Reactor Economics 2007 Jim Harding California Senate Energy Committee Hearing December 10, 2007 San...
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Transcript of Reactor Economics 2007 Jim Harding California Senate Energy Committee Hearing December 10, 2007 San...
Reactor Economics 2007 Reactor Economics 2007
Jim Harding
California Senate Energy Committee Hearing
December 10, 2007
San Diego
Key DevelopmentsKey Developments
• Near certain carbon controls• Persistently high fossil fuel prices• Growing government subsidies for non-carbon resources
• Possible loan guarantees• Possible production tax credits
• The “China Effect” – concrete, steel, copper – up substantially since 2002
• Nuclear supply chain moribund for two decades• Electric industry restructuring
• Less certain cost recovery• Transmission bottlenecks and lead time
Since 2002… Since 2002…
360
380
400
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520
Jun-98 Jun-99 Jun-00 Jun-01 Jun-02 Jun-03 Jun-04 Jun-05 Jun-06
Ch
em
ica
l En
gin
ee
rin
g P
lan
t C
os
t In
de
x
950
1,000
1,050
1,100
1,150
1,200
1,250
1,300
1,350
Ma
rsh
all
& S
wif
t E
qu
ipm
en
t C
os
t In
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x Chemical Engineering Plant Cost Index
Marshall & Swift Equipment Cost Index
Chemical Engineering Plant Cost Index
0.0
100.0
200.0
300.0
400.0
500.0
600.0
1950.00 1960.00 1970.00 1980.00 1990.00 2000.00 2010.00
Year
Ind
ex
avg. slope from 1959 - 2005 ~ 3.5 %/yravg. slope from 2002 - 2005 ~ 7.4 %/yr
Steeper Curve Than in the Mid 80s
Pulverized Coal
Gas (CCCT) Eastern IGCC
Wind Nuclear
Capital Cost ($/kW)
2438 700 2795 1700 4000
Total cost (cents/kWh)
5.8 6.8 6.8 7.1 8.9
CO2 Capture Cost ($/kW)
940 470 450 NA NA
Cost for CCS (cents/kWh)
6.2 2.8 3.4 NA NA
Cents/kWh 12.0 9.6 10.2 7.1 8.9-9.8
Cents/kWh (credits $10-30)
6.2-7.9 7-7.7 7.1-8.7 7.1 8.9-9.8
Standard and Poor’s Assessment
Beware Old Studies, Particularly for Beware Old Studies, Particularly for Nuclear Power Nuclear Power
• Studies• GE/Westinghouse ($1000-1500/kW)• University of Chicago ($1500/kW)• World Nuclear Association ($1000-1500/kW) • US Energy Information Administration
($2083/kW)• Newer analyses disagree – S&P ($4000/kW),
Florida Power and Light, Keystone report ($3600-4000/kW), Moody’s ($5000/kW)
US Projections – Decades AgoUS Projections – Decades Ago
Construction start Estimated Overnight Actual Overnight % Over
1966-1967 $560/kW $1170/kW 209%
1968-1969 $679/kW $2000/kW 294%
1970-1971 $760/kW $2650/kW 348%
1972-1973 $1117/kW $3555/kW 318%
1974-1975 $1156/kW $4410/kW 381%
1976-1977 $1493/kW $4008/kW 269%
Mark Gielecki and James Hewlett, Commercial Nuclear Power in the United States: Problems and Prospects, US Energy Information Administration, August 1994. Data is in 2002 dollars.
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
1970 1975 1980 1985 1990 1995 2000
Date of first operation
Inst
alle
d c
apit
al c
osts
in 2
004
$/k
W
Shoreham
Nine Mile Point 2 Watts Bar 1
Comanche Peak 2
Copyright Jonathan G. Koomey 2007
Comanche Peak 1
US Economics – Two Decades Ago
Koomey, Jonathan, and Nate Hultman. 2007. “A Reactor-Level Analysis of Busbar Costs for US nuclear plants,” 1970-2005, forthcoming in Energy Policy
Recent Japanese ExperienceRecent Japanese ExperiencePlant MWe COD Yen@COD 2002$s/kW 2007$s/kW
Onagawa 3 825 Jan 2002 3.1 Billion 2409 3332
Genkai 3 1180 Feb 1994 4 Billion 2643 3656
Genkai 4 1180 Jul 1997 3.2 Billion 1960 2711
KK 3 1000 Jan 1993 3.2 Billion 2615 3617
KK 4 1000 Jan 1994 2.2 Billion 2609 3608
KK 6 1356 Jan 1996 4.2 Billion 2290 3167
KK 7 1356 Jan 1997 3.7 Billion 1957 2707
Y 5 (SK) 1000 Jan 2004 1700 2352
Y 6 (SK) 1000 Jan 2005 1656 2290
Average 2354 3257
Cost data from MIT 2003 Future of Nuclear Power study. Average does not include South Korean units.
Escalation Likely Worse for Nuclear Escalation Likely Worse for Nuclear
• Industry moribund in Western Europe, US, and Russia since TMI and Chernobyl
• Twenty years ago (US): 400 suppliers, 900 N-Stamp holders; today 80 and 200
• Only one forge for large parts – Japan Steel Works; maybe Creusot Forge (France)
• Skilled labor and contractor limits• Uranium production well below current
consumption
Lifecycle Costs
Cost Category Low Case High Case
Capital Costs 6.0 7.9
Fuel 1.6 2.0
Fixed O&M 1.3 1.8
Variable O&M 0.5 0.5
Total (Levelized Cents/kWh) 9.4 12.2
Costs are in real discounted 2007 cents/kWh
Jeff Combs, President, Ux Consulting Company, Price Expectations and Price Formation, presentation to Nuclear Energy Institute International Uranium Fuel Seminar 2006
Fuel cycle steps MIT This analysis
Uranium $30/kg $300/kg
Enrichment $100/SWU $140-340/SWU
Fabrication $275/kg $275/kg
Disposal $400/kg $400/kg
Reprocessing $1000/kg $1500-2000/kg
Fuel cycle cost
Open 0.5 cents/kWh 1.6-2 cents/kWh
Closed 2 cents/kWh 3.4-4.3 cents/kWh
Differential 4x 2-3.5x
Reprocessing Is ExpensiveReprocessing Is Expensive
Efficiency and Renewables are Efficiency and Renewables are Disruptive TechnologiesDisruptive Technologies
A disruptive technology is often cheaper than the operating cost of the existing system
Demand is not limited to growth in serviceEfficiency resources cost less than operating costs for
existing gas (or coal with carbon taxes); they pay for themselves with +3x more carbon savings per dollar
Wind was disruptive from 2002-2005 and may be againPhotovoltaics may soon become oneOnly disruptive energy technologies can grow fast enough
to solve climate challenges
Rapid Worldwide Growth in Renewables
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2,000
4,000
6,000
8,000
10,000
12,000
14,000
1960 1965 1970 1975 1980 1985 1990 1995 2000
kW
h
U.S.
California
2004
Efficiency Is A Resource = 22 Fewer 1 GW Plants Since 1970
Some Is Driven By Technical Some Is Driven By Technical InnovationInnovation
Figure 1 - Annual Lost-Opportunity Achievable Potential Supply Curve
0
10
20
30
40
50
60
70
80
90
100
$0 $10 $20 $30 $40 $50 $60 $70 $80 $90 $100 $110 $120
Levelized Cost (2004$/MWH)
Achi
evab
le P
oten
tial (
aMW
)
2005 (aMW/yr)
2007 (aMW/yr)
2009 (aMW/yr)
20011 (aMW/yr)
20013 (aMW/yr)
2015 - 2024 (aMW/yr)
Northwest Power Planning Council, Achievable Savings, August 2007
Codes, Standards, and Programs Are Also Needed
Figure 10 - Annual Utility Program Conservation Savings1980 - 2005
0
20
40
60
80
100
120
140
160
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
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1994
1995
1996
1997
1998
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2000
2001
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2003
2004
2005
Year
Savi
ngs
(aM
W)
Historical Northwest Utility Programs
Northwest Power Planning Council, Achievable Savings, August 2007
0%2%4%6%8%
10%12%14%16%18%20%22%24%26%28%30%32%34%
2000
Q4
2001
Q1
2001
Q2
2001
Q3
2001
Q4
2002
Q1
2002
Q2
2002
Q3
2002
Q4
2003
Q1
2003
Q2
2003
Q3
2003
Q4
2004
Q1
2004
Q2
2004
Q3
2004
Q4
2005
Q1
2005
Q2
2005
Q3
2005
Q4
2006
Q1
2006
Q2
2006
Q3
2006
Q4
NW CFL Market Shares
US CFL Market Shares
Figure 8 -Estimated ENERGY STAR CFL Market Share for the Northwest and U.S., 2000-2006
Sources: NW CFL sales 2000-2006: PECI and Fluid Market Strategies sales data reports; and NEEA estimate of an additional 1.5 million WAL-MART CFLs sold region-wide in 2006 (See Appendix A [Section 9.1.1] of MPER3 for more detail); U.S. and NW population estimates 2000-2006: U.S. Census 2004; U.S. market shares and non-CFL sales 2000-2005: Itron California Lamp Report (2006); U.S. market share 2006: D&R International (personal communication).
Compact Fluorescent Market Penetration
The Bottom LineThe Bottom Line
• Twenty years from light water reactor technology will be roughly the same as it is today
• Efficiency resources, wind turbine technology, and photovoltaics are improving rapidly
• Take one example --- Nanosolar• started by the Google founders, backed also by Swiss Re• Building two 430 MW/yr thin film PV production facilities this
year in Germany and California, using a technology they equate to printing newspapers
• Target price is $0.50/peak watt --- cheaper than delivered electricity price in most parts of the world
• The cheapest, least risk strategy is rapid development of efficiency resources