Uha Nurmi, the CEO of Fennovoima, told about Hanhikivi NPP construction project and the Russian-Finnish cooperation in his exclusive interview.
– Would you tell about your company and the cooperation with Rusatom Overseas?
– Fennovoima produces electricity at cost price for our shareholders’ use, so we are a non-profit company. Our shareholders can use it in their own production or sell it forward to their customers. This is a common model in Finland among power companies — for example, TVO is a similar company. Fennovoima was founded in 2007. We got approved by the government to build a nuclear reactor in 2010. Then, due to a change in our ownership, we changed our strategy from the 1,600 megawatt reactor to midsize reactors. We carried out an assessment and very quickly came to the conclusion that Rosatom would be the best partner for the project. We started a direct negotiation with Rusatom Overseas in April 2013 and then continued by making a project development agreement in the end of June 2013, and then finally signed the EPC supply contract just before Christmas last year. And at the same time we also signed the nuclear fuel contract with TVEL. Also the shareholders agreed in a shareholder agreement that Rusatom Overseas would become a shareholder of Fennovoima as well, which happened in March this year. Rusatom Overseas is now a 34 percent shareholder. And the Finnish group Voimaosakeyhti? SF owns 66 percent. We feel very strongly that this is a mutually beneficial arrangement. Rusatom Overseas has a dual role, on one hand being a shareholder and on the other being a supplier. We are convinced that this is very beneficial for everybody involved.
– Is it possible already to say anything about the project’s key milestones?
– Yes, the schedule is that the shareholders, after Rusatom Overseas became a shareholder, made the final commitment to finance the project on April 15, 2014. The schedule agreed in the EPC contract has certain key milestones. The first is the submission of the construction license application before the end of June 2015, and at the same time in summer 2015, the site preparation works, meaning rock excavation and cooling-water tunneling excavations, will begin. The construction license is planned to be issued in 2017, and the actual first concrete of the power plant would be laid in 2018. Then the commissioning will take place in 2023, and the plant will be put in operation in 2024. So, we have a 10-year schedule.
– And who is responsible for choosing suppliers? Is it your company or Rusatom Overseas?
– We have an EPC turnkey contract with Rusatom Overseas, so it’s Rusatom Overseas’ responsibility to choose the suppliers. Of course, the main suppliers will be up for approval with Fennovoima. We are working with Rusatom Overseas throughout the process, so I don’t expect that there will be any concerns in that process.
– Is it planned to build more reactors on the Hanhikivi NPP site?
– There are currently no plans for more reactors and of course in Finland it depends on the national energy policy whether such option at some point could be considered. This project is currently based on the one reactor. The law in Finland is such that you need to have a government permit in the form of a “decision-in-principle,” and only two such decisions-in-principle have been granted. At the moment there are no plans to grant any new decisions-in-principles. Without a doubt, after a few years definitely there could be new plans. This however, depends both on the national policies as well as on the owners’ considerations. The Hanhikivi site is in any case large enough to have a second reactor. So I must emphasize that the company has a very long-term plan. The site is designed so that it would be possible to have a second reactor there.
– How do Finns feel about working in nuclear?
– In Finland engineering has always been regarded as a good career option. Well, I’m an engineer, so what else do you expect me to say? The quality of the education in Finland is generally regarded to be world-class. Overall, Finland has been able to have success stories in engineering businesses, like Nokia, Kone and Metso for example. That has supported interest toward engineering and technical sciences. But of course we have to make sure that the university programs are in place to make that happen.
– Have you signed a contract with TVEL? How would you evaluate this work?
– The fuel supply contract that we signed with TVEL was for ten years. This currently fulfills the fuel supply security demand of the plant. We were extremely pleased to sign a long-term contract that has been approved by the European supply agency. So our strategy for securing and creating a long-term relationship with TVEL has been very successful so far.
– But in 10 years you have to choose whether to have some tenders. Is it obligatory for your company to use the current energy security strategy?
– We have two reloads of stock, so we are able to run the plant for two or three years even without any new fuel supplies if there will be an exceptional situation where the supply is not continuing as planned. We have that security stock to run the plan until we find a solution. That is the current and for the time being sufficient strategy. And from the point of view of the European supply agency, then ultimately there is the option of looking at other suppliers. But we do not have any reason to believe that that will be necessary as TVEL has always been a reliable fuel supplier.
– How will you store the spent nuclear fuel? Do you have a place to store the waste?
– The law in Finland is such that nuclear waste needs to be treated and stored in Finland. We are not able under the current law to export any waste – for example, for reprocessing. We have a waste management plan that includes the final disposal of the waste. The Ministry of Employment and Economy in 2012 formed a working group that arrived at the unanimous opinion that companies that have the responsibility under law to take care of the waste issue cooperate with each other. We are developing our own waste management plan based on the result of that working group. We will start negotiations about the cooperation later this year or next year. Our decision-in-principle from 2010 obligates us to present a cooperation agreement with Posiva (a Finnish nuclear waste company which is developing a final repository plant in Olkiluoto) by summer 2016, or to present an environmental impact study program of our own disposal facility. Those are the two options that the existing decision-in-principle gives us. But, of course, our primary option is based on the cooperation as outlined unanimously by that working group.
– Is there a possibility that in the near future the law could be changed?
– Well, that is the law at the moment, so we have to base our plans on that. We cannot speculate about it. But if you take a long-term perspective, the final disposal of nuclear waste from our plant would need to be done only after several decades. But, who knows, maybe after some years what is currently viewed as waste could be viewed as an invaluable material that could be used after reprocessing. However, I must emphasize, though, that we have to make our plans based on the existing law, and that’s what we’re doing.
– What are your short-term plans or the next few years? Do you have any risks at the moment?
– When talking about large investment projects, there are always risks. But the starting point is that we’ve planned the project and built the organization so that we are able to handle and mitigate the risks. And currently the important issues for us as Fennovoima are to increase our own capability by increasing our staff and developing our management system as required by the nuclear legislation so that we are able to fulfill our role as a license holder. And also from Rusatom Overseas’ point of view it’s very important to continue with mobilizing the project, which has already been started, and to select the key suppliers, like the turbine supplier and the I&C supplier. Rusatom Overseas is making such important selections at the moment. Then we will need to get the special design organizations fully working and starting to produce the design for the construction license process. Those are very critical targets for the coming months and the first year before the construction license application can be submitted. And it’s also very important for the localization to take place so that Rusatom Overseas has the local presence to be able to start construction and implementation in order to fulfill the contract.
