Russia Joins China's Race for Next-Generation Nuclear Reactors

(Bloomberg) -- China has agreed to pursue building next-generation nuclear reactors designed by Russia’s Rosatom Corp., the latest player seeking a boost for its new technology from China’s embrace of atomic power.

A plan to build four Russian units was among four deals signed Friday during a ceremony in Beijing attended by presidents Xi Jinping and Vladimir Putin. The agreements are worth more than 20 billion yuan ($3.1 billion) and total construction costs could exceed 100 billion yuan, according to China National Nuclear Corp., adding it’s the biggest nuclear pact ever between the two countries. China will finance the reactor construction, Rosatom Chief Executive Officer Alexey Likhachev said after the ceremony.

China’s nuclear industry has grown from its experience importing technology sold by foreign companies hoping to benefit from booming demand in the world’s largest energy consumer. The nation’s ambitions to build out its nuclear power industry at home, and sell its own technology abroad, is beginning to overcome cost overruns and tighter regulations.

The nation signaled in March it would end a multiyear freeze on new reactor construction this year, and a month later approved the fuel-loading of Westinghouse Electric Co.’s AP1000 in Zhejiang province’s Sanmen and French-designed EPR in Guangdong’s Taishan. That paves the way for startups within months, which would be the first successful operations globally for units of their kind.

Russian Reactors

As part of the agreements signed Friday, the countries will seek to build two Russian VVER-1200 units at the Xudabao power plant in China’s Liaoning province and two more at Tianwan in Jiangsu, according to a statement from Moscow-based Rosatom.

China already uses some of Russia’s older technology. Two VVER-1000 units at Tianwan started in 2007, and a third was connected to the grid in December, Rosatom said.

“Tianwan has been a testing ground for Russian nuclear technology,” said Snowy Yao, an analyst at China Securities International Finance Holding Co. “China looks willing to try out all the latest designs before endorsing a winner.”

The two countries also on Friday signed deals for the supply of equipment, fuel and services for the CFR-600 fast reactor pilot project developed by state-owned CNNC, as well as the supply of generator parts for China’s lunar exploration program.

China previously signed a contract with Westinghouse to build two units at Xudabao, according to a World Nuclear Association report in October 2016. They were among six AP1000 reactors planned for the site, it said. A Beijing-based Westinghouse spokesman declined to comment Friday.

To contact Bloomberg News staff for this story: Jing Yang in Shanghai at jyang251@bloomberg.net;Stepan Kravchenko in Moscow at skravchenko@bloomberg.net

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