Atomic Show #253 – Delivering the Nuclear Promise

The US nuclear industry has decided that it’s time to take aggressive action to improve its operational efficiency. Leaders have looked hard at the competitive landscape. They’ve clearly recognized that while they produce a valuable, desirable commodity, their production costs are not competitive.

Many of them aren’t willing to give up their markets and valuable assets without a fight. In the fall of 2015, they decided to focus on eliminating wasteful efforts and begin prioritizing efficiency alongside their traditionally strong core competencies of safety and reliability.

Note: The CO2 emission-free nature of atomic fission is an inherent attribute that comes with the technology choice. So is the elimination of other noxious air and water pollutants. End Note.

On April 22, I spoke with two senior executives from the Nuclear Energy Institute about their efficiency program. My guests were Maria Korsnick, the Chief Operating Officer, and Tony Pietrangelo, senior Vice-President and Chief Nuclear Officer.

No one is more knowledgable about the high priority initiative, which has been named, “Delivering the Nuclear Promise.” It’s an industry-wide effort that is scheduled to last for three years with expected effects that will live for many productive years.

In preparation for the discussion I had read the strategic plan issued in February. I also sampled the program’s early products, which are being delivered the form of “Efficiency Bulletins.”

Here is how Ms. Korsnick began our discussion.

I’ll start with the name, Delivering the Nuclear Promise. Why did we name it that and what does it mean? We stepped back and looked at the value proposition for nuclear. We said nuclear was always intended to be very safe, it was always intended to be very reliable and, if you can remember way back when, it was going to be “too cheap to meter.”

So our challenge is that we’ve delivered on the promise of being very safe, we have a very strong safety record. We delivered on the reliability. Last year, as a US fleet we were at about 92% from a reliability perspective. We took a hard look at the cost side and said, not so much.

The idea of delivering the nuclear promise was essentially that we would continue our focus on safety and continue our focus on reliability but really sharpen our pencils from an efficiency perspective and better understand how we can do a better job on the efficiency side.

It’s a cost as well as revenue piece. We want to be as efficient as we can at running the plants and also make sure that the product we’re producing, that carbon free product, is valued in the market place.

It would be difficult for anyone who has ever worked in the commercial nuclear industry, looked at a typical plant organizational chart, or observed the way that the plant is administered and guarded to fail to notice that there are many inefficiencies that can be addressed.

The industry has a long tradition of complying with requirements; which may be part of its Nuclear Navy roots. Unfortunately, the commercial users of the technology and operating modes invented and refined by ADM Rickover haven’t always applied the “questioning attitude” that his program also demanded of all participants.

Now that they’ve realized that cost is an object and that excessive costs can destroy valuable plants almost as easily as improperly operating them, leaders have decided it’s a good time to ask “Why are we doing things this way? Is there a more efficient and effective way to accomplish the task. Is the task in question useful at all, or should it be planned for elimination?”

Ms. Korsnick described the early steps of the program, which took place in the fall of 2015, as a group of Chief Nuclear Officers “shined the flashlight” into all areas of plant operations, focusing specifically on cost information. Member companies were asked to provide their last ten years worth of financial information with expenditures broken down into major categories like work management, training, and the corrective action program.

After reviewing the information for several days, the group established focus areas where spending had increased significantly or where the area represented a large portion of the total expenses. A Chief Nuclear Officer was assigned to be in charge of each focus area. The CNO’s gathered a team of cross-company and cross-functional subject matter experts from the industry to engage in detailed investigation.

The number of assigned team members is approaching 1,000 if all of the working teams are included. Industry employees don’t have to be formal members of a team to submit ideas for evaluation and possible implementation.

Early screening produced an initial list of approximately 180 areas that could be targeted. Since that is too many to address at one time, the list was narrowed to the 35 or so items that seemed to have the largest potential gain or could be implemented quickly for early wins.

Mr. Pietrangelo provided a more information on the types of efficiencies that are being addressed.

What we’re looking for is a lot of administrative gains because as an industry we’ve layered a lot of processes on top of processes over the years. So when we look at efficiency, it’s really trying to get the work done in the most efficient way. Free up the worker and provide some more accountability such that we can do this work smarter, safer and more efficiently.

Based on comments provided here on Atomic Insights, I asked Mr. Pietrangelo about the non-value added aspects of preparing for inspections and responding to corrective action program requirements. He acknowledged that those were among the areas being investigated but also provided a list of the other dozen or so focus areas.

Training is such a big part of the industry’s expenditures that it has been broken up into at least three separate topic areas, each with its own focused team.

It might strike some people as a bit incongruous to spend so much time and effort [aka cost] on trying to find efficiencies and reduce work efforts. However, that is the way that the industry often addresses difficult issues and achieves its admirable results.

It’s important to know that the Efficiency Bulletins receive a wide ranging review that includes EPRI, INPO, NEI, and a team of experienced chief nuclear officers before thy are released.

Ms. Korsnick explained that this review process is designed to avoid the probability that changes related to doing things better would be nullified by inspection team suggestions or comments if they observe that the implementation is different from the standard way of doing things.

Getting buy-in in advance should allow the changes to be implemented and accepted without having to invest costly effort to explain the improvement decisions to outside inspectors.

It’s encouraging to see the nuclear industry engage in this kind of “all hands on deck” effort improve efficiency and cost competitiveness. Our chosen technology efficiently produces vast amounts of high quality electricity with small material inputs and few environmental impacts.

Unfortunately people have proven they can bloat almost any task or facility if they’re not encouraged to ask “how much” and “is this worth doing?” It’s never easy to go on an organizational diet and effectively slim processes while maintaining performance, but the nuclear industry has a habit of overcoming challenges when it prioritizes solutions to those obstacles.

For more information about Delivering the Nuclear Promise see Mareia Korsnick’s post on LinkedIn


No obstacles prevent China from rapidly building floating nuclear power plants

1968 photo of the Sturgis, the first nuclear power barge, in the Panama Canal. It provided electricity to operate the locks from 1968-1975

1968 photo of the Sturgis, the first nuclear power barge, in the Panama Canal. It provided electricity to operate the locks from 1968-1975

Credible entities in China have begun lining up the supply chains required to produce reliable electrical power from barge mounted nuclear fission power plants. There are no technical, industrial, or regulatory hurdles that prevents the first of those machines from being in service by 2020.

China has a pressing need for the electricity those movable power plants will be able to produce; it is building artificial islands that are a long way from power lines, pipelines, and developed fuel handling port facilities. Nuclear plants, unlike all other options, can produce power 24 hours per day using fuel that can be airlifted at intervals that might be measured in years.

Many Chinese political leaders are competent engineers and scientists. They recognize that weak, unreliable energy sources like wind and sun are not capable of providing the power required to operate dredges, early warning radar systems, concrete plants, airports, and the electrical power needs for a growing population that will inhabit their brand new territory.

Russia, which has talked about building floating nuclear power plants for decades and has had a construction program underway since 2000 has yet to make any operational power plant deliveries.

China, however, has a history of follow through and task completion. They build what they say they are going to build. They manufacture some excellent products in a wide range of industries — including electronics, locomotives, ships, power plants, computers, and solar panels — that are exported all over the world.

In contrast, Russia’s export successes have been limited to oil, natural gas, vodka, military hardware and a few long-delayed nuclear power plants.

Unlike the United States, which has withheld its world-leading floating nuclear propulsion plant expertise from the commercial market for more than 60 years, China seems to understand that technology developed to propel ships can be put to valuable use in many other applications. Turbines are turbines whether they are on ships or on land. Power plants that include steam propulsion turbines can be readily adapted to drive steam turbines attached to electrical generators.

Since ship nuclear propulsion systems require robust foundations and the capability to withstand the stressful conditions of stormy weather and the possibility of nearby explosions, they are well-suited to being installed in power barges that can be moored in ports that may be in the path of typhoons. An old friend of mine who is a retired Dutch Navy engineering officer often told me that in the history of power plants, there are a number of examples of machines that made a successful transition from seaborne power to land based power, but there were few, if any, that had moved from land to sea.

In my worldview, Chinese floating nuclear power plants are not a strategic threat or safety concern. The infrastructure that they will power is another story that I won’t discuss here.

Market opportunity

China’s manufactured islands in the South China Sea are an ideal “early adopter” customer for floating nuclear power plants. However, they are not the only or even the largest market for the machines that may begin to float out of their shipyards at an increasing rate beginning in 2020.

Those transportable plants with their lightweight supply lines will represent an economically competitive source of electricity and clean water that may find a large and lucrative market once the builders begin series production. I expect that the suppliers will engage in the relentless production cost and sales price improvements that Chinese manufacturers have been able to achieve in so many other industrial enterprises.

The planning for the decision to build power barges to supply artificial South China Sea islands became publicly known at the end of 2015 with the announcement of the National Marine Nuclear Power Demonstration Project. In January of 2016, China Shipbuilding Industry Corporation and China Guangdong Nuclear signed a strategic cooperation agreement to develop off shore nuclear installations. Though it is a bit difficult to fully understand the Google translate version of the Chinese language story, it also appears that CNOOC (China National Offshore Oil Company) is cooperating by supplying its experience in offshore construction.

CNOOC is also interested in small nuclear plants to provide electricity to its power-hungry, distant offshore drilling rigs. It may sound a bit like carrying coal to Newcastle, but oil wells are generally powered by diesel engines that require refined petroleum; they cannot burn the crude oil that they are extracting, though some are able to beneficially use the natural gas that often accompanies the oil. When rigs are not too far off shore, it’s often cost effective to power them from the onshore power grid. Distant rigs, however, are almost ideally suited to be powered by atomic generators.

When added to the coastal cities of developing countries, the island nations that continue to rely on diesel generators, and the large number of oil rigs with diesel generators, the market for floating nuclear plants is potentially in the hundreds to thousands of units. As things stand today; China might be able to rapidly establish a dominant market position that will be difficult to overcome.

Capitalizing on attention

A story on appeared on Wednesday, April 20 describing the partnerships that have been established and describing the initial market target of the artificial islands in the South China Sea.

That story instigated a flurry of stories in a variety of media outlets, including Global Times, Reuters, Economic Times (India), Foreign Policy, Chicago Tribune, and New York Times.

My hope is that the development stimulates a prosperity and stability-enhancing competitive race to build ever more capable machines that can provide reliable power to places that have always been hampered by the difficulty of supplying fuel for dirty, polluting generators and by the lack of access to abundant fresh water.

My concern is that the development will be seen by some as an action that requires aggressive efforts to slow progress and halt development.

Sturgis in 2014. Powered Panama Canal pumps 1968-1975.  Reactor fuel long ago removed.

Sturgis in 2014. Powered Panama Canal pumps 1968-1975.
Reactor fuel long ago removed.

That shouldn’t be America’s response; we have competitive capabilities in this arena.

After all, we were the first nation to deploy a floating nuclear plant to provide power to an important piece of our global infrastructure. Unfortunately, we were also the first to abandon the technology after making budgetary decisions that ensured Sturgis was an expensive, one-of-a-kind orphan.

We should seize the flurry of attention being paid to maritime nuclear plants as an opportunity for generating excitement about atomic energy development and a growing understanding of the benefits provided by extremely compact fuel sources.

The US Navy, my former employer, has been designing, building and maintaining superior nuclear propulsion plants and training suppliers and operators for more than two generations. With the notable exception of the 1950s vintage Shippingport project, the nuclear Navy has been more than reluctant to share its technological expertise and skills in human resource development with anyone else.

Shippingport was a qualified success; it enabled a commercial nuclear industry that grew rapidly for 20 years and produced machines that have supplied a large, consistent supply of clean electrical power for the past four decades. Unfortunately, that first nuclear power plant construction industry had growing pains and ran into a number of obstacles. By the mid 1980s it had faded to a mere shadow with no new construction starts during a 35 year period.

Now is the right time for another effort to commercialize the investment that we’ve made in maritime nuclear energy. Maybe this time, it will point the way to an industry that doesn’t stop growing until all customers who can use the power are economically served.

I’m positive that my suggestion to selectively share more capability will not be well-received in certain offices in the Navy Yard — I’ve checked within the past week. I can only hope that my old friends there will think deeply and remember what we were taught long ago. It’s no good for the Navy to operate beautiful, esthetically amazing nuclear power plants if the ships they propel go down.

Extending that idea a bit, it’s not a sound national strategy for the United States Navy to so carefully protect useful but not militarily unique nuclear knowledge to the point of allowing the country that paid for that knowledge to experience a preventable economic decline.

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