Atomic Insights
June 7, 2005
Atomic Insight: PBMR Update June 7, 2005
As frequent readers know, I am a huge fan of the Pebble Bed Modular Reactor (PBMR) project that has been under development in South Africa since 1993. Though there have been some hurdles over the years, and the project has had to overcome a significant amount of resistance, the PBMR team - originally from Eskom, now a separate company named PBMR (Pty) Ltd - is now close to producing their introductory module. During the past few months, PBMR (Pty) Ltd has signed a number of important component production contracts.
I like the project and the concept for a number of reasons. As a technical development, it is exciting to see that people are recognizing that not all reactors have to be 1000 MWe (or larger) central station power plants in order to be economical. The PBMR is a modular design with each reactor power unit producing approximately 170 MWe. These smaller units will increase the reach of nuclear fission power into new markets that cannot integrate the power output supplied by traditional nuclear plants.
The economics for the PBMR are also attractive. South Africa currently has some of the lowest cost electricity in the world, produced for the most part by coal burning power plants located very close to some extremely productive and low cost coal deposits. Those coal deposits - fortunately, in my opinion - are not universally distributed throughout the country; there are significant population and growth centers that are 1000 or more miles away from the current generation centers. When the economists and engineers at Eskom carefully evaluated the available power systems to supply those growing needs, they found that the PBMR was the low cost option, even compared to expanded coal fired production.
When it comes to safety, I have to choose my words carefully. The PBMR is not "safer" than traditional nuclear reactors - it is very difficult to prove that anything is safer than a power production system with the amazing track record produced by commercial nuclear power plants over the past 40 years. It is, however, possible to say that the safety provisions required for the PBMR are easier and cheaper than they are for conventional reactors. Even under the very creative - and generally quite unrealistic and amazingly conservative - worst case analysis methods generally employed by the nuclear industry, the PBMR requires fewer engineered systems, fewer back up systems, and a smaller exclusion area.
Even though I have been following this project for more than a dozen years and writing about it for at least five years, I am occasionally surprised by new information. It has been common knowledge for PBMR news junkies like me that BNFL has been the only major foreign investor in the project since about 2002 when Exelon, the largest nuclear utility in the United States, ended its participation.
A couple of months ago, however, I came across some information indicating that Westinghouse was playing a significant role in the final development and commercialization of the PBMR. That fact confused me a bit until I realized that Westinghouse, the pioneer in the Pressurized Water Reactor (PWR) technology that underpins about 50% of the world's nuclear power plants, was now owned by BNFL. I guess I had lost track of the ownership of the Westinghouse brand name after a previous iteration of the company morphed from one of the premier engineering companies in the world into a broadcast network.
I recently had the good fortune to interview Dr. Regis Matzie, Senior Vice President & Chief Technology Officer, Westinghouse Electric Company, LLC. Dr. Matzie represents the Westinghouse arm of BNFL on the PBMR (Pty) Ltd board of directors. Among his many other accomplishments, Dr. Matzie graduated from the US Naval Academy in 1965 and served as an active duty submarine officer for five years. Apparently, his sleep patterns were set early in his career; he invited me to call him "first thing in the morning" for this interview. That is how I found myself on the 2nd of June 2005, at 0730, still sweating after my morning workout and having a cup of coffee outside the Crystal City Starbucks.
Adams: How was your trip to South Africa?
Matzie: It was wonderful - exciting work, good food, and excellent weather. It is always a good place to visit.
Adams: I would love to go there sometime.
Matzie: There is plenty to do down there. I recommend the trip.
Adams: What is Westinghouse's current role in the PBMR project?
Matzie: We provide technical assistance and consultation on a number of issues. We also are assisting in non technical consultations, e.g., supply management strategies, contract provisions, and market efforts.
Matzie: I am on the PBMR (Pty) Ltd Board of Directors. Our parent company - BNFL - is a major investor in the project and has two seats on the board. I occupy one of these seats, as a representative of Westinghouse, and the other seat is occupied by a Brit from our parent company.
Adams: Can you tell me a little about the ownership structure of the company?
Matzie: The PBMR (Pty) Ltd company is structured with a 51% ownership interest by the government of South Africa with additional investment by BNFL. There are serious discussions underway other potential foreign investors for the portion of the company left over after considering BNFL's interest and the 51% interest held by various organizations that are owned by the South African state. Some of those South Africa interests include IDC and Eskom.
Adams: Is there any plan to license and build PBMRs in the US?
Matzie: We have begun the process already. We held initial informal meetings with the NRC staff in early 2004 and a public meeting in November 2004. We have received permission in writing from the NRC staff to continue in the pre-application phase with our design certification efforts.
Matzie: There is a group of 7 major US nuclear utility companies that meet with PBMR semi-annually to keep abreast of our progress and to help us keep informed about their needs from an engineering, design and operations perspective.
Adams: I had an opportunity to speak with Chairman Diaz of the NRC a couple of weeks ago at the Nuclear Energy Assembly. He had spoken about his organization's efforts to develop its workforce and the challenges associated with that process. Most of the efforts seemed focused on Light Water Reactors. I asked him what would happen if someone filed an application for a Gas Cooled reactor and he told me it would be four to seven years before they would even be able to consider such an application. Do you have any comments?
Matzie: If that is what he said, I will say that his organization has a statutory obligation to review license applications for US standard plants that could be deployed in the US. Whether or not the NRC staff has the technical capability to do so remains to be seen. It is something that they will have to develop. The majority of their workforce has no gas cooled reactor expertise and actually has very little experience with reviewing plant designs other than light water reactors. That has been changing some in recent years with the initial effort on PBMR with Exelon and the early review of the ACR700.
Matzie: The NRC also seems to be using utility interest as one of the major criterion for establishing their review priorities. Several utilities have written to the NRC in the past year or so to express their interest in the progress of certain designs. We have started working with our utility customers to obtain a similar formal expression of interest to the NRC on PBMR.
Adams: I have also had the opportunity to meet with the Department of Energy Office of Nuclear Energy, Science, and Technology. They have told me that they are on track to develop a licensable recipe for high temperature reactor fuel by about 2012 and that they do not think that fuel from other sources will be able to be licensed by the US NRC. Do you have any comments?
Matzie: The fuel that PBMR plans to use was successfully manufactured and used by the German AVR and THTR programs during the 1970s and 1980s with very good performance. We are going to use that same recipe and manufacturing process. Of course, we will have to qualify the PBMR fuel manufactured in our new production line, but we are confident that we know how to do that. An extensive fuel irradiation program and qualification program is planned and will be fully launched next year.
Matzie: The PBMR project is on track to demonstrate the fuel in an operating, full-scale power plant within 4 to 5 years. We intend to license reactors using that fuel in the US.
Adams: Why do you think that the US DOE is going in a different direction?
Matzie: They are feeding the labs. They are establishing a large R&D program to develop a new kind of fuel - uranium oxy carbide - that has no history and has not been used in any operating power plants. I believe that this is required for some of the other gas cooled reactors because of their higher operating and accident fuel temperatures. Given that fact it is not surprising that their timeline is longer than ours.
Adams: I presume that PBMR (Pty) Ltd does not think that this new type of fuel is required for your project.
Matzie: That is right. We are confident that the original German designed UO2 fuel will meet the needs of PBMR.
Adams: I have noticed during the past few years that the power production part of the PBMR design - as shown on the PBMR web site - has changed significantly. Can you comment on that?
Matzie: Yes. The reference design for a number of years was what is referred to as the vertical three-shaft system, which was configured to account for the differences in optimal speed of the power generation turbine, the low pressure turbine and the high pressure turbine. When MHI (Mitsubishi Heavy Industries) was brought into the project, they performed a study of what was needed in order to develop and manufacture that system. When PBMR looked at what was still needed for research and development, including the magnetic bearings, the sealing systems and other rotating equipment, a workshop was convened to evaluate alternatives.
Matzie: We recognized during that workshop environment that there had been some developments in other industries that allowed us to reconsider whether or not the vertically mounted three shaft design was the optimum choice. Those developments include large reduction gears and gas sealing systems.
Matzie: The end result of that reevaluation is the current design with a single shaft system with the turbine, low pressure compressor and high pressure compressor on the same shaft with the shaft going to a set of reduction gears that then turn the generator at a speed appropriate to synchronize with the electrical power grid. This system lay out is very similar to that of conventional combustion gas turbines.
Adams: Is South Africa's grid 50 Hz or 60 Hz?
Matzie: 50 Hz.
Adams: The NRC just posted their new fee schedule. Does the power reactor fee pose any unique issues for PBMR since it seems that all plants, no matter what size, pay the same annual license fee? PBMR modules are considerably smaller than "conventional" 1000 Mwe plants.
Matzie: That should not be a problem for us. We think that the initial unit size for the US market will be a four pack - four modules making up a single plant. With modules producing about 170 Mwe each, that means that the plant size will be approaching 700 Mwe. Follow on module sizes may be half again as large, leading to a four pack that produces close to 1000 Mwe.
Adams: Have you thought about smaller combinations for markets, even in the US, where that size plant does not really fit?
Matzie: Of course we know that there are existing fossil plants internationally with capacities of a few hundred Megawatts that show there are places in the grid for that size power plant. At this time, we are looking for markets that are "the low hanging fruit," where there is existing infrastructure, grid support and other factors that make them logical early adopters for a new generation of power plants of smaller size.
Adams: What about places that are in the US, but not necessarily in the continental US, that depend on diesel generators to supply power.
Matzie: You have probably heard about the Toshiba project in Alaska. There is a proposal to site a 10 Mwe plant in a remote village.
Adams: Yes, but that is not really the kind of market that I am talking about. Your size plant might do very well in a place like Guam, an island with a significant power supply problem where it is a challenge to deliver sufficient diesel fuel. At current world oil prices, a diesel generator provides power at a cost of about 10-12 cents per kilowatt hour just for the fuel.
Matzie: The market that you are describing is very similar to that of developing nations and third world countries.
Adams: Other industries have found their early adopters by finding customers that really need and are willing to pay for the special characteristics of their product when compared to the ones that are already available.
Matzie: Good point.
Adams: Can you give me an idea of the development progress for PBMRs in South Africa?
Matzie: We are on track to have the first unit operational within four to five years.
Matzie: This is an exciting project, partially because of the direct leadership and participation by a large government-owned utility customer that is not only interested in getting a demonstration system built, but is also ready - assuming that the demonstration goes as planned - to provide a large order for a series of plants. We are moving toward a letter of intent for between 20 and 30 units from within South Africa. With an order like that, we can build up the required infrastructure for the supply of fuel, construction services, and equipment supply that will be needed. We are jump starting what is essentially a new industry and a lot of investment is needed. That is hard to support with small orders of one or two plants, but it becomes quite reasonable with quantities that we are projecting.
Adams: That is something that the nuclear industry has never really done. The mantra in the industry has always been that bigger is more economical, but it sounds like the PBMR company has realized that more units help in the economic picture.
Matzie: That is right. We think that there will be a profitable run if we are able to build towards a reasonable goal of 100 units or more.