Economic Indicators Assessment of NPP Project in Indonesia. Suparman Centre for Nuclear Energy Development

Transcription

1 Economic Indicators Assessment of NPP Project in Indonesia Suparman Centre for Nuclear Energy Development

2 INTRODUCTION Indonesia has performed: economics assessment using INPRO Methodology within its NESA project economics assessment in the feasibility study for NPP project in Bangka in In the FS: The evaluation uses the IEA s long-term CO2 trade price forecast to convert the CO2 reduced amount by a NPP as money value

3 Bangka NPP Feasibility Study Bangka Sites: Feasibility study ( ) 3

4 Deeply - costly CONSTRUCTION

5 Construction cost No. Item NPP (W.Bangka) NPP (S.Bangka) 1. M & E system cost Building cost Civil cost Initial core fuel cost Contingency 1,676 1, Owner s cost 1,398 1, IDC 1,467 1, VAT Total (Unit cost: USD/kW) 14,095 (5,972) (million USD) 13,843 (5,866)

6 Owner Cost No. Item Cost (million USD) NPP (W. Bangka) NPP (S. Bangka) 1 Electricity supply system Temporary house cost on site Cost for land resettlement, compensation Project management cost Consultancy cost Miscellaneous costs Transmission between Java and Sumatra Training center Cost of land 2 1 Total

7 Generation cost LCOE = Σt [ (Ct + Ot + Ft + Dt) x (1+r)-t ] / Σt [ Et x (1+r)-t ] With: Ct = Capital cost in the year t Ot = Operation and maintenance (O&M) cost in the year t Ft = Fuel cost in the year in t Dt = Decommissioning cot in the year t Et = Electricity generation in the year t r = Discount rate

8 Capital cost components 1) Depreciation cost Depreciation in the generation cost is a method of expensing the value of fixed assets, and the means to recover the invested capital. In this study, the 20 years is regarded as useful life based on Indonesian law, and the specified amount is evenly depreciated every year for the period. 2) Interest payment Interest of the loan is added to the generation cost in case of raising funds from outside. The interest rate applied is 2.73 %, and the repayment terms is regarded as 18 years. 3) Fixed asset tax As for the lands and buildings, 0.5 % of the net taxable amount is subject to the fixed assets taxation according to the tax law of Indonesia.

9 Interest rate Interest rate and repayment period for nuclear power project refers to: Commercial Interest Reference Rates (CIRRs) - OECD The Arrangement for Officially Supported Export Credits as May 2013 for US dollar In year 2014 CIRRs for US Dollar:

10 Technical and Economic Parameter Plant output : 1,180MWe Internal consumption : 5% Availability : 93% Economic Lifetime : 40 years Discount rate : 10%

11 Generation cost No. Item Cost (UScent/kWh) NPP (W. Bangka) NPP (S. Bangka) 1. Capital cost Operation and maintenance cost Fuel costs Decommissioning cost Total

12 Economic Evaluation Methodology The alternative thermal power method is applied to this evaluation. When the electricity supply is set to economic benefit, then, how the same benefit could be obtained by different ways. The expense which is necessary to obtain, it is defined as benefit (B). On the other side, any cost to install and operate a NPP in Indonesia is set to cost ( C). The cost includes any NPP specific costs, such as policy cost, any possible risk measure expenditures. The balance of (B) and (C) is considered to be the benefit which is brought by NPP introduction into Indonesia. With this balance, Economic evaluation is conducted by calculating Economic IRR (EIRR) and NPV.

13 CO2 PRICE ASSUMPTION Years High/2DS Low USD/tCO2 High/2DS Low

14 Economic Indicators Based on High price of CO2 Parameter NPP (W. Bangka) NPP (S. Bangka) NPV 2,156 2,285 IRR 13.1% 13.4% Based on Low price of CO2 Parameter NPP (W. Bangka) NPP (S. Bangka) NPV -1,550-1,421 IRR 7.3% 7.5%

15 Economic Assessment using INPRO Methodology Investment cost of NPP (including owner and contingency cost ) : 5254 USD/kWe Selling price of Electricity : 12 cent/kwh* Economic indicators: Parameter Selling price (cent$/kwh) LUEC 11.7Cent/kWh 11.7Cent/k IRR 10.13% 9.75% ROI 16.06% 15.44% * Average electricity tariff per 1 September become 1280 Rp/kWh or 11.6 cent/kwh (1 USD = 11,000 Rp)

16 Sensitivity analysis Discount Rate (%) LUEC (c$/kwh)

17 Levelized Cost of Electricity Generation for Different Technologies [c/kwh] L evelized C os t [c /kwh] ASSUMPTIONS: FUEL PRICE Coal Gas HSD Geo. steam : USD 70/ton : USD 6/MMBTU : USD 80/barrel : USD 4,2 c/kwh C OA L G A S (C C ) L NG (C C ) OIL G E OT HE R MA L C apex IDC F uel C ost O &M C ost Source: PLN OVERNIGHT COST CFPP : USD 1.250/kW CCPP : USD 850/kW GTPP : USD 600/kW GEOPP : USD 1.600/kW (Power Plant Only)

18 Conclusion Based on the Feasibility Study, NPP project in Indonesian highly depends on the CO2 price market. In CO2 price low scenario, NPP does not seem to be beneficial from the view of Indonesian economy. This is because some costs (risk cost and policy cost) are considered in the study. Based on assessment using INPRO methodology indicate that NPP with total capital cost of 4765 USD/kWe seem to be attractive when selling price is 12 USD cent/kwh

19 THANK YOU