Nuclear Reactors Cost Too Much. Here are Some Ideas to Fix it
- Dec 14, 2020 4:59 pm GMT
- New Nuclear Economics Book has an Action Plan for Dealing with Reactor Costs
- MIT Study Cites Changes to Design and Fabrication as Key Drivers of Overruns
- EDF Commits to Success Factors on Costs for Next EPRs to Be Built in France
- Three DOE National Labs Team Up to Get Synergies for Hybrid Energy Systems
- Kairos Power to Deploy Molen Salt Test Reactor at ORNL site
- GE-Hitachi Passes NRC Milestones in Licensing Effort for BWRX-300
Nuclear energy is too expensive to build and it is also too important, relative to dealing with climate change, to have its future left to market forces. Several new efforts address these issues with ideas about how to fix the problem.
Nuclear Economics Book & Action Plan
Ed Kee, at the Washington, DC, based Nuclear Economics Consulting Group, has published a new book, available on Amazon next month, that explains why a market-based electricity industry is killing existing nuclear power plants and stopping new nuclear power plants. In the book he analyses the issue and presents an action plan with multiple recommendations to fix the problem.
MIT Cost Study
Separately, researchers at MIT have published an important new study, which finds that the “stick built” approach to design and construction of new nuclear power plants is one of the reasons these projects wind up with cost overruns. The study says that building more plant components, or even the entire plant, offsite under controlled factory conditions, could substantially cut extra costs. It also called for getting a better grip on design processes to prevent changes after sending the specifications off to suppliers.
World Nuclear Association – Nuclear Power Economicshttps://www.world-nuclear.org/information-library/economic-aspects/economics-of-nuclear-power.aspx
A New Nuclear Economics Book Details Cost Issues
and What to Do about Them
According to nuclear energy expert Ed Kee, in his new book, titled. “Market Failure – Market-Based Electricity is Killing Nuclear Power,” he writes that the biggest threat faced by nuclear power is from a market approach to the electricity industry.
This book includes information on the nuclear power and electricity industries, market failure in the nuclear power industry, and some ideas about resolving this market failure.
Electricity industry reforms have led to the early closure of existing nuclear power plants and stopped new nuclear power development. The consequences are already here and more are coming.
In the US, 6,778 MWe of operating nuclear power plant capacity was closed early between 2013 and 2020, an additional 9,162 MWe of operating nuclear power plant capacity is scheduled to close early by the end of 2025, and more US merchant nuclear plants face financial issues that may lead them to close early.
In the market approach to electricity, short-term electricity market prices set the value of commodity electricity, electricity prices define power plant value, and private companies develop and own power plants based on financial returns. This market approach leads to less nuclear power, with the loss of the considerable public benefits that nuclear power provides. Economists call this a ‘market failure.’
A market approach to electricity will mean fewer nuclear power plants. The public good, e.g., millions of tonnes of CO2 not released into the atmosphere, from these missing nuclear power plants will be lost.
This book explains why nuclear power matters, nuclear power, electricity and electricity reform, the market failure concept, real-world experience with nuclear power, and how nuclear power market failure can be resolved.
Quick Summary of the Book’s Chapters
- ‘Why Nuclear Power Matters‘ outlines the author’s view of the valuable attributes that should make nuclear power a preferred electricity source.
- ‘Nuclear Power‘ provides information on the nuclear power industry. It explains industry terminology, nuclear power project development phases, costs of building and operating nuclear power plants, operating modes, industry organization, business models, and key industry risks and issues.
- ‘Electricity‘ provides information on the electricity industry. Nuclear power plants, almost exclusively, are special-purpose machines that generate electricity. The value of electricity determines the value of nuclear power. The electricity industry has a traditional approach that has been in place for almost a century, and a new industry approach developed during electricity industry reforms started in the 1990s.
- ‘Market Failure‘ explains market failure, which is when private companies acting in markets fail to maximize the public good. This book is about market failure for nuclear power from a market-based approach to electricity.
- ‘Nuclear Power in the Real World‘ provides detailed information on nuclear power in the US, the UK, Canada, France, and China. In these five countries, differences in electricity and nuclear power industry approaches lead to very different nuclear power outcomes. This chapter provides clear evidence of market failure.
- What Can be Done? outlines some actions that could help resolve market failure for nuclear power.
- ‘A Call to Action‘ explains the urgency and importance of recognizing market failure for nuclear power and taking action to stop it.
Kee’s Call to Action
The book has an extensive list of actions national and state governments can take to stop the further erosion of nuclear energy in the US and elsewhere. Here are just a few of the examples.
ANS Toolkit The 2017 American Nuclear Society Toolkit has a long list of actions focused on the US. It covers an increased government role, a return to the traditional electricity industry approach, control of negative externalities, payment for nuclear power’s positive externalities, and improved electricity market designs could help resolve nuclear power market failure.
Nuclear In the States Toolkit, Policy Options for states considering the sole of nuclear power in their energy mix, Version 2.0, ANS Special Committee on Nuclear in the States, June 2016. (PDF file)
Government Build, Own, Operate New government utilities could be formed to purchase, build, own and operate nuclear power plants or to purchase the output of nuclear power plants Governments in market economies could acquire or nationalize existing nuclear power plants to establish a state-owned nuclear power fleet.
Targeted Intervention at the State and National Level State or federal government intervention in the electricity industry and electricity markets could help support existing and new nuclear power.
- Governments can provide higher and more certain revenue to merchant nuclear power plants than electricity spot markets by requiring government electricity users to buy nuclear electricity under long-term power purchase agreements.
- Governments might provide credit support or funding for new nuclear power projects. The US DOE loan guarantee program is an example of this. The UK announced in late 2020 that it might make equity investments in new nuclear power plants.
- Governments could fund nuclear power plant construction with the completed plant sold to the market after commercial operation.
- Government support for nuclear industrial companies could help form national nuclear power industry champions that could deliver nuclear power plants in their home country and compete with state-owned nuclear industrial companies worldwide.
Nuclear as Critical Public Infrastructure Most countries have a direct government role in national defense, long-distance transportation (e.g., highways, railroads, airports), water, public health, and other sectors. Some countries have government-owned electricity companies, and even in countries with the new market-based electricity industry approach, the transmission system remains regulated or government owned. Designating nuclear power as a critical public infrastructure could be a step toward a more significant government role in supporting the nuclear power industry.
MIT Study Cites Design and Component Fabrication Issues as Reasons for New-build Cost Overruns
(WNN) Building nuclear power plants based on existing designs actually costs more, rather than less, than building plants based on new designs, according to a new study from the Massachusetts Institute of Technology (MIT). Rethinking engineering from the outset can help to avoid increased indirect costs.
The findings of the study have been published in the journal Joule in a paper titled “Sources of Cost Overrun in Nuclear Power Plant Construction Call for a New Approach to Engineering Design.” [citation – firewall]
It is well known that nuclear plant costs in the USA and in global markets have repeatedly exceeded cost estimates. The authors used 50 years of data and “bottom-up” cost modelling to identify the mechanisms behind this widespread problem. Two issues emerged from the review.
- A counter-intuitive finding is that the team found nth-of-a-kind plants are more costly, not less, expensive than first-of-a-kind plants.”
- Most of the increases in costs are due to indirect expenses, which are largely due to the the need to make last-minute and costly design changes with downstream impacts on the fabrication of large long lead time and other nuclear-related components as well as non-nuclear elements of the project. Changes in safety regulations account for some cost increases but are not the only factor.
What to Do About Runaway Costs?
Building more plant components, or even the entire plant, offsite under controlled factory conditions, could substantially cut extra costs. This approach is already being advocated for small and modular reactors, which could be completely manufactured off-site.
Larger plants could be designed to be assembled on site from an array of smaller factory-built sub-assemblies. Specific design changes to containment buildings, such as using new kinds of concrete, could also help to reduce costs significantly by reducing the overall amount of material needed. This would cut onsite construction time as well as the material costs.
“[W]e need to be rethinking our approach to engineering design,” Trancik told WNN. “This requires new methods and theories of technological innovation and change.”
The work was supported by the David and Lucille Packard Foundation and the MIT Energy Initiative.
EDF Commits to Success Factors for Next EPR Projects in France
(WNN) France’s EDF has issued plan the aims to enhance the French nuclear industry’s manufacturing quality, boost skills and tighten governance of major nuclear projects.
EDF and Framatome are developing a simplified version of the EPR design, known as EPR2. Its aim is to incorporate design, construction and commissioning experience feedback from the EPR reactor, as well as operating experience from the nuclear reactors currently in service.
The state-owned firm said it will leverage cost savings methods learned at the UK Hinkley and Sizewell projects which involve the construction of four EPRs for a total of 6.4 Gwe of electrical generating capacity. The firm will also leverage its experience building and commissioning two 1650 MW EPRs at the Taishan site in China.
French Finance Minister Bruno Le Maire has called for improvements in the construction methods which lead to cost reductions and to avoid schedule delays for new units. Le Maire told EDF to implement an action plan laying out how it will address skills shortages and other issues that have caused delays and cost increases at new nuclear power plant projects.
The execution of the plan is being overseen by Alain Tranzer, EDF’s executive director for industrial quality and nuclear skills. He reports directly to Jean-Bernard Lévy, the company’s chairman and CEO.
“We intend to achieve results quickly in all companies and plants forming part of the nuclear industry,” Lévy said.
“Our aim is to be up to the mark for our current and future projects both in France, the United Kingdom and in other parts of the world, thereby making nuclear energy an instrumental player in the fight against climate change.”
EDF said the French nuclear industry is making 25 commitments in 2021. These commitments revolve around 5 “cornerstones.”
- State-of-the-art project governance, with an oversight function for major nuclear new-build projects in order to ensure that each milestone is fully completed.
- Scaling-up of competencies in France’s nuclear sector, with a focus on the 21,000 professionals joining the industry over the period of 2019 to 2022.
- The industry’s manufacturing and construction companies will develop a plan for “zero defects”.
- There will be a supply chain relationship based on more streamlined and result-driven contracts.
- In a related action, the industry will raise quality and nuclear safety standards through standardization lower costs and insure on-time delivery.
Also, a welding plan has been established to address specific competency and quality challenges, EDF noted. This plan will support the training and qualification of welders working on nuclear projects.
OTHER NUCLEAR NEWS
Three DOE National Labs Team Up to Get Synergies for Hybrid Energy Systems
Future novel hybrid energy systems could lead to paradigm shifts in clean energy production, according to a paper published last week in a major energy journal (abstract)
Researchers from the U.S. Department of Energy’s (DOE’s) three applied energy laboratories—Idaho National Laboratory (INL), the National Renewable Energy Laboratory (NREL), and the National Energy Technology Laboratory (NETL)—co-authored the paper describing such integrated energy systems.
Their effort outlines novel concepts to simultaneously leverage diverse energy generators—including renewable, nuclear, and fossil with carbon capture—to provide power, heat, mobility, and other energy services.
The new effort presents an objective new framework for engineering-based modeling and analysis to support complex optimization of energy generation, transmission, services, processes and products, and market interactions.
Hybrid Energy Systems
The study outlines a viable path forward for hybrid energy systems. Such systems are capable of leveraging multiple energy sources to maximize the value of each. They do this by creating higher-value products, delivering lower-emission energy to industry, and better coordinating demand with energy production.
The paper describes an example of the multi-input, multi-output nature of these systems: a hypothetical, tightly coupled industrial energy park that uses heat and electricity from highly flexible advanced nuclear reactors, small-scale fossil generators, and renewable energy technologies to produce electricity and hydrogen from electrolysis.
“In this scenario, depending on market pricing, electricity and or heat could be sold into the grid, used on-site, or stored for later distribution and use,” said David C. Miller, NETL’s senior fellow for Strategic Systems Analysis & Engineering and co-author of the article.
Furthermore, the output streams could also be used to produce hydrogen or other valuable chemicals and products.”
This flexibility could provide an abundant supply of clean energy for a larger net-zero-emission energy system. Such systems could support sectors of the economy that are more difficult to decarbonize, such as industry and transportation.
“Considering complementary attributes among various energy technologies opens up new opportunities for asset use optimization that meet multiple energy services and maximize economic value,” said Douglas Arent, NREL’s executive director for Strategic Public-Private Partnerships and the study’s lead author.
“The design of integrated energy systems is a significant challenge—and opportunity,” INL Director Mark Peters said.
“The collaboration by the three applied national laboratories, and the setup and operation of real-world experiments at their testing facilities, represents a comprehensive and focused effort that is transparent and objective. This work will help realize future advanced energy systems that should help our nation expand affordable energy options and significantly contribute to wide-scale decarbonization efforts.”
Kairos Power to Deploy Fluoride Salt-Cooled High-Temperature
Test Reactor at Oak Ridge
Kairos Power announced this week it plans to deploy a test reactor at the East Tennessee Technology Park (ETTP) in Oak Ridge, Tennessee, pending completion of due diligence and the results of discussions with state and local officials.
- (Kairos technology & reactor design concept)
- (2018 NRC Public Document – Kairos Design Overview ML18337A040 – PDF file)
Image Caption - “Simulating a Salt-Cooled Reactor for Safety” by By Fatih Sinan Sarikurt, CFD & Thermal Fluids Engineer, Kairos Power, Alameda, U.S.A. Ansys Advantage Magazine, Vol 14, Issue 1, 2020 https://www.ansys.com/about-ansys/advantage-magazine/volume-xiv-issue-1-2020/simulation-salt-cooled-reactor
“We are thrilled at the prospect of coming to East Tennessee,” said Michael Laufer, Co-Founder and CEO of Kairos Power.
“The infrastructure available at ETTP, combined with its proximity to key collaborators at the Oak Ridge National Laboratory makes this a great location to demonstrate our technology.”
“The Oak Ridge Corridor will be a great location for Kairos Power,” ORNL Director Thomas Zacharia said.
“The national lab has a number of efforts under way to advance nuclear technologies, including world-class capabilities in molten salt reactors. We have worked with Kairos Power in the past and are pleased that they selected the ETTP site for this project.”
Kairos Power has executed a Memorandum of Understanding with Heritage Center, LLC, to acquire the cleaned up former K-33 gaseous diffusion plant site at ETTP, subject to ongoing due diligence evaluations.
GE Hitachi Nuclear Energy BWRX-300 Small Modular Reactor Achieves U.S. Licensing Milestone at NRC
GE Hitachi Nuclear Energy (GEH) announced that the U.S. Nuclear Regulatory Commission (NRC) has issued a Final Safety Evaluation Report for the first of several licensing topical reports (LTRs) that have been submitted for the BWRX-300 small modular reactor (SMR). (See docket number 99900003 in NRC ADAMS)
The LTR, which was submitted to the NRC in December 2019, forms the basis for the dramatic simplification of the BWRX-300. Two additional LTRs were submitted in early 2020 and GEH anticipates the review of these LTRs will be completed in the coming months. A fourth LTR was submitted in September 2020. GEH expects such LTRs to serve as a foundation for the development of a Preliminary Safety Analysis Report that could potentially be submitted to the NRC by a utility customer.
The BWRX-300 is a 300 MWe water-cooled, natural circulation SMR with passive safety systems that leverages the design and licensing basis of GEH’s U.S. NRC-certified ESBWR.
Through dramatic design simplification, GEH said in its press statement that the it projects the BWRX-300 will require significantly less capital cost per MW when compared to other water-cooled SMR designs or existing large nuclear reactor designs.
The firm noted in its press statement that as the tenth evolution of the Boiling Water Reactor (BWR), “the BWRX-300 represents the simplest, yet most innovative BWR design since GE began developing nuclear reactors in 1955.”
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