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Effective Nuclear Regulation from a Utility Perspective Seminar “Tuumaenergia efektiivne reguleerimine”, Tallinn, 26 Fe

Effective Nuclear Regulation from a Utility Perspective Seminar “Tuumaenergia efektiivne reguleerimine”, Tallinn, 26 February 2010. Dr. Christian Raetzke E.ON Kernkraft, Hannover. Contents. Introduction: E.ON and Nuclear New Build Part One: Some basics on regulation of nuclear power plants

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Effective Nuclear Regulation from a Utility Perspective Seminar “Tuumaenergia efektiivne reguleerimine”, Tallinn, 26 Fe

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  1. Effective Nuclear Regulation from a Utility PerspectiveSeminar “Tuumaenergia efektiivne reguleerimine”, Tallinn, 26 February 2010 Dr. Christian Raetzke E.ON Kernkraft, Hannover

  2. Contents Introduction: E.ON and Nuclear New Build Part One: Some basics on regulation of nuclear power plants Part Two: Nuclear Regulation from a utility‘s perspective: reducing regulatory risk Part Three: Making use of international progress: design standardization Part Four: Nuclear regulation trends in the EU Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  3. Introduction: E.ON and nuclear new build Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  4. E.ON Nuclear: Existing fleet 21 units in operation (9 units operated by E.ON, 12 with minority shares) 5 units shut down / in decommissioning Installed capacity ≈11 GW Employees ≈ 3.300 Availability > 90 % Power generation ≈ 80 TWh E.ON headquarters NPP minority shares NPP operated by E.ON NPP under dismantling and decommissioning Source: EKK (2008). Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  5. E.ON Nuclear: New Build Activities Sweden Finland UK France Italy ►New build footprint in countries with well-established nuclear excellence Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  6. Project Development UK: Horizon NP Status • 50/50-JV with RWE located in Gloucester • Goal: appr. 6 000 MW by 2025 • Acquisition of two sites: Oldbury and Wylfa • Two reactor technologies under evaluation: EPR (Areva), AP1000 (Westinghouse) Gloucester Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  7. Project Development Finland: Fennovoima Oy Status • JV with Finnish partners, E.ON as the nuclear „backbone“ • Decision in Principle application submitted in January 2009 • Decision by Finnish Government / Parliament expected in 2010 • Two sites proposed: Simo and Pyhäjoki • Three technologies under discussion: • EPR (Areva) • KERENA (Areva) • ABWR (Toshiba) Simo Pyhäjoki Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  8. Pre-selected reactor designs subjected to site-independent review activities at E.ON: EPR (PWR) AREVA ABWR (BWR) Toshiba/Westinghouse AP1000 (PWR) Westinghouse KERENA (BWR) AREVA Dr. Michael Micklinghoff April 2009 Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  9. Part One: Regulation of nuclear power plants Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  10. Why is regulation of NPPs so specific? (1) Safety Demonstration of safety is paramount • Exposure to radiation during normal operation • Prevention of accidents with radiological consequences • Long-term safety of waste/decommissioning High international pressure and monitoring • IAEA • International conventions • Peer reviews • Pressure by EU and neighbouring states Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  11. Why is regulation of NPPs so specific? (2) Politics • Nuclear is highly political: licensing of NPP is not only an administrative procedure, but also a political issue • NPPs need a national infrastructure (nuclear regulatory system, waste concept, education facilities, supply chain, service companies etc.) • „Any expansion of a nuclear power programme will require strong and sustained government support“ (OECD Nuclear Energy Agency) • Licensing and supervision needs to be kept clear of day-to-day politics Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  12. Why is regulation of NPPs so specific? (3) Financing • Specifics of investment in NPP: • higher share of investment in levelized electricity generating costs • higher cost of capital • longer period of construction • It is crucial that regulatory and licensing risk is under control in order to give certainty to investors ► Predictable, streamlined, efficient and effective licensing process needed Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  13. Main elements of a system of nuclear law and regulation • General frameworkregulatory body •  regulatory functions • Radiation protection • Nuclear safetysafety of nuclear installations •  emergency preparedness and response •  safety of radioactive waste and spent fuel management •  transport of radioactive material •  other items • Nuclear liability and coverage • Non-proliferation and physical protection Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  14. National Nuclear Law and Regulations: Hierarchy International Treaties and Agreements Nuclear Act Decrees/Ordinances Technical Regulations Codes and Standards Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  15. Safety of nuclear installations: International standards • Technical regulations for NPPs are set by each country nationally, but the following need to be taken into account: • IAEA safety standards • Mandatory for IAEA itself and for its activities (for example review missions) • Not mandatory for member states • However, member states are expected to take IAEA safety standards as a benchmark/model • WENRA reference levels • WENRA: Western European Nuclear Regulators` Association • In 2006, definition of appr. 300 Reference Levels • RLs are basis for harmonization of national safety requirements • Voluntary implementation in national regulations by 2010 Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  16. International conventions • Convention on Nuclear Safety • Joint Convention (on the Safety of Spent Fuel Management and on the Safety of Radioactive Waste Management) • Non-Proliferation Treaty • Vienna and Paris/Brussels conventions on nuclear liability • etc. Member states have to incorporate these treaties in their national law Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  17. IAEA • Most visible in safeguards/non-proliferation • Safety standards are models/benchmarks for national regulations • IAEA gives advice to newcomer countries how to install a nuclear regulatory framework • IRRS (Integrated Regulatory Review Service) missions: peer reviews of a regulator by a team of fellow regulators, resulting in recommendations Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  18. EURATOM • EURATOM Treaty 1957 • Some legislation competences in the nuclear field • But: no European regulatory authority • Recent developments • 2009 Directive setting up a Community framework for nuclear safety • ENEF, European Nuclear Energy Forum • ENSREG, European Nuclear Safety Regulators Group Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  19. Part Two: Nuclear Regulation from a utility‘s perspective: reducing regulatory risk Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  20. New World for Investment in Nuclear Power (1) New market conditions  Investors need to be able to quantify risks, including regulatory and licensing risk, before making their investment Christian Raetzke, Effective Nuclear Regulation 26 February 2010 20

  21. New World for Investment in Nuclear Power (2) Globalization Emerging of multinational utilities International vendors, standardization of designs Vendor is in most cases a foreign company Applicant/licensee may be controlled/owned by a foreign utility Money comes from foreign utilities, banks or credit guarantee agencies Harmonization of regulations, critical review of national procedures and cooperation of governments and regulators is mandatory Christian Raetzke, Effective Nuclear Regulation 26 February 2010 21

  22. What are the important issues for utilities today? Two main issues Encouraging investment by reducing regulatory and licensing risk Taking account of international aspects (indeed, profiting from them): standardization of designs multinational character of vendors and operators These issues are closely related! Example: taking an internationally standardized design facilitates the licensing procedure and makes it more predictable Christian Raetzke, Effective Nuclear Regulation 26 February 2010 22

  23. Regulatory and licensing risk Some risks and their consequences Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  24. Reducing regulatory risk In order to mitigate those risks, the licensing and regulatory framework must ensure that decisions taken by the national regulators are predictable  proportionate stable in accordance with a pre-defined timescale nationally coordinated internationally aligned The regulator must be strong with a clear policy, strong project management function, and adequate resources and staffing to deliver on its tasks Christian Raetzke, Effective Nuclear Regulation 26 February 2010 24

  25. The long road to licensing of a nuclear power plant Policy decision about nuclear energy Decision in principle about a particular NPP project Pre-licensing: designs and/or sites Licensing process (construction and operating licence) design site applicant Surveillance and inspection during operation Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  26. Firm political decision („Decision in principle“) A firm, legally binding basic decision on a project should be takenat the outset so that political issues are kept out of the licensing process, thus giving more certainty • Finland: Decision in principle, endorsed by Parliament • Switzerland: General Licence, endorsed by Parliament and, as the case may be, by the People in a referendum Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  27. Pre-Licensing Pre-licensing (project-neutral) Licensing of particular NPPs Design certifications (owned by vendors) Design 2 NPP 1 Design 1 Applicant Design 2 Design 3 Site A Site licences (owned by utilities) NPP 2 Design 3 Site A Applicant Site B Site B Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  28. Policy decisions and pre-licensing US (government incentives, e.g. loan guarantees) design certification early site permit UK White Paper National Policy Statement Generic Design Assessment (National Policy Statement) FIN Decision in principle France Multi-year plan on electricity production investment (Generic letter on a design by ASN) GER Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  29. Pre-Licensing in smaller countries? For a smaller country with only one or two NPP projects, pre-licensing should also be considered Disadvantages • only one design will eventually be built • review of several designs consumes resources Advantages • review of several designs keeps competition between vendors open • pre-licensing facilitates the take-over of design approvals from other countries Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  30. Timeliness of licencing process Sticking to a pre-agreed timeline is essential • Time is more important after start of construction work What about Legal timelines? (“Decision about application must be taken xxx months after application is filed”) • For the political decision (decision in principle): probably not feasible • For nuclear licensing: • Mandatory timelines are not a remedy for lengthy procedures • They depend on a complete application being filed (which may be subject to discussion) • Consequences are doubtful (licence “deemed to be issued”?!?) • Much more important: • ►strong project management by government • ►strong staffing and resources of regulator (see UK) Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  31. Nuclear licensing: one-step or stepwise? (1) The main investment decision has to be taken when construction begins. At this point in time, there must be certainty that operation will be allowed. This can be assured by issuing one licence for construction and operation only: • US: Combined construction and operating licence, COL • UK: Nuclear Site Licence • France: The “autorisation de création”, issued by decree of government, is the main licence. The operating permit, issued “only” by the authority, is a predictable milestone. Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  32. Nuclear licensing: one-step or stepwise? (2) US COL, Combined construction and operating licence UK Nuclear Site Licence FIN construction licence operating licence France autorisation de création operating permit GER 1st CL 2nd CL 1st OL 2nd OL ►start of construction Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  33. Licensing: Managing a multitude of processesFor an NPP, a number of licences/permits/authorisations is needed ► Strong government coordination and management required Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  34. Safety of nuclear waste / spent fuel management (1) To give certainty to all stakeholders, an overall national strategy (embedded in legislation and policy papers) is needed Responsibility for waste management: • Who does it? • Who pays for it? Who pays? • The operator (polluter-pays principle) • Accumulation of funds during operating lifetime of installation Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  35. Safety of nuclear waste / spent fuel management (2) Who performs waste management activities? • Interim storage: operator or sometimes government agency • Final disposal:  Sometimes operators or commercial waste management companies Sometimes a government agency (especially spent fuel repositories) Final disposal of high level waste and spent fuel • Deep geological disposal as only practical solution • Discussion on multinational repositories for smaller countries Further decisions to be taken on a national level • Reprocessing to be allowed/prescribed? • Import/export of nuclear waste and spent fuel to be allowed? Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  36. Nuclear liability Nuclear third party liability: liability for damage suffered by a third party (not the operator) caused by a nuclear incident Firm and clear liability regime is important Nuclear liability regime governed, • for most countries, by international conventions: Vienna or Paris convention (Estonia: Vienna Convention) • or by national legislation (USA: Price-Anderson Act) Nuclear liability regimes have some special features, aimed at • Protection of victims • Just and equal distribution of existing resources for compensation • Compensation across national borders • Enabling development of nuclear industry Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  37. The Finnish case (1): Licencing procedure Energy Policy Decision-in-principle Government decision and Parliament ratification Nuclear Safety Construction Licence Government, based on STUK safety assessment Operating Licence Government, based on STUK safety assessment Improved Licensing Procedures for NPP in Europe 13th May 2009 KK-NNR-Dr.Rae/Stb 37

  38. The Finnish case (2) Positive aspects Legislation and regulations fairly recent: Nuclear Energy Act 1987, Council of State Decisions 1991, Safety regulations (YVL guides) updated constantly Decision in Principle as general political decision on an NPP project; the following licencing process can concentrate on nuclear safety Two-step licensing (construction and operation) does not really seem to cause uncertainty Very competent and respected authority (STUK) The overall Finnish licensing approach is good and does not need to be overhauled Improved Licensing Procedures for NPP in Europe 13th May 2009 KK-NNR-Dr.Rae/Stb 38

  39. The Finnish case (3) Aspects which are not perfect Many reasons for the delays in Olkiluoto 3 project are not specific to the Finnish approach, e. g. „first of a kind“ design, shortage in experienced personnel, lack of harmony between vendor and applicant etc. Some regulatory issues: Construction licence issued at an early stage of design completion, making further design work during construction necessary Some Finnish safety requirements deviate from the European „mainstream“, leading to re-design and to uncertainty More openness to design and manufacturing standards of other countries would be helpful Very strict requirements on management by licensee; risk of inconsistency of STUK approach with a „turnkey contract“ model? Improved Licensing Procedures for NPP in Europe 13th May 2009 KK-NNR-Dr.Rae/Stb 39

  40. Part Three: Making use of international progress: design standardization Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  41. Reducing regulatory risk: design standardization • The vision: • If a design is assessed and licensed in one EU country, authorities in other countries should not do it all over again • The goal should be mutual acceptance of design approvals or a joint design approval • This would • reduce risk and uncertainty for the investor, once a First-of-a-kind (FOAK) of a design is licensed in Europe • reduce the strain on regulators • make the licensing process more efficient and effective • lead to a coherent approach to safety • actually increase safety, due to a better basis for experience feedback Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  42. Vision: Pre-Licensing of designs in an international context Pre-licensing (project-neutral) Licensing of particular NPP Design certifications (owned by vendors) Validation Design 2 NPP Applicant Design 1 licensed in country A Design 1 Site Design 2 licensed in country B Design 2 Design 3 licensed in country C Design 3 Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  43. Existing regulatory/legal situation Each reactor project needs a licence issued in a specific procedure after full assessment by the competent regulatory body Licence is issued according to special national licensing procedures, which vary considerably Licence is based on national safety requirements, which vary considerably in details ► This does not facilitate deployment of standardized designs across a range of countries ► A design approval in one country is irrelevant for others Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  44. Initiatives for Cooperation and Harmonization Worldwide MDEP (Multinational Design Evaluation Program): regulators of 10 new build countries worldwide WNA CORDEL Group (Cooperation in Reactor Design Evaluation and Licensing): industry‘s response to MDEP Europe: WENRA: safety reference levels to be implemented in national regulations by 2010 EU Commission initiatives, including the recent Directive on nuclear safety (see next chapter) Christian Raetzke, Effective Nuclear Regulation 26 February 2010 44

  45. The CORDEL proposal: 3 steps towards standardization World Nuclear Association (WNA) Cooperation in Reactor Design Evaluation and Licensing (CORDEL) Group Founded in January 2007 Membership: includes all major vendors and many utilities interested in new build CORDEL proposes 3 subsequent steps to achieve international validity of design approvals and thus to achieve full international standardization of reactor designs Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  46. Step 1: Share design assessment Regulator A Regulator B design review design review share elements of design review, for example calculations or modelling of event sequences design approval by regulator A design approval by regulator B Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  47. Step 2: Accept design approvals after validation Regulator A Regulator B design review validation design approval by regulator A design approval by regulator A Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  48. Step 3: Issue multinational design approval Team of Regulators: A, B, C (or, much later, International Agency) design review multinational design approval Country A Country B Country C Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  49. Some boundary conditions to be respected Sovereignty of each country’s regulator has to be respected Regulators are bound by law to apply their national safety requirements and licensing procedures Regulators need to build up knowledge of the design Christian Raetzke, Effective Nuclear Regulation 26 February 2010

  50. Design approval as part of the overall regulatory process policy decision about nuclear energy decision in principle about a particular NPP project licensing process (construction and operating licence) design site applicant surveillance and inspection during operation Christian Raetzke, Effective Nuclear Regulation 26 February 2010

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