Thought question – Will China buy $8 billion worth of nuclear power plants from a Japanese owned company?

There is an often discussed plan for China to purchase four large nuclear reactors at a cost of about $2 billion per reactor. This deal has been in the works for quite some time; two years ago on September 12, 2004, People’s Daily Online published a story titled Foreign energy giants bid for China’s nuclear contracts that included the following description of the process to request bids for the project:

“The tender documents and proposals have already been approved by the State Council, and now we have presented them to the National Development and Reform Commission for final approval,” Yu Jianfeng, director of the Nuclear Power Department of China National Nuclear Corp (CNNC), which is working to offer the tender.

There’s no specific timetable for the bidding yet, Yu added. This is the country’s first bidding for nuclear power projects which is open to foreign companies.

China is expected to invite foreign companies only to bid for four 1,000-megawatt pressurized-water nuclear power facilities by the end of this year.

I expressed some thoughts about the decision process a few months ago in a post titled China’s nuclear power prospects but I recently had a conversation that made me do some additional thinking on the topic.

As readers of Atomic Insights know, one of the leading contenders for the contract is Westinghouse, a company with deep roots in the United States. That company, however, was recently purchased by Toshiba, one of the largest companies in Japan. The question that interests me is whether or not that transaction will sway the competition away from Westinghouse to Areva, the other leading contender.

China has a long standing animosity toward Japan, dating back to the period before and during WWII when Imperial Japan occupied much of China and was not particularly nice to the local population. (I know – that is a bit of an understatement.) The feelings between the two Asian powers are still pretty raw; check out China-Japan showdown is coming for one observer’s recent opinion on the state of relations between the two countries.

Do you think historical animosities combined with current struggles for influence in the Asia-Pacific region will cause China to decide that purchasing important new nuclear power plants from the French government owned Areva would be a better choice, especially since the technological and economic distinction between the two offers seems pretty close?