President of Russia Vladimir Putin: Mr Kiriyenko, I have the usual questions: what is the situation in the sector, how is your work going, and how is work with our partners abroad going?
CEO of Rosatom State Atomic Energy Corporation Sergei Kiriyenko: We have several major achievements as far as work in Russia goes, in particular, the launch of new facilities. We had a key event this summer that was a first not only for our nuclear energy sector but for the world in general — the launch of a new unit at the Novovoronezh nuclear power plant. This is the world’s first generation 3+ power unit. There was much discussion of the ‘post-Fukushima’ requirements following the events at Fukushima. There were many projects, and construction has begun in many places, but it was Russia that completed the first new generation power unit. Overall, this confirms our leadership in the sector.
This is important for us as a benchmark power unit, of course. We are building units of the same type and design in Belarus, Hungary, Egypt and Bangladesh. We have completed this first project and we now have people coming on a pilgrimage as it were, foreign delegations asking to let them take a look at the new face of nuclear energy.
The second important event in Russia was that the BN-800 sodium-cooled fast breeder reactor in Sverdlovsk Region is now working at full capacity. This is a new generation reactor to appear on the commercial market somewhere around the end of 2020, we think. This is the next step in fast breeder technology. Russia is the absolute leader in this sector. We operated the BN-600 reactor with success for more than 30 years, and now we have the BN-800, which is the most advanced reactor in the world. As it is a fast breeder reactor, it uses uranium isotope U-238, which is 100 times more abundant in nature and leaves us with less waste at the end. In other words, this is a much safer and cleaner technology. Here again, Russia was the first to make this a reality.
As for the situation abroad, Mr President, as you may remember, you and the Indian Prime Minister inaugurated the first power unit at the Kudankulam nuclear power station on August 10. The Indian Prime Minister asked us on that occasion to speed up the launch of the second power unit. I can report now that the second unit came on line on August 29 and is now gaining capacity. We are now working actively on the third and fourth units. We have just settled the details with our Indian partners and will be ready this autumn to sign an agreement to build the fifth and sixth units.
They are happy with the product and this seems to have prompted them to want to take the project further. The power unit’s technical characteristics are better than what was in the contract. It was a case of us delivering more than we promised. The unit’s efficiency is 2.5 percent higher than what was set out in the contract, capacity is 2.5 percent higher, and the availability factor is 8 percent higher.
Vladimir Putin: Is the price the same as before?
Sergei Kiriyenko: Concerning the price, we met our obligations, but this first unit we built there was much better than originally promised. This is important for our other projects in third countries. Everybody was watching the implementation of this project. The fact that the product was better than what we promised is important.
Finally, Mr President, a ceremony took place at Bushehr in Iran on September 10, the groundbreaking ceremony for the second and third power units. The first unit, overall, was not a straightforward project.
Vladimir Putin: It had to be redone.
Sergei Kiriyenko: No one in the world had undertaken such a project. The Germans started building the first unit 30 years ago but then abandoned it. When we took on the commitment to complete it, it had a hole in the roof from a direct missile hit. We rebuilt and completed the unit and won ourselves great trust from our partners in Iran and other countries. We have now signed a framework agreement to build a series of reactors in Iran.
We had a ground-breaking ceremony on September 10 in Bushehr for the second and third units, and then work will shift to another site. In other words, the Bushehr power plant will have three or four units, and then work will continue at another site in Iran. The Iranians have already said the first unit at Bushehr has already saved them 27 million barrels of oil and that each unit will save them 11 million barrels a year. They think the project has already paid itself off and is now generating revenue.
We are also building up a good pace in service and maintenance work. It is important to build new power plants, of course, but we built a large number of plants around the world during the Soviet period, so we set the objective of increasing the services we provide for these facilities. This is bringing in good revenue. The volume of services we provide in this area has increased by around 74 percent, from 17 power units to 24. This year, we want to bring the number of power plants we service to 34. Most important is that this is a long-term job.
We are signing new contracts now not only for construction, but for the whole life cycle, including services, operation, and fuel supplies. In terms of the revenue this generates for Russian industry, this is even greater than the cost of building power units. A power plant will work for at least 60 years. We provide contractual guarantees of 60 years for the new power units we are building, but we know that in reality, they will work for at least 80 years.
Then there are our additional export products, primarily isotope products. Sales here have had a 2.5-fold increase.
Vladimir Putin: Products for use in medicine?
Sergei Kiriyenko: Primarily for use in medicine, also in material studies and scientific research. We export to a wide range of countries. Australia and Europe are among our traditional markets. We have started exporting to Brazil, Argentina, Vietnam, Indonesia, Malaysia, even Japan. Our exports are increasing every year and this is good for revenue and also for giving our institutes work.
We are moving further now. We began with isotopes but are now moving into radiopharmaceuticals. As you heard at the meeting in Tula, a complete technological chain of Russian-made medical equipment is in place now. Our objective was to supply not only isotopes or produce radiopharmaceutical products, but to ensure the entire range of Russian-made medical equipment as well.
Vladimir Putin: The resulting equipment is good, modern and very promising.
Sergei Kiriyenko: Yes, the technical characteristics are just as good as and sometimes even better than those of foreign equivalents, and the cost is at least twice lower.