GE and Hitachi Ltd. recently completed the first half of their agreement to form a global alliance of their nuclear businesses, creating a comprehensive nuclear power plant and services operations that will compete for new reactor projects around the world.
The global business that will operate throughout the world, excluding Japan, is called “GE-Hitachi Nuclear Energy” and officially began business on June 4. It is 60 percent owned by GE and 40 percnet by Hitachi, and will be led by the executives of GE’s current nuclear business.
In Japan, the business plans to begin operations in July and will be called “Hitachi-GE Nuclear Energy.” It will be owned 80.01 percent by Hitachi and 19.99 percent by GE and will be led by the executives of Hitachi’s current nuclear business. All entities will share a joint advisory committee.
By combining their nuclear businesses, GE and Hitachi are aiming to become the world’s foremost provider of advanced boiling water reactor (BWR) plants and related services. The newly allied businesses will also offer key equipment and services for pressurized water reactors (PWRs).
“Our new alliance complements and optimizes GE’s and Hitachi’s respective strengths,” said John Krenicki, president and CEO of GE Energy. Krenicki said the alliance will allow the two companies to offer customers a broader portfolio of technology and services, and will be backed by the two companies’ advanced reactor project development supply chain.”
In an industry where a single reactor project can require an investment of several billion dollars, GE’s and Hitachi’s newly allied nuclear businesses will offer customers and investors even greater confidence that projects can be delivered on time and on budget.
“By strengthening our existing businesses and positioning our alliance for growth, the breadth of our combined capabilities and experience will be even more impressive in an extremely competitive global nuclear marketplace,” said Akira Maru, president and CEO, Power Systems Group, Hitachi, Ltd.
The two companies have collaborated for decades in developing reactor projects. Since the 1980s, GE and Hitachi have worked together in developing Advanced Boiling Water Reactors (ABWRs) in Asia, a design that represents the world’s only commercially proven Generation III reactor design.
GE and Hitachi partnered on building the first ABWR units to enter service in the mid 1990s, with Hitachi serving as a key provider of critical components and utilizing the ABWR design for additional new build projects in Japan. There are four ABWRs currently operating in Japan and several more being built in Asia, further honing GE’s and Hitachi’s joint reactor project capabilities.
Under their new alliance, GE and Hitachi plan to execute a single strategic vision to create a broader portfolio of industry solutions, an improved capacity for “new-build” opportunities, and the assets required to invest in and expand the allied businesses.
“While GE and Hitachi have collaborated for decades in developing advanced BWR projects, there are relatively few overlapping areas in our respective nuclear businesses,” said Andy White, president and CEO of GE-Hitachi Nuclear Energy. “As a result, this model will enable us to quickly capitalize on critical business synergies that will add value for our customers around the world.”
GE and Hitachi are already two of the three owners of the Global Nuclear Fuel (GNF) joint venture, one of the world’s largest nuclear fuel assembly providers. GNF remains a separate business entity from the newly created alliance.