South Korea: Cables fail tests; Government suing LS Group; Price Fixing

This website has been tracking the developments concerning corruption (including bribery for contracts) and faked certification of parts in the South Korean nuclear industry since July of this year; you can click here to see the original post on this topic on Atomic Power Review, which detailed the developments as then released dating back through June 2013.

In that post, I asked a number of questions; two can now be answered.  In terms of "will parts with faked certificates actually work," the answer appears in at least one case to be "no," and "do parts supplied under these bribery-induced contracts meet specs," the answer also appears to be "no."  Much else has developed in the interim.

Let's detail developments in recent times, since it was announced that about 100 people had been indicted overall in the scandal (which wasn't reported on this site.)

•In early October, it was found that eight nuclear cable suppliers were price fixing; a fine was imposed and a case referred to prosecutors.  See this link.

•The cable makers were found to have been paying very high dividends - and it was noted that the fine amount was insignificant to deter the practice when compared with the profit derived from a successful bid.  See this link.

•A large number of faked testing results were discovered in connection with investigation into the corruption scandal, including 277 used to cover parts at operating plants.  See this link.

•Suspect cables have failed inspections at two reactor plants.  See this link.

•On October 17 it was revealed that the Korean Government would sue LS Group, which owns JS Cable - the major culprit in supply of suspect cables.  See this link.

•Another piece hinted that LS Group might sue Korea Hydro & Nuclear Power.  See this link.

•On October 22, Korea Hydro & Nuclear Power confirmed it would sue LS Group for very significant amounts in damages.  See this link.

Some of the reporting linked above includes the revelation that the easy movement of public officials to nuclear power or utility companies (and back) is part of the problem, and a moratorium period of three years during which this transfer cannot occur has been suggested.  No action has been definitively taken on this measure, however, as the major focus at this time is discovery of the extent of possible threat due to truly undocumented and untested parts and discovery of the extent of the corruption that led to this entire episode in the first place. 

As always, I will continue to update on this situation periodically as warranted.

1:40 PM Eastern 10/25/2017
ATOMIC POWER REVIEW

Read More

SCE Requests Arbitration in SONGS Steam Generator Dispute with MHI

Press release below from Southern California Edison.

----------

Media Contact: Maureen Brown, (626) 302-2255
Investor Relations: Scott Cunningham, (626) 302-2540

SCE Asks for Arbitration Against Mitsubishi Heavy Industries over Defective San Onofre Steam Generators

ROSEMEAD, Calif., Oct. 16, 2013 — Southern California Edison (SCE) today submitted to the International Chamber of Commerce (ICC) a Request for Arbitration which states claims against Mitsubishi Heavy Industries and Mitsubishi Nuclear Energy Systems for the defective steam generators Mitsubishi designed and built for the San Onofre nuclear plant.

The request for binding arbitration seeks to hold Mitsubishi accountable for the defective replacement steam generators, a failure which led to the permanent shutdown of the plant and caused billions of dollars in harm.

“We are taking this step today to ensure that Mitsubishi takes responsibility for providing defective steam generators and to recover, on behalf of our customers, all damages from Mitsubishi for its failures,” said Ron Litzinger, SCE president.

SCE requested arbitration after the Notice of Dispute it filed against Mitsubishi in July did not produce a resolution. The Request for Arbitration says that Mitsubishi totally and fundamentally breached its contract by failing to deliver what it promised. Among other things, SCE also alleges that Mitsubishi failed to submit to a contractually mandated audit requiring it to disclose documents relevant to the design and other aspects of the replacement steam generator project and its implementation.

A panel of three ICC arbitrators will oversee the proceedings in San Francisco. The contract is governed by California law.

The Nuclear Regulatory Commission (NRC) announced in September that it had identified flaws in the computer codes that Mitsubishi used to design the failed steam generators, and the agency issued a “Notice of Non-Conformance” against Mitsubishi for the failed design that resulted from the implementation of the codes. The NRC also cited SCE for the failed design created by Mitsubishi.

SCE announced June 7 that it would permanently shut down San Onofre Units 2 and 3, and begin the process to decommission the nuclear plant.

SCE has made public key documents regarding the failure of the San Onofre replacement steam generators in a Digital Document Library. The library, however, remains incomplete because Mitsubishi has refused to make public other key documents.

For more information about SCE, follow us on Twitter and Facebook.

About Southern California Edison
An Edison International (NYSE:EIX) company, Southern California Edison is one of the nation’s largest electric utilities, serving a population of nearly 14 million via 4.9 million customer accounts in a 50,000-square-mile service area within Central, Coastal and Southern California. 

11:55 AM Eastern 10/17/2013
ATOMIC POWER REVIEW

Read More

SCE Demands Mitsubishi Allow Contractually Mandated Audit

The following press release was received last evening from Southern California Edison.

----------

Media Contact: Media Relations, (626) 302-2255

SCE Demands that Mitsubishi Submit to Contractually Mandated Audit

Mitsubishi Has Refused Repeated Requests to Allow the Audit in the Months Since Its Failed Replacement Steam Generators Resulted in the Permanent Closure of San Onofre

ROSEMEAD, Calif., Oct. 7, 2013 — Southern California Edison (SCE) today announced that it has formally demanded that Mitsubishi Heavy Industries agree to undergo a contractually mandated audit of Mitsubishi's design and manufacture of Replacement Steam Generators (RSGs) for the San Onofre nuclear plant. On Sept. 20, the Nuclear Regulatory Commission (NRC) concluded that a flaw in Mitsubishi's computer model led to the failure of the Replacement Steam Generators. The NRC's investigation also uncovered internal Mitsubishi consultant materials that expressed concerns about Mitsubishi's computer model.

Edison's latest formal audit demand, set forth in a letter from SCE president Ron Litzinger, can be found at http://www.songscommunity.com/docs/093013_letter.pdf. The letter notes that SCE “officials and lawyers have made this [audit] request on at least three prior occasions, but Mitsubishi has steadfastly refused to date to submit to this audit.” Litzinger wrote that he was appealing once again “because Mitsubishi's repeated refusal to agree to such an audit is harmful to the public, regulators and our entire industry, as it hinders efforts to understand and learn from the RSGs’ failures.”

The SCE audit demand letter says that “[t]he contractual language requiring Mitsubishi to undergo this audit could not be clearer . . .: Section 1.9.6 of the contract gives [SCE] the right to ‘examine and copy’ Mitsubishi's ‘books, accounts, relevant correspondence, specifications, time cards, drawings, designs, and other documentation, to the extent that these are related and relevant to the Work under the Purchase Order[.]’”

In repeatedly refusing to submit to the audit, Mitsubishi has argued that this contractual language applies only to financial information necessary to support invoices. SCE’s demand letter characterizes Mitsubishi's excuse as “disappointing” and says that it “will only confirm the suspicion that Mitsubishi refuses to be transparent.”

Litzinger's letter concludes by saying that SCE “stands ready to begin the audit as soon as Mitsubishi advises that it will abide by the straightforward terms of the contract.”

In July, SCE filed a Notice of Dispute with Mitsubishi in an attempt to recover all damages caused by Mitsubishi’s failed design and manufacture of the San Onofre Replacement Steam Generators that led to the shutdown of the nuclear plant. SCE has also announced that it continues to reserve all of its rights as to any and all legal remedies available against Mitsubishi. Finally, SCE has made public key documents regarding the failure of the San Onofre Replacement Steam Generators in a Digital Document Library located at www.SONGScommunity.com/library, although the Digital Library remains incomplete because of Mitsubishi’s continued refusal to permit other key documents to be made public.

About Southern California Edison
An Edison International (NYSE:EIX) company, Southern California Edison is one of the nation’s largest electric utilities, serving a population of nearly 14 million via 4.9 million customer accounts in a 50,000-square-mile service area within Central, Coastal and Southern California. 

----------

10:24 AM Eastern 10/8/2012
ATOMIC POWER REVIEW

Read More

Resin-based solution to Fukushima water problems

Below is a very interesting press release I received this morning.  I think all of us knew that (among many other things) the Fukushima Daiichi accident would lead to new technologies, or useful developments of existing technologies.  This announcement seems to herald just that kind of development.

-----

FOR IMMEDIATE RELEASE

Purolite Corporation develops an ion exchange resin based solution to the Fukushima radioactive water crisis

Reduces radionuclides to non-detect levels

Bala Cynwyd, PA – October 1, 2013 - Purolite Corporation, a world leader in water treatment and the treatment of radioactive nuclides in high chloride water announced today, that after two years of extensive research and development, it has a solution to the multiple issues surrounding the Fukushima radioactive water crisis. The proprietary process incorporates a total solution to include the four main points identified by TEPCO in its most recent request for proposals.

The Purolite solution can be quickly implemented and can achieve the following goals:

1. Remove 62 identified radioactive nuclides contained in the Fukushima water to non- detectable status. This was confirmed in tests using actual reactor site contaminated water.

2. Eliminate over 80% of the radioactive sludge versus normal precipitation treatment.

3. Eliminate the need for storage tanks for highly radioactive water.

4. Reduce the need to build water intrusion walls around the reactors.

“Our technical experts worked in cooperation with major Japanese companies over the past two years to develop a unique solution to this complex problem,”said Steve Brodie, President. “Our proprietary technology effectively removes the identified containments and will help solve Fukushima Daiichi’s environmental problems.”

The continuous accumulation of radioactive water at the tsunami stricken Fukushima Daiichi nuclear power plant is unprecedented and well documented. Currently there are over 1,000 storage tanks at the reactor site containing over 300,000 cubic meters of highly radioactive water. More and more tanks are being built daily to accommodate the intrusion of about 400 m³/day groundwater into the reactor cooling water loopbecause it remains too toxic to discharge to the environment.

About Purolite

Purolite Corporation is a leading manufacturer of ion exchange media, catalysts, adsorbents and advanced polymers for life sciences. Headquartered in Bala Cynwyd, PA, the company has ISO-9001 certified manufacturing facilities in the USA, China and Romania and operates dedicated R&D centers in the USA, China, Romania, Russia and the UK. Purolite also has a technical laboratory in Japan. Purolite, the only company focused exclusively on resin technology, has 40 sales offices in more than 30 countries.

Contact

To learn more about Purolite, please go to purolite.com or contact

Jeffrey Frain

Global Marketing Manager

150 Monument Road, Ste. 202

Office: (610) 668-9090

Fax: (610) 668-8139



jeffrey.frain@purolite.com

Read More

SCE Demands Reimbursement from Mitsubishi for San Onofre RSG's

Below is a press release from Southern California Edison.

----------

Media Contact: Media Relations, (626) 302-2255

SCE Demands that Mitsubishi Heavy Industries Reimburse for Expenses Incurred Because of Mitsubishi’s Failed San Onofre Replacement Steam Generators

SCE Spent More Than $140 Million Investigating the Failure, Yet Mitsubishi Maintains that Just $7.6 Million of Those Expenses Are Its Responsibility

ROSEMEAD, Calif., Oct. 1, 2013 — Southern California Edison (SCE) today criticized Mitsubishi Heavy Industries (Mitsubishi) for “stonewalling” and made public its demand that Mitsubishi reimburse SCE for expenses incurred in responding to fundamental defects in the San Onofre replacement steam generators (RSGs) that Mitsubishi designed and manufactured. SCE’s demand follows the Sept. 23 findings from the Nuclear Regulatory Commission that Mitsubishi’s replacement steam generators failed because of a flaw in the computer code that Mitsubishi used to design and manufacture them.

According to SCE’s Sept. 27 letter to Mitsubishi, available at www.songscommunity.com/docs/edisoninvoices.pdf, “Edison spent over $140 million investigating the cause of excessive tube wear in the RSGs following a tube leak in one of the Unit 3 RSGs, plugging damaged tubes in all four RSGs, and attempting to restart Unit 2 after both Units were shut down due to the RSG defects.” SCE’s letter states that “it is simply incredible for Mitsubishi to assert that only $7.6 million of those expenses are Mitsubishi’s responsibility.”

SCE’s letter also maintains that, although Mitsubishi claims that “it has still not received sufficient documentation to recognize its warranty obligations,” the facts demonstrate otherwise. According to the letter, “Edison has gone well beyond its obligations to provide documentation supporting its costs,” including:

•   “Mitsubishi employees [were] present at the plant and involved in much of the activity described in these invoices”;

•    “Edison has provided Mitsubishi with several thousand pages of detailed backup documents supporting the charges”;

•    “Edison employees have spent hundreds of hours responding to Mitsubishi’s ongoing demands for information, including by creating specialized reports for Mitsubishi”; and

•    “The documentation Edison has provided far exceeds the level of detail that is customary in the industry — and far exceeds any backup that Mitsubishi has ever provided Edison in support of any charges it is claiming.”

The SCE letter concludes that “Mitsubishi’s actions have made it clear that no reasonable level of documentation will ever be sufficient to support payment in its view. We are therefore unwilling to engage in yet another time-consuming effort, only to face continued stonewalling by Mitsubishi.”

In July, SCE filed a Notice of Dispute with Mitsubishi in an attempt to recover all damages caused by Mitsubishi’s failed design and manufacture of the San Onofre replacement steam generators that led to the shutdown of the nuclear plant. SCE has also announced that it continues to reserve all of its rights as to any and all legal remedies available against Mitsubishi. Finally, SCE has made public key documents regarding the failure of the replacement steam generators in a Digital Document Library located at www.SONGScommunity.com/library, although the Digital Library remains incomplete because of Mitsubishi’s continued refusal to permit other key documents to be made public.

About Southern California Edison
An Edison International (NYSE:EIX) company, Southern California Edison is one of the nation’s largest electric utilities, serving a population of nearly 14 million via 4.9 million customer accounts in a 50,000-square-mile service area within Central, Coastal and Southern California.

----------

10:00 AM Eastern 10/2/2013
ATOMIC POWER REVIEW

Read More

South Korea Nuclear Corruption Investigation Update

It's been a while since I have reported on the developments in the corruption scandal concerning nuclear plant parts and quality assurance, and production contracts, in the South Korean nuclear energy program.  Here are the important updates since my last post (which I'll link below.)

•There have been no further implications of any sort that plant safety is actually compromised.

•Not long ago a former Vice Commerce Minister was indicted in the scandal, for influencing the decision to award contracts for construction of the nuclear plants in the UAE.  Click here.

•A former Vice Minister for Trade and Energy has just been named as the new head of KHNP, or Korea Hydro and Nuclear Power. Click here for brief announcement.  Click here for detailed piece.

As we can see, the corruption appears to have reached high levels in South Korean government, but as we also see the rate at which further persons are being implicated has greatly slowed.  It may be that the investigation is reaching its ultimate limit; this however is not yet guaranteed, and for that reason I'll keep on the story... and of course should any actual realistic implication against plant safety appear, I'll report on that here as well.

Click here for the previous update on this situation, which includes background links.

2:35 PM Eastern 9/25/2013
ATOMIC POWER REVIEW

Read More

NRC Finds Flaws in Mitsubishi RSG Design for San Onofre

Those of us watching the San Onofre situation closely have been waiting for a good, solid hint, one way or the other as to which way the continuing situation between SCE and Mitsubishi would play out.  The matters covered in the release below may constitute a significant, if early, hint.

---------

(Press release from SCE, Sunday evening 9/22)

Media Contact: Media Relations, (626) 302-2255

SCE Announces that Nuclear Regulatory Commission Finds Flaws in Mitsubishi Heavy Industries’ Design that Led to Failed Steam Generators at San Onofre

ROSEMEAD, Calif., Sept. 22, 2013 — The Nuclear Regulatory Commission (NRC) has confirmed to Southern California Edison (SCE) that the NRC has identified flaws in how Mitsubishi Heavy Industries (MHI) used its computer codes to design the failed steam generators at the San Onofre Nuclear Generating Station (SONGS). The NRC further informed Southern California Edison that it is issuing a “Notice of Non-Conformance” against MHI for its flawed computer modeling in the failed design. The NRC is also citing SCE for failing to ensure that MHI’s modeling and analysis were adequate.

In particular, the NRC reports indicate that MHI’s use of its computer codes in the design of the steam generators inaccurately predicted thermal hydraulic conditions in the steam generators, leading to tube vibration and wear, and a steam generator tube leak. The NRC also found that MHI embedded the same computer modeling error in the design of steam generators at four other nuclear plants, although none developed the fluid elastic instability that caused San Onofre to shut down. The NRC inspection findings reinforce an NRC Augmented Inspection Team report a year ago that identified MHI’s computer modeling errors. The San Onofre units were permanently shut down in June.

Pete Dietrich, SCE senior vice president and chief nuclear officer, said it is not unusual for the NRC to cite the licensed operator of the nuclear plant as a responsible party even when problems are created by a vendor or contractor, and that SCE takes its licensee oversight responsibilities seriously. The NRC’s decision to also directly cite MHI reflects the fact that MHI created the flawed design and also failed to properly perform the verification and checking that SCE hired MHI to do.

“Mitsubishi designed the system. Mitsubishi built the system. Mitsubishi’s system failed. They are the experts. SCE was the customer,” Dietrich said.

“SCE is responsible for the safe operation of San Onofre and will continue to make safety our top priority as the plant is decommissioned,” Dietrich added. “MHI is accountable for its failure to provide properly functioning steam generators.”

Dietrich said SCE relied upon MHI, the qualified vendor authorized to design, manufacture and test the steam generators in accordance with American Society of Mechanical Engineers Code requirements, to meet specifications. Dietrich added that during the design of the steam generators, SCE appropriately questioned MHI about its design and use of computer models on multiple occasions. MHI repeatedly reassured SCE that its design and models were correct.

In its letter to SCE, the NRC also noted that MHI hired consultants with expertise in designing large steam generators, but that MHI did not rigorously evaluate their concerns about MHI’s computer modeling.

No financial penalties were imposed by the NRC.

On July 18, SCE served MHI with a Notice of Dispute http://www.songscommunity.com/docs/noticeofdispute.pdf for breach of contract and warranty for supplying defective steam generators that resulted in the permanent closure of San Onofre. The notice details MHI’s failures in designing the steam generators.

SCE announced June 7 that it would permanently shut down San Onofre Units 2 and 3, and begin the process to decommission the facility.

SCE has provided an online Digital Document Library containing thousands of pages of primary documents about the history of the design and testing of the Replacement Steam Generators, and a summary of design review minutes at http://www.songscommunity.com.

For more information about SCE, follow us on Twitter and on Facebook.

About Southern California Edison
An Edison International (NYSE:EIX) company, Southern California Edison is one of the nation’s largest electric utilities, serving a population of nearly 14 million via 4.9 million customer accounts in a 50,000-square-mile service area within Central, Coastal and Southern California.

----------

BACKGROUND LINKS  (for further information)

SCE:  Rates not impacted by San Onofre (APR Sept. 8)

SCE Releases San Onofre documents (APR Sept. 7)

MHI Document Release by NRC, and evisceration of the claims by Boxer / Markey that "SCE and MHI knew the steam generators were bad."  My analysis of just the MHI documents, an injection of reality, and proof that Boxer and Markey have no idea what they're talking about.  Also contains many further informative links on steam generator design and testing (these are past APR articles as well.)

7:45 PM Eastern 9/22/2013
ATOMIC POWER REVIEW

Read More