Exelon Picks Hitachi Reactor for Planned Texas Plant (Update1)

By Jim Polson

March 26 (Bloomberg) -- Exelon Corp., the biggest U.S. operator of U.S. nuclear power plants, switched to Hitachi Ltd.’s advanced boiling water reactors for a planned nuclear power plant in Texas to enhance its chances of getting federal loan guarantees for the project.

An initial design agreement with Tokyo-based Hitachi for the planned twin-unit plant in Victoria County was reached in recent days, Exelon spokesman Craig Nesbit said today in an interview. Exelon amended its loan-guarantee application with the U.S. Department of Energy to reflect the change, he said.

Exelon in November abandoned plans to use a design for an Economic Simplified Boiling Water Reactor developed by a joint venture of Hitachi and General Electric Co. because it wasn’t certified by the Nuclear Regulatory Commission. Hitachi’s advanced boiling water reactor is certified, making it more likely the project will get loan guarantees from the Energy Department, Nesbit said.

“Loan guarantees are critical to the project,” Nesbit said. Exelon, based in Chicago, also will revise its license application with the Nuclear Regulatory Commission to incorporate the different design, he said.

The Energy Department last week issued its first loan guarantee, to a company building a solar-panel manufacturing plant. Loan guarantees for nuclear plants will “probably follow a little later in the process,” Stephanie Mueller, spokeswoman for the department, said in a telephone interview.

Companies have asked for a total of $122 billion in loan guarantees to support construction of 21 nuclear reactors. The program has $18.5 billion in guarantees available.

General Electric, based in Fairfield, Connecticut, was the original designer of Hitachi’s advanced boiling water reactor, and Exelon expects it to have a role in the Texas project, Nesbit said.

The agreement with Hitachi was reported earlier today by Dow Jones Newswires.

To contact the reporter on this story: Jim Polson in New York at jpolson@bloomberg.net.

Last Updated: March 26, 2009 12:01 EDT