New company for US ABWRs

5 June 2008

NRG Energy has formed a new company, Nuclear Innovation North America, to promote the deployment of ABWR projects in North America, including the planned South Texas Project (STP) units 3 and 4 that NRG is developing with CPS Energy.

Toshiba, which will serve as the prime contractor on all of the new company’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 in return for a 12% equity ownership of the company. Half of this investment will be to support the STP 3 and 4 project and the other half will be focused on new projects.

As part of its partnership with Toshiba, Nuclear Innovation North America will work closely with the newly-formed Toshiba America Nuclear Energy Company.

Nuclear Innovation North America expects to focus on developing new ABWR projects in partnership with nuclear power companies. The company is exploring potential sites and partners for additional units and anticipates providing a letter of intent to the US Nuclear Regulatory Commission (NRC) for at least one new project by the end of this year.

Toshiba is extending pre-negotiated engineering, procurement and construction (EPC) terms to Nuclear Innovation North America for two additional two-unit nuclear projects similar to the terms being offered for the STP unit 3 and 4 development. The company will work with Toshiba to develop each project’s costs, including a pre-negotiated project fee and contingency percentage.

The design of the ABWR that Nuclear Innovation North America intends to use is based on the US-certified design. Nuclear Innovation North America expects to file a revision to the combined construction and licence application for STP 3 and 4 by this autumn. According to NRG, the resulting delay in licensing “will be outweighed by the advantages the changes create in price and schedule certainty. Given the changes to the application, NRG anticipates STP units 3 and 4 will come online in 2015 and 2016 respectively.” The company had previously expected both units to start up one year earlier.

Steve Winn, NRG’s executive vice president of strategy and nuclear development, will serve as chief executive officer of Nuclear Innovation North America.

Last year, Toshiba signed a project services agreement 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 also selected by NRG and CPS Energy to be the prime contractor for the development of the STP 3 and 4 units. 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 finalised this summer.


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