International Atomic Energy Agency
Paper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Approaches to Assess Competitiveness of Small and Medium Sized Reactors
(Paper 1S01)
Vladimir Kuznetsov (IAEA)Nadira Barkatullah (IAEA)
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
CONTENT1. Definitions/ Developments in Member States
2. SMRs – Options for Near-Term Deployment
3. IAEA Project “Common Technologies and Issues for SMRs”
4. Economics and Investments
4.1. IAEA Tools – MESSAGE and FINPLAN
4.2. G4-ECONS and PVCC models
4.3. Economy of Learning
4.4. Uncertainty analysis
5. INCAS model – integrated model for competitiveness assessment of SMRs versus large reactors
6. Case studies on SMR competitive applications – some results
7. Going across the curves - Could the SMRs be cheap if produced indigenously in a developing country?
8. Conclusions
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Definitions/ Developments in Member States
Small Reactor: < 300 MW(e)Medium Sized Reactor: <700 MW(e)
This year, of the 436 NPPs operated worldwide 134 are with SMRs; of the 45 NPPs under construction 10 are with SMRsIn 2009, not less than 45 concepts and designs of advanced Small and Medium Sized Reactors (SMRs) are analyzed or developed in Argentina, China, India, Japan, the Republic of Korea, Russian Federation, South Africa, USA, and several other IAEA member states
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
SMRs - Options for Near-Term DeploymentReactors with Conventional Refuelling Schemes
PWRs with integrated design of primary circuitIRIS - Westinghouse (USA) + Intl. Team CAREM – CNEA, ArgentinaSMART – KAERI, the Republic of Korea, and several others
PWRs – marine reactor derivativesKLT-40S (Floating NPP) – Rosenergoatom, RussiaVBER-300 (Land based NPP) – OKBM + Government of Kazakhstan, Rosatom
Advanced Light Boiling Water Cooled Heavy Water Moderated Reactors, Pressure Tube Vertical Type
AHWR (Designed specifically for U233-Pu-Th fuel) – BARC, India
High Temperature Gas Cooled ReactorsHTR-PM – INET, ChinaPBMR – PBMR Pty, Ltd., South Africa
Small Reactors without On-site RefuellingABV (Floating NPP) – OKBM, Russia; NuScale - NuScale, USA
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Project “Common Technologies and Issues for SMRs” P&B 2008-2009: 1.1.5.4 Recurrent Project, Ranking 1
Objective:To facilitate the development of key enabling technologies and the resolution of enabling infrastructure issues common to future SMRs of various types
Expected outcome:Increased international cooperation for the development of key enabling technologies and the resolution of enabling infrastructure issues common to future SMRs of various types
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
What could be done to support advanced SMR deployment?
Adjust regulatory rules toward technology neutral and risk-informed approach
Quantify reliability of passive safety systems
Justify reduced or eliminated EPZ (proximity to the users)
Justify reliable operation with long refuelling interval
Demonstrate SMR competitiveness for different applications
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Project “Common Technologies and Issues for SMRs” Deliverables
INTERNATIONAL ATOMIC ENERGY AGENCY, Innovative Small and Medium Sized Reactors: Design Features, Safety Approaches, and R&D Trends, IAEA-TECDOC-1451, Vienna (May 2005)
INTERNATIONAL ATOMIC ENERGY AGENCY, Advanced Nuclear Plant Design Options to Cope with External Events, IAEA-TECDOC-1487, Vienna (February 2006);
INTERNATIONAL ATOMIC ENERGY AGENCY, Status of Innovative Small and Medium Sized Reactor Designs 2005: Reactors with Conventional Refuelling Schemes, IAEA-TECDOC-1485, Vienna (March 2006)
INTERNATIONAL ATOMIC ENERGY AGENCY, Status of Small Reactor Designs without On-site Refuelling, IAEA-TECDOC-1536, Vienna (March 2007)
Appendix 4 of the IAEA Nuclear Technology Review 2007, titled "Progress in Design and Technology Development for Innovative SMRs",
INTERNATIONAL ATOMIC ENERGY AGENCY, Design Features to Achieve Defence in Depth in Small and Medium Sized Reactors, NUCLEAR ENERGY SERIES REPORT NP-T-2.2 (July 2009)
INTERNATIONAL ATOMIC ENERGY AGENCY, Approaches to Assess Competitiveness of SMRs, NUCLEAR ENERGY SERIES REPORT (Final Editing, to be Published in 2009)
INTERNATIONAL ATOMIC ENERGY AGENCY, Final Report of a CRP on Small Reactors Without On-site Refuelling, IAEA-TECDOC (Drafting, to be Published in 2010)
SMR Inputs for Updateable Electronic Database of Advanced Reactor Designs – In Progress, More Than 30 Designers Preparing Their Inputs
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Economics and Investments
Deployment options for SMRs:
A single SMR goes where there is no option to accommodate a large NPP (and then the competition are non-nuclear options available there)
A series of SMRs is considered against fewer larger plants of the same total capacity
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
IAEA TOOLS – MESSAGE (IAEA-PESS)
FIG. 13. A typical MESSAGE application.
OUTPUT
MESSAGE
INPUT
l Energy systemstructure (including vintage of plant and equipment)
l Base year energyflows and prices
l Energy demandprojections (MAED)
l Technology and resource options & their techno-economic performance profiles
l Technical andpolicy constraints
● Primary and final energy mix● Emissions and waste streams● Health and environmental
impacts (externalities)● Resource use● Land use● Import dependence● Investment requirements
OUTPUT
MESSAGEMESSAGE
INPUT
l Energy systemstructure (including vintage of plant and equipment)
l Base year energyflows and prices
l Energy demandprojections (MAED)
l Technology and resource options & their techno-economic performance profiles
l Technical andpolicy constraints
● Primary and final energy mix● Emissions and waste streams● Health and environmental
impacts (externalities)● Resource use● Land use● Import dependence● Investment requirements
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
IAEA TOOLS - FINPLAN
Figure 7. Main inputs and outputs of FINPLAN [10].
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Economics – Basic ApproachG4-ECONS Model: [email protected]
LUEC = LCC +[(FUEL+O&M+D&D)/E]LUEC – Levelized Unit Electricity CostLCC – Levelized Cost of CapitalE – Average annual electricity production MW-hourAssumption: Constant annual expenditures and production
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Small or Medium Sized Reactor Does not Mean a Low Capacity Nuclear Power Station
Several SMRs can be built at a single site; twin units are possibleMany of innovative SMRs provide for power station configurations with 2, 4, or more NPPs or reactor modules .
FIG. II-10. Perspective view of IRIS multiple twin-unit site layout.
Fig. XVIII-1. Schematic view of the FAPIG-HTGR 4-module plant.
Reactor core Generator
Turbine
Recuperator
High pressure compressor
Inter-cooler
Low pressure compressor
Pre-cooler
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Economics and Investments
Present Value Capital Cost (PVCC) Model – Westinghouse, USA
0 300 600 900 1 200 1 500Plant Capacity (MWe)
5
Construct Schedule
2
3
4
Multiple Unit
Learning Curve
Unit Timing
6 Specific Design
1
Present Value Capital Cost “SMR
Concept”
(5) TIMING – SMR enables gradual capacity increase to fit energy demand
Cos
t per
kW
(e)
(1) ECONOMY OF SCALE - Assumes single unit and same design concept (large plant directly scaled down)
(2) MULTIPLE UNITS – Savings in costs for multiple small units at same site (direct – parts and buildings shared; fixed – one time charges; site related costs)
(3) LEARNING – Cost reductions due to learning (in construction, operation) for a series of units at a single site
(6) SPECIFIC DESIGN –Cost reduction due to specific design concept characteristics (e.g. simplification)
(4) CONSTRUCTION SCHEDULE –shorter construction time
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Learning Curve – Capital Cost Reduction; Example (OKBM, Russia)
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
1.1
0 1 2 3 4 5 6 7 8 9 10 11
Number in the series
Cos
ts, r
el. u
nits
At least 15% for the second-of-a-kind plant
At least 5% for each n-th-of-a-kind plant
Stabilization range
Learning Curve Applicability:
Only valid within a country
Assumes no substantial changes to regulations over time
Cannot be extrapolated to new sites with new reactors
Depends on continuity in reactor build-up
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Economics Taking Into Account PVCC – A Simple Case StudyPresent Value Capital Cost (PVCC) Model – Westinghouse, USA
Table 1. Assumptions for the test case. SMR to large reactor capacity ratio
1:4
Scaled large reactor cost Based entirely on large reactor design scaled to 1:4 ratio
SMR unit timing Every 9 months
Discount rate 5% per year
Table 2. Results of SMR capital cost factor model. Capital cost factor ratio
(Four SMRs versus single large reactor, see Table 1) Capital cost
factor Overnight
capital cost
Total capital investment
cost
Present value capital cost
(1) Economy of scale 1.74 1.74 1.74
(2) + (3) Multiple units plus Learning
0.78 0.78 0.78
(4) Construction schedule N/A 0.95 0.95
(5) Unit timing N/A N/A 0.94 (6) Design specific factor 0.85 0.85 0.85
Cumulative Total 1.16 1.09 1.04
The initial 74% economy of scale penalty is largely offset by capital cost improvement factors!
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
TAKING INTO ACCOUNT UNCERTAINTIES – Case Study by FER (University of Zagreb, Croatia)
Discounted net cash flow in plant lifetime (40 years)
Source: Ref. (1)
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Economics and InvestmentsEconomics
G4-ECONS Model: [email protected]
LUEC = LCC +[(FUEL+O&M+D&D)/E]LUEC – Levelized Unit Electricity CostLCC – Levelized Cost of CapitalE – Average annual electricity production MWhAssumption: Constant annual expenditures and production
Investments and Revenues
Important Factors: Time-Dependent Expenditures and Production, Interest Rates ->Uncertainties and Sensitivities
CUMULATED CASH FLOW TO THE FIRM
-5.000
-3.000
-1.000
1.000
3.000
5.000
7.000
9.000
11.000
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
years
SMRs LR
Figure provided by POLIMI, Italy
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
NEW MODELS AND SOFTWARE (RATIONALE)
•A variety of models and tools addressing different aspects of a comparative economic assessments of SMRs versus larger reactors exist in member states or are available from international organizations
•Consolidated approach to the application of all these models is not established yet
•Many SMRs are at early design stages and full data needed for economic analysis is not yet available
•Advanced SMR designers need simple but comprehensive economic assessment tools capable of guiding the design development from early stages
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
NEW MODELS AND SOFTWARE (EXAMPLES)
Integrated model for Competitiveness Assessment of SMRs – INCAS (POLIMI, Italy)
INVESTMENT RISK MODEL(Monte Carlo Simulation)
Generation Cost Model
RevenueModel
Financial Model
EXTERNAL FACTORS IMPACT MODEL
•Social Factors ?•Market Factors ?
PROJECT ATTRACTIVENESS(Analytic Hierarchy
Process)
Economic & Financial Indexes
Long Run Risk Factor Indexes
1 2 3
4
5
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
The benefits of Investment Scalability -Case Study By Politecnico Di Milano (Italy)
Incremental capacity reduces the required front end investment and the Capital-at-Risk
Lower Interest During Construction compensates higher overnight costs: • Lower Total Capital Investment cost of
SMRs vs. Large Reactors
Capital structure is more balanced and risk of default is lower
SMRs may bear a higher financial leverage during construction.
SMRs are able to absorb construction delay without heavy financial shock
Profitability is comparable between LR and SMRs in terms of NPV and IRR
Trade-off: excessively staggered construction delays full site power availability to the grid and lowers NPV of the project (by shifting cash inflows onwards).
Unit overnight capital cost ($/kWe)
0
500
1000
1500
2000
2500
3000
3500
4000
LR SMR1 SMR2 SMR3 SMR4
FINANCIAL DEBT (M€; first 20 years)
0
500
1000
1500
2000
2500
3000
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19yearsLR SMRs Serie3
CUMULATED CASH FLOW TO THE FIRM
-5.000
-3.000
-1.000
1.000
3.000
5.000
7.000
9.000
11.000
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
years
SMRs LR
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
IAEA ACTIVITIES
INTERNATIONAL ATOMIC ENERGY AGENCY, Approaches to Assess Competitiveness of SMRs, NUCLEAR ENERGY SERIES REPORT (Final Editing, to be submitted for
publication in September 2009)
Ongoing IAEA Activity – CASE STUDIES ON COMPETITIVENESS OF SMRs IN DIFFERENT APPLICATIONS
POLIMI (Italy) Case Study: Electricity price decrease from 70 cents/kWh to 60 cents/kWh
CUMULATED CASH FLOW TO THE FIRM
-5.000
-3.000
-1.000
1.000
3.000
5.000
7.000
9.000
11.000
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
years
SMRs LR
CUMULATED CASH FLOW TO THE FIRM
-5.000
-3.000
-1.000
1.000
3.000
5.000
7.000
9.000
11.000
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
years
SMRs LR
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
POLIMI (Italy) Case Study – INCAS Investment Model: Example of Results
NPV sensitivity to the financing mix (Equity / Equity+Debt)
700
800
900
1000
1100
1200
1300
1400
1500
1600
30% 35% 40% 45% 50% 55% 60% 65% 70% 75% 80% 85%
LRSMRs
NPV sensitivity to construction delay
-1000
-500
0
500
1000
1500
no delay 1 1,5 2 2,5 3 3,5
LR SMRs (delay on first SMR) SMRs (delay on SMR 1 and 2)
NPV sensitivity to overnight constr. cost (€/kWe)
-500
0
500
1000
1500
2000
2000 2500 3000 3500 4000 4500
LR SMRs
NPV sensitivity to ee price
-1500
-1000
-500
0
500
1000
1500
2000
2500
3000
40 50 60 70 80 90
LR SMRs
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
SMRs Could Be Cheap If Indigenously Produced in Countries with High
Purchasing Power of Hard Currency
Options for Immediate Deployment:
CANDU6/ EC6 AECL (Canada)
PHWR-220 – being built in India; PHWR-540 (NPCIL, India), 1800 US$/kW(e)
Chinese PWRs of 325 MW(e) (China) – being built in Pakistan; and 610 MW(e) – being built in China
CANDU Plants at Bruce, ON
Calandria at manufacturer (L&T) shop
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Conclusions (1)
When investing in reactor technology, the typical choice is not between a single SMR and a single large reactor but rather between a nuclear power option in general (large reactor or SMR, whichever fits within a certain niche) and the competing non-nuclear energy technologies, such as gas, coal, hydro, renewables, etc.
Or, alternatively, between a single large reactor and a group of sequentially built SMRs, intended to yield the same aggregate power
When assessing sequential deployment of several reactors, factors related to multiple units, learning, construction schedule, unit timing, and plant design should be taken into account, in addition to the economy of scale
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Conclusions (2)• Uncertainty analysis needs to be incorporated to
consider risks and add a degree of fidelity to the overall assessment
• A variety of models and tools to address different aspects of a comparative economic assessments of SMRs versus larger reactors exist in member states or are available from international organizations
• Consolidated approach to the application of all these models is not established yet
• Advanced SMR designers need simple but comprehensive economic assessment tools capable of guiding the design development from early stages
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Conclusions (3)
• Consolidated approaches are being developed in some member states, and the IAEA keeps a track of these developments and conducts a series of national Case Studies on assessment of SMR competitiveness in different applications
The results of the completed case studies indicate that some SMRs could compete with large
reactors in some applications.
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
THANK YOU!
E-mail: [email protected]
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
BACK-UP VIEWGRAPHS
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Attractive Common Features of SMRs
Option of incremental capacity increase, flexible and just-in-time capacity addition
Potentially, smaller emergency planning zone and proximity to the users
A variety of flexible and effective non-electrical application options (i.e., co-generation)
For small reactors without on-site refuelling: long refuelling interval and reduced obligations of the user for spent fuel and waste management
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
SMR estimates extracted from RDS-1 2008
30
0
2
4
6
8
10
12
14
16
by 2010 by 2020 by 2030
GW
e
Low Case
North America low
Latin America low
Eastern Europe low
Africa low
Middle East and South Asia low
Far East low
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
SMR estimates extracted from RDS-1 2008
31
0
2
4
6
8
10
12
14
16
by 2010 by 2020 by 2030
GW
e
High Case
1 North America high
2 Latin America high
4 Eastern Europe high
5 Africa high
6 Middle East and South Asia high
8 Far East high
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
Deployment potential of innovative SMRs
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
What would happen if this is not done?
All innovative SMRs are licensable against current safety requirements and regulations
There are established methods for validation of passive safety systems
Reduced EPZ can be partly justified using current regulations in some countries
Long refuelling interval has experience with submarines
Competitiveness of SMRs needs to be demonstrated
International Atomic Energy AgencyPaper 1S01, WR09 Intl. Conf., IAEA, 27-30 October 2009
IAEA TOOLS – MESSAGE (IAEA-PESS)
Figure. 6. A simple energy supply model in MESSAGE – physical flow [4].
Coal Extraction
Gas Import
Prim
ary Coal
Primary G
as
Coal Power Coal
Hydro Power
Electricity
Electricity
Gas
Coal
Coal Transport & Distribution
Electricity Transport & Distribution Gas Power
Plant
Gas Transport & Distribution
Industrial Heat
Industrial Electricity
Coal Ind.
Gas Ind.
EElec. Ind.
RESOURCES PRIMARY SEN FINAL DEMAND
SMR
Coal R
esources
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