New company formed to promote ABWRs in North America

26 March 2008

Toshiba of Japan will participate in Nuclear Innovation North America LLC, a new company formed by NRG Energy to promote the use of Advanced Boiling Water Reactors (ABWRs) in North America.

NRG said it established Nuclear Innovation North America (NINA) in February to market, site, develop, finance and invest in new advanced design nuclear projects in select markets across North America, including the planned South Texas Project (STP) units 3 and 4 that NRG is developing in partnership with CPS Energy.

Toshiba - which will serve as the prime contractor on all of NINA’s projects - has agreed to partner with NRG on the new venture. Toshiba will invest $300 million in the company over the next six years and will receive a 12% stake in the company. Half of this investment will be to support development of STP units 3 and 4. The other half will be focused on new projects and will help accelerate development and deployment of additional ABWR projects in North America with other potential partners. NINA is already exploring potential sites and partners for additional units and anticipates providing a letter of intent with the US Nuclear Regulatory Commission (NRC) for at least one of the new projects by the end of 2008.

Toshiba signed a project services agreement in 2007 for STP units 3 and 4, under which the company is carrying out key pre-engineering work and procuring major components with long lead times. Toshiba was recently selected by NRG and CPS Energy to be the prime contractor for the development of STP units 3 and 4. Toshiba is now responsible for all engineering work prior to the start of plant construction, for the procurement of major equipment and components, and for supporting the licensing process. The final contract for the two plants, including the construction phase, is expected to be finalized by this summer.

In September 2007, NRG and South Texas Project Nuclear Operating Company (STPNOC) filed with the NRC the first full application for a combined construction and operating licence (COL) for a new nuclear power plant. It was for two 1358 MWe GE-Hitachi ABWRs to come on line in 2014-15 at the South Texas site. The ABWR design was certified by the NRC in 1997. NINA intends to use the certified design, with a limited number of changes to enhance safety and construction schedules, and to file a revision to the original COL application later in 2008. NRG said it believes that "the modest delay in licensing that is expected as a result of these revisions will be outweighed by the advantages the changes create in price and schedule certainty." Given the revisions to the COL application, NRG now anticipates STP units 3 and 4 will come online in 2015 and 2016, respectively.

"Our partnership with NRG is an important step toward establishing Toshiba's presence in the US ABWR business," said Yasuharu Igarashi, executive vice president of Toshiba's Power Systems Company. He added, "We expect the new company to achieve a powerful synergy and carry forward the construction of new plants in North America."

Toshiba will continue to promote its nuclear power plant business through its US subsidiary, Toshiba America Nuclear Energy Corp, which was established in January.