June 15, 2007

Flies in the nuclear power ointment: Supply chain complexity, shortage of skilled labor

Kennedy Maize

Perhaps the most interesting aspect of the nuclear track at the ELECTRIC POWER 2007 Conference & Exhibition (EP07) in Chicago last month was the attendance. For the most part, its sessions were jammed, leading session chairmen to mention how different this was from prior years.

 

Clearly, nuclear has buzz. The environment looks promising: The regulators are helpful, and there are multiple willing sellers and multiple willing buyers. Those folks filled the conference rooms.

The optimism was widespread. Several utilities said they planned to submit a combined construction and operating license (COL) application for a new plant to the Nuclear Regulatory Commission (NRC) by the end of this year.

Some of this is gamesmanship, however. Realizing that, session moderator Dennis Demoss, PE, a senior vice president and project director of Sargent & Lundy, took the temperature of the first session by asking how many of the announced applications will be on the NRC docket when the industry reconvenes at ELECTRIC POWER 2008 in Baltimore next spring.

The answers to Demoss's question ranged from eight applications to none. These estimates, of course, are pixie-dust. Both the reactor vendors (the willing sellers) and the utilities (the willing buyers) are very careful not to betray their marketing strategies. Most want to be second, not first, to file with the NRC.

Surprisingly, the low-ball estimate came from General Electric's Tom O'Neill. That was in the face of the announcement at the conference that GE and Virginia-based Dominion, parent of Virginia Power, have signed a contract for long lead-time equipment for a GE ESBWR (economical, safe boiling water reactor) at Dominion's North Anna site in Virginia. The contract includes long lead-time items such as large forgings, reactor vessel fabrication, and the like.

Clearly, willing buyers are meeting willing sellers, regardless of the still-unsettled political and regulatory environment. That's a basic definition of a market—where supply and demand can sort out price.
 

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