Siemens

Nuclear power? No way!
Olkiluoto Blockade Camp 6th - 13th August 2012
Olkiluoto Blockade Camp in Eurajoki, western Finland, will bring together people from the anti-nuclear movements in Finland and internationally. The camp will be an opportunity to discuss nuclear power projects, including uranium mining, and to share experiences, skills and tools for struggles against the nuclear energy industry and for encouraging truly sustainable, decentralized forms of energy.     

On August 11, Olkiluoto Blockade action day, people are invited to come and block the roads to the Olkiluoto nuclear power plant by civil disobedience. Year 2012 will mark the third annual blockade. Previous years have seen people blocking the roads using banners, drumming, performances and peaceful civil disobedience. You can join the demonstration in any way you like, with no obligation to participate in civil disobedience.

The Olkiluoto power plant consists of two reactors owned by Teollisuuden Voima (TVO). Additionally, TVO and French Areva are currently building a third reactor, which will be the world's largest and first EPR reactor. Despite the countless problems with the EPR's construction so far, the Finnish parliament has granted the company a license to build a fourth reactor at the site. Another pioneer project in Olkiluoto is Onkalo ("the Cave"), the world's first permanent underground storage for highly radioactive waste.   

Nuclear power cannot solve the climate crises, but rather it feeds the economic system where short-term profit-making sacrifices common safety and environmental issues.  

While many European countries are phasing out nuclear power after the disaster in Fukushima, the Finnish government is grasping the opportunity to increase nuclear power production in Finland. Join us in action and send a strong message to the state and the industries: you will not turn Finland into a nuclear power reservation! Uranium mining, nuclear power plants and waste disposal projects will be met with growing and determined resistance, on a local and international level.       
Get more information, or give your ideas for the program at http://olkiluotoblockade.info

RWE abandoning nuclear power (well…, new construction). 
RWE AG, Germany's second-biggest utility, is abandoning plans to build new nuclear power plants outside its home market, where the government decided last year to phase out nuclear power. "We will not invest in new nuclear power plants," incoming Chief Executive Peter Terium said. Like E.ON and peer EnBW, RWE had to close nuclear power plants after Fukushima and by the German government's decision to phase out nuclear power generation, which, actually was a turn back to the year 2000 phase out schedule. "We can no longer afford the financial risks and the surrounding conditions for nuclear power plants." 
Meanwhile, RWE is one of the four German utilities that are going to the Federal Constitutional Court  (Bundesverfassungsgericht) in order to get a 15 billion euro 'compensation' for the nuclear phase out. Remember: the same four utilities agreed to this phase out plan on June 14, 2000. The Court will examine the compensation claims in the coming weeks. Its decision is not expected until late 2013, after Germany's next federal parliamentary election. It will first consult with both houses of the German parliament as well as 63 other organizations, including Greenpeace and the Federation of German Industry (BDI). The constitutional court must then decide whether Germany's exit from nuclear energy violated the constitution before civil courts can rule on possible damages.
Deutsche Welle, 13 June 2012 / Reuters 17th June 2012 

Siemens can return to nuclear in 2012, EC rules. The European Commission has closed an antitrust investigation of the arrangement that prevents Siemens from selling nuclear products and services, following its withdrawal from the Areva NP business. The Commission has accepted an agreement between the two companies to allow Siemens to sell core products and services later this year. In 2001, Areva and Siemens created the joint venture Areva NP and agreed on a specific non-compete obligation. This obligation was meant to apply for up to 11 years beyond the duration of the joint venture itself. The joint venture came to an end following Siemens' exit in 2009, when Areva acquired sole control over Areva NP. In December 2011, the European Commission expressed concerns that the non-compete obligation and a confidentiality clause may infringe EU antitrust rules. In response to the Commission's concerns, Siemens and Areva offered commitments. They agreed to limit the duration of the clause to three years following Areva's acquisition of sole control over Areva NP in relation to the joint venture's core products and services. They also agreed to remove it completely for all other products and services. The same commitments apply to the confidentiality clause.
Now, the European Commission has made these commitments legally-binding after market-testing them, and has closed its investigation. However, Siemens' next move is unclear, as it publicly announced in 2011 that it had pulled out of the nuclear market altogether.
Nuclear Engineering International News, 22 June 2012

Europe's largest engineering company, Siemens, decided to withdraw entirely from the nuclear industry. Chief executive Peter Loescher told Spiegel magazine it was the firm's answer to "the clear positioning of German society and politics for a pullout from nuclear energy". Siemens was responsible for building all 17 of Germany's existing nuclear power plants, and some abroad.

Siemens has been active in nuclear power for decades, for the most part under the name of KWU (Kraftwerk Union AG). KWU was established on April 1, 1969, by Siemens and another Germany firm AEG. The first (foreign) order was signed on that same day, the construction of the 450MW PWR at Borssele, The Netherlands. As a matter of fact an option for the construction of a second reactor was signed too, but never materialized. Other foreign reactor construction contracts signed were with Brazil, Iran, Argentina, Switzerland and Spain

On January 1, 1977 Siemens bought the AEG 50% KWU share and 10 years later, on October 1, 1987 KWU ceased of being an independent company and became part of Siemens concern.

In early 1989 Siemens started talks with Framatome, the French builder of PWRs. Which resulted in the joint venture Nuclear Power International (NPI). In 1991 a technical reactor concept was decided called the European Pressurized Water Reactor (EPR). "EDF and the major German utilities decided early 1992 to support the strategy and streamline their separate development of future reactors on the basis of this Franco-German cooperation", as Jean-Claude Leny Chairman and CEO of  Framatome put it in a March 1993 article in the German industry magazine Atomwirtschaft. The key milestone in the marketing of the EPR would be 1998 when first pouring of concrete was expected for the first EPR. EDF would place orders to Framatome and "hopefully" the German utilities to Siemens for EPR units to be built in Germany. "Framatome, Siemens and NPI will market and supply the EPR export markets", which was considered to be the main market.

Well as we know it didn't work out as planned.

In August 2000, Framatome and Siemens agreed to a new joint venture formally merging their nuclear activities into a new company called Framatome ANP, subsequently renamed Areva NP. Framatome would hold 66 per cent of the stock and Siemens the rest.

Continued delays to EDF’s order led Areva NP to switch to Finland as the focus for its marketing. In May 2002, the Finnish Parliament approved the construction of a fifth nuclear unit in Finland. In December 2003, the Finnish utility TVO signed a turnkey deal with Areva NP for a 1600MW EPR at a cost, including interest during construction and two fuel charges  of €3bn with first power first half 2009. Again, that didn't work out as planned: online not before second half of 2013 and costs expected to double.

In 2009 Siemens used an option to exit Areva SA. But an arbitration tribunal in May this year ordered Siemens to pay 648 million euro (more than US$900 million) to Areva after it failed to meet contractual obligations.

Due to the decision to withdraw entirely from nuclear, Siemens will cancel the long-planned joint-venture with Russian nuclear-power company Rosatom Corp. in the field of reactors. although Mr Loescher said he would still seek to work with their partner "in other fields". There are no financial implications linked to Siemens's retreat, according to spokesman Alfons Benzinger.

The German government's decision marked a complete U-turn by the chancellor, who only in September 2010 had announced that the life of existing nuclear plants would be extended by an average of 12 years. Siemen's move, announced on September 18, is also a turnaround. In 2009, the firm withdrew from the joint venture with Areva, because the German firm had ambitions to expand its own competence to build entire nuclear plants. "In view of global climate change and the increasing power demand worldwide, for us nuclear energy remains an essential part of a sustainable energy mix," Mr Loescher had said at the time.

Siemens has gradually scaled back its nuclear-power operations in recent years, after helping build some of the world's largest reactors in the latter part of the last century. While Siemens is pushing renewable-energy sources such as wind turbines and solar power, the company will continue to build steam turbines that can be used both in conventional as well as nuclear facilities.

The German engineering company makes products including high-speed trains, medical scanners, and factory-automation equipment. The entire energy division is Siemens's second- largest by revenue, generating 6.77 billion euros ($9.34 billion) in the most recent quarter.

Sources: Groene Amsterdammer (NL), 16 November 1977 /  Financial Times, 28 February 1989 / Frankfurter Allgemeine Zeitung, 14 April 1989 / Atomwirtschaft,: Franco-German Cooperation in Nuclear Development, March 1993 / Nuclear News ‘Siemens/Framatome nuclear merger completed’ August 2000 /  Nuclear Monitor 719/720, 12 November 2010 / Bloomberg, 18 September 2011 / BBC News, 18 September 2011
Contact: WISE Russia

Vladimir Putin has invited Siemens to enter into discussions with Rosatom, the umbrella agency for the Russian nuclear power industry. A tie-in now looks likely. The discussions follow Siemens' announcement that it wishes to leave its nuclear plant construction partnership with Areva. The Areva group will buy back Siemens 34% stake in Areva NP before the end of January 2012. “We will have to negotiate with Areva over the details” of a separation agreement “beginning right away”, Siemens announced.

According to Siemens the cooperation between it and Areva has been good, but that the minority stake "considerably limits the entrepreneurial maneuverability of Siemens within the joint venture." Siemens CEO Peter Loescher said “it was not possible” for Siemens to participate in the global nuclear power plant market through its partnership with the French firm. Loescher said Siemens was committed to doing business in that market. The company's main role in Areva NP has been heavy involvement in the conventional islands for Areva nuclear power plants - the steam turbines, generators and main systems apart from the reactor building. The company said it wanted to continue to offer its products for nuclear plants, including systems for operation and control.

Siemens
According to sources close to the company, Siemens will explore setting up an equal partnership with Russian industry that would allow Siemens to participate in what the German company believes will be a major global expansion in nuclear power plant construction.

But according to Nucleonics Week, some board members have voiced caution that partnering with Moscow-controlled firms is risky, and there is no consensus so far that Siemens should take that risk. In 2007, Siemens and Russia’s Federal Agency for Atomic Energy, or Rosatom, signed a memorandum of understanding for future cooperation. That MOU, which is dormant at the time, could become the basis of a future partnership in which Russian VVER technology could be joined with Siemens’ technology for energy production and distribution systems, sources said.

By cooperating with Rosatom, Siemens could even gain a re-involvement in reactor technology, which it packaged into Areva NP. Russian nuclear technology could gain a valuable image boost, while a joint venture would allow Russia some interest in Western markets.

Siemens has already cooperated with AtomStroyExport to build the two pressurized water reactors at Tianwan in China, supplying the control systems. Atomstroyexport, a Rosatom subsidiary, is incorporating Siemens instrumentation and control in all its export nuclear power plants, and there are plans to use it in domestic Russian reactors as well. Siemens will also partner with Areva to supply electronic equipment for two new Russian reactors at Belene in Bulgaria.

The Siemens move is no surprise. More than a year ago, in November 2007, the Nuclear Monitor published an article called: 'Rebuilding the Areva group – End of German Reactor Constructor?' in which was announced the likelihood of Siemens leaving the Areva-group. Reason for the departure would be the reconstruction of Areva.

The merging of nuclear construction capacities and the know-how of the two leading West European nuclear constructors Siemens and Framatome in 2001 was meant to help to survive economically and to push for a new generation of nuclear reactors. In 2001 Siemens houses its nuclear section, Siemens Nuclear Power (SNP) in the subsidiary of Areva, Framatome. Since the first of March 2006 this subsidiary trades under the name of Areva NP.

At the time the Siemens nuclear section became part of the Areva company, it was agreed that the French state has the right to takeover the German shares in 2009 at the soonest and in 2011 at the latest. The legal effectiveness of the Areva/Siemens deal would thus be on January 1, 2012.

Areva NP is currently heavily involved in promotion of its EPR pressurized water reactor worldwide, with four planned for the UK and six under discussion for the USA. Announcements are expected soon regarding deployment in India. The units are already under construction at Flamanville and Olkiluoto, while work will start soon on two more units at Taishan in China.

Besides its involvement through Areva NP, Siemens is a consortium partner at Olkiluoto 3 in that it provides the entire conventional island. Siemens has also signed a letter of intent to cooperate on EPR deployment in the UK and should provide the conventional islands for any forthcoming EPRs in that country. Meanwhile, French rival Alstom is contracted to provide turbine islands for Flamanville 3, the two EPRs at Taishan and the three proposed Unistar Nuclear Energy EPR projects in the USA.

Areva NP

Delays at Olkiluoto-3 and Flamanville-3, cancellation of South Africa’s nuclear plant tender, and “uncertainties about the US program” are elements that could lower the value of the Areva NP business plan and future cash flow projections, Vignon, former president of Areva NP predecessor Framatome said. That could result in Areva lowering its estimate for what it owes to Siemens for the 34% stake in the joint venture. According to a January 28 report in French financial newspaper Les Echos, Siemens management evaluated the Areva NP stake at between 2 billion and 3 billion euro. But independent sources say it is 500 million less than 2 billion euro.

Areva announced net debt of 2.4 billion euro at the end of June 2008 and is scheduled to release its full-year financial results on February 25. Finnish utility Teollisuuden Voima Oy, or TVO, is seeking 2.4 billion euro in compensation from Areva and Siemens. The money is for delays in startup of the Olkiluoto-3 EPR that forced TVO to buy electricity in the market. Areva and Siemens, in turn, are seeking 1 billion euro in compensation from TVO for the utility’s delays in processing project documentation.

According to industry observers quoted in Nucleonics Week, Siemens’ announced exit from the Areva NP joint venture with Areva puts the Paris-based vendor under “tremendous financial stress” that could force it to rein in its ambitious investment plan and strain its ability to raise more money. Areva is engaged in a vast investment program that some outside the company have estimated as high as 14 billion euro (US$18.5 billion). The program includes two uranium enrichment plants, a new UF6 conversion complex, new uranium mining projects, construction of a reactor components plant in the US and similar facilities in France. Areva CEO Lauvergeon told the government in January that her company needs some 3 billion euro to support the investment program in this year alone.

Industry observers say the move will force the French government, which owns about 84% of Areva, to clarify the company’s ownership structure. It will force a government decisionon whether to pump more state money into the company, organize a merger with turbine maker Alstom, promote the entry of oil giant Total, or a combination of those options.

Meanwhile, Total, which is seeking a double-digit percentage stake in France's second EPR nuclear plant, stated that it also wants to play an active role in its construction. "We want to acquire expertise in the nuclear sector in order to one day become a true nuclear plant operator," Chief Executive Christophe de Margerie told French daily les Echos in an interview. "We do not want to be just a financial partner in this new EPR plant. We would like a significant stake, a double-digit stake, but we are also industrialists and our wish is that EDF gives us the opportunity to participate actively in the construction of the second French EPR," he said.

Sources:
Nucleonics Week, 29 January 2009 / World Nuclear News, 27 January & 4 February 2009 /  Nuclear Monitor 662, 8 November 2007 / Reuters, 9 February 2009