Westinghouse Electric Company
Westinghouse logo (designed by Paul Rand)
|Private, licensee of Westinghouse Licensing Corporation (Westinghouse Electric Corporation)|
|Predecessor||Westinghouse Electric Corporation|
|Founded||Monroeville, Pennsylvania, U.S. (1999 )|
|Headquarters||Cranberry Township, Butler County, Pennsylvania, U.S.|
|George Westinghouse, (corporate namesake; founder of the original Westinghouse (1886))
José Emeterio Gutiérrez, President and Chief Executive Officer
Number of employees
Fauske & Associates
Westinghouse Electric South Africa
WEC Welding and Machining
Westinghouse Electric Company LLC is a US based nuclear power company formed in 1998 from the nuclear power division of the original Westinghouse Electric Corporation. It offers nuclear products and services to utilities internationally, including nuclear fuel, service and maintenance, instrumentation, control and design of nuclear power plants. Westinghouse's world headquarters are located in the Pittsburgh suburb of Cranberry Township, Pennsylvania. Toshiba Group is the majority owner of Westinghouse.
On March 24, 2017, parent company Toshiba announced that Westinghouse Electric Company would file for Chapter 11 bankruptcy because of US$9 billion of losses from nuclear reactor construction projects. The projects responsible for this loss are mostly the construction of four AP1000 reactors at Vogtle in Georgia and V. C. Summer in South Carolina. Westinghouse filed for Chapter 11 bankruptcy protection on March 29, 2017.
- 1 History
- 2 Association with CBS Corporation
- 3 New generation of reactors
- 4 International business
- 5 Environmental record
- 6 See also
- 7 References
Westinghouse Electric Company was formed in 1999 after the original company with that name, George Westinghouse's Westinghouse Electric, founded in 1886, ceased to exist due to a series of divestitures and mergers through the mid-to-late 1990s. These included Westinghouse Electric's purchase of CBS in 1995, expansion into communications and broadcasting, and the selling off of most non-broadcast operations by 1998; renaming itself CBS Corporation. That same year, the Westinghouse Power Generation Business unit was sold to Siemens, AG of Germany. In 1999 CBS Corporation sold its nuclear business (Westinghouse Electric Company) to British Nuclear Fuels Limited (BNFL). and a year later CBS Corporation was merged into Viacom (1971-2005), thus putting an end to the original Westinghouse. (Legally, Westinghouse Electric Corporation still exists, mainly for the purpose of licensing, as a subsidiary of CBS Corp.)
Sale to Toshiba
In July 2005 BNFL confirmed it planned to sell Westinghouse, then estimated to be worth $2 billion. This attracted interest from several companies, including Toshiba, General Electric and Mitsubishi Heavy Industries. When the Financial Times reported on January 23, 2006 that Toshiba had won the bid, it valued the company's offer at $5bn (£2.8bn). On February 6, 2006 Toshiba confirmed it was buying Westinghouse Electric Company for $5.4bn and announced it would sell a minority stake to investors. The sale surprised many industry experts who questioned the wisdom of BNFL selling one of the world's largest producers of nuclear reactors shortly before the market for nuclear power was expected to grow substantially; China, the United States and the United Kingdom were all expected to invest heavily in nuclear power. After the 2005 Indo-US nuclear deal, there was also hope that India's plan of massive investment in nuclear plants would help to revive the U.S. nuclear power industry. Reasons in favor of a sale were: The commercial risk of the company's business in Asia may have been too high for a company then owned by taxpayers; if Westinghouse won the bid for any new nuclear stations in a UK competition, questions may be raised of favoritism, but if it lost, it might have been seen as a lack of faith in its own technology. Finally, the record of UK governments building nuclear plants had been a commercial disaster.
On October 16, 2006 the acquisition of Westinghouse Electric Company for $5.4 billion was completed, with Toshiba obtaining a 77% share, partners The Shaw Group a 20% share and Ishikawajima-Harima Heavy Industries Co. Ltd. a 3% share. On 13 August 2007 Toshiba sold 10% to Kazatomprom, the national uranium company for the Republic of Kazakhstan, for US$540 million, leaving Toshiba with 67%. Kazatomprom's ownership is entirely passive, with no voting or veto rights or presence on the board of directors.
In September, 2011, Toshiba was reported to be in talks to acquire the Shaw stake and both companies confirmed the story soon thereafter. Shaw CEO James Bernhard said[when?], that Toshiba was paying US$1.6 Bn for the Shaw-owned 20% stake, and that it was the 50% rise in the yen on its yen-denominated debt over five years, which had led it to exercise its sale option. Toshiba said[when?] it was open to, and considering, having other partners invest in the business. The purchase closed in January 2013, and brought Toshiba's share in the company to 87%.
Move to Cranberry Township, Pennsylvania
After several years of doing business there, Westinghouse decided to move its world headquarters from the Energy Center in Monroeville, Pennsylvania, to Cranberry Woods in Cranberry Township, Butler County, Pennsylvania, as reported in a 2007 memo to its employees that stated the main reason was the rapid expansion of the global nuclear industry. Construction began in July 2007, the move lasted from June 2009 to December 2010. The Repair, Replacement and Automation Services (RRAS) business segment moved to Cranberry Township earlier than other business segments to help alleviate space issues at the headquarters in Monroeville and was completed in spring of 2008. As part of this move, Westinghouse piloted the first commuter shuttle running an all-day loop between Monroeville and Cranberry Township. The shuttle ceased operation after Westinghouse formally closed, and sold their Monroeville facility in 2012.
2015 accounting difficulties
In 2015 concerns were expressed that the value of assets and goodwill in Westinghouse were overstated. Following an accounting scandal in which profits were overstated at Toshiba, leading to the CEO resigning, Toshiba stated that the Westinghouse nuclear business was more profitable than at acquisition in 2006.
In December 2016 Toshiba said it expected to write down its investment in Westinghouse by "several billion", adding that it was possible that their investment in Westinghouse could ultimately have a negative worth, due to cost overruns at U.S. nuclear reactors it was building. In February 2017 Toshiba revealed unaudited details of a 390 billion yen ($3.4 billion) loss, mainly in its US nuclear business which was written down by 712 billion yen ($6.3 billion). On 14 February 2017 Toshiba delayed filing financial results, and Toshiba chairman Shigenori Shiga, formerly chairman of Westinghouse, resigned. Toshiba considered selling the Westinghouse nuclear business.
2017 Chapter 11 bankruptcy
On March 29, 2017 Toshiba's Westinghouse filed for Chapter 11 bankruptcy, citing a yearly loss for Toshiba that could exceed $9 billion, almost three times its previous estimate. The Wall Street Journal reported that four nuclear reactors being built in the southeastern U.S. would be left to an unknown fate. The U.S. government had given $8.3 billion of loan guarantees on the financing of the four nuclear reactors being built in the U.S.
The fuel manufacturing division has been profitable, but not enough to cover corporate overheads and support the other divisions. Research and development investment in fuel manufacturing has been low, which has impacted the quality and comparative performance of its fuel compared to competitors.
Timeline of Westinghouse Electric Company
- 1999: Westinghouse Electric Company officially began operations as BNFL's nuclear power business.
- 2000: BNFL bought ABB Group's nuclear power business, and merged into Westinghouse.
- 2004: Westinghouse bids for two Chinese reactor sites; the US Export-Import bank approved $5 billion in loan guarantees
- 2006: Westinghouse acquired PaR Nuclear/Ederer Nuclear Cranes, providing fuel and cask handling equipment systems. Westinghouse Electric Company was sold by BNFL to Toshiba,
- 2007: Westinghouse won China National Nuclear Corporation's bid for 4 AP1000 reactors including Technology Transfer agreement; acquired IST Nuclear of IST Holdings (South Africa); Carolina Energy Solutions (CES) and its affiliates Aggressive Equipment (AE), now WEC Machining; Construction Institute of America (CIA), now WEC Welding Institute; and Carolina United Services, now Carolina Union Services; Astare, a French nuclear engineering company headquartered near Paris.
- 2009: Westinghouse acquired Nuclear Fuel Industries LTD, Japan's sole producer of nuclear fuel for boiling-water reactor and pressurized water reactors for $100 million and CS Innovations, LLC, an Instrumentation and Control (I&C) nuclear product supplier to the digital I&C safety system upgrade market.
- 2010: Westinghouse announced involvement in a new, ultra-large forging press in the UK to be built at Sheffield Forgemasters in Yorkshire; took a major stake in Springfields Fuel Limited in the UK. Westinghouse moved world headquarters from Monroeville, Pennsylvania, to Cranberry Township, Pennsylvania.
- 2012: Westinghouse cut 200 jobs citing the Fukushima disaster, Germany's Energiewende and low natural gas prices.
- 2015: Toshiba profits overstated leading to accounting scandal.
- 2017: Westinghouse files Chapter 11 bankruptcy.
Association with CBS Corporation
Although no longer associated with the current CBS Corporation, Westinghouse Electric Company LLC as of 2011 still uses the trademarks owned by Westinghouse Licensing Corporation, CBS' brand management subsidiary, under license, as is the case with other Westinghouse licensees.
New generation of reactors
A revived interest in the nuclear power generation field in the late 1980s[when?] led to Westinghouse's development of the AP600 reactor which received NRC approval[when?]. Interest in the Westinghouse design, but with larger power output led to the change of the project to the AP1000 in 1999 and shortly after became the first Generation III+ reactor to receive final design approval from the NRC in 2004. As of 2014, four of these units are under construction in China, though the first was due to come on-line in November 2013. and has been delayed until December 2014. The delay due to the constantly changing, and consequently untested, design prompted Li Yulun, former vice-president of China National Nuclear Corporation, in 2013 to raise concerns over the safety standards of the plant. Citing a lack of operating history, he questioned the manufacturer's assertion that the AP1000 reactor's "primary system canned motor pumps" were "maintenance-free" over 60 years, the assumed life of the reactor, and noted that Westinghouse had yet to receive approval from British authorities on an improved version of AP1000.
As of January 2009, six AP1000 plants had been ordered in the US, and several other customers had chosen the AP1000, if they were to build new nuclear plants, for a combined total of at least 14 new plants, announced by the NuStart Consortium, Duke Power, Progress Energy, Southern Nuclear and SCE&G. In May 2011 after the Fukushima Daiichi nuclear disaster, US government regulators found problems with the design of the shield building of the new reactors. Gregory Jaczko, chairman of the Nuclear Regulatory Commission since 2005 said that computations submitted by Westinghouse about the building’s design appeared to be wrong and “had led to more questions.” He said the company had not used a range of possible temperatures for calculating potential seismic stresses on the shield building in the event of an earthquake, for example. The NRC asked Westinghouse not only to fix its calculations, but also to explain why it submitted flawed information in the first place. Westinghouse countered that the “confirmatory items” that the commission was asking for were not “safety significant.”
In November 2011, the AP1000 Oversight Group published a report highlighting six areas of major concern and un-reviewed safety questions requiring immediate technical review by the NRC. The report concluded that certification of the AP1000 should be delayed until the original and current “unanswered safety questions” raised by the AP1000 Oversight Group are resolved.
In December 2011, the UK’s Office for Nuclear Regulation published a design assessment report on the AP1000 reactor which highlighted 51 'Generic Design Assessment' issues remaining that must be addressed before the assessment would be completed.
In October 2013, US energy secretary Ernest Moniz announced that China was to supply components to the US nuclear power plants under construction as part of a bilateral co-operation agreement between the two countries. Since China’s State Nuclear Power Technology Co (SNPTC) acquired Westinghouses's AP1000 technology in 2006, it has developed a manufacturing supply chain capable of supplying international power projects. Industry analysts have pointed out that there are gaps in the Chinese supply chain.
Westinghouse Electric Company fully owns several subsidiaries in Europe, such as the European Service Center, also called Westinghouse Electric Belgium located in Nivelles, Belgium, where equipment is prepared for projects throughout Europe. After Westinghouse's 1990 takeover of ABB Reaktor in Germany, it transferred radiological storage activities located in Ladenburg, Germany, to consolidate in Nivelles, which had to be extended. Soon afterwards[when?] another expansion was necessary as employees in the Brussels office were transferred to Nivelles. It was estimated that 200 people were working in Nivelles at the end of 2011.[who?]
In 2001, Westinghouse took over Logitest in Les Ulis, France, one of 3 companies qualified to inspect nuclear steam generator plants for Electricité de France. After the French nuclear market partially opened in 2004 to suppliers from outside the country to fulfill European Commission directives regarding international competition, Westinghouse started to expand its business in France with a Westinghouse team located in Metz in charge of repair, replacement and automation services. By 2005 Westinghouse had 160 employees in France and two-thirds of Westinghouse's business in France was fuel supply. Westinghouse Electrique France is located in Orsay and Manosque near Marseille (engineering development). As of 2014, about 400 employees are part of Westinghouse in France.
Westinghouse owns a nuclear fuel fabrication plant at Västerås, Sweden which has provided nuclear fuel for Russian VVER nuclear reactors. In 2000 Westinghouse started development of fuel for customers in Finland and Hungary, supported by cheap Export–Import Bank of the United States loans, but the business remained small-scale in competition from cheaper Russian suppliers. A 2008 contract with Ukraine for VVER-1000 fuel has been crucial for the plant. In 2015, the European Union awarded $2 million in funding to a Westinghouse-led consortium to support the development of a more competitive fuel for the Russian built reactors.
Westinghouse also has business locations in Italy, Germany, Spain, the UK, Russia, and Bulgaria.
In South Korea, Westinghouse has been involved in the construction of new nuclear plants since 1972, with the first plant Kori Nuclear Power Plant starting up in 1977 and in commercial operation in 1978, followed by eight reactors under construction in the early 1980s. Combustion Engineering (now Westinghouse) entered into a ten-year technology transfer program with the Korean nuclear industry aiming at self-reliance, which was extended in 1997.
In December, 2006, China’s State Nuclear Power Technology Company (SNPTC) selected Westinghouse to provide four new AP1000 nuclear power plants. The first was due to come on line in 2013, has been delayed until the end of 2014.
On 7 June 2016, Nuclear Power corporation of India have agreed to begin engineering and site design work for six nuclear power reactors in India and to conclude contractual agreements by June, 2017.
Westinghouse has been involved in South Africa through support of the Koeberg Nuclear Power Station since the 1990s, both reactors are Westinghouse-licensed. In 2007 Westinghouse acquired IST Nuclear (Pty) Ltd, and won the final bidding process for new nuclear plants in South Africa, for which it signed an MOU in 2013. IST Nuclear provides services and systems for the pebble-bed reactor.
There has been a number of major Westinghouse-related environmental incidents in the US. Below is a short list of these. All of these are chemical pollution incidents; none of them involve nuclear reactors or nuclear pollution.
- Sharon Plant: The Westinghouse Sharon Plant is a 58-acre facility Westinghouse power-plant and production facility in Mercer County, Pennsylvania. The EPA's Recent Second 5-Year Overview (2013) of this toxic Superfund site determined that the Shenango River is heavily polluted due to Westinghouse operations in this area. The report notes that "the PCB concentrations in the fish tissue results for the channel catfish and smallmouth bass samples, an unacceptable risk is present even for [...] consumption rates of one meal per month"
- Adams County Plant: Westinghouse was fined $5.5 million in 1996 for polluting groundwater in over 100 wells, as well as other water sources, while operating its Adams County, Pennsylvania plant. Toxic degreasers and other chemicals were released over a 5-year period in the 80s, though the legal battle was not settled until the EPA's involvement. (Pittsburgh Post-Gazette – Nov 12, 1996)
- Horseheads Site: Westinghouse is responsible for illegal pollution at what is now known as the Kentucky Avenue Wellfield Superfund site in Horseheads, New York. Westinghouse knowingly polluted acres of soil, affecting the safety of a nearby aquifer and wells used by residents. One phase of the clean-up effort describes "Westinghouse Electric Corporation's facility, designated "Disposal Area F" and the "Former Runoff Basin Area," which are contaminated with volatile organic compounds (VOCs), polycyclic aromatic hydrocarbons (PAHs) and arsenic, will be cleaned up using a combination of soil excavation and soil vapor extraction. At Disposal Area F, the area of contamination is about 0.3 acres. At the Former Runoff Basin Area, the contaminated soils cover approximately 0.7 acres. Disposal of the excavated soils will be at appropriate off-site facilities. The removal of the PAHs and arsenic contamination will protect site workers and employees at the Westinghouse facility and the cleanup of the VOCs will help restore the quality of the Newtown Creek Aquifer."
- Sunnyvale Plant: The extent of the pollution at this Sunnyvale, California site has been found to cover the following: "Groundwater and soil are contaminated with PCBs, fuels, and volatile organic compounds (VOCs). Potential health threats to area residents include accidentally ingesting or coming into direct contact with site contaminants in soil or groundwater." There are municipal drinking water wells within 1/4 mile from this site, and 300,000 people get their drinking water from within three miles of the site.
- "Westinghouse Electric Company's Leadership". Retrieved 29 August 2017.
- "Westinghouse layoffs now projected to be 1,500". Pittsburgh Post-Gazette. 2017. Retrieved 2017-08-22.
- See State of Delaware, Divisions of Corporations, Entity Search
- Robert Walton (24 March 2017). "Reports: Nuclear firm Westinghouse Electric to file for bankruptcy next week". Utility Dive.com. Retrieved 24 March 2017.
- Fuse, Taro (24 March 2017). "Toshiba decides on Westinghouse bankruptcy, sees $9 billion in charges: sources". Reuters. Retrieved 25 March 2017.
- Yamazaki, Makiko; Kelly, Tim (29 March 2017). "Toshiba's Westinghouse files for bankruptcy as charges jump". reuters.com. Retrieved 29 March 2017.
- "Sale of Westinghouse Businesses to MK/BNFL Complete". PR Newswire. 22 March 1999. Retrieved 17 January 2014.
- Terry Macalister and Mark Milner (24 January 2006). "Toshiba to buy BNFL's Westinghouse". The Guardian. Retrieved 17 January 2014.
- "Toshiba Acquires Westinghouse from BNFL". Press Release. Toshiba. 6 February 2006. Retrieved 2008-03-08.
- "BNFL to sell U.S. power plant arm". BBC News. January 23, 2006. Retrieved 2006-02-06.
- Chellaney, Brahma (30 Mar 2017). "US-India nuclear deal falls prey to Toshiba woes". Nikkei Asian Reivew. Retrieved 11 April 2017.
- "Technology transfer – Selling Westinghouse is lucrative but controversial". Economist. 26 January 2006. pp. 30–31. Retrieved 17 January 2014.
- "Toshiba Completes Westinghouse Acquisition". Toshiba. October 17, 2006. Retrieved 2008-03-08.
- "Kazatomprom buys 10% stake in Westinghouse". World Nuclear News. 2007-10-22. Retrieved 2008-04-19.[permanent dead link]
- "Toshiba reportedly to buy 20% of Westinghouse", MarketWatch, Sept. 5, 2011, 6:53 pm EDT. Retrieved 2011-09-05.
- "Toshiba confirms it will buy Shaw stake in Westinghouse", Bloomberg via gulfnews.com, September 8, 2011. Retrieved 2011-09-08.
- "Toshiba buys Shaw Group's stake in Westinghouse". 7 January 2013. Retrieved 2 March 2013.
- "Westinghouse memo to employees". Pittsburgh Tribune-Review. March 20, 2007. Archived from the original on December 11, 2007. Retrieved 2008-04-04.
- Ritsuko Ando (21 July 2015). "Toshiba CEO quits over accounting scandal". Reuters. Retrieved 21 July 2015.
- Ritsuko Ando and Taiga Uranaka (21 July 2015). "Toshiba says Westinghouse has grown more profitable since acquisition". Reuters. Retrieved 21 July 2015.
- Mochizuki, Takashi. "Toshiba Expects Write-Down of as Much as Several Billion Dollars". Wall Street Journal. Retrieved 28 December 2016.
- Makiko Yamazaki, Taiga Uranaka (14 February 2017). "Delays, confusion as Toshiba reports $6.3 billion nuclear hit and slides to loss". Reuters. Retrieved 14 February 2017.
- "Toshiba chairman quits over nuclear loss". BBC News. 14 February 2017. Retrieved 14 February 2017.
- Karishma Vaswani (14 February 2017). "Toshiba: Why troubled Japanese firms survive". BBC News. Retrieved 14 February 2017.
- "Toshiba looking to sell Westinghouse nuclear business". BBC News. 14 March 2017. Retrieved 22 March 2017.
- "Westinghouse files for bankruptcy". Nuclear Engineering International. 29 March 2017. Retrieved 4 April 2017.
- Gold, Russell; Negishi, Mayumi (March 29, 2017). "Toshiba's Westinghouse Electric Files for Bankruptcy Protection". Wall Street Journal. New York City, New York, United States. Retrieved March 30, 2017.
- Rapoza, Kenneth (13 April 2017). "A Bankruptcy That Wrecked Global Prospects Of American Nuclear Energy". Forbes. Retrieved 14 April 2017.
- "Nuclear Power in China". Information library. World Nuclear Association. April 2014. Retrieved 15 April 2014.
- "Westinghouse to Acquire Nuclear Fuel Industries Ltd". Press Release. PR Newswire. 29 April 2009. Retrieved 15 April 2014.
- Gough, Paul (May 18, 2012). "Westinghouse cuts 200 employees". American City Business Journals. Retrieved 15 April 2014.
- "AP 1000 Public Safety and Licensing". Westinghouse. September 13, 2004. Archived from the original (web) on 2007-08-07. Retrieved 2008-01-21.
- "First Concrete Pour For Sanmen Unit 2 Complete", The Wall Street Journal, 2009-12-17.
- Eric Ng (7 October 2013). "China nuclear plant delay raises safety concern". South China Morning Post.
- “Regulators Find Design Flaws in New Reactors” Matthew L. Wald, Washington DC, New York Times, 20 May 2011
- “Fukushima and the Westinghouse-Toshiba AP1000: A Report for The AP1000 Oversight Group” Arnie Gundersen, November 10, 2011
- "Office for Nuclear Regulation New nuclear reactors: Generic Design Assessment Westinghouse Electric Company LLC AP1000® nuclear reactor" 14 December 2011
- “China set to supply components to US nuclear power plants.” Lucy Hornby (Beijing) and Ed Crooks (New York), Financial Times, 30 October 2013
- “Analysis – China needs Western help for nuclear export ambitions” David Stanway (Beijing), Reuters, 17 December 2013
- "Westinghouse Expands Nuclear Services Capability in France; Announces Acquisition, Divestiture to Focus Solely on Nuclear Market" (Press Release). Westing house. 17 December 2001. Retrieved 15 April 2014.
- "A Global Reach A Local Perspective" (PDF). Worldview 2005. Westinghouse. 2005-09-01. p. 5. Retrieved 15 April 2014.
- Bershidsky, Leonid (30 March 2017). "U.S. Nuclear Setback Is a Boon to Russia, China". Bloomberg. Retrieved 21 April 2017.
- Gotev, Georgi (27 February 2017). "Westinghouse: Only Ukraine applies EU's nuclear diversification policy". EURACTIV. Retrieved 7 March 2017.
- Litvak, Anya (7 July 2015). "Politics helps commerce for Westinghouse". Pittsburgh Post-Gazette. Retrieved 21 April 2017.
- "Nuclear Power in South Korea". Information Library. world nuclear association. January 2014. Retrieved 15 April 2014.
- 2009 Westinghouse corporate profile
- "US-based Westinghouse to build 6 nuclear power plants in India". Times of India. Retrieved 30 July 2016.
- "Westinghouse Announces Strategic Agreement with Leading South African Engineering Company". Press release. 24 October 2013. Retrieved 15 April 2014.
signed a significant Memorandum of Understanding (MOU) with Sebata Group of Companies (Sebata Group), a leading South African-owned and operated engineering, procurement and construction management company, in preparation for the potential construction of Westinghouse AP1000® nuclear power plants in South Africa.
- "EPA Site Overview, Westinghouse Sharon Plant". EPA.
- "Cleanup of Horseheads Superfund Site". EPA.
- "Sunnyvale Superfund Site". EPA.