Westinghouse CEO makes global push as market shifts
Danny Roderick spent four days last week in the Czech Republic to nudge his company, Westinghouse Electric Co., closer to winning a potential $10 billion contract to build two nuclear reactors there.
The outcome is important to the Cranberry-based company's growth in the nuclear power business and employment levels. Such long-term mega projects don't come around often and account for 20 percent of Westinghouse revenue.
“We're working very hard in international markets to bring in one of those orders,” Roderick said in a recent interview. “It's still going to be a few years before anything new breaks in the United States.”
A veteran utilities executive who took the helm of Westinghouse six months ago, Roderick is “tweaking” its strategy to meet a shifting market for nuclear power.
In addition to pressing harder in places such as the Czech Republic and China to build Westinghouse AP1000 reactors, Westinghouse is leveraging its nuclear technology to provide more services to utilities.
The company is tweaking its 13,300-person global work force. It eliminated 650 jobs worldwide in the past month, or about 5 percent of total employment.
Roderick would not say how many of those cutbacks are in Western Pennsylvania, where it employs about 6,000 people. That includes 4,300 workers in Cranberry, and the balance at sites in Madison, New Stanton, Blairsville and Churchill.
“We have to be realists about where the economy is and where the market is to make sure Westinghouse is positioned for growth, whether or not we have more new builds” of AP1000 reactors, he said.
Roderick was a senior executive in nuclear plant projects at GE-Hitachi Nuclear Energy from 2008 until last year. From 1996 to 2008, he was a site operations director and plant manager in Florida for Progress Energy. While with the utility, Roderick ordered two AP1000 reactors not yet built.
Westinghouse went on a hiring spree about five years ago, adding 5,000 people globally in anticipation of building AP1000 reactors to meet the growing demand for energy, especially in China.
“The long-term prospects for the nuclear energy industry are good. But these are large projects and they take time to develop,” said James Bodner, co-president of The Cohen Group, a global business consulting firm in Washington.
One AP1000 — a technology Westinghouse developed to create a simpler, safer nuclear reactor — costs about $5 billion and takes several years to build. The global recession, stiffer competition from natural gas plants fed by shale gas, and shaken views about nuclear power safety after a tsunami crippled Japan's Fukushima Dai-Ichi nuclear complex dampened demand for orders.
“I don't know what the magic price for natural gas is to make nuclear competitive, but as long as gas stays below $4 or $5 (per a thousand cubic feet), it's probably not going to be comparatively economic to build new nuclear,” said Christopher Guith, vice president for policy at the U.S. Chamber of Commerce.
Since the March 2011 meltdown at Fukushima, governments in Japan, Germany and France scaled back nuclear power plans. Orders for two AP1000 reactors in North Carolina are on hold, and the supply of two others in Florida is delayed for perhaps a decade.
“We assumed we would have a dozen AP1000s under construction right now, and instead, we have eight,” said Roderick — two reactors in Georgia, two in South Carolina and four in China. That means reducing such jobs as procurement engineers and supply-chain functions not needed when construction drops, he said.
Yet Westinghouse in recent months garnered work servicing and fueling nuclear reactors, and that means adding jobs such as instrumentation and controls experts or safety engineers.
For example, Westinghouse engineers in February introduced a radar-based system to remotely measure water levels in spent nuclear fuel-rod pools. The failure to detect those water levels was a key reason reactors at Fukushima melted down.
Westinghouse was awarded nuclear fuel contracts in Sweden and South Africa in March. Last week, the company began sending its first light-water reactor fuel to France.
Such work put the company on track to post a record $5 billion in revenue for the fiscal year ending March 31, up from $4.8 billion in fiscal 2012. About 60 percent of Westinghouse revenue comes from work outside the United States.
Roderick continues to press for AP1000 builds globally. That includes the Czech Republic contract for which Westinghouse is competing against a Russian consortium.
He is negotiating with China officials to commit to building six AP1000 reactors, beyond the four under way. Such talks take at least four years before construction starts.
About 45 percent of the world's nuclear reactors — and 60 percent of those in the United States — are Westinghouse designs.
Despite the Fukushima catastrophe, most Americans support nuclear power being part of the American energy mix. A Gallup Inc. poll of about 1,000 Americans said 57 percent supported nuclear power in 2012, about the same level as in 2011.
This month, Westinghouse began pouring huge concrete pads for AP1000 reactors in Georgia and South Carolina, the first domestic nuclear power plants to start construction in 30 years.
“We're going to spend about a month watching concrete dry,” Roderick said.
Thomas Olson is a staff writer for Trib Total Media; email@example.com.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- EPA talks on pollution limits trigger protests, arrests Downtown
- 3 things to know about Do Not Call registry
- Software developers aim to ease crush of emails for businesses
- Trib 30 index drops nearly 5%
- French company Iliad bidding for T-Mobile US
- Target replaces interim CEO, names Pepsi’s Cornell
- Vitaminwater goes back to old formula because of outcry
- 1,100 layoffs planned at Alpha coal mines in W.Va.
- SeaWorld, Southwest Airlines to end partnership
- Fast-food scandals in China troubling for industry
- It’s lights out for Bayer sign on Mt. Washington