New Jersey Clean Air Council Public Hearing April 1, 2009

1. New Jersey Clean Air CouncilPublic HearingApril 1, 2009 Jeff Halfinger Babcock & Wilcox

2. A Shifting Landscape Increasing construction cost and schedule Skilled field craft labor NSSS component supply chain Tightening capital markets Government loan-guarantees Capital cost and funding access Changing geo-political environment Carbon-constrained regulatory framework Fossil-fueled power generation costs Energy independence and security

3. Modular reactors are NOT:

4. Modular Reactors are NOT:

5. NSSSsupply chain Improved Construction Schedule ProjectFinancing Design & Licensing Risk Base Load Impact Cost Efficiency The Drivers Behind a Modular Reactor 1000 125 10 MWe Real-world issues are shaping the optimal size.

6. Solution: B&W’s mPowerTM Reactor Modular Approach Flexible and scalable to customer requirements }Integrated reactor modules }Multi-unit (1-10+) plant }100 percent shop manufactured }Rail-shippable Reduced licensing risk, construction cost, & schedule }Evolved PWR-type concepts }Passive safety }No on-site NSSS construction }Three years to start-up Integrated and simplified NSSS with fewer components }Internal helical coil SG }No need for safety-grade backup power }No external pressurizer }Conventional core and standard fuel Simplified operations and maintenance }Four plus-year core design }Sequential partial-plant outages }Standardized BOP Lower risk and cost solution…

7. 125 Mwe integral reactor Internal steam generator Standard PWR fuel Large primary coolant inventory SA508 RPV with SS clad Small penetrations into Primary Coolant System at TOP of RPV Diverse, redundant internal CRDMs No boron in primary coolant B&W’s mPowerReactor Steam Outlet Steam Generator Internal CRDM Feedwater Inlet Reactor Primary Circulation Circulators Nuclear Core

8. B&W’s mPowerReactor Features Underground containment Used fuel stored in spent fuel pool for life Natural circulation decay heat removal system for emergency/refueling cooling Primary coolant treatment system within containment Steam generator inspection within containment Decay heat removal heat sink Module Spent fuel pool Pressure Suppression Independent, self contained modules

9. The B&W mPower Plant Design Features Prefabricated components, Streamlined construction NSSS Steam turbine Control room containment Limited Module Interaction Independent controls “Local” responses minimizes interaction Underground reactor building, Enhanced safety Missile penetrations Seismic advantages Non-proliferation support Reliable Sequential outages Minimize options, Cost effective Condenser cooling (air or water) Seismic design (2 zones?) Number of modules

10. Compact footprint • Self-contained • Location flexibility 500 MWe Plant Using 125 MWe Modules 1900 Ft 1550 Ft

11. Adaptability to Government Installations • Small compact standardized design • Passively safe • Scalable • Long refueling cycle • 5+ years at <5% enriched U235 • ~10 years at <10% enriched U235 • Built in the USA • Heavy forgings from Lehigh Heavy Forge • Component fabrication at B&W’s Mt. Vernon, Indiana facility • Fuel fabrication at B&W’s Lynchburg, VA facility • Modular construction techniques • Transportable size

12. Adaptability to Government Installations • Potential for Co-Generation • Steam • Desalination • Electrolysis for hydrogen and oxygen production • Fischer-Tropsch? • Sell Excess Electricity to Secondary Market

13. Public-Private Partnerships • To be Successful Program Must: • Select appropriate sites for reactor deployments • Critical missions • Strategic offensive and defensive capabilities • High energy costs and usage • Production tax credits and loan guarantees could make nuclear power more competitive at more sites • Develop a long-term land lease agreement (EUL?) • Win-Win arrangement for Air Force and commercial developer • Develop a long-term power purchase agreement • Mechanism for third-party financing • Minimizes market risks for initial units

14. B&W Supply Chain of Proven Technology • Domestic Forgings or Rolled Plate • Component fabrication • B&W’s Mt. Vernon, Indiana facility • Fuel fabrication • B&W’s Lynchburg, VA facility • Control rod drive fabrication • B&W’s Euclid facility • Modular construction capabilities • McDermott’s Morgan City Mt. Vernon, IN Lynchburg, VA Vertical Integration within B&W Mt. Vernon, IN

15. First Plant Deployment Concept Definition Define Functional Requirements NRC review paces project implementation Preliminary Design Latest submittal Prepare DCD NRC Review Final Design Prepare COL Application NRC Review Long-Lead Procurement Construction ITAAC 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

16. B&W mPower Benefits Sized to customer requirements Competitive cost Reduced risk – minimum site work and supply chain Shorter schedule – three-year construction Proven approach – evolved PWR technology Optimized O&M – four plus-year refuel cycle with partial outages Improved safety, safeguards, and security