AECL Perspectives on newcomer NPP owners: lessons from the Cernavoda experience

1. IAEA Technical Meeting/Workshop “Topical Issues on Infrastructure Development: Managing the Development of a National Infrastructure for Nuclear Power” 9-12 February 2010, Vienna, Austria AECL Perspectives on newcomer NPP owners: lessons from the Cernavoda experience John Saroudis Regional Vice-President CANDU Reactor Division

2. Outline • AECL Profile • Vendor Expectations of newcomers to nuclear • Some key questions • Legal, commercial and regulatory matters • Training and Education • Industrial and Localisation Aspects • The Cernavoda Experience • Longer Term Issues • Conclusions

3. Atomic Energy of Canada Limited • Established in 1952 to lead the Canadian nuclear industry. • 33 CANDU reactors in-service worldwide • Over 5,000 employees • CANDU recognized as one of the top 10 major engineering achievements of the past century in Canada. • World records in construction and commissioning. • Advanced R&D Facilities

4. AECL’s Power Reactor Products • ACR-1000TM (Advanced CANDU ReactorTM) • 1200 MWe class reactor • Generation III+ technology • Combines experience of CANDU 6 with new CANDU concepts • Light water cooling & low enriched fuel • Enhanced safety, economics, operability • EC6 (Enhanced CANDU 6) • 740 MWe class • Heavy water moderated and cooled, natural uranium fueled • Based on the Qinshan project • Enhanced to meet current regulatory requirements in Canada and internationally, and the Gen III guidelines

5. Wolsong, S. Korea Pickering, Canada Qinshan III, China CANDU – A Global Success Romania Cernavoda 2 units + 2 units planned Quebec, Canada Gentilly 2 1 unit South Korea Wolsong 4 units Ontario, Canada Darlington 4 units Pickering 6 units Bruce 8 units China Qinshan 2 units India 2 CANDU units 15 PHWR units, 3 units under construction N.Brunswick, Canada Point Lepreau 1 unit Argentina Embalse 1 unit Pakistan KANUPP 1 unit

6. Vendor Expectations of NPP newcomer countries • Vendors want to deal with an intelligent customer; • Realistic expectations and objectives from host country; • Clear and practical (credible) process; • Transparency and trust; • Host country commitment to undertaking long process to develop the necessary infrastructure and human resources required for the successful implementation of an NPP program;

7. Vendor Expectations: some key questions • What is the country's legal framework: does it adhere to international agreements? • Does the country have the ability to develop the required human resources? • Does it have a developed electricity sector from which to draw resources that can be further trained? • What is the funding/financing model?

8. Why the subject is pertinent • 43 countries have expressed interest in building a first NPP; • 25 countries are actively considering nuclear power programs; • Newcomer Country Perspective: Issues of economic effort, capability of industrial infrastructure, availability of human resources, cultural considerations • Nuclear Vendor Perspective: Responding to new NPP acquisition process is a time-consuming and expensive process

9. What the vendor can do • Help educate the buyer with help from the IAEA; • Undertake joint pre-feasibility studies (reflect some vendor requirements into the process); • Make their expectations and requirements known to the newcomer countries; • Sell proven technology; this provides a reliable base on which to build in a newcomer country.

10. OFFICIAL USE ONLY CANDU Development: A Strong History Darlington ACR and beyond 900+ MWe Class Reactors 900 CANDU 9 Enhanced CANDU 6 800 Bruce A Bruce B 700 Pt Lepreau Embalse CANDU 6 Qinshan 1&2 Wolsong 2,3,4 600+ MWe Class Reactors 600 Cernavoda Gentilly 2 Wolsong 1 Power (MWe) 500 Pickering A Pickering B RAPPS 1,2 Research & Prototype Reactors 200 Douglas Point NRU 100 KANUPP ZEEP NPD NRX 2000 1980 1950 1960 1970 1990 Today Years

11. Legal and Commercial Aspects Legal: • Non-Proliferation legislation; • Nuclear Liability legislation; Commercial: • Well-established judicial system; • Acceptance of 3rd country legal system (if required);

12. Regulatory Aspects • Independent regulatory capability needs to be built up early in the process; • Close initial cooperation with vendor countries regulators; • Train regulator staff in vendor country(s); • Adopt a clear, well-structured licensing system;

13. Training and Education Training: • Second regulator staff and future operations staff to vendor country institutions/utilities; • Develop local labour capabilities in nuclear manufacturing and construction; Education: • Existence of high level universities; • Institute nuclear engineering courses including Masters level; • Educate future pillars of nuclear program in vendor country universities

14. Industrial and Localisation Aspects • Autonomy - self-reliance • ability to implement program without undue dependence on others • Economic development • local companies to benefit from economic activity • Scientific & Industrial Development • strengthens centres of excellence that support other industries • Shorten the supply chain • suppliers closer to customers • eliminate language barriers • Costs • reduce costs in a multi-unit new build program

15. AECL Localization Policy • AECL is committed to share technology • Four decades of experience • CANDU plants exported to six countries & operate in over six languages • High localization in most “CANDU” countries • AECL has no manufacturing facilities- therefore ready to partner with local companies

16. The Cernavoda Experience • Long history of collaboration starting in the late 1960’s • Technology transfer contracts signed in 1978 for CANDU 6 technology; • Initially program was too ambitious and not realistic (too much dependence on local capability; program too large in scale); • From 1990’s and on the program was scaled back to one more manageable and has resulted in the completion of two very successful CANDU 6 units (Unit 1: in 1996 and Unit 2 in 2007)

17. Short history of Canada/Romania nuclear cooperation Preliminary Phase: • Initial discussions started in late 1960’s; • Bilateral agreement signed 1971; • Joint AECL/ Ministry of Electrical Energy study; • Common study AECL/ISPE on feasibility of CANDU in Romania (1975-76); • Meeting international safety standards; • Economic evaluation; • Localisation studies; localised D2O production; • Visits to Canadian nuclear sites

18. Short history of Canada/Romania nuclear cooperation (con’t) 1st Commercial Phase (1978-1989): • Commercial contracts signed in 1978: • Technology transfer to manufacturing sector; • Training in Canada (engineering training at AECL; operations training at Canadian utilities: Pickering and Pt. Lepreau NPPs) 2nd commercial phase (1990’s to present): • Greater involvement from vendor; • Single unit pace (not 5 units at once); • Successful completion of Unit 1 in 1996; • Successful completion of Unit 2 in 2007 (greater local participation – local training of operations staff)

19. Cernavoda: Regulatory Cooperation • Initially Romania adopted USNRC based licensing process; • Then had to be adapted to CANDU approach in collaboration with the AECB (CNSC); • CNCAN set up team of about 25 staff who were trained in Canada; • In latter years of 2nd commercial phase the CNSC had a full-time representative advising CNCAN during Unit 1 construction; • Unit 2 licensed entirely by CNCAN (2003-2007)

20. Cernavoda: Technology Transfer • 1978 agreements had significant technology transfer from Canadian to Romanian nuclear manufacturing sector; • Capability developed for an ambitious nuclear program during the 1980’s (e.g. for Cernavoda Unit 3 it was envisaged to manufacture calandria vessel in Romania); • In reality fell somewhat short of requirements; • Long delays in program and limited volume led to failure to fully develop domestic capability and eventually to further erosion (mainly in manufacturing).

21. Longer Term Issues: • Effective nuclear programs need sustained efforts to maintain capabilities; • Long interruption in program leads to loss of capability; • Competition for trained human resources can seriously hamper domestic programs (manufacturing; construction; operation); • Need to adapt objectives to realistic requirements (a single or 2 unit program has different requirements than a multi-unit long-term program)

22. Conclusions • Vendors want to deal with an intelligent and well-prepared customer; • The acquisition process is long and complex: newcomer countries must devote the necessary resources (human and monetary) to carry this out; • Preparation for introduction of a first NPP is long and demands commitment from the buyer; • But, it has been done successfully in several countries; • You CANDU it also!

23. Thank you