China and the U.S. signed a multibillion-dollar agreement for Westinghouse Electric Co. to build nuclear-power plants, a deal that could help set a new technological standard as the nuclear-power industry enjoys a global renaissance.

The deal was announced Saturday in Beijing, a day after the close of talks between a group of U.S. cabinet officials and their Chinese counterparts to discuss bilateral economic issues such as the ballooning U.S. trade deficit with China.  About half the value of the new nuclear projects will be obtained in the U.S., and the other half in China, according to a statement from Westinghouse.

A source familiar with the deal said its value to Westinghouse would be $3 - 4 billion. The deal has ramifications beyond China; high oil and natural-gas prices, along with worries about the pollution caused by using fossil fuels, have sparked renewed world-wide interest in building nuclear-power plants as a cleaner alternative.

Winning the China contract could help Westinghouse’s technology become a standard for a new, so-called third generation of reactors. Westinghouse says the technology is safer because it uses a simpler design that relies on passive mechanisms such as gravity and the natural circulation of water to prevent accidents.
If completed, the Chinese plants would be the first using Westinghouse’s plans to be finished. The company is looking at building 12 nuclear plants in the U.S. with its new technology. Areva offers a competing third-generation technology.

“We now look forward to working with our Chinese customer to negotiate final contract details so that we can formally implement this forward-looking new build program,” Steve Tritch, Westinghouse’s chief executive, said in a statement.

U.S. Energy Secretary Samuel Bodman has said the China deal would create 5,500 jobs in the U.S.
Bodman last week attended five-nation energy talks, which reflected growing concerns over the high costs of existing energy sources like oil. The participating countries pledged closer cooperation on efforts to reduce market volatility and improve transparency and on regulation of emergency oil stockpiles.

The new U.S.-China agreement calls for Westinghouse to build two of its AP1000 pressurized water reactors each at two sites: in Sanmen, in the eastern province of Zhejiang, and in Yangjiang, in southern China’s Guangdong province. The Louisiana-based engineering and construction firm Shaw Group Inc. is Westinghouse’s consortium partner.