[NukeNet] Problems at Finland Reactor Highlight Global Expertise Shortage

[Diane Farsetta]

http://online.wsj.com/article/SB117314234678827681.html

Trials of Nuclear Rebuilding
Problems at Finland Reactor Highlight Global Expertise Shortage
By DAVID GAUTHIER-VILLARS
March 6, 2007; Page A6

OLKILUOTO, Finland -- A two-millimeter welding oversight is one of  
the many setbacks plaguing construction of a €3 billion, or $4  
billion, nuclear-power reactor in this Finnish coastal village, the  
first to be built in Europe in 15 years.

The glitches highlight how an unexpected challenge is holding back a  
global effort to revive the nuclear industry: an acute shortage of  
skilled manpower.

Finnish regulators noticed a few months ago that panels of the steel  
cage that will encase the reactor were being welded together with a  
gap of seven millimeters (about a quarter of an inch), instead of the  
five-millimeter space required by design specifications. The mistake  
meant France's Areva SA and Germany's Siemens AG, the companies in  
charge of the project, had to conduct strain tests to make sure the  
welding would hold, causing delays and irritating regulators.

"Areva should have detected the wider gaps," says Jukka Laaksonen,  
director of Finland's nuclear-safety watchdog, Stuk. "You can't play  
with specifications in the nuclear sector."

A long string of technical and regulatory problems have overrun the  
project's schedule and budget. Completion is expected 18 months after  
the original mid-2009 deadline.

Areva will book a €700 million ($923 million) charge, according to  
the French government, the company's controlling shareholder, and  
Siemens says it has so far lost several million euros.

The troubles illustrate how hard it will be to resurrect the world's  
nuclear industry, which sank into a prolonged slumber after accidents  
at Three Mile Island in the U.S. in 1979 and Chernobyl in Ukraine in  
1986, even as countries try to slash their dependence on fossil fuels.

The heart of the problem is that a fall in orders after those  
accidents has stripped the global industry of much know-how and  
discipline. "The industry isn't ready for a construction boom," says  
Mr. Laaksonen.

Many nations are eager to develop new sources of energy, as the price  
of crude oil has soared this decade, and a scientific and political  
consensus has accepted evidence that fossil-fuel emissions are a  
prime contributor to climate change.

Oil, natural gas and coal combined account for 80% of the world's  
energy diet. And most oil and gas is found in volatile regions such  
as the Middle East, Africa and states of the former Soviet Union.

Nuclear power, which emits no global-warming gases and whose main raw  
material, uranium, is abundantly available, accounts for 6.5% of  
global energy supply. But that share is expected to decline to 4.7%  
by 2030, according to International Energy Agency forecasts, as  
overall demand outpaces the addition of fresh nuclear capacity --  
unless the industry can seize the moment to repair its safety  
reputation and start expanding again.

There are 435 nuclear reactors in operation world-wide, but most were  
built in the 1960s and 1970s. Finland last constructed a nuclear  
plant in the late 1970s, and Areva NP, the Areva-led joint venture at  
Olkiluoto, hasn't been a lead contractor since the 1980s. Excluding  
Olkiluoto, 29 reactors are currently being built, mainly in Asia, but  
all are using old designs that Western European and U.S. nuclear- 
safety regulators won't allow.

France, which has 58 reactors, including the latest built in Europe,  
is better placed than others in terms of nuclear competence. But even  
there, many skilled nuclear engineers have retired or shifted to  
other businesses over the past two decades.

State-run utility company Electricité de France, which operates all  
the country's reactors, recently ordered a 59th facility. Beyond  
needing extra power, EDF wants to preserve in-house nuclear  
expertise. "We must benefit from transfer of competence between  
generations," Chairman Pierre Gadonneix said at a recent news  
conference.

The setbacks at Olkiluoto are being closely watched in China and in  
the U.S., which are considering building several nuclear reactors. In  
February, China signed a draft agreement to buy four reactors from  
Westinghouse, a unit of Toshiba Corp. of Japan. China is also in  
talks with Areva to purchase two others similar to the one being  
built here.

In the U.S., various consortia formed by nuclear-engineering  
companies and utilities have started a lengthy licensing process with  
the U.S. Nuclear Regulatory Commission in order to start construction  
early next decade.

The 1,600-megawatt Olkiluoto reactor was ordered by Finnish power  
company Teollisuuden Voima Oy in December 2003 to meet growing  
electricity demand from the country's paper mills.

Work began slowly because Areva and Siemens had to first complete a  
detailed design for the new model of reactor. The biggest snag  
happened in September 2005, though. Workers struggled with a concrete  
mix that, because of the frost, wasn't fluid enough to be poured into  
the reactor's base slab measuring about 10 feet thick. Areva NP and  
its local subcontractor long argued over solutions and eventually  
opted to add slightly more water than what the design specifications  
required.

The nuclear watchdog immediately ordered a two-month suspension of  
construction work. "Inspection showed that the slab is perfectly  
strong, but we should have been informed of the changes in advance,"  
Stuk's Mr. Laaksonen said. Areva said that early on it didn't realize  
it had to inform Stuk of minor changes to materials.

Areva NP's project manager, Philippe Knoche, adds that in the  
beginning, Areva had trouble coordinating with subcontractors, some  
of which had no experience in the nuclear field. Relations with  
subcontractors are now much smoother, Mr. Knoche says.

Another problem at Olkiluoto -- and for industry officials banking on  
a global nuclear renaissance -- is procuring heavy forgings. These  
crucial parts can be supplied only by a handful of factories, mainly  
in Japan and France. Forgings are used to make the enormous steel pot  
that hosts the nuclear chain reaction, as well as in making  
pressurizers, steam generators and complex pipes.

"It's unclear how fast we can re-create forging capacity," Mr. Knoche  
said. "The know-how is in people's heads and there aren't that many  
who master the technology."

At Olkiluoto, problems securing a steady supply of forgings are  
causing more delays. Late last year, Areva NP realized that eight  
pieces of forgings -- long pipes measuring about a meter in diameter  
-- weren't up to snuff because grains in their metallic structure  
were preventing ultrasonic inspection of the forgings as a whole. "We  
are going to make them again," Mr. Knoche said.

Areva NP's headaches over the steel cage to encase the reactor aren't  
over, either. Late last year, a storm blew part of the steel ring  
slightly off its wooden wedges, causing bends in the lining.

"We had to prepare a 180-page memo on how we will fix the ring," Mr.  
Knoche said.

In Helsinki, the Finnish regulator's chief says the memo is a sign  
that Areva's attitude towards regulation and specifications is  
improving. "They've learned the lesson," he said.

Write to David Gauthier-Villars at David.Gauthier-Villars at dowjones.com