NRG Energy, Toshiba form venture to build nuclear plants in U.S.: New company to use Japanese techno...

Mar 26, 2008 - McClatchy Tribune Business News
Author(s): Elizabeth Souder

Mar. 26--NRG Energy Inc. created a company Tuesday to develop nuclear power plants beyond Texas.

The New Jersey plant developer said it formed a company with Toshiba Corp. to develop nuclear plants in the U.S. using the Japanese company's technology. First, they plan to build the two reactors in South Texas that NRG had already announced. Then they'll take their nuke designs on the road. "Maybe we'll announce one this year and maybe announce one next year," said Steve Winn, NRG's executive vice president for strategy and nuclear development. He'll be chief executive of the new company, Nuclear Innovation North America. The new company allows NRG to share some of the risk of investing in multibillion-dollar projects with the equipment vendor.

This way, both the developer and the manufacturer share the goal of finishing the projects on time and on budget. Toshiba will invest $300 million for a 12 percent stake in the new company. The new company aims to develop two more nuclear plants in the U.S., and it could apply for an operating license for one project as early as next year, Mr. Winn said. He said he's discussing plans to develop reactors with several U.S. power companies, but he wouldn't name them. He declined to say whether any are in Texas. The new company aims to develop a fleet of nuclear plants that use Toshiba's advanced boiling water reactor design.

Japanese power companies have used this technology to build reactors in the past, and the U.S. Nuclear Regulatory Commission certified th design in 1997. The Japanese nuclear plant that spilled some radioactive material after last year's earthquake used the design. Still, the length of operating history gives Mr. Winn some comfort that the reactors will gain licenses from the NRC and can be built on time and on budget. But the budget could be a moving target. So far, NRG officials have said the two reactors in South Texas will cost around $7 billion. But with higher commodity prices and the weak dollar, Mr.

Winn said he will raise that figure modestly in a presentatio to Wall Street analysts today. The timeline for the Texas reactors has also shifted, though the venture with Toshiba should nail things down. NRG had asked the regulatory commission to suspend the review of some portions of the license application until the company could strike a deal with its equipment vendor. With the Toshiba deal, NRG can submit detailed data to the commission this year. The situation will probably delay the project a few months, Mr. Winn said. That means NRG might begin operating the first reactor in 2015 and the second in 2016