Transcript Document 7352084

Update on New Nuclear Plant
Development
for the Kansas Energy Commission
August 15, 2007
Mary Quillian
Director, Business and Environmental Policy
Nuclear Energy Institute
202-739-8013, [email protected]
Overview
 Factors driving interest in building new nuclear plants:
–
–
–
–
–
Performance of existing nuclear fleet
Fuel diversity
Public opinion
Environmental Benefits – no GHG emissions
Need for new capacity – particularly new baseload
 The next wave of new plants
–
–
–
–
–
–
Who’s developing them?
New licensing process
Used Fuel
Financing
Energy Policy Act of 2005 support for new nuclear
State initiatives that support new plant construction
Sustained Reliability and Productivity
U.S. Nuclear Capacity Factor
95
90
Capacity factor (%)
85
80
75
70
65
60
55
88.1% in 2000
89.4% in 2001
90.3% in 2002
87.9% in 2003
90.1% in 2004
89.3% in 2005
89.8% in 2006*
50
'81 '82 '83 '84 '85 '86 '87 '88 '89 '90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06
Source:Global Energy Decisions / Energy Information Administration
* Preliminary for 2006
Output Remains Near Record Levels
U.S. Nuclear Generation
800
Billion kilowatt-hours
700
600
500
400
Billion kilowatt-hours
754 in 2000
769 in 2001
780 in 2002
764 in 2003
789 in 2004
782 in 2005
787 in 2006*
300
200
'81 '82 '83 '84 '85 '86 '87 '88 '89 '90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06
Source: Global Energy Decisions / Energy Information Administration
* Preliminary for 2006
Solid Economic Performance Continues
U.S. Nuclear Production Cost
2006 Cents per kilowatt-hour
3.0
2.5
2.0
2000: 2.03 cents/kWh
2001: 1.89 cents/kWh
1.5
2002: 1.90 cents/kWh
2003: 1.86 cents/kWh
1.0
2004: 1.84 cents/kWh
2005: 1.76 cents/kWh
0.5
0.0
2006: 1.72 cents/kWh
'95
'96
'97
'98
'99
'00
'01
'02
'03
'04
'05
'06
Source: Global Energy Decisions
U.S. Industrial Safety Accident Rate
2006
ISAR = Number of accidents resulting in lost work,
restricted work, or fatalities per 200,000 worker
hours. Electric utilities and manufacturing do not
include fatality data.
3.50
2.00
0.12
Nuclear Power Plants
Electric Utilities
Manufacturing
Sources: Nuclear (World Association of Nuclear Operators), Electric Utilities
and Manufacturing (2005, U.S. Bureau of Labor Statistics).
Updated: 4/07
Fuel as a Percentage of Electric Power
Production Costs
2005
Fuel
26%
Fuel
78%
Coal
Conversion
Fabrication
11%
Waste Fund
26%
Enrichment
52%
Uranium
Fuel
94%
O&M
74%
O&M
22%
4%
7%
6%
Gas
Nuclear
Nuclear Fuel Cost
Components
Source: Global Energy Decisions
63% Favor Use of Nuclear Energy
(Annual Averages)
80
Favor
Oppose
63
60
49
46
40
31
20
Apr1983 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2007
Source: Bisconti Research, Inc., poll conducted March 30 and April 1, 2007
Five Steps of Support for New Plants
Important
for our
energy
future
Renew
licenses
80%
81%
Prepare
to build
71%
Definitely
build
56%
Accept
new
reactors
at nearest
plant
66%
Source: Bisconti Research, Inc., poll conducted March 30 and April 1, 2007
U.S. Electric Power Industry CO2 Avoided
Million Metric Tons
2006
681.2
241.9
Nuclear
Hydro
22.2
12.8
0.4
Geothermal
Wind
Solar
Source: Emissions avoided are calculated using regional and national fossil fuel emissions rates from the Environmental
Protection Agency and plant generation data from the Energy Information Administration.
Updated: 4/07
Nuclear Energy Has an Environmental
Impact Comparable to Renewables
Life Cycle Emissions for Various Electricity Sources
790 - 1182
Coal - Modern Plant
Solar Photovoltaic
13 - 731
Natural Gas (Combined Cycle)
Wind
Biomass/forestry/waste
combustion
Nuclear
Hydropower
389 - 511
7 - 124
gram equiv CO2/kWh
15 - 101
Low
High
2 - 59
2 - 48
Source: “Hydropower-Internalised Costs and Externalised Benefits,” Frans H. Koch.
International Energy Agency
Emissions Reductions in Perspective
 The UNFCCC estimates that the Kyoto Protocol’s
Clean Development Mechanism (CDM) will
generate 1.2 billion tonnes of emission
reductions by the end of 2012
 Worldwide, nuclear power avoids the emissions
of around 2 billion tonnes of CO2 annually
Source: UNFCCC CDM Statistics (http://cdm.unfccc.int/statistics) and International Energy Agency. Emissions avoided by nuclear power
are calculated using an average fossil fuel emissions rate that is weighted by the ratio of projected coal and gas generation.
Magnitude of the Climate Challenge
Under “business as usual”
projections, global CO2
emissions from fossil fuels
expected to double by 2050 –
from 7 GtC/yr to 14 GtC/yr.
But stabilizing atmosphere at
500 PPM CO2 requires avoiding
this growth and then rapidly
shrinking CO2 emissions after
2050.
To get to 2050, we would need
seven “wedges” of low-carbon
energy, each enough to displace
1 GtC/yr.
Source: Keystone-NJFF Report June 2007
What is a “Wedge” of Nuclear Capacity?
from 370 GW to 1070 GW,
or about 700 net GW.
1000
GW Installed nuclear capacity
One wedge would require
that we roughly triple the
size of global nuclear
power plant capacity,
1200
800
600
400
200
0
Current
One Wedge
Source: Keystone-NJFF Report June 2007
Kansas
 Wolf Creek avoided 9.3 million metric tons of
CO2 in 2006
 In 2030, a new nuclear plant in SPP could
avoid 9.7 million metric tons of CO2 a year
All the passenger cars in Kansas emitted 4.5
million metric tons of CO2 in 2005
Source: NEI calculations using EPA and EIA data
New nuclear plant size 1,400 MW
SPP Electricity Generation Fuel Shares
2006 and 2030
2006*
Coal
68.0%
2030*
Oil
0.6%
Oil
0.8%
Coal
73.3%
Gas
20.9%
Gas
17.2%
Nuclear
4.4%
Renewable
and Other
6.1%
Nuclear
3.2%
Renewable
and Other
5.5%
* Forecasted
Source: Energy Information Administration’s Annual Energy Outlook 2007
Updated: 8/07
U.S. Electricity Generation Fuel Shares
2006*
Gas
19.9%
Oil
1.6%
Nuclear
19.4%
Hydro
6.9%
Coal
49.0%
Renewable
and Other
3.1%
* Preliminary
Source: Global Energy Decisions / Energy Information Administration
Updated: 4/07
U.S. Electricity Generation Forecast
2005 – 2030, Billion kWh
2030: 5,797 Billion kWh
5,500
4,500
2005: 4,046 Billion kWh
3,500
2005
2010
2015
2020
2025
2030
Source: Energy Information Administration
Updated: 4/07
U.S. Electricity Generation Fuel Shares
2030
Oil
1.8%
Gas
16.2%
Nuclear
15.5%
Coal
57.4%
Hydro
5.3%
Renewable
and Other
3.7%
* Preliminary
Source: Global Energy Decisions / Energy Information Administration
Updated: 4/07
U.S. Capacity Factors by Fuel Type
2006*
Fuel Type
Average Capacity Factors (%)
Nuclear
89.8
Coal (Steam Turbine)
71.1
Gas (Combined Cycle)
39.9
Gas (Steam Turbine)
17.2
Oil (Steam Turbine)
14.9
Hydro
31.8
Wind
30.3
Solar
18.8
*Preliminary
Source: Global Energy Decisions / Energy Information Administration
Growing Need for
Additional Capacity (2006)
 Electricity demand in 2030 will be 45% greater
than today
 To maintain current electric fuel supply mix would
mean building:
50
Nuclear reactors (1,000 MW)
261
Coal-fired plants (600 MW)
279
Natural gas plants (400 MW)
93
Renewables (100 MW)
Source: 2006 Annual Energy Outlook, Energy Information Administration
Nuclear Units Under Construction Worldwide
Country
Number of Units
Total MWe
Argentina
1
692
Bulgaria
2
1,906
China
4
3,220
China, Taiwan
2
2,600
Finland
1
1,600
India
6
2,910
Iran
1
915
Japan
1
866
Pakistan
1
300
Romania
1
655
Russia
7
4,585
S. Korea
2
1,920
Ukraine
2
1,900
Total
31
24,069
Source: International Atomic Energy Agency PRIS database. Updated: 5/07
New Nuclear Plants Under Consideration
Company
Location (Existing Plant)
Units
Dominion
Louisa County, VA (North Anna)
1
NuStart Energy (TVA)
Jackson County, AL (Bellefonte)
2
NuStart Energy (Entergy)
Claiborne County, MS (Grand Gulf)
1
Entergy
West Felciana Parish, LA (River Bend)
1
Southern Co.
Burke County, GA (Vogtle)
1-2
Progress Energy
Wake County, NC (Harris) & Levy County, FL
2-4
South Carolina Electric & Gas
Fairfield County, SC (V.C. Summer)
1-2
Duke Energy
Cherokee County, SC (Lee)
UniStar Nuclear
Calvert County, MD (Calvert Cliffs)
Florida Power and Light
TBD in FL
1
NRG/STPNOC
Matagorda County, TX (South Texas Project)
2
Amarillo Power
Carson County, TX
2
TXU
TBD in TX
2-5
Exelon
TBD in TX
2
Alternate Energy Holdings
Owyhee County, ID
DTE Energy
Monroe County, MI (Fermi)
1
PPL Corporation
Luzerne County, PA (Susquehanna)
1
2
1-5
TBD
New NRC Licensing Process
(1992 Energy Policy Act)
Early Site
Permit *
Combined
License *
Construction
Construction
Acceptance
Criteria *
Design
Certification *
* Public Comment Opportunity
Operation
Standardized Plants Benefits


Design -- designed once with one NRC approval documented in a NRC rule
Construction practices
–

Parts and components
–

More efficient & effective licensing
More efficient use of regulatory resources
Design improvements
–

Procurement efficiencies and shared “spare part” inventories
Regulatory interface
–
–

Increased construction efficiencies & schedules with experience
One modification package Standardizes modifications (like uprates, physical and procedural
improvements)
Operating and maintenance
–
–
–
–
Procedures
Good practices & training
More efficient outages
Improved equipment reliability
Standardization will reduce the cost of building subsequent plants
and operating all plants
The “Once Through” Fuel Cycle:
The Old View of Used Fuel Management
Yucca Mountain
Nuclear Plant
Used Fuel
Used Fuel Management:
An Integrated, Phased Program
 Developing advanced technologies to recycle nuclear fuel
provides needed flexibility
 Sites for recycling logical candidates for interim storage
– Allows DOE to meet statutory obligation to remove used fuel
from operating plants
– Sustains public, political, industry confidence in used fuel
management program
– DOE grants to 11 volunteer sites for siting studies
 Yucca Mountain still needed long term
Used Fuel Management:
New Strategic Direction
Recycled
Nuclear Fuel
Advanced
Recycling
Reactors
Used Fuel
Used Fuel
Recycling,
Interim
Storage
Nuclear
Waste
Yucca Mountain
Capital Intensive Industries
5.0
Duke3
Capital Intensity1 (three-year average)
4.5
4.0
NRG
Southern Co.
Dominion
Entergy
3.5
3.0
FP&L
2.5
2.0
1.5
AmerenUE
PPL Corp.
Exelon Corp.
TXU
Progress
DTE Energy
SCANA
BP
ExxonMobil
1.0
0.5
0.0
$0
Constellation
Chevron
$50
$100
$150
$200
$250
$300
$350
Market Capitalization2 (billion dollars)
1.
Capital Intensity = total assets divided by total revenues, 2004 – 2006..
2.
Market capitalization = number of shares outstanding times share price on 7.3.07..
3.
Capital Intensity for Duke is for 2006 only.
$400
$450
$500
Energy Policy Act of 2005:
Production Tax Credit
 $18/MWh for first 6,000 MW of new nuclear capacity
 Distributed on a pro rata basis to all plants that:
– Submit a COL application to the NRC by Dec. 31, 2008
– Begin construction by Jan. 1, 2014
– Start commercial operation by Jan. 1, 2021
 Production tax credit
– Enhances financial attractiveness of project after it is built
and in commercial operation
– Does not address financing challenges before and during
construction
Energy Policy Act of 2005:
Standby Support
 Federal insurance coverage for delays caused by
licensing or litigation
 Covers debt service only
 Limitations on coverage reduce value
– First two $500-million policies: 100% of delay costs, no
waiting period for claims
– Second four $250-million policies: only 50% of delay costs
after 6-month delay
Energy Policy Act of 2005:
Loan Guarantee Program
 2005 Energy Policy Act authorizes loan guarantees
up to 80 percent of project cost
 Should allow nuclear plant developers to
– Increase leverage
– Reduce financing costs
– Reduce cost of electricity from project
– Non-recourse to project sponsor’s balance sheet
 Final regulations late 2007
State Policies Supporting
New Nuclear Construction
 Utilities and policymakers in regulated states realize
need for fuel and technology diversity
 Policies being implemented that:
– Value diverse generation portfolio
– Limit retroactive reviews of prudence
– Allow PUCs to approve new plant costs, set future rate
increases before construction
– Allow investment recovery during construction