Steam rises from two nuclear power plant cooling towers in this thermal image. A battle between Russia and the U.S. is being waged in Ukraine to supply the country with nuclear fuel.
A fight over the supply of nuclear fuel sounds like something from a futuristic sci-fi novel. But that is exactly what is unfolding here in Ukraine, as a Russian and an American company clash over the control of a market worth more than half a billion dollars per year.
About half of Ukraine’s electricity is produced by nuclear power plants. Russia, the long-time monopoly supplier of nuclear fuel to Ukraine, was met with a challenger in 2011, when the American Westinghouse Electric Company got its foot in the door. It was contracted by state nuclear energy company Energoatom to provide fuel to three of the country’s 15 reactors over five years in a deal experts say is worth more than $100 million.
But Westinghouse hit a roadblock in 2012. During a scheduled maintenance at the Yuzhnoukrainsk nuclear power plant, located some 350 kilometers south of Kyiv, Ukraine’s State Inspectorate for Nuclear Regulation found that Westinghouse’s fuel assemblies (cases that support nuclear rods in the reactor) were damaged and unsuitable for future use.
Although the Americans took the brunt of public bashing for the flaw, Michael Kirst, Westinghouse vice president of customer relations and sales in the region, says that the problems lie with the design of fuel assemblies produced by its Russian competitor, the state-owned nuclear fuel maker TVEL, which has long held a monopoly in the Ukrainian fuel market.
Russian-made fuel assemblies are used alongside the American ones in three of Ukraine’s reactors. Using a variety of suppliers is new for Ukraine, but it is common in most other countries that produce nuclear energy.
Westinghouse first brought fuel to test in Ukraine’s Yuzhnoukrainsk reactor No. 3 in 2005. It worked as designed, according to the company, and at the time TVEL’s assemblies were similar to Westinghouse’s, allowing the two to operate seamlessly in Ukraine’s reactors.
But shortly thereafter, Kirst said, TVEL changed its fuel assembly design, which did not fit well in Ukraine’s reactors alongside those made by Westinghouse. He said the move was likely done to spite Westinghouse.
“Russia is doing everything to make it difficult for us (to operate in Ukraine),” he told the Kyiv Post.
In a written response to the Kyiv Post, TVEL deflected the accusation. “The process of improving the characteristics of Russian nuclear fuel does not align with our desire to somehow complicate someone’s life,” the company said. Ukraine’s Energoatom provided no comment for the story.
Yet Kirst insists that his company’s fuel assemblies “are being damaged because the Russian (TVEL) fuel is bending substantially” and colliding with other assemblies inside the reactor. “Westinghouse designs performed perfectly,” he said.
The technical term used in the industry to describe the bending is “fuel bow,” a certain amount of which is necessary.
“The fuel assembly should be flexible, but not bending in the manner in which TVEL’s are,” Kirst explained. “If you look at a photograph of (the TVEL fuel assembly), you’ll see the space between is so narrow that (Westinghouse) must force its fuel assemblies into the reactor. I don’t have to tell you that (with nuclear fuel assemblies) that is a bad idea. These things can’t be forced.”
Olga Kosharnaya, a leading researcher of energy security at the government-funded National Institute for Strategic Studies in Ukraine, says problems with Russian-made fuel are actually common. In 2011 alone, 21 TVEL assemblies were discovered to be defective in Ukraine, she said.
The problems caused by this design flaw included the depressurization of fuel elements, which led to the release of radioactive contaminants in some cases, she said.
But TVEL insists that its “fuel element for many years has successfully, safely and reliably operated at power plants in Ukraine, and has received no complaints and criticism from Energoatom and by the Ukrainian regulator.”
But it was Westinghouse that was asked by the State Inspectorate for Nuclear Regulation to improve the design of its assemblies to ensure further delivery of its fuel to Energoatom’s nuclear power plants.
Another agency, the State Financial Inspection of Ukraine, said the American-made fuel assemblies are flawed and have cost Energoatom Hr 114 million (about $14 million). Energoatom officials on June 13 said they were preparing a lawsuit against Westinghouse in case it did not remedy the issue, according to an Interfax-Ukraine report.
At the end of June the Americans submitted a proposal to the State Inspectorate for Nuclear Regulation for improving the design of its fuel assemblies to be able to continue supplying fuel along with TVEL. But even if the proposals are accepted, Westinghouse won’t be out of the woods yet.
Ildar Gazizullin, an energy policy specialist and economic analyst at the Ukrainian Institute for Public Policy, says that he has seen “a lot of disinformation and (misuse of facts) around this issue.”
“Russia is concerned with protecting its markets in Central Europe and has made attempts to keep competitors out,” he said.