John Herter September 13, 2017 What will Advanced Nuclear Power Plants Cost?
Lack of credible cost data is slowing industry progress Advanced nuclear is caught in a negative feedback loop, which significantly limits policy support and investment Prevailing Perceptions Not differentiated from conventional nuclear Too expensive Safety case is not fully understood Vicious Cycle Lack of Investor Interest Industry Consequences Little policy visibility/traction Lack of licensing capacity Lack of customer order book discourages investment by supply chain and financial investors The projected timeframe for commercialization is too far out to be relevant Licensing pathway is too lengthy and costly Slow development process Lack of customer/ policy interest Lack of support by environmental advocacy organizations Missed opportunity to align pro-economy & pro-climate constituencies Energy Options Network 1
Participating companies Company Reactor Type Country Reactor Capacity (MWe) Plant Capacity (MWe) Elysium Industries MSR U.S. 1,000 1,000 General Electric * SFR U.S. 1,648 1,648 Moltex MSR U.K. 1,000 1,000 NuScale Power APWR U.S. 47.5 570 Terrestrial Energy MSR Canada 288 288 ThorCon MSR U.S. 250 1,000 Transatomic Power MSR U.S. 520 520 X-energy HTGR U.S. 75 600 Energy Options Network 2
Total Capitalized Construction Costs The average total capitalized cost is $3,782/kW, a reduction of $2,973/kW from the PWR total of $6,755/kW All companies reported significant reductions in indirect construction costs relative to conventional nuclear projects. Financing costs during construction were significantly lower due to lower construction expenditures and faster construction schedules (averaging ~4 years vs. ~7 years for conventional nuclear projects). Energy Options Network 3
Annual operating costs ($/MWh) The average total operating cost for the advanced nuclear companies is $21/MWh, a reduction of $10/MWh from the PWR total of $31/MWh. Several companies achieve large reductions in O&M costs because their inherently safe and simple designs require fewer technicians, safety monitors, and other staff compared to conventional nuclear. Some are loading fuel and sealing their reactor for, at times, decades and thus don t report annual fuel costs (the fuel is added to their capitalized construction costs). Most companies have very low financing costs during operation, but one company would charge a periodic lease payment for reactor and fuel canisters. Energy Options Network 4
Sum of Capitalized and Operating Costs per MWh To levelize the capitalized costs per MWh, the EON Model assumes a capitalization period of 25 years, an interest rate of 7%, and a capacity factor of 95%. The average sum of capitalized and operating costs per MWh for the advanced nuclear companies is $60/MWh, a reduction of $37/MWh from the PWR sum of $97/MWh. This is a simplified LCOE calculation as it neglects tax expenses (which depend on tax rate and depreciation schedule), year-by-year cost variation, and other factors requiring additional assumptions. Energy Options Network 5
Primary cost reduction drivers Not all companies adopt the same drivers (and not to the same extent) Reduction in plant-specific design costs: NOAK is assumed to have been designed and reused with little modification Reduced construction duration Fewer/Smaller buildings Combination of modular plant designs and factory/shipyard-based manufacturing Other reductions in construction scope Fewer operating staff due to plant s inherent safety Other justifications: Plant did not require certain PWR components (e.g., feed pump buildings, waste water treatment buildings, other safety systems, etc.) Lower costs based on 3 rd party engineer reports or competitive bid solicitations Energy Options Network 6