Nuclear, Reactors

Catching Up With Areva

Issue 1 and Volume 5.

By Lindsay Morris, Associate Editor, Power Engineering magazine

During the United States Energy Association’s World Energy Council meeting in Houston, Lindsay Morris sat down with Jacques Besnainou, president and CEO of Areva N.A. The discussion focused on Areva’s efforts to rebuild the supply chain in North America for nuclear growth, as well as the company’s progress in Sweden, France and China.

NPI: What do you see in terms of Areva’s nuclear future in North America?

Jacques Besnainou: I’m quite optimistic about Areva’s future in North America. Nuclear energy is a huge part of making the cost of energy here affordable. It is the cheapest form of energy at $.02-$.03 per kWh. I’m pretty optimistic that the U.S. will continue to have 20 to 30 percent of the electricity generated come from nuclear energy and will at one point replace the current operating nuclear fleet. Areva will be a big part of that. We have 5,000 employees in North America. We were just awarded a contract from TVA (Tennessee Valley Authority) to help complete the Bellefonte plant.

Nuclear power plant retirements will start in 2025. We have to look at the nuclear fleet like a housing development. There will be six to seven plants built every year starting in 2025. The nuclear power fleet in the U.S. will retire, so we need to start investing in new nuclear now, because it takes about 10 years to get a new plant up and running. In order to really make sure that we have the means to do these developments, we need to have a large supply chain. Building a nuclear reactor is difficult because you have to rely on a very large supply chain, which was destroyed in the U.S. because we didn’t do anything for 30 years. We are now rebuilding the supply chain. Between now and 2025, you will see each vendor build one or two reactors. That’s why Areva invests in the U.S.

NPI: What is the status of the Eagle Rock project? What is the significance of that project in regards to nuclear in the U.S.?

Besnainou: We were awarded the license a few weeks ago – we got it in record time. Now we are waiting on ratification of the Pentapartite Agreement between five countries (U.S., France, Germany, U.K. and the Netherlands) in order to transfer the technology back to the U.S. It has been approved by four and now we’re waiting for the conclusion of the fifth country. It’s also backed by the U.S. Administration. We are finalizing the terms of the loan guarantee now.

We’re waiting to start construction until these processes are concluded and for the winter to be over because the weather can present challenges. It’s pretty difficult to dig in Idaho. We’re planning construction in 2012.

It’s a critical project for us. Most of the production is already sold. It’s backed up by the U.S Administration. We are finalizing the load guarantee now. It’s an extremely important project for the nation for security of supply.

NPI: What are some of the lessons learned from Areva’s projects in Finland, France and China?

Besnainou: When you look at what happened in Finland and France, we are late, but we are on time in China. The big difference is supply chain. The supply chain in China was ready. These people in China are building roads, highways – they have companies that are ready to build nuclear plants. They never stop building. In Finland, they didn’t build for 30 years. And the same thing in France. So the big lesson learned is to rebuild the supply chain in the U.S. before we start construction.

Also, consider the people – intellectual properties. Some of our U.S. employees are in Finland now. The idea is to bring them back to the U.S. We invest in people. One of my goals is to hire young engineers and send them abroad to get experience, and they will be the ones who will come back in a few years and rebuild the nuclear fleet in the U.S. It’s very exciting. The amount of planning is very difficult, because you’re planning long-term. You have to have a double brain – planning long-term but also short-term on the financial side.

It’s a long-term effort. When are we going to get the first plant off the ground? It could be between 2012 and 2015 – it depends on the customer. It depends on policy. We have time, so we are planning for the next stage. I’m absolutely certain that we will have an EPR built by 2020 because it’s super important for the U.S. to start development to replace the fleet.

NPI: What are the most valuable lessons learned from Fukushima?

Besnainou: First, whatever our energy choices are, safety is the first priority. Second, dialogue and transparency are critical because we need to build trust with our stakeholders. Third, despite Fukushima, the fundamentals haven’t changed. We needed clean, reliable, affordable energy before March 11, and we still need it.

The right lesson from Japan is to learn from it, not to stop the industry. It’s not right to abandon clean, reliable, affordable energy.

NPI: Can you tell me about the Areva Supplier Days and how they are helpful to the U.S.?

Besnainou: We explain our nuclear program, not only in the U.S., but worldwide. If you want to excite a supplier, we tell them we will use them around the world — whether in France, Finland, China, UK, Poland, South Africa. We explain the entire scheme. We tell them what we need. It’s big picture. We determine what they would need to embark on in order to be qualified. We partner with some of our customers at the location – for example the one we held in Missouri.

It’s very successful. I remember there was someone who approached me, he was the owner of a company specializing in air conditioning. He asked me, “Do you have air conditioning in a nuclear plant?” I said, “You cannot even dream of it. The best!” He didn’t even know! It’s taking established businesses and letting them know about the opportunities in nuclear.

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