Generation mPower – Modular Reactor Team That Is Aiming For Turn-Key Units With Predictable Schedules And Costs

I attended a heart warming press event this morning that gave me the same kind of goosebumps that I feel when listening to the Star Spangled Banner after an American wins a gold medal at the Olympics. Considering the potential economic and environmental impact of the product that will be produced as a result of the announcement, that is probably a gross trivialization of the importance of the event.

Bechtel and B&W announced that they had formed an exclusive alliance called Generation mPower that will produce modular nuclear power plants, not just nuclear steam supply systems. The 125 MWe machines will be engineered, manufactured and licensed in the United States. They will be aimed first at the domestic market, but will also be engineered for the export market. The alliance is determined to eventually produce nuclear power plants that can be sold for a predictable price and installed on a predictable schedule.

Bechtel will be responsible for engineering the portion of the plant that converts steam supplied by the reactor into electricity – the part of the plant that nuclear engineers call “balance of plant”. Instead of putting together new teams for every project and bidding for various components, the alliance will produce plants that are identical copies. The description of the alliance and the desire to build plants that are carbon copies of each other sounded a lot like the way that Mike Wallace at Unistar has described his notion of a fleet of identical plants – though Mike’s fleet will be made up of 1600 MWe US-EPRs instead of 125 MWe mPower modules.

Aside: I realized while writing this article that there is a good reason why some of the terms used to describe Generation mPower sounded vaguely familiar. Both Bechtel and B&W are involved in the Unistar project to build a fleet of standardized large plants for US utility customers, Bechtel as a partner and B&W as a component supplier. End Aside.

Senator James Webb (D-VA), Representative Lincoln Davis (D-TN 4th District), Representative Brad Ellsworth (D-In 8th District), Gary Leidich (EVP and President, FirstEnergy), and Ashok Bhatnagar (Senior Vice President, Nuclear Operations, Tennessee Valley Authority) joined Christofer Mowry (B&W) and Jack Futcher (Bechtel) at the head table. The extent of the head table group demonstrates that the Generation mPower alliance has strong political backing and significant customer interest. The two utilities at the table are just a small sample of the more than one dozen utilities of various sizes who have joined in the customer user group to help the plant designers make good technical choices early in the design process. The involvement of operating companies helps the designers to select features that will ease operations, maintenance and licensing challenges

Christofer Mowry reminded the assembled audience that it had been slightly more than a year since B&W announced the mPowerTM at a similar press event held at the National Press Club in Washington, DC. The company has been busy during that year; there are now approximately 400 people working full time on the project and the team is expanding to include license preparation and balance of plant work.

During the event, I heard all of the good arguments that support development of smaller unit sizes. The speakers talked about better capacity addition scheduling as power demand grows, simpler financing with more moderate project size, higher overall reliability due to unit independence, factory production, easier shipments, and the notion that learning curves from a higher unit volume will help drive down costs over time. The utilities also mentioned the importance of smaller unit sizes as they make plans to replace aging coal fired power plants often built 40-50 years ago when unit sizes of 125-300 MWe were common.

Another major point of excitement was the fact that both Bechtel and B&W are American companies; there is a strong current of patriotism in the project based on the goal of restoring US manufacturing capacity and nuclear technology leadership.

Christofer Mowry provided a brief history lesson by pointing to the recognized success of the public-private partnership that built the Shippingport reactor and unleashed several decades of rapid nuclear power plant development around the world using American developed technology. Representative Davis talked about how the Tennessee Valley Authority had brought electricity to his home region and the beneficial effects from switching from burning wood and kerosene to flipping on light switches. Senator Webb described how he had been a nuclear supporter ever since his days at the Naval Academy as he watched many of the top members of the classes in his era join Admiral Rickover’s program.

(Aside: Mr. Webb was not always so complimentary in his novels and non fiction books of the impact of the engineering focus at the Academy that Rickover influenced. It is obvious that Webb, the author, was a Marine Corps officer; they often have a different notion about combat preparation compared to some of the more cerebral sections of the Naval service – like the nuclear submarine service.

Senator Webb, however, has supported nuclear energy developments and spoken frequently about the potential benefits to his goal of restoring the US manufacturing industry’s activity level. He is a reliable supporter for efforts that put Americans to work in productive enterprises that enhance our national security. End Aside.)

When asked about the length of time that the exclusive partnership would last,
Jack Futcher from Bechtel explained that the alliance does not have an expiration date – the word that he used was “perpetual”. I asked where the alliance would be located if it was eventually going to be a single entity, Christofer Mowry and Jack Futcher explained that the initial effort will remain focused in Fredrick, MD (Bechtel) and Charlotte, NC (B&W) with detailed nuclear steam supply system engineering remaining at B&W’s facility in Lynchburg, VA. I also asked if B&W intended to manufacture the mPower fuel itself; Chris Mowry indicated that the company certainly had that capability and experience but the decision was not yet made.

After the event had concluded, I spoke in more detail to Chris Mowry and listened as he explained how his company’s research on the history of the nuclear enterprise in the US had revealed that 30% of the material and labor cost of the existing units came from the supplied components while 70% was related to the site construction effort. He described how the preponderance of site work had influenced the cost uncertainty that has helped to discourage new nuclear plant construction for so many years.

He told that his customers have repeatedly told him that they need predictability in both cost and schedule. We also talked a bit about ways to overcome the first of a kind challenge; no matter what product a manufacturer builds, the first one will be an expensive learning experience that will cost more than all subsequent units. That is an area where the Generation mPower Alliance is still talking about the
need for a public-private partnership, perhaps with the first unit being constructed on a national laboratory site or other government installation to supply local loads. Such a development will help the government agency achieve its emission targets while obtaining cost-effective, reliable electricity.

My impression is that Generation mPower has taken a significant step forward in what is certain to be a lengthy journey. In this case, I strongly believe that there are several large pots of gold distributed along the road. It is also a road that may not actually have a destination. Unlike going to the moon, supplying reliable, emission free power is a continuing need that offers steady work for generations to come.

There is one more thing worth mentioning about the event. As a father of two adult daughters who are both well-educated professionals, I could not help but notice the make up of the seven politicians and executives. Those discussions with my girls over the years have reinforced the diversity training that I received as a Naval Officer; visual impressions do matter more than some of us ever thought. However, I enjoyed chatting with Mary Pat Salomone, B&W’s Chief Operating Officer after the event. Mary Pat assured me that the team is significantly more diverse than that photo made it seem. My conversation with Pinar Akgun Gursoy from Bechtel reinforced Mary Pat’s assertion.

Background of Generation mPower companies

Bechtel is one of the largest privately held corporations in America with 49,000 employees around the world and 2009 revenues of more than $30 billion. It is a world class engineering, procurement and construction contractor that has either built or participated in significant renovations at 64 of the 105 nuclear plants in the US.

B&W has been building power plants and plant components for more than 140 years. It has been involved in the nuclear plant construction business in the US for more than 50 years, including significant participation in building small, modular nuclear power plants designed to propel ships and submarines for the US Navy. B&W employs 13,000 people directly and another 10,000 in joint ventures with other companies.

Update: (Posted at 1846 on July 14, 2010) Here is a link to the video of the news conference.

http://www.bechtel.com/mpower-press-conference

Disclosure: I have a small portion of my personal portfolio invested in McDermott International (MDR). Stockholders of record as of July 9, 2010 (I qualify) will be distributed one share of B&W for every two shares of MDR held as B&W is spun out into a separate company. I have also entered a buy order for a few more shares in the new company, which is currently trading in a “when issued” status.

About Rod Adams

10 Responses to “Generation mPower – Modular Reactor Team That Is Aiming For Turn-Key Units With Predictable Schedules And Costs”

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  1. spudbeach says:

    This sounds great. The engineering logic is good, the political muscle is impressive, and the tone is wonderfully upbeat.
    But I’m still skeptical. The NRC has not approved this design. The NRC has not at all signed on to the basic concept (of small and modular needing less oversight). And most importantly, the NRC has not, and will not any time soon, increase its workforce to get licenses approved.
    Until the NRC gets in gear, I’m not going to get excited.

  2. Bryan Kelly says:

    “Predictable” costs and schedules are one thing, capped costs and shifted construction performance risks are the next step: Surety Bonds for Nuclear Energy Facility Construction Cost-Savings.
    With the news yesterday, this possibility becomes more and more feasible.

  3. Anonymous says:

    I would like to know how you’re going to get the NRC to devise regulations specific for these modular reactors in any time scale shorter than three decades. Under the Precautionary Principle attitude of anti-nuclear Chairman Jackzo, these ideas will reach fruition in foreign countries, but never here in the liberal-controlled US. Of course, that may change in November – I pray nightly for that happy event.

    • Rod Adams says:

      You are apparently under the same mistaken impression as Chairman Jaczko. He only has one of five votes on the commission. Just because he holds the title of chairman, it does not give him executive authority over a body set up by law to have five members with equal voting rights.
      I am pretty confident that the NRC will figure out how to allow smaller, evolutionary light water reactors in a relatively short period of time. The other choices might have a more difficult path, but even that is being addressed already.

    • SteveK9 says:

      The three politicians at the head table were all members of the Democratic Party.

      • DocForesight says:

        That would be the “Democrat” Party. And your point is? I am pleased to see those politicians supporting a common-sense approach to expanding both our nuclear energy capacity and the skilled manufacturing and supply chain jobs this promotes. Now, if they can convince their very vocal and influential anti-nuke brethren like Waxman and Markey, there will be even more to celebrate — and I would do so without hesitation.
        If Waxman and Markey were really serious about their conviction on climate change they would include nuclear power plants in the “Renewable Energy Standard” or any other policy aimed at reducing our use of coal or natural gas for electricity generation and drop all pretense of promoting weather-dependent, intermittent, high land-use / low value wind and solar”farms”. They are demonstrably not serious, so they don’t drop the pretense as a sop to their radical environmentalist lobby – of whom some are supported by large carbon-based fuel interests.
        No one can hide behind an excuse of “not enough data” to show how wind and solar don’t compete without actual subsidies, feed-in tariffs, Production Tax Credits and other accounting gimmicks – paid for by the other consumers and taxpayers. That being said, both sides of the political aisle have their pet lobbies that either restrict entry of competitors or limit expansion of better technologies based on actual performance and results, rather than handing out financial favors to prop up constituents “back home”.
        For the record, I say this having relatives in farming and being involved personally in the solar arena. You do the right thing because it’s the right thing, not because of favoritism or personal preferences. Let the objective facts speak for themselves.

    • katana0182 (Dave) says:

      I know the NRC is hard to deal with. Prospective regulation – anything that is not allowed is forbidden – rather than retrospective regulation – anything that is not forbidden is allowed – literally chokes the life out of the nuclear industry.
      However, never doubt that a system can evolve new structures to deal with new circumstances. I’m hopeful that the NRC will change; it’s not a monolithic body. Given the right sorts of pressures, change can be encouraged.
      Perhaps we here could work on developing ways to identify how to improve the NRC system and make suggestions.
      One great place to start would be in reading Donella Meadows “Twelve Leverage Points To Intervene In A System”, one of the best practical systems theory pieces that I’ve ever read that’s applicable to any complex system – whether bureaucratic systems, legal systems, technological systems, environmental systems, military systems, computer systems, or engineered systems. The NRC is one such complex system. Meadows arguments, though they’re framed in an ecological context, can be applied to any sort of complex system.
      You can download the document itself at:
      http://www.sustainabilityinstitute.org/pubs/Leverage_Points.pdf
      (Interestingly enough, Meadows was an associate of Lovins before she passed on, and a genuinely great thinker in her own right. I was exposed to her work well before I even knew who Lovins was, or I became actively pro-nuclear power).
      There’s also a WP article that covers her piece:
      http://en.wikipedia.org/wiki/Twelve_leverage_points

  4. Reese says:

    Uh-oh: “…more cerebral sections….”
    Brace for turbulence. You have that subtle USNA way of… razzing.
    Actually, if I remember right, James Webb was in both our chains of command. “They” made me memorize mine in boot camp– company commander to president. He was CNO or SECNAV or some such upper echelon in the Reagan administration when I enlisted. You and I were both contemporaneously in the Navy (you career, me formative), so we’ve definitely got that “six degrees of separation” thing solved.
    …with the first unit being constructed on a national laboratory site or other government installation ….
    Oh please, please put one on Kirtland Air Force Base (which hosts Sandia National Laboratories). An air-cooled one. I know at least a dozen former Navy Nukes that work there (me one of them) ready to train up and operate it.

  5. Robert Steinhaus says:

    Does it make sense that Bechtel should handle the “balance of plant” turbine generator for this modular reactor concept?
    B&W has historically provided steam plants. Why reach out to Bechtel if steam turbine-generators are part of your corporate competence?
    http://www.babcock.com/library/steam.html

    • Rod Adams says:

      Robert – yes, it makes sense. B&W certainly knows steam, but it does not design and build steam plants including all supporting infrastructure like buildings, sewer pipes, cooling water supplies, electrical power in and out, etc. Bechtel does. What is more is that Bechtel does procurement from other specialty companies for a very large range of projects and can obtain better pricing for many components that B&W could by itself. A final consideration is that Bechtel is excited enough about the technology development to invest cash and in kind engineering support. That spreads the risk to another substantial player.
      Disclosure – Generation mPower is one of the options I am investigating.