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Bedrock of U.S. Energy Security By Michael Wallace, Constellation Energy. 1. What has been labor’s support in building Calvert Cliffs unit 3 and other EPR nuclear power plants? Labor has become a valuable partner in our efforts to build the next wave of nuclear plants. They are part of a broader effort to create home-grown jobs that will help us rebuild our nation’s nuclear manufacturing infrastructure. Earlier this year, we congratulated Bechtel Construction Company, our constructor, on its Project Labor Agreement (PLA) with the building trades unions to provide labor for the Calvert Cliffs 3 project in southern Maryland. The PLA serves as a framework for future UniStar EPRs. The intent is to deploy labor on the first unit, establish the tools and the training and the qualifications, and then replicate it exactly, not only by process but by people. We really focused on getting craft labor early on about three years ago. Labor has provided important political support for us with federal loan guarantees. I can’t say enough about the efforts they made a year and a half ago supporting the $18.5 billion in loan guarantees. I heard labor leaders talked to Congress directly about how important a nuclear plant was going to be, and to be frank, members of the Congress listened to labor leaders more than to any CEO. I’m very happy with how all that’s come together. Loan guarantees are probably the most critical issue we’ve worked on with labor. Some of the things we did 25 years ago at Braidwood nuclear plant in Illinois are approaches that are revving up again this time around. The building trades in general have significantly upgraded their training programs and their journeymen requirements. That’s the number one issue. An interview by Newal Agnihotri, Editor, Nuclear Plant Journal at the Nuclear Energy Institute's Nuclear Energy Assembly in Washingtion, D.C. on May 19, 2009. Michael Wallace Michael Wallace is vice chairman and COO of Constellation Energy, and chairman of UniStar Nuclear Energy, a strategic joint venture between Constellation Energy and the EDF Group, an energy market leader in Europe. Mr. Wallace has a Bachelor of Science degree in electrical engineering from 2. What is the status of required permits from the state of Maryland? The Maryland Public Service Commission (PSC) approved our state permit in late June, and it addresses all the relevant issues -- economic and environmental, air and water. This was a significant milestone for us – very important. The approval came about 18 months after we filed our application, and I know we were very encouraged by the overwhelming support during public hearings conducted by the PSC. 3. How will your plants be fi nanced? Federal loan guarantees are critical to our proposed Maryland reactor and we’re pleased the Department of Energy has accepted us as one of the four prospects for loan guarantees. A lot of effort went Marquette University and a Master of Business Administration degree from the University of Chicago, with a specialization in fi nance. He also served as a naval offi cer in the U.S. Navy nuclear submarine force. He is a member of the National Infrastructure Advisory Council (NIAC) which advises the President on matters related to homeland security, chairman of the Nuclear Sector Coordinating Council under the Department of Homeland Security’s National Infrastructure Protection Plan, director of Nuclear Electric Insurance Limited (NEIL), and a member of Marquette College of Engineering’s National Advisory Council. He is active in a variety of boards and organizations, including those associated with Boy Scouts of America, Big Shoulders Fund of Chicago, Catholic Charities of Maryland, and Ocean Race Chesapeake. into it. The AREVA, Bechtel, ALSTOM and UniStar team all worked very closely together for the loan application. So we feel pretty good about how that process is moving forward. Before long we will be in a position to talk more publicly about how we are getting full financial support, how we plan to leverage the DOE loan guarantee by using export credit agency backing. UniStar will be the owner of Calvert Cliffs 3. UniStar is 50 percent EDF, 50 percent Constellation so the equity will be 50 percent Constellation and 50 percent EDF. We’d like to get a conditional loan guarantee commitment from DOE by the end of 2009 so we can move forward and break ground and begin preliminary site work. 28 www.NuclearPlantJournal.com Nuclear Plant Journal, July-August 2009
4. How is Constellation planning to bring “trade” workers due to the current shortage of skills for construction of nuclear power plants? We are having a lot of communications about the need for workers at a skilled level, such as the electricians, plumbers, pipefitters, sheet metal workers, and other skilled workers. It’s a very special trade that’s needed for those types of activities. The jobs are 3-5 years long. They’re wellpaying jobs and there is good reason this is going to be a natural attraction. We’ll need robust training programs to make sure interested parties are trained to do the work. I think a good pipefitter welder, nuclear grade, is going to be making more money than a degreed engineer for probably a decade because there is going to be such a shortage and it’s going to take a particular skill set. So I think once that starts it’s too difficult to recruit people just on words, but once the project starts and the jobs are real I think they will come really fast. What we’re doing in particular -- many other companies are doing the same thing -- we’ve established relationships with local high schools to recruit students who don’t really want to go to college so we can bring them right into the trade. We do it with both our fossil and nuclear plants. So a relationship is established with the local schools. Some of those kids graduate and go to work in the plant and they give feedback to the kids that are a class or two behind in school that it’s a good place to work, that they get training, it’s a well paying job, and it’s a great environment. It promotes the value of trade; not everyone needs to go to college to do very well in life. We’re doing that in New York and we’re doing that in Calvert County right now. 5. What is the base plant for EPRs to be constructed in the United States? The EPR being built by EDF in Flamanville, France is our base plant. Because EDF is our partner, we have a direct transparent data transfer of all of the Flamanville drawings, analysis and construction experience. Everything about Flamanville is directly transferred to UniStar for consideration of how we replicate it. In addition, we expect to reap the benefit of four EPRs that will be operating ahead of us -- Olkiluoto in Finland and two in China. It’s to their benefit as well as ours to get a transfer of all the lessons learned from Flamanville. I’d like to think I know a little bit about nuclear plant construction because at Braidwood from 1982-1988, I was the executive overseeing design and construction, and we saw some construction techniques that I had never seen before. EDF, because they never stopped building nuclear plants, they kept getting a little better every time they got to the next plant. That is the closest real-time optimization of nuclear project construction that I think we can have. It’s not a theoretical experience that we’re drawing on. In fact, some of the senior people at the Flamanville site, I expect are going to be at our Calvert Cliffs site when it’s under construction to bring great added experience. So we’re hoping to optimize how we do Calvert Cliffs by drawing heavily on Flamanville. 6. What efforts (design or construction) are under way for Calvert Cliffs? The UniStar team right now is about 20 percent EDF people who have come over from France and they are working in Baltimore, Maryland full time. So, we don’t just get data transfer, we actually have people who are here working on developing the plant. The main thing right now of course is engineering, project management, and licensing. Once we get to construction, we want some of these individuals who were personally involved in the construction of Flamanville to be involved in the construction of Calvert Cliffs because that’s the best way to get data transfer. When it comes to operations, there is probably a little less transfer that we get because the regulatory framework that we operate under here with the NRC is a little different than what the French use. So we’ll have systems and procedures that we use but the details, all the licensing individuals need to be U.S. citizens, so there will be less EDF involvement in operation. EDF will have heavy involvement in design, construction, and testing. 7. How is the political support for Calvert Cliffs unit 3? Steny Hoyer, majority leader of the U.S. House, is from Calvert County, and Calvert Cliffs is in his district. You can’t get a more direct connection than that. Then when you come to the state side, a year ago when the governor, Martin O’Malley, was at Calvert Cliffs and he held his press conference he said new nuclear at Calvert Cliffs 3 is a necessity for clean and reliable energy, so we have good support from the governor. We have good positioning with the leadership in Congress. We think the political leadership is going to continue to come. We also enjoy strong support from Maryland’s legislative leaders and the Calvert County Commissioners. We’ve been through our hearings already, both the state hearing and NRC hearing, and there has been no significant intervention that we’ve had to deal with at all. All of the public and political support seems to be pretty solid. 8. Concluding comments? We’ve gone through a period where we were unintentionally competing with each other, competing over loan guarantees, wondering how much is going to be there. Now we have to get in a mode where we are really collaborating, really cooperating. The first four plants constructed have to be done right because they will set the stage for whether we have a renaissance or a fizzle. I think it’s (Continued on page 34) Nuclear Plant Journal, July-August 2009 www.NuclearPlantJournal.com 29
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