IBM Nuclear Power Advisory Council Identifies Key 2008 Issues for Nuclear Power

Market Wire, December, 2007

The IBM Nuclear Power Advisory Council (NPAC) announced today the top nuclear power industry imperatives that emerged from its inaugural meeting last week at the new IBM (NYSE: IBM) Global Center of Excellence for Nuclear Power in La Gaude, France. Among them, the group stressed that nuclear power operators and suppliers must find more transparent means to manage various types of risk in order to create a more positive environment for the industry's growth. In particular, failure by the industry to dramatically alter their approach to financial and political risk will result in an increasing number of barriers to continued operation and market expansion.

The two-day forum explored the state of the global nuclear industry, current operational challenges including asset management and performance, an aging workforce, as well as business imperatives and IT solution priorities for the year ahead.

During the meeting, Council members from across the globe discussed and prioritized key nuclear power industry issues, which will be addressed through the Center's work in 2008:

--  Risk Elements for New Build Need to Be Managed With Visibility --
    plant economics, regulatory challenges, supply base risks, as well as
    safety and plant security need to be managed to provide a positive signal
    to the marketplace as new power plants are licensed and built.

--  Aging Workforce & Lack of New (Young) Talent is Critical -- in the
    global nuclear power industry, 25% of labor will be eligible to retire over
    the next five years, and the Internet generation is far from interested in
    filling their ranks.

--  Integration of New Technologies Into Existing Plants is A Hard Sell --
    sophisticated business case modeling, endorsement from regulators, and
    other best practices must be developed to help drive acceptance of new
    technologies targeted to the nuclear power industry, including updating
    oversight commissions.

--  Efforts to Increase Nuclear Power Generation are Hampered -- with
    global energy consumption rates steadily rising, limited capacity to build
    new plants, a complex supply chain, a significant labor force shortage, and
    uncertain public opinion, several road blocks must be addressed in order to
    maintain and potentially increase nuclear power generation's percentage of
    the total electricity generation mix.
    

IBM will discuss these nuclear power industry issues and its point of view with delegates from the International Thermonuclear Experimental Reactor (ITER) Business Forum 2007, who are scheduled to visit the IBM Global Center of Excellence for Nuclear Power later this week. The ITER Business Forum 2007 is linked to the larger ITER Fusion Project, which is focused on designing and building a cleaner nuclear reactor by the year 2050.

"Today, there are more than 30 countries worldwide operating nuclear reactors for electricity generation. In these countries, nuclear power plant license extensions and new plant construction are driving the need for sophisticated risk modeling and information tools that ensure safe and reliable operations," said Guido Bartels, General Manager, IBM Global Energy and Utilities Industry. "The two-day forum with our IBM Nuclear Power Advisory Council members reinforced this, as well as the fact that advanced technologies are crucial to overcome the IT design and implementation challenges that have traditionally held the industry back. We look forward to collaborating with the Council to help create safe, reliable and efficient electricity generation by nuclear power companies worldwide."

The IBM NPAC provides governance for the IBM Global Center of Excellence for Nuclear Power, which extends IBM's on-going work with leading nuclear power companies to support improved design, construction safety, and operation of power plants based on IBM software, hardware, consulting, and services industry offerings. The Center opened in La Gaude, France this past July. The Council is comprised of operation and IT experts from the global nuclear power industry, including utility company executives, service providers, academics, and members of key industry organizations.

"As we look ahead to 2008, the nuclear power industry will need to engage in more collaboration across the ecosystem -- even amongst competitors -- in order to address the serious challenges which the industry is facing. The IBM Nuclear Power Advisory Council has a unique opportunity to lead by example, and demonstrate the power of teaming to innovate," said Craven Crowell, Managing Director, Oliver Wyman, former Chairman of the Tennessee Valley Authority, and member of the NPAC. "Particularly for the aging workforce issue, there is little in the way of a track record and there appears to be no silver bullet to effectively solve this problem. Only by working together, and embracing new technologies and new ways of collaborating will companies be able to manage and transfer knowledge."

The next meeting of the IBM Nuclear Power Advisory Council will be in second quarter of 2008.