British firms eye up nuclear manufacturing contracts

UK companies are set to receive most of the contracts for the new £16bn Hinkley Point nuclear power station, including some work on the most complex equipment.

Project developer EDF Energy has selected fellow French firms Areva and Alstom to lead manufacturing of the plant’s reactor system and turbines, respectively, but UK firms are already lined up to undertake a large amount of sub-contracted work.

A total of 57 per cent of the value of the project is due to go to British companies, assuming they can put together suitable proposals, including Costain for the marine elements of the project and Laing O’Rourke, which together with the French firm Bouygues TP will lead civil construction.

Although not quite a full nuclear industry renaissance, the project could pave the way for more British firms enter the civil nuclear manufacturing sector.

‘There are a couple of major structural components like the nuclear steam supply system and the main turbine, which aren’t going to be provided from within the UK because we don’t have the capability to do that,’ said Chris Savage, industrial adviser to the Nuclear Industry Association.

‘But there are a lot of components that are supplied into both of those major pieces, things like the radioactive waste treatment plant, the heating and ventilation, a lot of the pipework and valves for the secondary systems outside the pressurised primary circuits, along with the control and instrumentation. So there’s a lot of value outside the nuclear island and the main turbine where the there’s a lot of UK capability.’

Areva last year signed memorandums of understanding with 25 UK firms and is working with a further 25 that it hopes could provide manufacturing and installation services for components including forgings, valves, pumps, cranes, electronics, piping, tanking and refrigeration units.

‘Our objective is to work with our client to develop how best to proceed in order to help these companies qualify, and then bid to work on the project,’ said Areva spokesperson Katherine Berezowskyj via email.

‘We are encouraging these companies to work closely with the NAMRC (Nuclear Advanced Manufacturing Research Centre) to get all the skills and qualifications to bid for and win this work.’

Among the firms is Rolls Royce, which has already agreed to manufacture complex components and provide engineering and technical services for the first of the two Hinkley Point C reactors and could win a total of £400m worth of work if selected as supplier for all four reactors that EDF plans to build in the UK.

Rolls Royce already supplies instrumentation and control systems for nuclear plants in 20 countries around the world, and produces reactors for the UK’s nuclear submarine fleet.

But the agreement with Areva will see it explore the possibility of moving into manufacturing civil reactor components, which would require much larger facilities.

At least one third of the value of work on the two 1,750MW steam turbine systems will also be awarded to UK companies, according to primary contractor Alstom, which said the main opportunities will be in the supporting systems include piping and instrumentation and control.

Areva is encouraging UK firms to form partnerships with businesses that are already working with EDF on their existing nuclear construction projects in France and Finland. ‘In practice, EDF are going to favour partnerships with companies they’re familiar with in their own supply chain,’ said Savage.

‘Those companies will typically be working in partnership with UK companies who can bring understanding of the UK regulatory, commercial and stakeholder environments and the ability to provide detailed design and delivery work tailored to the UK site requirements.’

Savage added that he broadly expected contracts for the other seven new nuclear plants planned for the UK to follow a similar pattern, as the UK no longer had the capability to produce its own reactors or the facilities to manufacture turbines.

‘The UK does not have a mature reactor design that can be brought to market,’ he said. ‘We just don’t have the design capability and IP to provide that, so that is going to come from an existing technology vendor …

‘But there’s no reason in principle why turbine manufacturing facilities couldn’t be developed in the UK if there was a sufficient market requirement and if that made commercial sense to the companies concerned.’

Hitachi has promised that 60 per cent of investment in the Horizon new nuclear plants in Wylfa and Oldbury will go to UK firms and has signed agreements with Rolls Royce and Babcock to look at developing and providing UK capability.