|The Longmen ABWR plant in Taiwan, built by GE-Hitachi, nearing completion,|
Hitachi has agreed to buy the Horizon nuclear company for around £700 million from RWE and E.ON, and begin a programme of building new ABWR reactors in Britain. But the four operational ABWR plants in Japan have a history of being off-line over 40% of the time.
The Japanese company, leading a consortium which contains Canadian engineering and construction group SNC-Lavalin, is to work with two leading British engineering companies, Rolls-Royce and Babcock International, intending to build two or three 1.3GW plants at each of the two sites owned by Horizon: Wylfa on Anglesey and Oldbury in Gloucestershire.
Hiroaki Nakanishi, president of Hitachi, said: “Today starts our 100-year commitment to the UK and its vision to achieve a long-term, secure, low-carbon, and affordable energy supply”.
Between 5,000 and 6,000 jobs are hoped to be created at each site during construction, with 1,000 permanent jobs per side following.
Government ministers welcomed the announcement, which comes after a series of talks at Whitehall with the potential buyers. The other contender was Westinghouse, but Hitachi beat them on price, offering twice what the owners of Horizon were expecting.
Hitachi is to use the Advanced Boiling Water Reactor (ABWR) design, which it has employed on four plants in Japan. Other plants based on this design are being constructed in Taiwan. All have been delivered on time and on budget.
The design has not yet been submitted to the Health and Safety Executive for approval, a process which can take up to four years. The first plant is therefore not expected to be operational until the middle of the 2020s.
However, the four Japanese ABWRs in operation have often shut down due to technical problems. According to the International Atomic Energy Agency, they have an operating factor below 60%, meaning that on average, 41.2% of the time they have not been producing electricity.
The Shika 2 ABWR reactor was unavailable 57.5% of the time; the 46.8 %">Hamaoka-5 reactor 46.8% of the time, the Kashiwazaki Kariwa-7 plant was unavailable 32.4% of the time; and the the Kashiwazaki Kariwa-6 plant 28.1% of the time.
Another ABWR planned to be built in Texas was cancelled in March 2011, and earlier this month almost two-thirds of Lithuanians voted against such a plant being built in their country.
Energy and Climate Change Secretary Edward Davey said: “Hitachi bring with them decades of expertise, and are responsible for building some of the most advanced nuclear reactors on time and on budget, so I welcome their commitment to helping build a low carbon secure energy future for the UK. I particularly welcome Hitachi’s firm commitment to involve the UK supply chain and local workforce."
Around 60% of the value of the first plant is expected to be sourced from within the UK, with more from subsequent plants.
Speaking on Radio 4 this morning, Ed Davey repeatedly denied that there had been any discussion of the price that might be paid for the electricity any of the plans might produce. He insisted that it was purely a commercial arrangement.
EDF Energy is negotiating with the government over the strike price for the electricity it is hoping to generate at Hinkley.
Mr Davey also announced the setting up of a new arms-length body, the Nuclear Industry Council. It will attempt to promote the UK's commitment to new nuclear power abroad and will be chaired jointly by government and industry representatives: Edward Davey (or Energy Minister John Hayes) and Business Minister Michael Fallon, and Lord Hutton, Chairman of the Nuclear Industry Association.
John Hutton said that the council “symbolises the long-term strategic partnership developing between the UK nuclear industry and the Government".
Also today, the Department for Business, Innovation and Skills announced that Sheffield University has been selected to go forward to final contracting and due diligence for a £37 million project involving continuing support for the Nuclear Advanced Manufacturing Research Centre.
This will be responsible for improving the skills base in the nuclear industry in the UK.
ABWRs have a design life of around 60 years, and take four years to construct. Unlike Areva's EPR design, they have a single not a double containment shell. They do not use steam generators.
Greenpeace Energy Campaigner Leila Deen commented on the news that: "It speaks volumes about the UK’s struggling nuclear programme that the Government is promoting a reactor that's years from being granted UK safety approval and is designed by the company that helped build Fukushima.
"Instead of waiting years to find out how much bill payers will end up subsidising this project, the Government should join Japan and Germany, abandon nuclear, and invest instead in clean, renewable energy."