Despite its bankruptcy, Westinghouse Electric Co. won a $450 million contract from the Tennessee Valley Authority on Thursday to fabricate nuclear fuel through 2030.
TVA directors agreed to use Westinghouse for the fuel fabrication after TVA Executive Vice President Joe Grimes told the board that TVA will obtain appropriate credit assurances before any contract with Westinghouse is signed. Westinghouse was the low bidder for the contract, which has a proposed term of 14 years.
Grimes said Westinghouse has a proven technology for the two Westinghouse-designed plants TVA operates in Tennessee — the Sequoyah Nuclear Power Plant near Soddy-Daisy and the Watts Bar Nuclear Plant near Spring City, Tenn. Grimes said TVA will obtain adequate protections to ensure that it will get ongoing fuel supplies at contract prices from either Westinghouse or its successors.
Westinghouse, a subsidiary of the Japanese-based Toshiba, filed a Chapter 11 bankruptcy petition in March after projecting it could lose up to $10 billion from costly problems at the nuclear plants it is building in Georgia and South Carolina.
The fiscal problems for Westinghouse related entirely to its construction operations, and not its fuel or services businesses, TVA President Bill Johnson said.
"Fuel and services are very robust and viable enterprises, and Westinghouse probably provides 70 percent of the fuel fabrication for pressurized water reactors in the United States," Johnson said. "In any event, that business is either going to be spun off or repackaged and stay in business."
Johnson said Westinghouse prices "were very good" and won't push up any rates or costs for nuclear power in the future.
The TVA board also approved a contract Thursday with Louisiana Energy Services, a supplier of uranium used in making fuel, valued at $500 million through 2030.
In addition, the board authorized the CEO to enter into contracts for work to convert all wet storage of coal ash to dry storage and meet the environmental standards for water quality and effluents at TVA's coal plants that previously used coal ash ponds. The combined value of the contracts is capped at $1.9 billion.
Contact Dave Flessner at email@example.com or at 423-757-6340.