans.
It said SMRs offer the potential for lower costs, scalability and flexibility, and are easily integrated with other clean energy sources.
“They can be easily a part of any clean energy solution mix for a country or region needing to transition its energy sector away from fossil sources,” the report said
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Microreactors Could Replace Diesel Generators – INL Report
DOE’s Idaho National Laboratory released a report ‘Global Market Analysis of Microreactors’, identifies potential markets for microreactors in 63 countries and assesses their potential for commercialization between 2030 and 2050.
Microreactors, small nuclear reactors that produce up to 20 MWe of electricity or equivalent amounts of heat, are being designed for small applications away from the centralized electric grid such as remote communities and military bases. Most microreactor designs could be built in a factory and shipped in cargo containers to locations around the globe.
When they arrive, these so-called “nuclear batteries” or “fission batteries” could be located on less than an acre and would plug into a mini- or micro- electrical grid with very few infrastructure upgrades. There, they could provide power for decades with minimal operating costs and maintenance.
The key to making these reactors a reality is finding niche markets where the numbers work, said David Shropshire, a nuclear energy economist at INL. Shropshire coauthored the report with Dr. Geoffrey Black from Boise State University and Dr. Kathleen Araújo from the Center for Advanced Energy Studies Energy Policy Institute at Boise State.
“Nuclear energy’s share of the energy marketplace is expected decrease in the coming decades, mainly as a result of retiring old light water reactors,” he said. “But nuclear could potentially increase shares in the future if you really consider non-traditional applications for these new reactors in future markets.”
“We’re not talking about your grandfather’s nuclear anymore,” Shropshire continued. “We’re talking about using microreactors to help fill some specific niche markets. The question is whether microreactors can be truly economic in these markets.”
Shropshire added, “We were looking for markets with fairly high energy demands,” he said.
The analysis showed that regions with growing energy demands such as Eastern Europe and Asia could provide plenty of opportunity for microreactors in distributed applications along with small modular reactors. The report noted that build rates in the hundreds of units by 2040 and thousands by 2050 would be needed to attain market penetration at scale.
Instead of competing with renewable energy sources such as wind and solar, microreactors could support renewables as the backbone of these systems. Microreactors could help facilitate the expansion of renewables in these systems by providing a reliable source of power and the flexibility to operate with variable sources.
“We think microreactors could be a good option for balancing and providing resilience for wind and solar,” Shropshire said.
Likewise, microreactors could be embedded in emerging global megacities with underdeveloped electrical grids to power specific applications with large power needs such as a water purification facility (desalination), an aluminum refinery or a hydrogen production facility.
In the future, microreactors could also find a use powering commercial shipping vessels and other large marine ships. “Currently, container ships use a lot of super dirty fuel that they must haul along to propel the ship,” Shropshire said. “It’s wasteful and polluting.”
If industry can find these markets and build microreactors in large enough numbers, at the scale of hundreds of reactors by 2040 and thousands by 2050, industry could realize the benefits of standardization of mass produced reactors to reduce costs and make microreactors a viable option for these niche energy needs.
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Helion Fusion Secures $500M for Fusion Commercial Venture
Helion Energy, which focuses on generating zero-carbon electricity from fusion, has secured a $500 million Series E investment. The Everett, Wash.-based company also announced an additional $1.7 billion of future commitments tied to specific performance-based milestones.
“The funding marks the largest deal in clean energy ever and could be the beginning of a new era: abundant, clean energy from commercialized fusion technology,” said Svenja Telle, an analyst at PitchBook.
The company plans to use the funding in part to complete the construction of Polaris which is its seventh generation fusion generator. It is a machine that creates a hot plasma chamber in which pairs of hydrogen atoms can be fused together to release energy that can be turned into electricity. Hellion told Pitchbook it expects to be capable of achieving net electricity production by 2024.
Existing investors cited by Pitgchbook including Asana co-founder Dustin Moskovitz, Mithril Capital and Capricorn Investment Group also participated in the current round. Helion raised $40M at $1.25B valuation in September 2020.
The latest investment in Helion catapults it into the ranks of top tier players in the race to develop a commercial fusion machine. Four of the biggest players in the private fusion industry – Commonwealth Fusion Systems, General Fusion, TAE Technologies and Tokamak Energy – currently account for 85% of the investor led funding.
Another 35 firms are identified in the first-ever report on the state of the fusion industry, which has been published last month by the Fusion Industry Association (FIA) and the UK Atomic Energy Authority (UKAEA). The report is The Global Fusion Industry in 2021
However, as COP 26 became a stage for the private sector to fully commit to investing trillions of dollars into clean technologies over the next 30 years, we will see more deals of this size soon, said Pitchbook’s Telle. Some of the firms described in the FIA report declined to disclose their investment profiles saying they were “in stealth mode.”
US government support for fusion energy sciences at the Department of Energy has mostly been directed towards basic and long term scientific research and not towards near term commercialization.
One Investor Stands Out
CNBC reports Silicon Valley’s Sam Altman put $375 million, his biggest investment ever, into fusion start-up Helion Energy. It’s also the biggest bet the Silicon Valley luminary has ever made. Altman made his first investment of $9.5 million into Helion 2015.
“I immediately upon meeting the Helion founders thought they were the best and their technical approach was the best by far,” he told CNBC.
For Altman, fusion is part of his overall vision of increasing abundance through technological innovation — a vision that stands apart from many investors and thinkers in the climate space.
“Number one, I think it is our best shot to get out of the climate crisis,” Altman said.
More generally, “decreasing the cost of energy is one of the best ways to improve people’s quality of lives,” Altman said. “The correlation there is just incredibly big.”
Other investors in Helion include LinkedIn founder Reid Hoffman, and Dustin Moskovitz, a Facebook co-founder. Moskovitz also participated again in Friday’s funding round.
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