“Look what happened to the CANDU,” a senior official at Rosatom, the Russian nuclear conglomerate, recently told Platts. “It’s a good reactor, but nobody is building it.” Why the post mortem, for a reactor that at six a.m. today was cranking out 62.6 percent of Ontario’s electricity? Because, said the official, a Rosatom analysis indicates that if you want to be a profitable reactor vendor, your worldwide installed capacity must be at least 100,000 megawatts. Toshiba-Westinghouse has that, so does Areva. Soon, says the Rosatom official, Russia will too. AECL, which makes the CANDU, has only around a quarter of that putative requirement.

How valid is this go-100,000-MW-or-go-home claim? According to Platts, the Rosatom guy used the CANDU as an example of what will happen to vendors of boiling water reactors, who may represent more serious competition for Russian PWRs than the CANDU. But he is also worried about the CANDU 6: it is competing directly against Russian and French PWR technology in Jordan, and possibly in Argentina.

Presumably GE-Hitachi (GEH), the biggest BWR maker, will read the writing on the Rosatom wall and just withdraw from the global reactor market. And Areva, which only 12 days ago signalled its readiness to offer its own BWR, the 1,200 MW Kerena, to New Brunswick, will also abandon that design and focus only on the 1,100 MW Atmea and the 1,650 MW EPR (both PWRs).

Such wishful thinking is commonplace when companies talk about their competitors. Rosatom obviously hopes that other prospective buyers are listening, and that this go-big-or-go-home idea takes root in buyers’ minds. If that happens, then the competitive field is narrowed down to the big PWR vendors Toshiba-Westinghouse, Areva, Rosatom, and the South Koreans. Against that field, Rosatom hopes that the Russian VVER, with safety features its proponents claim come close to being as inherent as those of BWRs, comes out on top.

Still, it is worth examining the CANDU situation, since the Canadian government is trying to sell the CANDU part of AECL. Why is nobody building one of these reactors right now? Does it really have anything to do with the size of the worldwide CANDU fleet? Let’s look at the most “firm” sale AECL has in the hopper right now: two, maybe three, ACRs to Ontario Power Generation. OPG wants 3,000 MW of new capacity at its Darlington station. That process has been on the shelf since this time last year, reportedly because of the high cost of AECL’s bid.

Did the the Government of Ontario (owner of OPG) suspend the Darlington project because the worldwide CANDU fleet is only a quarter of what Rosatom says it should be? Remember, the analysis says the fleet must be 100,000 MW for the vendor to be profitable. If AECL had a fleet that size, thereby fitting Rosatom’s definition of a profitable vendor, then presumably it could have offered a bid to Ontario that was both compliant and reasonably priced. Might that be why the overrun risk portion of its bid was priced so high? 

Nobody connected to the Darlington bid has indicated anything like this. That doesn’t mean it’s not a background factor. But both Areva and Westinghouse, which fought AECL for OPG’s business, have Rosatom’s required installed base. Their bids were deemed non-compliant by the Ontario bid reviewers. Who really knows.

Regardless of whether or not the size of AECL’s fleet played any role in Ontario’s shelving of the Darlington project, I think fleet size is irrelevant to this particular case. OPG liked the economics of the ACR. It’s just as question of working out a deal with AECL. And that means quantifying the risks of schedule delays and the consequent cost overruns.

The Platts reporter, Ann MacLachlan, also talked to somebody at GEH about the alleged fleet size issue. Of course GEH doesn’t think the BWR’s relatively small worldwide installed base means the company cannot be profitable. Its strategy for rolling out its next-generation BWR is therefore not to rush headlong to the 100,000 MW mark. Rather, a GEH official said, the company is just focused on building “one unit at a time, on schedule and on budget.”

Same for AECL and the CANDU. Whoever buys it, buys a project at Darlington, and possibly one in Rumania and another in Jordan. If the new owner(s) can make these projects profitable, the CANDU line is very much alive and ready to power India and China—and any other buyer who likes the machine’s world-class engineering, economics, and ability to refuel without shutting down—into low-carbon prosperity.