Vattenfall extends fuel supply to include Russia

14 December 2016

UPDATED: This article has been updated to include details of Vattenfall's new fuel supply contract with Areva NP.

Swedish utility Vattenfall has signed long-term supply contracts with three nuclear fuel manufacturers, adding for the first time Russia's TVEL to its established relationships with French Areva and American Westinghouse. The agreements - worth SEK 1.2 billion ($131 million) in total - cover 19 consignments to Ringhals 3 and 4 between 2018 and 2025.

TVEL will account for about a fifth of these, while Areva and Westinghouse will supply the remainder.

Per-Olof Nestenborg, head of Vattenfall Nuclear Fuel, said: "With TVEL we now have suppliers on three continents, which reduces our business risks as well as our dependence on a single supplier."

Vattenfall said it is committed to having at least two qualified suppliers of nuclear fuel to each of its reactors, adding that fuel accounts for about one-quarter of the total cost of production.

It noted that its nuclear fuel procurement "complies with the guiding principles" established by the Euratom Supply Agency and the International Atomic Energy Agency. In addition, it said, Areva, TVEL and Westinghouse comply with Vattenfall's code of conduct for suppliers.

The utility said it has "evaluated" TVEL according to the same criteria it uses to evaluate all its suppliers. These include each supplier's commitment to environmental issues, working conditions, employment rights, anti-corruption measures, among others.

"To this end, we have applied procedures such as physical audits, i.e. on-site inspections," Nestenborg said. "TVEL has been very transparent and open at all times and has clear routines and rules. It also has a great interest in being able to access Western markets and is therefore willing to learn and adapt to our European ways of working," he added.

Addressing the "political discussion" about the Swedish state-run company's agreement with the Russian fuel manufacturer - "the concern that Russia may be able to use these fuel supplies to apply political pressure on Sweden", Nestenborg said: "Vattenfall's primary concern is to ensure the business viability and strategic utility of the deal ... The agreement creates the preconditions for the secure and stable economic operation of Ringhals into the 2020s."

In a separate statement, TVEL said its contract with Vattenfall - signed on 30 November - covers the supply of TVS-K fuel for the Ringhals plant and includes delivery of commercial reloads of nuclear fuel assemblies starting from 2021.

TVEL, a subsidiary of Russian state nuclear corporation Rosatom, said the contract enabled its entry into the pressurised water reactor (PWR) part of the nuclear fuel market.

This is the first contract for commercial reloads of TVS-K, TVEL noted, and it opens new opportunities for the Russian company "to broaden the geography of supplies and to enter other markets with PWR fuel".

Following the contract signing, TVEL's president, Yury Olenin, said: "We have been working in cooperation with Vattenfall since 2008. In 2011 the contract for the operation of several Russian lead fuel assemblies was signed. These fuel assemblies continue operating at the third unit of Ringhals NPP; the performance is within the normal design limits with no deviations. Our priority is the highest safety and reliability of the Russian nuclear fuel."

He added: "Throughout the years of our cooperation we have built an effective communications framework ... Our fuel design comprises the advanced engineering solutions and the sound experience of VVER fuel fabrication."

TVEL and Vattenfall signed a contract for the delivery of a pilot batch of Russian TVS-K fuel for Ringhals in September 2012.

TVS-K is a 17x17-lattice PWR nuclear fuel assembly developed by TVEL for use in Westinghouse-designed 3- and 4-loop PWRs, drawing on TVEL's experience in the development, manufacture and operation of nuclear fuel for Russian-designed VVER-1000 reactors.

In May this year, TVEL and Global Nuclear Fuel Americas (GNF-A) agreed to work together to introduce Russian-designed PWR fuel into the USA. The companies announced a strategic alliance to introduce lead use assemblies of TVEL's TVS-K fuel design in the USA and to seek licensing approval from the US Nuclear Regulatory Commission to supply the fuel in reload quantities. GNF-A will provide US-based project management, licensing, quality assurance and engineering services while TVEL will provide TVS-K design expertise, engineering support and initial fabrication of LUAs. Subsequent LUAs are planned to be produced at GNF-A's facility in Wilmington, North Carolina. GNF is GE-led joint venture with Hitachi and Toshiba Corporation.

Vattenfall operates the four-unit Ringhals plant as well as three-unit Forsmark. Ringhals 1 and all three Forsmark units are boiling water reactors, while Ringhals 2, 3 and 4 are PWRs.

The company announced in April 2015 that it would to bring forward the closure of Ringhals 1 and 2 to 2018-2020 instead of 2025 as previously planned, due to declining profitability and increased costs. In October that year it confirmed that Ringhals 2 is to be decommissioned in 2019 and Ringhals 1 in 2020. It plans to operate Ringhals 3 and 4 and the three reactors at Forsmark for at least 60 years, until the beginning of the 2040s. All these units started up in the early 1980s.

Areva NP said on 20 December it had signed a contract with Vattenfall Nuclear Fuel to supply fuel assemblies for Ringhals 3 and 4, beginning in 2019. Under the agreement, Areva NP will deliver its latest GAIA fuel design for PWRs, of which lead test assemblies have been operating at unit 3 since 2012. The fuel assemblies will be manufactured in Germany at Areva NP's Lingen site.

Researched and written
by World Nuclear News