This week’s NEI news brief includes: Reliance; Areva & Siemens; UK decommissioning costs; University of Michegan; Nuclear energy market performance; State Nuclear Power Technology Corp; and IEAE.

Reliance forays into nuclear energy

India-based Reliance Industries Ltd. is looking to enter nuclear energy, according to the Economic Times.

The Indian petrochemicals-to-gas conglomerate is said to be in negotiations with US engineering firm, Bechtel, with a view to collaboration.

The Economic Times quoted an unnamed senior government official as saying: "RIL has indicated to the government that it is keen on generation and distribution of nuclear power."

EU probes Areva-Siemens deal

European Union regulators are investigating nuclear power non-compete deals between France's Areva SA and Germany's Siemens AG, following Areva’s buy out of Siemens' 34% stake in the companies’ joint venture.

Claiming that Areva’s buy out had eroded its leverage in the joint-venture, Siemens walked out of the Areva NP unit last year, and instead struck a deal to develop nuclear reactors with Russia's Rosatom.

French daily Le Figaro reported last week that Siemens wanted the commission to probe the post-divorce ties, which currently prevent it from concluding a tie-up with Russian group Rosatom.

In an official statement, EU regulators said they are now investigating whether the “non-compete clauses are…. in violation…of European Union antitrust rules.

According to a report by the Associated Press, if the EU regulators find that the companies are in violation of fair competition rules, both companies may be forced to drop the agreements under threat of fines of up to 10 percent of their respective global revenue.

UK decommissioning costs loom large

UK Energy and Climate Change Secretary, Chris Huhne, has warned that previous UK governments have left a £4bn "black hole" in the UK’s nuclear power budget.

Huhne says the costs of decommissioning aging nuclear plants are extremely high. He estimates that UK taxpayers will have to stump up £850m next year, £950m in 2012-13 and £1.1bn for each year up to 2015, in order to cover decommissioning costs.

The Liberal Democrat MP says these costs provide impetus to his party’s terms that any new nuclear programmes must not be financed using public money.

Huhne describes the decommissioning costs, which place extra pressure on the Department of Energy and Climate Change’s annual budget of £3bn, as "a massive post-dated bill" for many years of low-cost electricity. He says the resulting deficit is a "classic example of short-termism".

While the UK Nuclear Decommissioning Authority currently provides some of the finance required, taxpayers are becoming burdened with decommissioning costs as an increasing number of operational power stations are closed down.

University of Michigan named ‘national nuclear energy hub’

The University of Michigan has been named part of a national hub for boosting U.S. nuclear energy research and development. The university is to apply advanced capabilities of the world’s most powerful computers to advance nuclear reactor design and engineering.

Nine engineering faculty members will lead U-M’s part of the Nuclear Energy Modeling and Simulation Energy Innovation Hub announced by the U.S. Department of Energy. The team, consisting of members from universities, industry and national labs, is led by Oak Ridge National Laboratory (ORNL) for an award of up to $122 million over five years.

The University of Michegan will receive up to US$8.5 million for its work in the Consortium for Advanced Simulation of Light Water Reactors (CASL).

According to US Deputy Energy Secretary Daniel Poneman, the hub is critical element in America’s push to re-establish itself as a world leader in nuclear energy research and development.

The CASL will use powerful supercomputing to simulate how materials age in the harsh environment of a nuclear core. This will allow engineers to better assess how long a reactor can safely operate or determine what changes can be made to allow the reactor to run longer, according to the university.

The CASL will also provide internships and course development for undergraduate and graduate students, as well as assignments for postdoctoral students and outreach activities for practicing engineers.

The university’s team includes Martin, Tom Downar, Ed Larsen and Gary Was, professors of nuclear engineering and radiological science; Anton Van der Ven and Katsuyo Thornton, assistant professors of materials science and engineering; Michael Thouless, professor of mechanical engineering; Wei Lu, associated professor of mechanical engineering; and Krzysztof Fidkowski, assistant professor of aerospace engineering.

Nuclear energy investment takes a dip in Q1

The nuclear energy industry experienced a spike in deal value, but a plunge in overall investment during the first financial quarter, according to Research and Markets and Global Data.

The global nuclear energy industry witnessed an increase in deal value, with US$8.7 billion worth of transactions in Q1 2010 compared to $1.5 billion in Q4 2009. According to the research firm, the value increase is attributable to FirstEnergy’s landmark deal, valued at US$8.5 billion, with Allegheny Energy.

However, the actual number of deals and the overall level of investment by PE and VC firms into the nuclear energy sector took a dive. Only 49 deals worth US$11.4 billion took place in Q1 2010, compared to 126 deals worth US$18.7 billion in Q4 2009, representing an overall investment decline in the nuclear energy industry of 39% during the first financial quarter.

GlobalData cites a relatively tight financial market, coupled with certain nuclear energy companies’ poor stock performance and a high risk in terms of return on investments in the capital-intensive nuclear projects, as having an impact on investments in the market.

SNPTC plans 2012 IPO

China’s State Nuclear Power Technology Corp (SNPTC), which develops third-generation nuclear power technology in China, plans to list its shares in the second quarter of 2012, according to the China Daily.

SNPTC’s Chairman Wang Binghua, told the paper that SNPTC will adopt a ‘three-pronged approach to list its shares’, but declined to reveal where the float would be.

According to the report, the company plans to increase its registered capital from 4 billion yuan to 10 billion yuan through a capital injection. It will establish a financial services arm this year to enter the financial sector. Final preparation for the listing would be undertaken between 2011 and the first half of 2012.

SNTCP, which was launched 3 years ago, is in the process of constructing four third-generation nuclear power units in the country, using nuclear technology from US-based Westinghouse and French company Areva. SNTCP is also currently developing its own nuclear technology in-house.

Third-generation units are said to be comparatively safer than conventional nuclear reactors, and have a longer life cycle.

The company is also working with China Huaneng Group, a major power generation company, to build a nuclear power project in Shandong province, for which it will use CAP1400, a technology based on the AP1000 technology developed by US company Westinghouse.

SNPTC is also working with partners to build China's first batch of inland nuclear power projects, which will use AP1000 technology.

IAEA report casts further doubt over Iran nuclear programme

A report issued by the IAEA last week indicates that Iran has produced at least 5.7 kilos of higher-enriched uranium, for a research reactor that makes radioisotopes for medical purposes.

While Iran continues to deny any interest in nuclear weapons, its refusal to stop enriching the material, which can be used both for nuclear fuel and for warheads, has given rise to international concern.

Iran insists that it is only pursuing civilian nuclear energy, however, the IEAE report found that Tehran is continuing its widely contested uranium enrichment activities at even higher levels of purification, despite three existing rounds of UN sanctions.

The U.S., Russia, China, Britain and France have indicated their willingness to back a new, fourth set of U.N. sanctions against Iran over uranium enrichment.

The restricted International Atomic Energy Agency report said that the IAEA "remains concerned about the possible existence in Iran of past or current undisclosed nuclear related activities, involving military related organizations, including activities related to the development of a nuclear payload for a missile."