Since the world's first commercial nuclear power plant (NPP) was commissioned in 1956 (Calder Hall nuclear power station, UK), the world's NPPs have evolved in the direction of increasingly large reactors, which tend to require costly and highly specialized construction and assembly equipment, labor and supply chains. There have also been many instances of the nuclear regulatory regime changing during the plant construction process, which has required significant change orders. These and other challenges in developing new large reactor plants has contributed to the nuclear industry's "bad marks" for significant construction delays and cost overruns in many parts of the world over the past few decades.
Despite the many challenges of developing large reactor nuclear power plants, these large plants have proven to be safe, reliable, efficient and a source of low-carbon electricity. Furthermore, on a life-cycle basis large reactor nuclear plants offer cost-competitive generation and can offer significant economies of scale given that NPPs have operating lives of more than 60 years. In many cases, large reactor NPP sites are configured with multiple reactors and can be designed to be scaled-up through phasing in additional reactor units in the future in accordance with electricity market plans and models. Large reactor NPPs, operating at high capacity factors, are an ideal generation technology for the purpose of providing for the base load generation supply in a country's or region's energy markets. However, large reactor NPPs can also be operated as "load following" plants, as has been demonstrated in France after the significant growth of intermittent renewables generation.
In most cases the significant up-front capital costs need to be amortized over a long time horizon (e.g. 20 - 30 years). Traditional "ringfenced project financing" from commercial banks and international finance institutions (IFIs) is categorically unavailable for nuclear power projects. Therefore, there has been a tendency for many of the recent new-build NPPs to be financed through export credit (typically loans and guarantees from ECAs and EX-IMs), sovereign loans and other financing and guarantees arranged by the exporting country in the case of a state-to-state transaction, or the exporting company(-ies) in the case of a commercial transaction.
In the large reactor nuclear generation segment, DCS provides expert advisory services in the following specific areas:
- Assist governmental or plant developer/sponsors, contractor(s), lender clients in:
- Formulating energy market plans and policies to determine whether large reactor nuclear generation can and should be a component (including cost-benefit studies and options analysis)
- Developing nuclear energy programs in coordination with IAEA Integrated Nuclear Infrastructure Review (INIR) or 'Milestones' process (strategic planning)
- Developing the county's nuclear policy framework and implementation legislation and regulations
- Amending energy market regulatory framework (if necessary) to accommodate nuclear generation
- Market sounding and outreach for investor sponsors, contractors and lenders
- Developing feasibility studies (economic and market and bankable feasibility studies)
- Lead transaction advisory and nuclear project/program management services
- Training and capacity building workshops
- Developing and negotiating project contractual structures and corporate structures
- Procurement, drafting and negotiation of construction, services and supplier contracts including nuclear EPC/EPCM, technology vendors, nuclear fuel cycle contractors, operations and maintenance contractors, and decommissioning services contractors
- Financial modeling (development, maintenance, training, review and model auditing)
- Procuring and negotiating nuclear financing (equity and debt: ECA/EX-IM, commercial, sovereign).
- Drafting and negotiating offtake agreements (Power Purchase Agreements, Contracts for Differences, etc.)
- Training and capacity building workshops
Within the nuclear power subsector, DCS experts maintain relationships with numerous related project consultants and participants including: both international and local legal advisors; technical, engineering and environmental/social advisors, economic/market consultants; contractors, vendors and technology providers; strategic and financial equity sponsors; lenders (including commercial lenders, Export Credit Agencies and Export-Import Banks (ECA/Ex-IMs), institutional lenders, bond funds and investment banks) and credit rating agencies (if necessary). We are always prepared and highly experienced in taking on a lead transaction advisory or project/program management role where we coordinate and manage (in some cases, procure and retain via subcontract) various technical, legal and other consultants required for the project. On behalf of our clients we are prepared and accustomed to leading and concluding negotiations with governmental/public sector or equity sponsors, contractors and venders, lenders, rating agencies and regulators, as may be relevant for a given client project.
Please click on the below links to learn more about the specific services related to the nuclear power generation segment that DCS experts can offer:
- Transaction Advisory
- Project/Program Management
- Strategic Planning
- Project Feasibility Studies
- Debt and Equity Capital Raising
- Contract Drafting & Negotiation
- Financial Modeling, Review and Audit
- Business and Asset Valuation
- Tender Management: RFEI/RFQ/RFP
- Mergers & Acquisitions Advisory
- Workouts and Restructuring
- Corporate Governance
- Training & Capacity Building
DCS focuses on providing the above services in the nuclear power generation segment to the following categories of clients:
energy & utilities: nuclear power generation
large reactor FOCUS
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