1. Building a nuclear future Recent developments By Bill Bryce, Interim Chairman NIA King’s College, London 27 February 2007

2. Recent developments World scene UK - Energy gap – Current nuclear scene – Recent and future events – New build – Resources The big issues Points for debate

3. World energy scene WEC - “Fossil fuels will continue to dominate” Currently - Coal 40%, Gas 20%, Oil 6% Nuclear 16%, Hydro 16%, Renewables 2% Stern Report (October 2006) Coal will increase to ~50% as power demand increases Greenhouse gases will double by 2035 Power sector needs to be > 60% decarbonised by 2050 Intergovernmental Panel on Climate Change (February 2007) - Will it make things happen ?

4. Nuclear in world scene Nuclear waste still a major issue but several countries are implementing solutions Nuclear new build happening just about everywhere Finance available through different models even for private ownership nuclear vendors and contractors likely to carry bulk of construction and financing risks Scarcity of key components getting more severe RPV head forgings waiting list beyond 2018

5. World nuclear new build BuildingPlannedProposed CHINA 10 13 50 INDIA 8 4 15 KOREA 5 7 0 JAPAN 2 12 1 RUSSIA 4 8 18 USA 1 2 21 EU 2 0 ? OTHERS 0 18 53 TOTALS 32 64 158

6. New reactor technology PBMR ACR-1000 ESBWR AP-1000 EPR

7. Recent events July 2006-Energy Review Report -CoRWM Reports September 2006-Mori polls shows big rise in support for nuclear among MPs and public October 2006-Finland proposes 6 th reactor -Government announces support for CoRWM proposals -NDA given responsibility for Nirex -Stern report – 60% power generation decarbonised by 2050

8. Recent events December 2006 - Westinghouse selected to build 4 reactors for China January 2007 - Regulators publish their proposals for reactor pre-licensing -Tim Stone to advise on financial provisions for new build decom and waste -Germany initiates rethink on nuclear February 2007 - AREVA gets OK for 2 reactors for China - Greenpeace wins high court case against Energy Review

9. Future events April/May 2007-Government White Paper - New full consultation to start Spring 2007-Secondary legislation to be enacted to streamline public enquiries -Planning White Paper to be published July 2007-NDA to launch consultation on site selection process for high level waste repository

10. UK nuclear capacity Dungeness ‘A’ & Sizewell ‘A’ Oldbury Dungeness ‘B’ 10 year LE granted Wylfa Hinkley Pt ‘B’ & Hunterston ‘B’ Heysham 1 & Hartlepool Heysham 2 and Torness After 2023, Sizewell ‘B’ is the UK’s only operating nuclear plant 10 year LE planned 5 year LE planned 10 year LE planned

11. Current UK nuclear scene Generation Sizewell A and Dungeness B closed 31/12/2006 AGR life extensions planned Capacity reducing earlier than planned? Clean up NDA achieving some successes, but… Change in sell off plans – aspirant Tier 1s re-thinking Annualised funding and potential reductions causing problems for supply chain Near Term Work Plans becoming unreliable Market experiencing competition for Tier 2, 3s

12. UK energy gap 20 to 30 GW gap to occur in 2015 Despite popular impressions, renewables and conservation cannot fill this Could be filled by gas and clean coal with security of supply and carbon consequences New gas can buy time for decision on nuclear

13. UK new power plants activities Wind farms - many receiving approvals Clean coal - several studies underway CCGT stations – 2 new builds started 2006 2 more to start 2007 Nuclear - Government recognises that it must be a significant part of the future power mix

14. Low carbon – cradle to grave Source: Parliamentary Office of Science and Technology, October 2006

15. UK nuclear new build New build owners require CONFIDENCE:- in the long term carbon price and trading scheme in the planning/licensing processes that sites will be made available in selection process for waste repository site in costing for decommissioning and waste m’gment that industry can deliver on time and within cost

16. Paul Golby “I will not make investments in nuclear unless I can see a carbon framework that gives me confidence there will be a price for carbon going forward, but I am not looking for guarantees.” “…we will look to build plants with a range of technologies, including nuclear if the right environment and framework exist.” “We will be moving with other technologies of which nuclear is just one, but it will start to make a contribution from the middle of the decade onwards.” UK nuclear new build Dr Paul Golby Chief Executive E.ON, UK Evidence to Trade and Industry Committee 6 June 2006

17. UK nuclear new build Vincent de Rivas “I am confident that if we have clarity from Government on these issues (planning, licensing, sites, waste and carbon) by the end of 2007, we can have the first of the next generation of (nuclear) power stations on stream 10 years later.” Vincent de Rivas Chief Executive EdF Energy 16 November 2006

18. UK nuclear new build Bill Coley "We have today launched a process to invite potential partners for new nuclear generation projects in the UK. Construction of new nuclear power stations is critical to meeting the UK's security of supply and climate change objectives. Electricity is essential to continued economic growth, jobs and quality of life for the people of the UK today and into the future.” Bill Coley Chief Executive British Energy 13 February 2007

19. Resources Power sector demands set to grow dramatically Other engineering projects creating competition Major deficiencies Project managers Regulator staff (for clean up and new build licensing/safety ) Nuclear specialists (for clean up and regulators) Trades skills Lack of clear plans hindering training/recruitment Can supply be managed for short and long term?

20. Resources Education and training initiatives Dalton Institute (Manchester University) National Nuclear Skills Academy Cogent Training Boards »Civil Industry (CITB) »Engineering Contractors (ECITB) »Science and Engineering (SEMTB) EnergyForesight (school programme) New Nuclear R&D laboratory for Cumbria

21. The NIA study in March 2006 of the UK supply chain capability: Assumed  5 twin reactors over 20 years (maintains nuclear at 25%)  international, approved designs Concluded  Much of engineering and construction work is broadly similar to other major projects  UK nuclear supply chain could supply 70% of a new nuclear plant. With investment this could rise to 80%  Supply of resources can be managed, if started now New build - can industry deliver ?

22. Resources for new build

23. The impact on jobs

24. The timings are critical 5 years for approval : 5 years to construct Today

25. Pinch points for new nuclear build Policy framework to encourage investment Reactor safety and licensing resources Programme and project management skills Scarcity of specialised plant items due to world upsurge in new nuclear build: Large forgings Reactor pressure vessel manufacture Steam generator manufacture Large turbine/generator manufacture

26. Actions to overcome pinch points UK Government must Set framework to attract investors, utilities and nuclear system vendors to the UK market Enable UK regulators to implement streamlined licensing/planning processes for international designs UK Industry must Be competitive in the global supply chain Invest in project management Decide role and invest accordingly Prepare to supply resources and equipment

27. The big issues The White Paper Carbon price and trading scheme Nuclear waste site selection Public perception UK market - sufficiently attractive to investors and nuclear vendors ? Will new gas plants delay nuclear decision

28. Some points for debate Does new nuclear need Government intervention to make it happen? Can we effectively reduce the planning and licensing approval times ? Would you bank on industry delivering on time and cost ? Who will actually buy one ? What about the political scene – change of PM, change of government, influence of Lib Dems ? Other surprises – Greenpeace legal challenge etc ?