Next Generation Nuclear Reactors Stalled by Delays

Costly delays, growing complexity and new safety requirements in the wake of the triple meltdown at Fukushima are conspiring to thwart a new age of nuclear reactor construction.

So-called generation III+ reactors were supposed to have simpler designs and safety features to avoid the kind of disaster seen in Japan almost six years ago. With their development, the industry heralded the dawn of a new era of cheaper, easier-to-build atomic plants, Bloomberg reported.

Instead, the new reactors are running afoul of tighter regulations and unfamiliar designs, delaying completions and raising questions on whether the breakthroughs are too complex and expensive to be realized without state aid. 

The developments have left the industry’s pioneers, including Areva SA and Westinghouse Electric Co., struggling to complete long-delayed projects while construction elsewhere gains pace.

Toshiba Corp., Japan’s biggest maker of nuclear power plants, is the latest to join a list of companies facing impairments in the pursuit of cutting-edge reactors.

Tokyo-based Toshiba said in December it may have to write down billions on an acquisition by its Westinghouse unit due in part to cost overruns at two nuclear plants it is building in the US. 

In 2015, the average global investment cost to develop a new nuclear plant was $5,828 per kilowatt, up from $2,065 in 1998, according to a World Nuclear Association report. Construction of a new nuclear facility in France is seen costing $7,202 per kilowatt, compared with $2,280 two decades ago.

France’s Areva SA is seeking a €4.5 billion bailout from the French government after running into delays and escalating costs at its next-generation EPR reactor at Olkiluoto in Finland, which is almost a decade late.  

Two third-generation reactors at Hinkley Point in southwest England to be built by London-based company EDF Energy are expected to hit $22.5 billion. The cost of a third-generation reactor being built by the company at Flamanville in France has tripled since construction started in 2007. The project is six years behind schedule.

One fundamental problem facing developers is the slow pace of construction since a nuclear building boom in the 1970s and 1980s, according to Mark Hibbs, a senior fellow at the Carnegie Endowment for International Peace’s Nuclear Policy Program.

“You get better at building reactors when you can keep at it,” Hibbs said by e-mail. “At some point Areva and Westinghouse may get to the point of doing that with generation three, but they would have to get up to speed first.”