Nuclear Plant in N.J. on Alert as Sandy Tests Industry


Nuclear Plant in N.J. on Alert as Sandy Tests Industry

By Kasia Klimasinska, Mark Drajem and Christine Harvey – Oct 30, 2012

Hurricane Sandy forced three nuclear power plants to shut and put another on alert as federal regulators dispatched inspectors to monitor 11 facilities in the path of the storm, the biggest test for the U.S. industry since a crisis in Japan more than 18 months ago.

Public Service Enterprise Group Inc. (PEG) manually closed its 1,174-megawatt Salem Unit 1, about 18 miles south of Wilmington, Delaware, when four of six circulating pumps were no longer available because of weather, according to Joe Delmar, a company spokesman. The unit operated at full power yesterday, while unit 2 was shut for refueling.

“The biggest challenge for us overnight was waves hitting the circulating water systems at both stations,” Delmar said in an e-mail response to questions. There was also “lots of river grass and debris,” he said.

Sandy, the biggest Atlantic Ocean tropical storm on record, moved along the East Coast for five days before slamming into the mid-Atlantic coast yesterday, unlike the earthquake and tsunami in March 2011 that crippled Japan’s Fukushima Dai-Ichi plant. Still, Sandy may disturb intake of water for cooling or sever plants’ links to external power.

Nine Mile Point in Scriba, New York, was automatically shut down after a power disruption to a switchyard, the U.S. Nuclear Regulatory Commission said. Entergy Corp.’s Indian Point 3 nuclear plant in New York also automatically closed at 10:41 p.m. yesterday because of power-grid issues from the storm, Neil Sheehan, an NRC spokesman based in King of Prussian, Pennsylvania, said today in an e-mail.

Oyster Creek

The nation’s oldest nuclear plant, Exelon Corp. (EXC)’s Oyster Creek facility in New Jersey, declared an alert last night due to elevated levels of water in its water-intake structure, according to a statement from the NRC. The plant, about 33 miles (53 kilometers) north of Atlantic City and near the center of the storm’s landfall, was already offline for a refueling outage.

“Nuclear plant operators throughout the region had their hands full dealing with this historic storm. While three reactors experienced shutdowns, all are in a safe condition,” Sheehan said in the e-mail. “Inspectors were on duty throughout the storm to keep a close watch on plant conditions and will continue to do so as work on restoring the units to service” begins.

Public Safety

Exelon said last night there was “no challenge to plant safety equipment and no threat to the public health or safety,” according to an e-mailed statement. “Exelon has staffed on-site and off-site emergency operations centers to monitor weather and plant conditions and to provide updated information to local, state and federal officials.”

Exelon said the alert was declared when water rose above 6 feet (1.8 meters) above sea level, the threshold for an alert — the second-lowest of four levels of emergency declaration. A disruption was also reported at the plant’s switchyard, which delivers power to the plant, though diesel generators kicked in automatically.

Oyster Creek began operating in December 1969 as the nation’s first large-scale commercial nuclear power plant. The company announced in 2010 plans to close it by the end of 2019, when it will have been in operation 50 years. Its single boiling-water reactor produces 645 net megawatts, enough electricity to power 600,000 homes.

‘Breadth, Intensity’

On its website, the Chicago-based company called Oyster Creek “a robust and fortified facility, capable of withstanding the most severe weather.” Earlier yesterday, Exelon said it repositioned emergency gear, activated back-up communications and boosted staffing at its three Pennsylvania plants in the path of the storm: Limerick, Peach Bottom and Three Mile Island.

Entergy Corp. (ETR)’s Indian Point 3 nuclear plant in New York automatically shut down at 10:41 p.m. yesterday because of power grid issues from the storm, Sheehan said today in an e-mail.

Constellation Energy Group Inc.’s Nine Mile Point 1 reactor in the state was also shut because of a problem putting power onto the grid, Reuters reported, citing an unidentified NRC spokesman. It wasn’t clear if the outage was related to Sandy, Reuters said, citing the NRC. Nobody answered calls to the press offices of Constellation or the NRC.

NRC Inspectors

The Washington-based NRC sent inspectors armed with satellite phones to facilities from Maryland to Connecticut and said all plants remain in a safe condition. Procedures require plants to shut before winds are forecast to exceed hurricane force, the commission said in a statement yesterday.

“Given the breadth and intensity of this historic storm, the NRC is keeping a close watch on all of the nuclear power plants that could be impacted,” NRC Chairman Allison Macfarlane said in an e-mailed statement. “Our extra inspectors sent to the potentially affected sites will continue, on an around-the- clock basis, to independently verify that the safety of these plants is maintained until the storm has passed and afterwards.”

Analysts said loss of outside power, which is necessary to keep nuclear cores and spent fuel cool, would test adjustments being made at the plants after an earthquake-triggered tsunami led to radiation releases at the Fukushima Dai-Ichi plant in 2011. The Tokyo Electric Power Co. (9501) plant lost off-site power and backup generators failed after the earthquake.

Nature’s Power

Just as with Fukushima, plant owners “look back to see what flooding heights, wind speeds, etc. have occurred at the site and design their plants to survive repeats,” Dave Lochbaum, director of the Nuclear Safety Project at the Union of Concerned Scientists, said in an e-mail. “But when nature reaches new levels, as at Fukushima, past protections may be insufficient.”

“Designing by rear-view mirror works when nature cooperates and stays consistent with the past,” he said.

U.S. nuclear plants are well-equipped to handle the threats from Sandy, said Arthur Motta, chairman of the Nuclear Engineering Program atPennsylvania State University. “In terms of comparative risks, a nuclear power plant is safer than most of the other things nearby,” he said in an interview.

Plants in the path of the storm included Indian Point and Calvert Cliffs in Maryland, owned by Constellation Energy Nuclear Group LLC, a joint venture of Exelon and Electricite de France SA in Paris.

Flood Protection

“All plants have flood protection above the predicted storm surge, and key components and systems are housed in watertight buildings capable of withstanding hurricane-force winds and flooding,” the NRC said.

At Indian Point, debris in the Hudson River, which could disturb water-intake, poses a greater risk than flooding, Sheehan said in an interview. All the plants in the storm’s path were told to examine their vicinity for large objects that could become “airborne missiles” in high winds, he said.

Given the threat of loss of power, “it would be more responsible if NRC and plant operators would shut the plants down in advance,” Kevin Kamps, a radioactive waste specialist at Beyond Nuclear, a Takoma Park, Maryland, group that seeks to end nuclear power and nuclear weapons, said in an interview.

It takes longer to cool down the radioactive core at a plant operating at full power, he said.

“In terms of reactors, you had better hope those diesel generators work adequately,” Kamps said.

Backup Generators

Backup diesel generators and cooling systems at Fukushima failed after a 15-meter surge of water tied to a 9-magnitude undersea earthquake on March 11, 2011, led to the worst nuclear disaster since Chernobyl in 1986. Hydrogen explosions occurred as water in the reactors and spent-fuel ponds boiled away and radiation leaked.

Motta, a member of a National Academy of Sciences panel on U.S. nuclear safety, disagreed and said shutting the plants now wouldn’t make much of a difference.

Hurricane Sandy crossed the New Jersey coast south of Atlantic City. With winds extending 1,100 miles, the storm shut the federal government in Washington and state offices from Virginia to Massachusetts. It halted travel, prevented U.S. stock markets from opening and upended the presidential campaign.

To contact the reporters on this story: Kasia Klimasinska in Washington at; Mark Drajem in Washington; Christine Harvey in New York at

To contact the editor responsible for this story: Jon Morgan at

Copper Declines on Concern Global Stimulus Won’t Revive Growth


By Jae Hur – Sep 26, 2012

Copper dropped on concern that stimulus measures announced by central banks from the U.S. to Japan, won’t be enough to bolster global economic growth, curbing demand prospects for industrial metals.

Copper for delivery in three months lost as much as 1.1 percent to $8,185 a metric ton on the London Metal Exchange and traded at $8,200 at 4:15 p.m. in Tokyo. The metal is up 7.7 percent this month, the most since January. December-delivery metal lost 0.6 percent to $3.7375 a pound on the Comex.

Federal Reserve Bank of Philadelphia President Charles Plosser said yesterday that more bond purchases by the U.S. central bank probably won’t boost growth. Japan’s biggest manufacturers grew more pessimistic this quarter as China’s slowdown and Europe’s debt crisis sapped exports, according to a Bloomberg survey ahead of a data release next week.

“I expect copper to trend lower in the next couple of weeks,” said Zhang Tianfeng, an analyst at Dongxing Futures Co. “There’s no improvement in the physical market.”

The Fed announced a third round of stimulus on Sept. 13, and the Bank of Japan said last week it will add to a fund that buys assets. Copper inventories at bonded warehouses in Shanghai have probably risen to a record 650,000 tons, according to a Bloomberg survey of traders, analysts and warehouse managers.

The Bank of Japan’s Tankan survey will show Oct. 1 that business confidence fell to -4, the fourth quarter pessimists outnumbered optimists, according to the median of 12 estimates in the survey. That would mark the longest string of negative readings since Japan emerged from the global recession in 2010.

January-delivery copper closed little changed at 59,150 yuan ($9,381) a ton on the Shanghai Futures Exchange, set for a quarterly advance. Financial markets in China, the biggest consumer, will be closed next week for the National Day holiday.

On the LME, aluminum, tin, zinc, nickel and lead declined.

To contact the reporter on this story: Jae Hur in Tokyo at

To contact the editor responsible for this story: James Poole at

Copper Bears Rise to Eight-Month High as Hedge Funds Bet on Drop


By Nicholas Larkin – Jun 1, 2012

Copper traders are the most bearish since September and hedge funds are betting on price declines as concern that Europe’s debt crisis is deepening drove the metal to the lowest this year.

Eighteen of 33 analysts surveyed by Bloomberg expect the metal to drop next week and six were neutral, the highest proportion since Sept. 23.Fund managers and other speculators held a net short position of 2,808 U.S. futures and options in the week ended May 22, from net-long holdings of 4,833 a week earlier, Commodity Futures Trading Commission data show. That’s the first bearish bet since January.

The metal slid the most since September in May as concern about Greece’s future in the euro and spreading of the region’s crisis grew. Economic confidence in the euro area dropped to the lowest in 2 1/2 years in May and consumer confidence fell to a four-month low in the U.S., data showed this week, while Chinese industrial companies’ profits declined in April. China accounts for about 40 percent of global copper use and Europe 18 percent.

“As long as the debt crisis is still in focus, risk aversion will remain high and copper has the potential to go even lower,” said Daniel Briesemann, an analyst at Commerzbank AG in Frankfurt. “Once we get a hard number that Europe will be in recession, then it might spread out to other regions and therefore globally.”

Copper Slumps

Copper fell 3.1 percent to $7,367.50 a metric ton this year on the London Metal Exchange and slumped 12 percent in May. It slid to $7,356 today, the lowest since Dec. 20. The Standard & Poor’s GSCI gauge of 24 commodities slipped 9.2 percent this year and the MSCI All-Country World Index (MXWD) of equities lost 1.2 percent. Treasuries returned 2.1 percent, a Bank of America Corp. index shows.

About $4.5 trillion was wiped from the value of global equities last month and the dollar climbed to the highest level in almost two years versus the euro as the turmoil in Europe spread. The European Commission challenged Germany’s remedies to the financial crisis on May 30, calling for direct euro-area aid for troubled banks. An opinion poll showed May 30 most Greeks want to see the terms of a financial rescue revised, stoking fears the nation may default and be forced to exit the euro.

While Germany helped the euro area avoid a second recession in three years in the first quarter, the International Monetary Fund predicts the region will contract 0.3 percent this year. An index of executive and consumer sentiment in the 17-nation bloc fell to 90.6 from a revised 92.9 in April, the commission said May 30. The Conference Board’s U.S. consumer index fell to 64.9 last month from a revised 68.7 in April, May 29 data show.

Global Growth

Chinese industrial companies’ earnings declined 2.2 percent from a year earlier, the National Bureau of Statistics said on its website May 27. Still, China’s 8.2 percent growth this year will help the global economy expand 3.5 percent, the IMF estimates. Goldman Sachs Group Inc. still expects Chinese demand to drive copper prices to $9,000 in three months.

Potential production losses may help sustain a supply shortage estimated by Barclays Plc at 158,000 tons this year. BHP Billiton Ltd. and Rio Tinto Group (RIO), the world’s biggest and third-biggest mining companies by sales, said last month they’ll ration capital spending because of costs. Codelco, the largest copper producer, produced 10 percent less metal in the first quarter as ore-grades decreased.

Thirteen of 28 traders and analysts surveyed by Bloomberg said gold would gain next week and five were neutral. Futures on the Comex inNew York fell 1 percent $1,551.30 an ounce since the start of January after climbing the previous 11 years.

“I have a hard time seeing commodity prices recovering in the short term,” said Filip Petersson, an analyst at SEB AB in Stockholm. “Europe is definitely back in a very difficult situation that could spin out of control quickly. The question is if politicians react to that or just try to push the solution into the future again as we have gotten used to.”

Gold survey results: Bullish: 13 Bearish: 10 Hold: 5
Copper survey results: Bullish: 9 Bearish: 18 Hold: 6
Corn survey results: Bullish: 17 Bearish: 10 Hold: 2
Soybean survey results: Bullish: 16 Bearish: 12 Hold: 2
Raw sugar survey results: Bullish: 5 Bearish: 5 Hold: 3
White sugar survey results: Bullish: 5 Bearish: 5 Hold: 3
White sugar premium results: Widen: 6 Narrow: 2 Neutral: 5

To contact the reporter on this story: Nicholas Larkin in London at

To contact the editor responsible for this story: Claudia Carpenter at

Copper Falls to Four-Month Low on Europe, China Growth Concerns


By Joe Richter and Agnieszka Troszkiewicz – May 23, 2012

Copper dropped to a four-month low in New York on concern that slowing growth in China and the risk of Greece leaving the euro signal weaker demand for the metal.

European leaders meeting in Brussels are seeking to keep Greece within the 17-nation monetary union, a day after the Organization for Economic Cooperation and Development said the crisis could spiral and damage the world economy. Growth in China, the world biggest copper user, will slow to 8.2 percent this year from 9.2 percent in 2011, the World Bank said.

“Given this gloomy backdrop, we expect that markets will continue to be on the defensive for much of this week, at least until we see more specifics coming out from the EU policy meeting,” Edward Meir, an analyst at INTL FCStone in New York, said in a report.

Copper futures for July delivery slid 2.6 percent to settle at $3.396 a pound at 1:19 p.m. on the Comex in New York. Earlier, the metal touched $3.3865, the lowest since Jan. 9.

The Chinese economy may have the worst growth in more than two decades if Greece abandons the euro, economists at investment bank China International Capital Corp. said in an e- mailed report today.

The Standard & Poor’s GSCI Spot Index, which tracks 24 raw materials, fell as much as 2.3 percent to the lowest level this year. It dropped 0.9 percent yesterday as the dollar rallied on demand for a haven.

Inventories Rise

Copper inventories monitored by the London Metal Exchange rose for the fourth time in five sessions to 225,700 metric tons, daily exchange figures showed.

On the LME, copper for delivery in three months fell 2.7 percent to $7,531 a ton ($3.42 a pound).

Aluminum for three-month delivery on the LME declined 1 percent to $2,009 a ton. Orders to draw the lightweight metal from warehouses climbed to 1.73 million tons, the highest level since at least 1997.

Zinc, lead, nickel and tin were also lower in London.

To contact the reporters on this story: Joe Richter in New York at; Agnieszka Troszkiewicz in London

To contact the editor responsible for this story: Steve Stroth at

China Slowdown to End in Third Quarter, Survey Shows


By Bloomberg News – May 17, 2012

China’s economic growth is likely to accelerate for the first time in seven quarters after banks’ reserve requirements were cut, buoying global expansion threatened by Greece’s possible exit from the euro.

Third-quarter growth will rebound to 8.3 percent from 7.9 percent this quarter, according to the median estimate of 21 economists surveyed by Bloomberg News. Analysts forecast a further reduction of 100 basis points in reserve ratios this year, while a majority of respondents expect benchmark lending and deposit rates to be unchanged.

The forecasts reflect optimism that the ruling Communist Party has enough monetary and fiscal firepower to support the world’s second-biggest economy as leaders prepare for a once-a- decade power handover later this year. Even with the pickup next quarter, annual growth is forecast at a 13-year low after reports showed April industrial production and trade grew less than forecast and renewed European debt turmoil roiled markets.

“The recent spate of poor data should convince the authorities to take additional measures to prevent a further slowdown in the run-up to the Party Congress later this year,” said Ding Shuang, senior China economist at Citigroup Inc. in Hong Kong, who previously worked for theInternational Monetary Fund and China’s central bank.

Authorities on May 12 cut the reserve ratio for the third time in six months following two days of weaker-than-forecast economic data. Government tools to boost expansion include lowering reserve requirements, giving banks more leeway on their own to reduce lending costs, increasing fiscal stimulus and relaxing deposit-to-loan ratio rules, said economists including Ding.

Lower Lending Rates

“There is room for lending rates to come down without a cut of the benchmark rate,” Ding said. Six of 10 economists in a separate Bloomberg survey that ended this month said regulators will permit banks to set lower interest rates by the end of this year.

Separately, China said yesterday it will allocate 26.5 billion yuan ($4.2 billion) in subsidies to promote the use of energy-saving household appliances and products, replacing a consumption-incentive program that ended last year.

The Communist Party is scheduled to hand power to a new generation of officials later this year in the aftermath of the ouster of Chongqing party boss Bo Xilai, which triggered the deepest political tensions since 1989.

Slowest Since 1999

Gross domestic product will probably expand 8.2 percent this year, according to the median forecast of 22 economists in the survey conducted May 14-15. That would be the slowest pace since 7.6 percent in 1999, following 9.2 percent in 2011.

The Chinese Academy of Social Sciences, a government researcher, today projected growth of 8.7 percent this year, the official Xinhua News Agency reported. That’s higher than all Bloomberg survey estimates, which ranged from 7.9 percent to 8.5 percent.

Citigroup, JPMorgan Chase & Co., Bank of America Corp. and UBS AG were among banks to pare their forecasts for China’s expansion following last week’s data, which included the weakest industrial production growth in three years.

Lu Ting, head of Greater China economics at Bank of America in Hong Kong, wrote to clients on May 11 that “we were wrong” about growth picking up in the second quarter as he reduced a forecast for the period to 7.6 percent from 8.5 percent. He predicts the expansion will be 8 percent in the third quarter. Industrial production will speed up this month or next because of policy easing, Lu said separately.

Interest-Rate Cut

Not everyone is certain of a rebound. Joy Yang, chief economist for Greater China at Mirae Asset Securities (HK) Ltd. in Hong Kong, said further deceleration over the next two months is likely to trigger an interest-rate cut in July.

A rising risk of default by Greece will threaten additional turmoil, said Yang, who previously worked for the IMF.

Greece’s future in the euro has been thrown into doubt by a political standoff that has forced the president to call for new elections. German Finance Minister Wolfgang Schaeuble called the next vote a referendum on whether Greece exits the euro, a move that would leave lenders to its government, businesses and households unsure of recouping their money.

A report today showed Japan’s economy expanded faster than forecast in the first quarter, boosted by reconstruction spending that’s poised to fade just as a worsening in Europe’s crisis threatens to curtail export demand.

Singapore also reported an acceleration in growth last quarter, while warning about the risk of a disorderly European debt default. Malaysia’s central bank chief saw possible “catastrophic” consequences for Europe and South Korea said it has enough currency reserves to weather the storm.

‘Expensive’ Exit

IMF Managing Director Christine Lagarde said a Greek exit from the euro area would be “extremely expensive” and hard.

There are some signs China’s downturn isn’t over. The benchmark Shanghai Composite Index fell 1.2 percent yesterday, the fourth straight drop, while yuan forwards had the biggest decline in two months, touching the weakest level this year. The stock index rebounded 1.4 percent today at 2:59 p.m. local time.

China’s four biggest banks, including China Construction Bank Corp., had almost zero net new lending in the two weeks ended May 13, Shanghai Securities News reported yesterday, citing unidentified people familiar with the matter. Yuan deposits at all Chinese banks fell by 465.6 billion yuan in April from the prior month.

The latest reserve-ratio cut lowers the level to 20 percent for the largest banks, effective May 18. Eight of 20 economists forecast another reduction of 50 basis points this month or next; all see at least one by the end of the third quarter. Fourteen expect at least 100 basis points of additional cuts in 2012.

Bull Market

The more-vigorous pace of policy easing is pushing Chinese stocks into a bull market, Morgan Stanley said, as inflation is brought under control and the property market stabilizes. The “bear phase” for equities is over, Hong Kong-based analysts led by Jonathan Garner, chief Asiaand emerging-market strategist, said in a report dated yesterday.

“With enhanced stimulus from Beijing, the economy should gradually recover in the second half,” said Li Wei, a Shanghai- based economist at Standard Chartered Plc, which has the most- aggressive reserve-ratio forecast at 150 basis points of additional cuts through September.

To contact Bloomberg News staff for this story: Zheng Lifei in Beijing at; Ailing Tan in Singapore

To contact the editor responsible for this story: Paul Panckhurst at

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