KAUNAS UNIVERSITY OF TECHNOLOGY THE ANALYSIS OF POSSIBLE CONTINUITY FOR NUCLEAR POWER GENERATION IN LITHUANIA AFTER SHUTDOWN OF IGNALINA NPP

Transcription

1 KAUNAS UNIVERSITY OF TECHNOLOGY Department of Thermal and Nuclear Energy THE ANALYSIS OF POSSIBLE CONTINUITY FOR NUCLEAR POWER GENERATION IN LITHUANIA AFTER SHUTDOWN OF IGNALINA NPP NATO Advanced Research Workshop BALTIC ENERGY SECURITY AND INDEPENDENCE Vilnius, Lithuania June, 2004

2 CONTENT OF A PRESENTATION 1. Purpose of work 2. Ignalina NPP significance for Lithuania and Baltic region energy market 3. Ignalina NPP decommissioning impact on Lithuanian national debt and payment balance 4. Forecast of the national economy development 5. Electrical power balance after Ignalina NPP decommissioning 6. Reasons for possible increase of natural gas price 7. Fuel price and investment impact on electricity generation cost 8. Comparison of finance calculation results for new NPP and new CCGT 9. Comparison of economic calculations results for new NPP and new CCGT 10. Conclusions 2

3 PURPOSE OF WORK Determine is it worthwhile to construct a new NPP after decommissioning of Ignalina NPP Determine under which conditions a new NPP can be competitive with new CCGT 3

4 ELECTRICITY PRODUCTION AND CONSUMPTION IN BALTIC REGION (2002 YEAR) 4

5 ELECTRICITY PRODUCTION AND CONSUMPTION IN BALTIC REGION (2005 YEAR) 5

6 ELECTRICITY PRODUCTION AND CONSUMPTION IN BALTIC REGION (2010 YEAR) 6

7 ELECTRICITY PRODUCTION AND CONSUMPTION IN BALTIC REGION 7

8 ELECTRICITY PRODUCTION CAPACITIES AND LOAD FORECAST IN LITHUANIA 8

9 Ignalina NPP decommissioning impact on electrical energy, fossil fuel markets and national payment balance I scenario. Slow increase of electricity demand Period: year: Decrease of electricity generation causes decrease of electricity export; Nuclear electricity replacement by fossil fuel generated will increase an import of fossil fuel II scenario. Fast increase of electricity demand Period: year : Decrease of electricity export causes changes of payment balance; Increase of fossil fuel import; Period: year : An increased electricity demand can be fulfilled by import of electricity 9

10 Ignalina NPP decommissioning impact on national payment balance I scenario II scenario PB variation depending on INPP electricity export revenue loss PB variation depending on fossil fuel import increase PB variation depending on electricity export PB variation depending on INPP electricity export revenue loss PB variation depending on fossil fuel im port increase PB variation depending on electricity import 10

11 GDP growth necessary to maintain fixed national debt GDP growth, % PB varaition, mln.lt I scenario GDP growth II scenario GDP growth I scenario PB variation (absolute value), mln.lt II scenario PB variation (absolute value), mln.lt 0 11

12 GDP growth Possible GDP growth if INPP will operate Needed GDP growth in II scenario Needed GDP growth in I scenario 12

13 National debt changes GDP growth, % National debt GDP growth I scenario, % GDP growth II scenario, % National debt I scenario National debt II scenario 13

14 Forecasts of economy growth Economy growth scenarios: Slow economy growth scenario 3.2% average annual GDP growth, slow local and foreign investment processes, possible economical and financial crisis. An average EU economical stage of 2000 will not be reached in 2025 Fast economy growth scenario 5.6% average annual GDP growth, fast local and foreign investment processes, minimum possible economical and financial crisis An average EU economical stage of 2000 will be reached in 2025 Very fast economy growth scenario - 6.2% average annual GDP growth, very high level of local and foreign investments, without economical and financial crisis. An average EU economical stage of 2000 will be exceeded in

15 Power balance in Lithuania Scenario Slow growth Fast growth Very fast growth (+670)* -347 (+453)* -663 (+137)* Year (+500)* -847 (-74)* (-519)* (+164)* (-669)* (-1123)* 1000 Slow growth 500 Fast growth MW Very fast growth Slow growth* Fast growth* Very fast growth* Years * with Kruonis HPS 15

16 Possible reasons for increase of natural gas price EU countries will increase an import of natural gas more than twice (from 133 to 298 MTOE) during next 20 years Possible export of natural gas from Russia can increase only from 165 to 245 MTOE Gasprom has declared the possibility to develop South-East Asian market. This can cause decrease of import to EU countries and increase of cost Extraction of natural gas in EU countries (Norway, Netherlands, U.K.) possibly will remain in the same level after 20 years New natural gas mining fields in Russia are situated mostly in the Arctic and North regions. Therefore transportation cost of gas will increase In general it is prognosticated that fossil fuel import cost for EU countries will increase: for oil - 85%, for gas % 16

17 Fuel price impact on electricity production price Varaition of electricity generation cost, % NPP CCGT Variation of fuel cost, % 17

18 15.0 Investment impact on electricity generation price Variation of electricity generation cost, % NPP CCGT Variation of investments, % 18

19 FINANCIAL CONDITIONS FOR NEW NUCLEAR POWER PLANT 1. Investment should not exceed 1500 US$/kW (vendors claim that investment can be reduced to US$/kW) 2. Duration of construction time should not be more than 4 years (new reactors can be built during months) 3. Discount rate should not be more than 10 % (usually it varies from 6 to 12 %) 4. A price of natural gas should rise faster than 0.9 % per year (prognosis allows growth more than 2 % per year) 19

20 ELECTRICITY PRODUCTION COST FOR NEW POWER PLANT Production cost, USct/kWh Taking into account possible increase of natural gas price Cost of electric power 670 (CCGT) 1070 (NPP - optimistic) 1533 (NPP - base) 2000 (NPP - pesimistic) 20

21 Results of the economical estimation Expanses due to supply reliability improvement, social and ecological problems have been estimated as external extra charges in economical calculations. It was estimated that discounted (10%) investment and exploitation expanses are million US$ for construction of new NPP, meanwhile it will be about 2200 million US$ for new CCGT, i.e. about 321 million US$ higher. 21

22 COMPARISON OF TWO OPTIONS (10 % DISCOUNT RATE) mln. US $ Extra charges Fixed costs Changeable costs Fuel Investment CCGT NPP 30 years expenses 22

23 CONCLUSIONS Premature decommissioning of Ignalina NPP will leave a negative impact on Lithuanian national economy From the financial point of view a new NPP is equivalent competitor to new CCGT From the economical point of view a new NPP is superior than new CCGT 23