PICMET 2008 Proceedings, July, Cape Town, South Africa (c) 2008 PICMET

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1 Using the Project Integrated Management Methodology to Enhance the Development, Viability and Sustainability of the SA PBMR and PWR Component Manufacturing Sector Manfried Koster 1, Jabulani Mangena 2 1 Graduate School of Technology Management, University of Pretoria, Pretoria, South Africa 2 Pebble Bed Modular Reactor (Pty) Ltd, PO Box 9396, Centurion 0046, RSA. Abstract--The South African (SA) utility company Eskom is planning to install additional 20 GWe of nuclear power plant (NPP) capacity i.e. between 2008 and Of the aforementioned installed capacity, 4 GWe will be from the PBMR generation IV high temperature gas reactors and 16 GWe will be from the advanced generation III+ pressurized water reactors (PWR) supplied by AREVA or Westinghouse. The SA government requires that the aforementioned nuclear projects must include knowledge and technology transfer which will be used to develop viable and sustainable SA nuclear industry. This research paper explores and demonstrates how the PMBOK project integration management methodology can be utilized to enhance the viability and sustainability of the localized technologies. Various technology localization or indigenization aspects such as R&D, engineering, operation and maintenance are considered in supporting the sustainability of the manufacturing sector. The project integration management model developed and presented in this research paper is used to integrate the aforementioned project life cycle phases to enable the development of a globally competitive nuclear component manufacturing sector. I. INTRODUCTION South Africa will like to develop an economically, socially and environmentally viable and sustainable nuclear program. Just like other countries that have developed and benefited from nuclear technologies, the SA government endeavors nuclear energy to contribute to the country s national program of social and economic transformation, growth and development [4]. According to the International Atomic Energy Agency (IAEA) a country that embarks on a sizable nuclear power programme can realize the following socio-economic benefits: Improvement of overall economy of the country by increasing national production Promotion of the development of national industrial, technological and educational infrastructures Raising of the general level of industrial qualifications, standards and capabilities Development of highly qualified manpower Acquisition of new technology and technical know-how Creation of new employment opportunities Reduction of foreign exchange expenditures Increase of the country s self-sufficiency [7] Accelerated and Shared Growth initiative for South Africa (AsgiSA) underpins some of the above benefits. AsgiSA is a government initiative which leverages on investment in infrastructure so as to achieve the target of accelerating shared growth to 6% by 2014, reducing poverty, and halving the unemployment rate [9]. In realizing the aforementioned objective the government is financially supporting the utility company Eskom s 20 GWe recapitalization nuclear power plant (NPP) program which will occur between 2008 and The Pressurized Water Reactors (PWRs) which will be complemented by the Pebble Bed Modular Reactors (PBMRs) are being used as the flagship. If a nuclear power programme is to support national development efforts, the infrastructures must be developed in step with these demands [5]. Hence NPP component manufacturing infrastructures will have to be developed within the aforementioned time period. The economic transformation will also be enhanced by Department of Public Enterprise s Competitive Supplier Development Programme (CSDP). The CSDP leverages SOE expenditures so as to optimize the development of competitive national supplier industries and, where possible, to build export capabilities [8]. Some countries have managed to successfully leverage on their nuclear power plant programs to develop viable and sustainable advanced manufacturing sectors. For example France, South Korea and Japan are usually given as examples of countries that have created a vibrant nuclear industry which is supported by a sustainable nuclear component manufacturing sector. A. Research Objective and Approach This research paper seeks to inform the creation of a viable and sustainable South African nuclear plant program component supply sector by identifying and defining various processes which need to be integrated. According to Djavanshir and Khorramshahgol many organizations efforts in the area of systems integration fail because of in-complete and ill-defined processes [3]. To achieve this main objective of the study a flowchart shown as fig.1 was created for undertaking and analyzing the following: various processes of the SA nuclear manufacturing program which need to be integrated; integration opportunities within the processes; integration opportunities between processes were examined; case studies on established nuclear plant component manufacturing sectors in other countries and various International Atomic Energy Agency (IAEA) documents on nuclear power program development and sustainability. 1423

2 The integration of identified processes was derived from the Project Management Body of Knowledge (PMBOK) project integration management methodology. II. ENHANCING VIABILITY AND SUSTAINABILITY THROUGH INTEGRATION A. Identifying and Integrating the PBMR and PWR Component Requirements According to PMBOK, the Project Management Project Integration Management includes the process required to ensure that various elements of the project are properly coordinated [14]. The assumption is that there should be integration for the viability sustenance to be achieved. Unlike in SA where the PWRs and PBMRs are being used for socio-economic, in South Korea the economic feasibility of the localization program was mainly based on the technology transfer and standardization of 16 PWRs which were complemented by 4 Pressurized Heavy Water Reactors (PHWRs) [12]. The integration of the nuclear component manufacturing program elements such as stakeholder requirements, nuclear power plant requirements and NPP project life cycle phases is part of NPP program planning process. The consolidation or integration of the SA fleet nuclear plant equipment requirements will therefore enhance the viability of the manufacturing ventures. III. USING THE DEVELOPED PROJECT INTEGRATION MANAGEMENT MODEL FOR SUSTAINING THE PBMR AND PWR COMPONENT MANUFACTURING VIABILITY A. Identifying nuclear and non-plants Requirements As shown in the model below, the following are the processes whose elements need to be identified and integrated i.e. within the process and between processes: Identifying PBMR NPP Requirements Identifying Local PWR NPP Requirements Identifying International NPP Requirements Identifying Foreign & Local Non-nuclear plant Requirements Identifying Foreign & Local Non-nuclear plant Requirements Identifying NPP Phases Identifying Stakeholder & their Roles Industrialization and Monitoring for Viability and Sustainability The identified processes are defined below i.e. from sections III.A.1 to III.A.7. 1) Identifying PBMR NPP Requirements During the preparatory phase of a nuclear programme, it is important that the local industry be surveyed to identify companies potentially capable of participating in the programme and the resources and for their upgrading and/or expansion [5]. In supporting the local development of suppliers, PBMR as a company considered the possibility of the local manufacturing industry to supply NPP components. In addition the company can conduct a SWOT analysis like the one shown in Table 1 which indicates the degree of local manufacturing capabilities [11]. Within this process itself it is important to identify components within various PBMR subsystems. Some of these components shown in Table 1 below can be consolidated and manufactured within the same facility, thereby enabling economies of scale or financially viability of the upgraded local company. For instant the recuperator shell can be fabricated at the same facility in which the other Pressure Boundary components such as the pre-cooler and inter-cooler. A capability which might need to be considered to increase the viability is manufacturing of some forgings within the same fabricating facility. Some elements within this process can be integrated to the PWR process requirements as discussed in section III.A.2 below. Strengths Facilities for conducting NPP component development tests Existing resources for ASME IV and BOP components Supply of PWR components at KNPS HTGR fuel fabrication Opportunities Modularization Heavy duty forging Heavy duty machining Lifting capability CI component manufacturing Nuclear grade component manufacturing Heat treatment facilities Upgrading of NDE Reduction in manufacturing time due to standardized designs Involvement in fuel cycle for PWRs Table 1: SWOT Analysis on the Availability of NPP Manufacturing Resources Weaknesses Lack of modularization Limited heavy duty forging Limited heavy duty machining Limited lifting capability Limited CI component manufacturing Insufficient nuclear grade component manufacturing Limited heat treatment facilities Limited testing capabilities Threats Learning new technologies results in longer manufacturing times Over-supply of fuel worldwide Source: Research Project: Investigating the Availability of Resources for Nuclear Power Plants in South Africa (2007) [11] 1424

3 Feedback TABLE 2: PBMR STRATEGIC SUPPLIERS Supplier Equipment Mitsubishi Heavy Industries (Japan) Turbo machinery, metallic internals Nukem (Germany) Fuel technology SGL (Germany) Graphite Heatric (UK) Recuperator IST Nuclear (South Africa) Nuclear auxiliary systems Westinghouse (USA) Instrumentation ENSA (Spain) Pressure boundary Sargent & Lundy (USA) Architect/engineer services Source: Nuclear Engineering and Design 236 (2006) [14] 1425

4 2) Identifying Local PWR NPP Requirements Out of the 20GWe nuclear power plant capacity to be installed by Eskom, 16GWe will be from PWRs i.e. in the form of Westinghouse s AP 1000 or AREVA s EPR. Hence most of the technology transfer for manufacturing opportunities i.e. between 2008 and 2025 will be for supplying PWR NPP equipment and components. To make technology transfer from foreign vendors to local manufacturers, bidders must submit relevant information indicating how they will transfer the know-how. The IAEA advocates that the economic bid evaluation must also be based on domestic participation and technology transfer (the local investment costs for industry, education of staff, infrastructure, authorities, research and development, and others can be calculated separately [6]. The two arrows between this process and the PBMR process are an indication that the manufacturing requirements of the two NPP must be examined for integration or consolidated. The reason for this assessment is to identify PWR and PBMR equipment which can be manufactured under one roof thereby increasing the viability and ultimately the sustainability of new or upgraded fabricating company. The possibility of supplying manufactured equipment to foreign nuclear power programmes should also be considered for integration as an additional means of sustaining the local companies. 3) Identifying International NPP Requirements The following are factors that have been identified as accounting for the improved prospects of nuclear power: Fossil fuel prices which continue to rise, especially oil and gas considering that NPP compete largely with gas fired power plants Climate change mitigation through reducing carbon emissions since there is increasing doubt on whether renewable energy and energy efficiency have as much mitigation potential Diminishing security of supply energy especially with concerns gas and electricity systems during winter peak demands Many countries have started looking at kick starting their nuclear programmes [1]. The aforementioned emerging demand of nuclear equipment for maintenance and new NPP is also confirmed by the fact that as of 1 April 2006 i.e. globally there were 443 nuclear power reactors in operation and 26 reactors under construction [8]. Although modest nuclear plant construction has continued around the world for much of the past 25 years, the population of manufacturers has diminished because of limited number of projects [2]. The above observations auger well for positioning the local companies to be developed to supply nuclear grade equipment or components for local and foreign NPP plants i.e. for plants at construction and maintenance and operation phases. The S Koreans had a gradual approach of developing and involving their local industry. In this S Korean nuclear situation the local suppliers were identified as stakeholders whose roles were integrated as part of an effort to create viable nuclear industry. The following were the progressive levels they employed: Level 1: As a minimum, local labour and some construction materials were used for on-site nonspecialized purpose, especially for civil engineering work. Level 2: Local contracting firms take full or partial or partial responsibility for civil work, possibly including some design work. Level 3: Local manufactured components from existing factories are used for non-critical paths of the balance of plant. Level 4: Local manufacturers extended their normal products line to incorporate nuclear design and standards. Level 5: Special factories are set up locally to manufacture heavy and specialized nuclear components, possibly under licensing arrangements with foreign suppliers [12]. As stated above in the S Korean example, the SA manufacturing companies can target level 3 as their entry point i.e. supplying balance of plant components. They can then increase or diversify their manufacturing and hopefully their viability and sustainability by incorporating nuclear design and manufacturing. The ultimate is the ability to target level 4 in which there are few manufacturers in the world who are able to manufacture heavy and specialized components. Thus the bulk of PBMR Pressure Boundary (PB) equipment including the reactor pressure vessel can be consolidated or integrated with the AP1000 and AP600 PWR Nuclear Steam Supply System (NSSS) heavy components shown in Fig. 2 below. The PB and NSSS equipment will require ultra heavy forgings. At present only one company in the world i.e. Japan Steel Works (JSW) manufacturers the ultra heavy forgings needed for nuclear plants [2]. The potential of supplying to local and foreign non nuclear projects must also be considered for the purposes of making sure that the developed companies remain viable. Hence the next section looks at non-nuclear requirements supplementing the NPP project requirements. 1426

5 Figure 2: Westinghouse s AP 600 Source: Nuclear Engineering and Design 109 (1988) 4) Identifying Foreign & Local Non-nuclear plant Requirements JSW product groups now include large-sized steel castings and forgings, heavy machinery and steel structures, steel plates, plastics machinery, industrial machinery, and equipment for the petroleum, gas, chemical, and petrochemical industries [10]. Thus as in the aforementioned Japanese company, the manufacturing capabilities developed for SA PBMR and PWR projects can also be used for other local projects such those for Sasol, Petro-SA and other similar projects world wide. For example the petro-chemical plants use large forgings and pressure vessels. Hence the requirements for the non-nuclear projects can be complement the viability of companies which were developed to local support nuclear projects. 5) Identifying NPP Phases Other phases other than manufacturing need to be identified and their role in supporting the manufacturing defined and integrated as shown in the right top corner of the developed model. Designing of nuclear components can be undertaken by the same company which is manufacturing in accordance with nuclear standards and codes i.e. if it has been determined to make any economic sense. Earlier it was mentioned that developed local companies can sustain themselves by supplying components required for maintaining reactors which are in operation locally and 1427

6 abroad. The same company can supplement its income by installing the manufactured components hence maintaining its viability and competitiveness. 6) Identifying Stakeholder & their Roles The IAEA has divided the stakeholders or partners for nuclear programmes in the following categories: Government which is made up of different departments which play different role including the initial funding of the nuclear programme. Utility Company/Owner which responsible for operating NPP. National Industry which comprises local manufacturing companies Research and development institutions responsible for example technical research and development which can be related to manufacturing. Educational and training institutions which will provide manufacturing skills Foreign governments and suppliers which will facilitate among other essentials bilateral agreements and technology transfer respectively [7]. Otherwise the indicated stakeholders and their roles in Fig. 1 are not exhaustive. Benefits brought about by the viable and sustainable nuclear component manufacturing companies will need to be monitored by different stakeholders. For example a foreign supplier which has gone into a joint venture with a local company will be interested in positive returns to its investment i.e. within the shortest possible time. In addition, the same foreign vendor will be keen to maintain the viability and sustainability of its local investments. 7) Industrialization and Monitoring for Viability and Sustainability As shown in the integration model (see Fig.1) the identified stakeholders have vested interest in the success of the manufacturing companies that will have been developed. For example some government departments will be interested in the viability and sustainability of the manufacturing entities for the following reasons: Job creation within the nuclear manufacturing sector Spin-offs to other non-nuclear sectors Eradication or decrease of poverty Achievement of Broad Based Black Economic Empowerment Reduction of carbon emissions Energy security Increase of exports Economic growth due to increase in local nuclear component manufacturing IV. CONCLUSION This research paper has demonstrated that the PMBOK project integration model can be used in formulating models that can used to integrate various processes to enable the sustainability and viability entities being established within a nuclear programme. The envisioned viability and sustainability will therefore be a product of the integration derived from the PMBOK methodology. The integration is also enhanced by referring to the case studies of established nuclear manufacturing industrialization programmes and IAEA guidelines. The same model can be used for nonnuclear industrialization projects which are being introduced in developing countries. For validation purposes this model will be included in Competitive Supplier Development Programme Plan to be submitted to SA Department of Trade and Department of Public Enterprises [9]. The two Government departments will be having major roles in developing and monitoring the sustainability of the SA nuclear industry. REFERENCES [1] ECONOMICS OF NUCLEAR POWER, A Report to the Sustainable Development Commission, University of Sussex and NERA (March, 2006) [2] Clamp, A. In Pursuit of a Nuclear Renaissance, EPRI Journal, Summer [3] Djavanshir, G.R. & Khorramshahgol, R Key Process Areas in Systems Integration, IT Pro, Jul. /Aug [4] DME (2007), Nuclear Energy and Policy and Strategy for the Republic of South Africa, Department of Minerals and Energy. [5] INTERNATIONAL ATOMIC ENERGY AGENCY, Choosing the Nuclear Power Option: Factors to be Considered, IAEA, Vienna (1998). [6] INTERNATIONAL ATOMIC ENERGY AGENCY, Economic Evaluation of Bids for Nuclear Power Plants, IAEA, Vienna (1999). [7] INTERNATIONAL ATOMIC ENERGY AGENCY, Manpower Development for Nuclear Power: Guidebook, Technical Reports Series No. 200, IAEA, Vienna (1980). [8] INTERNATIONAL ATOMIC ENERGY AGENCY, Nuclear Power and Sustainable development, IAEA, Vienna (2006). [9] INTRODUCTION TO THE COMPETITIVE SUPPLIER DEVELOPMENT, Department Public Enterprises, Republic of South Africa (2007) [10] JAPAN STEEL WORKS, LTD (JSW ). Product Outline. [11] Mangena, J Investigating the Availability of Resources for Nuclear Power Plants in South Africa, MPM thesis. University of Pretoria, unpublished. [12] NUCLEAR POWER PROJECT: POLICY AND KOREAN EXPERIENCE Korea Atomic Energy Research Institute (1 st ed.). (2001). [13] PROJECT MANAGEMENT BODY OF KNOWLEDGE, PMBOK Guide (2000 ed.) 1428

7 [14] WALLACE, E., et al., From Field to Factorytaking Advantage of Shop Manufacturing for Pebble Bed Modular Reactor. Nuclear Engineering and Design, Mar 2006, Vol. 236, p. 445 REFERENCES NOT-CITED [16] WORLD NUCLEAR ASSOCIATION, Feb. 2007: Nuclear Power in South Africa. (4 Mar 2007) [17] WORLD NUCLEAR ASSOCIATION, Feb. 2007: Nuclear Power in South Africa. (5 Mar 2007) [15] WORLD NUCLEAR ASSOCIATION, World Nuclear Power Reactors and Uranium Requirements, 29 Jan (3 Mar 2007) 1429