IAEA: LETTER RECEIVED FROM IAEA REGARDING VOLUNTARY

UNCLAS UNVIE VIENNA 000658

SIPDIS

STATE FOR ISN/NESS, IO/T, ISN/MNSA, ISN/RA
NA-243-GOOREVICH/BRUNNS; NA-241 O'CONNOR, LAMONTAGNE

E.O. 12958: N/A
TAGS: ENRG KNNP IAEA AORC TRGY
SUBJECT: IAEA: LETTER RECEIVED FROM IAEA REGARDING VOLUNTARY
CONTRIBUTION OF USD 500,000 TO SUPPORT NUCLEAR ENERGY ACTIVITIES


1. U.S. Mission received a letter from the IAEA dated October 30,
2008, which we conveyed initially by e-mail.

Begin text of letter:

Sir,

I have the honour to refer to my letter dated 2008-06-26 informing
you
of the IAEA's acceptance of your Government's voluntary contribution
of
USD 500,000 for 2008 to support the IAEA's nuclear energy
activities.

Over the past few years there has been a considerable increase in
the
number of countries expressing interest in a first nuclear power
plant.
The IAEA has been able to respond to the needs of these countries in
a
timely manner due to extrabudgetary contributions from inter alia
the
United States of America. This correspondence serves to provide you

with a brief status report on the projects for which US funds were
provided in 2007, as well as to propose activities for the use of
the
US contribution received in 2008.

With the U.S. contribution of USD 500,000 in 2007, we have completed
a
publication entitled "Evaluation of National Nuclear Infrastructure

Development Status" (NG-T-3.2),which is designed to accompany the
guide published last year, i.e. "Milestones in the Development of a

National Nuclear Infrastructure" (NG-G-3.1). We are nearing
completion
of a publication on the "Responsibilities and Competencies of a
Nuclear
Energy Programme Implementing Organization (NEPIO)" to provide
further
information on how to integrate various stakeholders into the early

planning for a nuclear power programme. These two publications (NE

series technical reports) will be the main subject of a Technical
meeting/Workshop on 'Evaluation Methodology for Nuclear Power
Infrastructure Development' to be held from 10-12 December 2008 at
the
IAEA's headquarters in Vienna. A review meeting was held in July on
a
publication tentatively titled "Improving the Prospects of Financing

Nuclear Power Plants," which will be finalized by the end of 2008.

Unless you indicate otherwise, we propose to use the remaining funds

allocated to this activity (approximately EUR 19,000) for follow-on

activities in 2009 related to financing nuclear power plant
programmes.
Activities regarding development of a document on site issues and
industrial capacity are just getting underway and will continue into


2009. More detailed information on the financial aspects of these
activities is provided in an attached spreadsheet. In the area of
Technology Deployment, the US contribution in 2007 is being used for

the development of a publication reviewing current construction
technologies and their application to new nuclear power plant
construction. The project will cover technologies that are
generally
used for large civil construction projects, not unique to the
nuclear
industry or to any specific nuclear plant design.

Regarding the US contribution of USD 500,000 received in 2008,
please
find enclosed a list of suggested activities for the use of these
funds
as discussed between representatives of the Department of Nuclear
Energy and Mr. Alex Burkart, of the US Department of State. We are

proposing activities that support nuclear power infrastructure
development and technology deployment in response to the needs of
countries planning a new nuclear programme as well as countries

expanding existing nuclear programmes. The proposed technology
deployment activities focus on equipment reliability lessons
learned,
materials management, and technology improvement for near term
plants
to reduce water consumption. We would appreciate receiving your
Government's concurrence to utilize the funds indicated for the
activities described in the attachment.

I look forward to the fruitful and continuing cooperation between
the
Government of the United States of America and the International
Atomic
Energy Agency.

Accept, sir, the assurances of my highest consideration.

Y.S. Sokolov
Deputy Director General
Head of the Department of Nuclear Energy

End text of letter


2. Per the foregoing letter, following is the list of activities
the
IAEA proposes could be financed from the USG CY 2008 contribution.

Text of attachment:

Voluntary Contribution from the USA for 2008 in tbe amount of USD
500
000 (EUR 321 027) for Nuclear Energy Activities.

Possible Topics for US Extra Budgetary Funding

Infrastructure Development Activities (2007 savings: EUR 65,000):


1. TM/Workshop on Evaluation Methodology for Infrastructure
Development, 10-12 December 2008, Vienna, Austria

This workshop will provide Member States an opportunity to learn how
to
evaluate their infrastructure status through a self-assessment or
peer
review. It is hoped that the results of the evaluation will inform
the
nuclear power programme planning process, and allow for more
effective
development and delivery of technical cooperation projects. The
workshop will also provide information on the NEPIO and raise
emerging
issues regarding infrastructure development. As with previous
infrastructure workshops, Member States will be asked to provide
their
experience and breakout sessions will give them an opportunity to
discuss challenges and solutions.

This activity is associated with the development of documents on
assessment methodology and NEPIO, and EUR 65 000 in savings from the

2007 contribution for those activities will be used to support the
workshop. (No additional 2008 funds are requested for this
activity.)


2. Develop a document on alternative contracting and ownership
policies
for nuclear power plants (EUR 70 000)

Build-Own-Operate and Build-Own-Operate-Transfer models, regional
approaches and leasing of nuclear power plants have not been used at

all, or not widely in the nuclear industry, despite their successful

application in other segments of the energy sector. Some advantages

associated with the BOO/T concept may be reduced need for human
resource development and access to vendor secured financing.
Examination of the issues associated with these approaches will
further
understanding of their current viability, as well as the advantages
and
disadvantages associated with them. The report will also identify
challenges and possible solutions to their more wide-spread use.

Funds are requested to support consultancies, consultants, review
meetings and other costs associated with the project. Approximate
costs

total EUR 70 000.


3. Develop a document on workforce planning to meet the human
resource
needs associated with the Milestones document (- EUR 90 000)

Human resource development is one of the most critical issues
associated with development of a nuclear power programme, especially
in
a country with little nuclear infrastructure. Identification of the

skills and technical competencies needed by key personnel for
planning
and implementing such programmes in the stakeholder organizations -
industry, NEPIO, regular, owner-operator and others, will help
member
states understand their human resource needs. This will be
coordinated
closely with related documents on the higher-level responsibilities
and
competencies of NEPIO and owner-operator. The document will also
identify how these skills can be acquired whether through use of
qualified contractors and consultants, or through training and
education.

Funds are requested to support consultancies, consultants, review
meetings, and other costs associated with the project. Approximate
costs total EUR 90 000.


4. Management Systems for developing nuclear power programmes (EUR
18
500)

Recent experience of Finland and France have identified the need for

appropriate management systems to be in place prior to issuing
requests
for bids and constructing nuclear power plants. The vendor (and all

subcontractors),owner-operator and licensing organization should
have
a common understanding of the project, share a safety culture, and
implement management systems. This project will look at lessons
learned
from recent experience and extrapolate useful guidance for new or
expanding nuclear programmes.

Funds arc requested to support the effort, especially participation
by
developing countries in a technical meeting scheduled for early

2009.
Approximate costs total EUR 18 500.


5. Vendor issues associated with a first nuclear power plant (EUR 20

000)

In introducing a Nuclear Power Programme, most countries will
acquire
facilities and components from a limited number of established
international manufacturers and vendors. However, those facilities
or
components are different from those purchased for other industrial
uses, because (a) most of nuclear technology goods are sensitive as

they could have non-peaceful uses (in addition to peaceful uses),
(b)
the monetary amount per transaction is comparatively large, and (c)

technical support by vendors and supplier governments, including the

regulator, during the planning, construction, and operation, or in
the
long-term, is needed. Furthermore a rapid growth in demand for
nuclear
power plants all over the world may cause shortage of supply in the

future. A Technical Meeting will be held with the participation of
vendors, users and related parties for information exchanges with a

view to understanding the issues required for mutual benefit.

Funds are requested from the US and Japan to support a workshop and

associated activities. Approximate funds requested from the US are
EUR
20 000.



6. Beijing Ministerial conference (EUR 15 000)

Funds are requested to support the full participation by developing

countries in the International Ministerial Conference on Nuclear
Energy
in Beijing in April 2009. Approximate costs total EUR 15 000.

Research Reactor/Human Resource De'Vel9pment Activity:


7. Initial Consultancy on International Remote Nuclear Engineering
Training on a Research Reactor (EUR 7 527)

North Carolina State University's research reactor facility bas
experience in training nuclear engineering students at other U.S.
universities over an internet-based connection. Should this kind of

remote training be available across national borders, it could
increase
the opportunities for nuclear engineering students without access to
a
research reactor, especially in developing countries. Given the
expected increase in demand for nuclear engineers in countries
expanding and developing nuclear power programmes, demonstrating the

feasibility of this kind of arrangement could help address human
resource development issues in many regions.

Up to EUR 7 527 in funding is requested to have an initial
consultancy
to explore the feasibility of an Agency demonstration project.
Should
the results of the consultancy be favourable, an additional request
may
be made for the project itself.

Technology Deployment Activities:


8. Component and system reliability and new plant development and
deployment (EUR 50 000)

A major impact on the economics of nuclear plants is system and
component reliability including the impact of materials on
reliability.
A systematic assessment of these areas as they impact new plant
development and deployment will enhance the overall economics and
sustainability of new plants. This activity would examine experience

regarding component and system reliability and materials behaviour
and
review how this experience is incorporated into new plant designs.
Similar activities are being conducted in individual countries but
no
significant attempt has been made to integrate worldwide practices
in
these areas. In particular, it is expected that this activity will
integrate ongoing work at EPRI and other research organizations in
industrialized countries with experience from developing countries
(e.g. Rep. of Korea, China, India) to present a global assessment.

Funds are requested to support the consultancies and review meetings
as
well as the consultants to produce the first draft report.
Approximate
funds requested from the US are EUR 50 000.


9. Design approaches for efficient water use for new, evolutionary
water-cooled NPPs (EUR 50 000)

Efficient use of water is very important in several developing
countries considering introduction of nuclear power, and in
industrialized countries considering expansion of their nuclear
power
programme. In some countries, the lack of water has even resulted in

shortages in electricity generation. Therefore, the efficient
management of water use at new nuclear plant designs is highly
important.

This activity would evaluate the use of water for nuclear power
plants,
and identify means of more efficient use. The approach followed will

utilize recent or ongoing industrialized country activities and
expand
the information to incorporate global and developing country

perspectives. The activity would examine strategies for modes of
water
generation/consumption for NPPs with regard to needs (e.g. service
water make-up water, refueling water, and others) and types of
cooling
systems to assure efficient use water by the plant. For cases in
which
the nuclear plant is also used for desalination, it would examine
the
optimal balance between water production and consumption through the

applications of water-consumption reduction strategies, and identify

areas in design/operation and in waste water treatment which at the
end
will affect the reduction of water consumption and cost for the
overall
power generation.

Funds are requested to support the consultancies and review meetings
as
well as the consultants to produce the first draft report.
Approximate
funds requested from the US are EUR 50 000.

End text of attachment.


3. Mission anticipates close coordination with Washington agencies
in
the prioritization of activities as proposed by the IAEA and in
preventing assistance to inappropriate activities such as the
recently
approved Technical Cooperation project SYR/0/020. U.S. Mission POC
is
Nuclear Energy Attache Lee Gebert (GebertLH@state.gov).

SCHULTE