National Grid puts Moorside plans on hold

The UK's National Grid said today it has "paused" plans for grid infrastructure work needed for the Moorside nuclear power plant whilst developer NuGeneration (NuGen) conducts a strategic review of the project. National Grid unveiled proposals last October for a £2.8 billion ($3.4 billion) project to connect the planned plant in West Cumbria to the country's electricity network, ahead of ten weeks of consultation it completed in early January.

A spokeswoman for National Grid told World Nuclear News today: "Following NuGen's announcement of a strategic review of their project, we will work with them to understand the implications for the timescales of their project. In line with NuGen's review, we are pausing work on our connection. This will ensure we can align our plans both for the application for consent and the development of the infrastructure itself."

NuGen, a 60-40% joint venture between Japan's Toshiba and France's Engie - plans to build a nuclear power plant of up to 3.8 GWe gross capacity at Moorside. NuGen has said it combines the strengths of its two globally-recognised parent companies, with proven operating and engineering experience, and AP1000 nuclear reactor technology provided by Westinghouse Electric Company, Toshiba's US nuclear unit.

UK regulators announced on 30 March that the AP1000 had successfully completed the Generic Design Assessment process. But the day before, on 29 March, Westinghouse filed for Chapter 11 protection from creditors to enable strategic restructuring amid "financial and construction challenges" in its US AP1000 power plant projects. Yesterday, Toshiba Corporation said it expects to report a consolidated net loss of JPY950 billion ($8.4 billion) for the 2016-2017 financial year, ending 31 March, according to unaudited results. The figures are projections only since the company's auditors, PricewaterhouseCoopers Aarata LLC, have refused to sign them off owing to discrepancies over losses at Westinghouse.

Toshiba Corp said on 14 February it would reduce its exposure to reactor construction projects outside Japan, but NuGen said the same day Toshiba remained committed to Moorside. A NuGen representative said then that the company "had not yet secured an EPC structure to build at the site, but did not intend to utilise Toshiba's services", adding, "It was always NuGen's plan to identify an independent constructor."

Toshiba received notice from Engie on 3 April that it had exercised its right to require Toshiba to purchase all shares held by Engie in NuGen.

Strategic Review

In a statement today, National Grid said: "NuGen has announced it is conducting a strategic review to look at its ownership and technology vendor. NuGen is confident this review will lead to an outcome that provides a more robust, stable and sustainable platform to meet its commitment to deliver the next generation of nuclear power. As a result of focusing their efforts on this review, NuGen are pausing work on their development consent order for Moorside. In light of this, we have decided to pause our work to consent NuGen's connection and take the time to understand NuGen's program to make sure our projects are aligned. It is important that we make sure the consents run broadly in parallel, so the Planning Inspectorate can examine the consent application for our connection knowing there is a strong need for it.

"Despite this pause, we are confident the connection will still be ready when NuGen requires it and are continuing to work closely with them. We would like to thank people and stakeholders once again for all their efforts in responding to our previous consultation. We will let you know more about how we are developing our connection as soon as we are able."

When National Grid unveiled its proposal for the Moorside project last October, it said it planned to put lines underground and under Morecambe Bay to protect the Lake District National Park and that more than a quarter of the connection could be underground. According to the proposal, some 23.4km (14.5 miles) of new line is to be laid underground through the entire western section of the national park. This could see the existing lines there being removed completely, leaving this part of the park free of pylons for the first time in 50 years, the National Grid said. This would be in addition to: putting cables through a tunnel measuring about 22km under Morecambe Bay to avoid the south part of the national park at a cost of £1.2 billion; removing many of the existing pylons owned by Electricity North West (ENW) and replacing them with fewer, taller pylons of its own operating at a greater voltage; and replacing the low voltage line in the area around the Hadrian's Wall UNESCO World Heritage Site with underground cables.

National Grid said it was confident that along the 164km route of the proposed connection, it could remove many of the existing pylons owned by ENW, which carry low voltage power lines around the west coast of Cumbria. It would replace them with fewer, taller pylons carrying lines of its own operating at a higher voltage. Engineers are already developing proposals, it said when it announced the proposal, for a £1.2 billion tunnel under Morecambe Bay, which would avoid putting new lines through the southern part of the Lake District.

National Grid had aimed to submit an application for consent to build the new connection to the Planning Inspectorate this year. A decision would then be made by the Secretary of State for the Department of Business, Energy and Industrial Strategy. If consent were granted, construction work would be expected to start in 2019. National Grid also said it was contracted to provide NuGen with the first phase of the connection into its transmission network by 2024.

Transitional phase

NuGen said today that its CEO, Tom Samson, had "held a series of meetings with elected representatives and technical and special interest groups in Cumbria to discuss the company's current transitional phase".

Samson outlined NuGen's "tough start to 2017" when the extent of the financial issues affecting Toshiba and reactor vendor Westinghouse became apparent. He said these issues, unconnected to Moorside, had then prompted current shareholder Engie to decide to exit the project in line with shareholder agreements.

"At the end of March, it became clear we at NuGen had to take a step back due to these circumstances and revisit some fundamental elements on which we had been building the program to deliver Moorside," Samson said, according to the company statement.

"As has been reported, we took the decision to 'hit the pause button' in order to explore our options to move forward to our objective - which is to deliver the next generation of low-carbon baseload electricity by the mid-2020s, for the benefit of the UK's future prosperity."

There is a "universe of options", he said, but NuGen cannot exercise those options unilaterally, and has launched a strategic review, sanctioned by its board and in consultation with the UK government, "to explore a range of options which could include new investors, technology and financing solutions to ensure Moorside is delivered".

He added that NuGen has "100% backing" from Toshiba as it moves through this transition.

Researched and written
by World Nuclear News