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Hitachi's Nuclear-Power Prospects Looking Up on UK Power Project Bid

Hitachis Nuclear-Power Prospects Looking Up on UK Power Project Bid
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Δευ, 29 Οκτωβρίου 2012 - 18:09
Hitachi Ltd.'s (6501.TO) efforts to expand adoption of its nuclear-power reactors overseas in the face of strong resistance at home appear to be bearing fruit after a person familiar with the matter said over the weekend that Hitachi's bid to acquire a nuclear-power venture in the United Kingdom has been selected.
Hitachi Ltd.'s (6501.TO) efforts to expand adoption of its nuclear-power reactors overseas in the face of strong resistance at home appear to be bearing fruit after a person familiar with the matter said over the weekend that Hitachi 's bid to acquire a nuclear-power venture in the United Kingdom has been selected.

RWE AG (RWE.XE) and E.ON AG (EOAN.XE) will likely announce the winning bid for the Horizon nuclear power venture--Hitachi and consortium partner SNC-Lavalin (SNC.T) are bidding against Westinghouse Electric Co., a unit of Toshiba Corp. (6502.TO).--as early as Tuesday, the person told Dow Jones Newswires.

It is unclear whether Hitachi and SNC-Lavalin are proposing a boiling-water reactor configuration for Horizon or plan to adopt a pressurized-water reactor system, which has come to be the industry standard for most new global projects.

To date, Hitachi has only manufactured BWR reactors based on a General Electric Co. (GE) design, though it may be contemplating adopting PWR technology for the U.K. project.

A Hitachi spokesman declined to discuss details of the consortium's plans, saying only, "We placed a bid because we expected positive outcomes."

In the aftermath of the Fukushima Daiichi accident last March, the BWR configuration of reactors at the complex was cited as having been a risky choice. One of the six units at Fukushima was equipped by Hitachi , with all six being General Electric designs.

BWR technology is used almost exclusively in Japan and the U.S. , a factor that apparently limits Hitachi 's scope for expansion given that Japan 's nuclear-power program is mostly stalled, while U.S. electricity generators are gaining interest in building gas-fired generators to take advantage of a natural-gas glut in the country.

Japanese competitors were also hard-hit in the aftermath of the Fukushima accident, but not as severely as Hitachi . Mitsubishi Heavy Industries Ltd. (7011.TO) produces PWRs, while Toshiba Corp. (6502.TO) produces both BWRs and PWRs.

In March RWE and E.ON put Horizon up for sale after Germany accelerated its planned exit from nuclear energy as a result of rising concerns about nuclear power after the Japanese accident. The two German utilities formed Horizon in 2009, planning to invest about GBP15 billion ($24 billion) to build the 6.6 gigawatts of nuclear-power generation capacity.

In its quest for new business overseas, Hitachi approached a few other European countries, including Poland , Finland and Lithuania --even before the Fukushima accident.

Expanding its customer base to the U.K. "is a positive thing," said Hirofumi Kawachi, an analyst of Mizuho Investors Securities.

"For the long term, demand for nuclear power will definitely rise, especially in emerging economies," he said.
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