SUPPLY CHAIN | BUILDING RESILIENCE
Light at the end of the tunnel? Improving the capabilities of the supply chain is a complex and multi-faceted challenge but Kruse believes there are positive actions that can be taken. He says: “I think one main requirement is to continue working on international harmonisation and standardization of licensing and permitting. That’s one key element. Secondly, I think that some existing plants need to get the ‘as built’ documentation, as well as the modification documentation in place and digitised so they have a proper component inventory and the needed master data for every component available. That will allow them to become more independent and knowledgeable about what they have really built into the plant as components.” Kruse says that new plants tend to already have this kind
Above: Western Europe is ramping up its supply chain as it looks to build new reactors
V the cost. That is needed to make the levelized cost of energy competitive against renewables and this is only possible if the licensing of SMRs is similar to aviation, for example. When you license an aircraft in the US, by the US authorities, it’s also accepted by the European authorities. For nuclear, that is not the case. It’s country-specific licensing and though there are a lot of efforts underway to make that process more harmonised it’s not really progressing satisfactorily.” Kruse continues: “This will also affect the supply chain
because economically viable SMRs require a standardised global supply chain. Today, nuclear new build often demands a significant local component. Countries like the Kingdom of Saudi Arabia and Turkey mandate local content for example, and that means modification of an open supply chain which requires that the local workforce are appropriately educated and all the manufacturing is certified.” Considering other aspects of new build, another key
supply chain issue is the loss of capability as the industry has fragmented. Suppliers from Western countries in particular do not have a strong integrated EPC capability like they used to when they were building multiple second generation plants. Kruse argues that companies like Framatome,
Westinghouse and Siemens had far stronger vertically integrated supply chains and could therefore manage the end-to-end supply chain in-house. “This capability doesn’t exist anymore among Western suppliers,” says Kruse. Conversely, Eastern suppliers, for example Rosatom, have a backwards vertically-integrated capability. “Their supply chain is capable of delivering locally but, irrespective from sanctions, is actually hardly able to deliver globally. This is because the local standards are often different from Western standards and then they need to either replace sub-suppliers, or they are internal sub suppliers and need to manufacture according to Western standards, like ASME and IEEE that they are not used to. Again, that’s strongly related to documentation requirements. If you link it also to the labour issue in Western countries then if the owner organization is short of capable people, then they cannot manage the supplier and the supply chain sufficiently to avoid cost overruns and redundant work and reengineering efforts,” Kruse concludes.
30 | April 2023 |
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of information available in a digital format as regulators nowadays have quite strict configuration management requirements asking the owner and the supplier to have a digital model of the plant, including all digital information available on the installed equipment and components. Older plants don’t all have that and there are even still a significant number of components which are not properly documented. “Often only the supplier who has been servicing the plant has the knowledge about that and this means that there is a risk for the operator by not having sufficient intelligence if the supplier is not available anymore, or if they want to have a dual source strategy,” explains Kruse, adding: “That technical database is a prerequisite to build a more robust supply chain, to understand where operators do have obsolescence of materials, or where materials and suppliers are at risk. That kind of classification is the groundwork that is needed.” This information needs to be available to operators to
build a resilient supply chain if alternative suppliers are to be sourced and are to be able to meet the replacement requirements for those components. “In Western Europe many operators have not done this homework yet and I would also suppose this is the case in the US even though the US has a larger fleet. Where those vulnerabilities exist, the risks to component supply chains are necessarily higher whereas in a bigger, more robust market that’s less likely to happen, although not impossible,” notes Kruse. In Western Europe, many operators are concerned about
the capability of the supply chain and suppliers of critical components leaving the market, or losing the required capabilities that means they can deliver on time, at the right cost and quality. That puts the economics of the plant at risk.
The nuclear supply chain is also complex. There is the
supply chain for new build, then for operations and another for decommissioning. There are international and quite local components in that supply chain. “There’s market design, policy and all sorts of other things that go into that but if you can’t build and maintain it at a reasonable cost, you’re nowhere. The common denominator is the question of technical and licensing and safety-related standards and the availability of knowledgeable people who can deal with the requirements engineering well,” says Kruse. He concludes: “The levelised cost of energy needs to be competitive against renewables that only have a very low marginal cost. This is the biggest challenge for nuclear power plants and the supply chain has to play a quite important role to deliver that promise of safe and cheap energy. There is simply no one gold bullet to fix it.” ■
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