Units 3 and 4 Cernavoda NPP Project Envisaged Ownership Structure and Operation and Maintenance

Transcription

1 Units 3 and 4 Cernavoda NPP Project Envisaged Ownership Structure and Operation and Maintenance POWERed by people Alexandru HAVRIS Head of Projects Management Department SN Nuclearelectrica SA IAEA Technical Meeting on the Responsibilities of Owners/Operators in New and Expanding Nuclear Power Programmes Atlanta, December 12, 2016

2 Project Sponsor - Nuclearelectrica - overview NUCLEARELECTRICA Executive Office Bucharest Cernavoda NPP Units 1&2 Branch office Nuclear Fuel Plant Pitesti Branch office Safe & Efficient operation of Units 1 & 2 Management of all Company assets in Cernavoda, including Units 3&4 Manufacturer of nuclear fuel bundles, for own use 84,65% until % starting 2014 Energonuclear Subsidiary (PCO) Units 3& 4 Project 2

3 Nuclear facts and plant lifetime Romania & SNN facts SNN - the only nuclear power producer in Romania and the only CANDU technology operator in Europe Romania has industrial technology for heavy water production High quality of domestic nuclear fuel produced in Romania proven by its behavior and performance during the reactor operation period Meets all requirements and conditions recommended by the International Atomic Energy Agency (IAEA) and imposed by the Romanian nuclear regulator CNCAN Successfully passed the stress tests required by the European Commission after Fukushima Proven expertise in nuclear power generation and nuclear waste management Training programs fully compliant with international best practices and standards Constant cooperation with key suppliers and contractors in nuclear industry (General Electric, Babcok & Willcox, Candu Energy Lavalin etc.) Units 1 & 2 Plant lifetime The world s nuclear reactor fleet is aging quickly; the average age of nuclear reactors operating today is 27 years Units 1& 2 are very young capacities (average age of 12,5 years) Unit 1 is 18 year-old and Unit 2 is 7 year-old Unit 1 and Unit 2 have an estimated useful life until 2027 and 2038 respectively Refurbishments procedures will extend Units lifetime by 25 years Units 1&2 total installed capacity: 1,413 MW Spent nuclear fuel stored as radioactive waste in dry storage facilities (no reprocessing of the spent fuel is taken into account) 3

4 Project background Cernavoda Nuclear Power Plant The Cernavoda NPP Project consists of 4 CANDU units of MW installed power each. Construction of Unit 1 of Cernavoda NPP was completed in 1995 and the plant started producing electricity in October Unit 2 of Cernavoda NPP had been partially built in the 1980s, simultaneously with the construction of Unit 1. Work was then stopped and the unit preserved. Ansaldo Nucleare and Atomic Energy of Canada Limited (AECL) were entrusted with completing the construction of Unit 2 in March Work on Unit 2 ended in 2007 and the rector began operating at full capacity in September 2007 Units 3 and 4 construction begun in the 80s; the civil structures are in different stages of completion (aprox. 52% for Unit 3 and 30% for Unit 4). After the suspension of the works in late 1989, the civil structures were included in a preservation program in order to avoid their deterioration and to allow resumption of works. Units 3 and 4 are expected to be CANDU 6 reactors, similar in design to that of Unit 2. The two units have been placed in conservation since 1992, their completion rate standing at around 15% During the Romanian Government decided to finalize the Units 3 and 4 Project, by setting up a Joint Venture, attracting foreign investors interested in financing the Project and off-taking the electricity produced. Therefore, in March 2009, EN was set up and registered under the Romanian law, with the purpose to promote and develop the Project. Starting with January 2014, SNN became the only Shareholder of EN. 4

5 Proposed Project Feasible project - Positive NPV, attractive IRR Proven technology CANDU worldwide Commissioning and O&M experience Unit 1 and 2 Existing infrastructure for CANDU tech, engineering and design local capabilities Authorized site Licensable design EU positive opinion Existing structures confirmed to be fit for purpose by the Design Authority Pre-project activities in advanced stage and international standards Functional electricity market and well developed grid with large connections to neighborhood 5

6 Romanian Government Strategy for continuation of the Units 3 and 4 Project The Romanian Government has approved on31 July 2014 the Strategy for the continuation of the Project (the Strategy ) The Strategy aims to create a joint venture ( JV ) between SNN and a private selected investor where the amount invested by SNN in EN will be transferred. The JV is the company preceding the IPP type company (Independent Power Producer IPP), set up for a duration of two years, which can be modified with the parties consent, with the purpose of assessing, in the current conditions, the project s feasibility, the valuation of the assets, deciding upon contracting engineering, procurement and construction works (EPC), obtaining the necessary authorizations and approvals for starting the works and also regarding the support measures that will be granted to the project, given current national and European Community legislation and taking a final investing decision for advancing towards the implementation stage of the Project and later on to the IPP stage. Principles for implementing the Strategy: - EPC Contract & Financing by JVCo; - SNN/Romanian State to contribute in-kind (existing assets, initial inventory of heavy water and initial fuel load); - SNN to recover investment in EN (previous SPV); - O&M to be made by SNN based on an SLA and a cost plus margin comparable to the market conditions - protection of minority shareholders rights incl. right to block certain decisions - to promote Romanian industry (indicative volume of 30%, but no less than 20% of the works, procurement of equipment, materials and engineering); - The participation of SNN and, where appropriate, of the Romanian state must not fall below 30% of the share capital. Envisaged support mechanisms - Measures under analysis: (i) possibility of contracting, by the project company, of the energy before the producer license being obtained (on/outside the OPCOM platform and (ii) development of a mechanism similar to contracts for differences, model used in the energy market reform of UK, which is focused on supporting investments in energy sector for generation capacities with low carbon emissions. - Possibility of using the state guarantee as an instrument used to secure financing of large energy infrastructure projects, subject to EU and local regulations compliance - The support measures identified will be implemented, should the case be, subject to the opportunity decision, in conformity with the legal framework and EU on this matter, and in conformity with the authorization decision from European Commission. 6

7 Envisaged O&M T&Cs Governing principles: Conservative Decision Making; The primary overriding consideration in all O&M matters shall be nuclear safety set-up a joint Safety Advisory Committee; To operate the Units 3 and 4 in a non-discriminatory manner vis-a-vis Unit 1 and Unit 2 as regards external events such a grid dispatch limitations or limitations to cooling water (no matter the nature of the organisational structure agreed upon or the risk/reward structure the parties shall undertake); To achieve safe long-term operations and cost savings for both sides; SNN shall perform maintenance of the Units 3 and 4 in line with such of the international nuclear industry standards as are reflected in SNN s practices (being those subject to periodic review by WANO, INPO and IAEA) and according to the established budgets and shall report on the achievement of these performance standards on a regular basis; Services to be provided by the Operator to the Owner : Type 1 - Production Services: operation, maintenance and current repairs, technical services for process systems, nuclear safety, fuel handling, chemical, radioprotection, planning, etc. These services are exclusively for Units 3 and 4; Type 2 - Support Services: design and technical support, components engineering, work safety, radioactive waste management, maintenance, employees training, quality management, IT, etc. These services are shared between Units 1 and 2 and Units 3 and 4; Type 3 - Management Services: administration, accounting, procurement and warehousing, document control, physical protection, etc.

8 ANNUAL MANAGEMENT PLAN Owner/Operator interface As the license holder the Operator is required by law to observe industry best practices in terms of strategic plans and goals. The Operator will include Units 3 and 4 into an overall strategic planning process for the site which is detailed in the relevant RD s/si s/etc. The Operator will also provide to the Owner an Annual Management Plan organized as follows: Operator shall develop and deliver to the Owner the Annual Management Plan, including : Annual goals and objectives in respect of operations, maintenance and management of the Project; Major maintenance schedule for the 24-month period after the beginning of the Operation Year; Capital investment plan; Technical support plan; Environmental, health and safety operating plan; If requested by the Owner, supplies and materials inventory recommendations; Target Quantity annual quantity of electrical energy in MWh based on a rolling 5-year plan (considering planned annual outages and a factor for unplanned outages) The Budget. The Owner will assign an Asset Manager (interface with the SNN CNO) and an Operating Representative (interface with the Plant Manager). The Owner will have the opportunity to participate in the Review Committee for long term strategic planning. The Operator and the Owner will establish an operational committee (the Operating Committee ) for the purpose of coordinating the operations of the project. The Operator and the Owner will establish a safety committee (the Joint Safety Advisory Committee ). The Joint Safety Committee will attend the Plant Safety Oversight meetings held quarterly.

9 Conclusions. Challenges: Nuclear Third Party Liability for Nuclear Damages Decommissioning and final disposal Would setting-up international standards/guidelines for roles and responsibilities of the owners and operators be a solution?