the politics and economics of international energy (spring 2009- e657)

© Copyright Giacomo Luciani

The Politics and Economics of International Energy

(Spring 2009- E657)

Lecture 10

About Nuclear Energy

Prof. Giacomo Luciani

The issue Obviously, the political impact of nuclear is

not the same as renewables and energy efficiency, nationally and internationally

A revival of nuclear energy raises the immediate threat of nuclear proliferation and possible use of WMD by governments as well as non-governmental actors

Hence nuclear energy will be an increasingly hot topic in international relations – hotter than it already is now

Main points to be discussed:

Current trends in nuclear energy uptake

Technological developments and issues

Nuclear energy for oil and gas exporting countries?

Non proliferation issues

No US players left?

Nuclear power Generation for Oil and Gas Producing Countries GCSP Geneva 4 July 07Helmut Warsch D-91341 Roettenbach Tel +49 9195 6751

10AREVA NP All rights are reserved, see liability notice.

Facts on ELECTRICITY

• Electricity is not a primary energy source but rather an energy carrier Practically all primary energy sources („clean“ or „dirty“) can be used for transformation into electricity

• Suitable for practically all applications (industry, traffic, housholds, ...) and for all purposes (drives, motion, heat, signal transmission, ...)

• Environmentally friendly and clean in use

• Easy to transport large amounts of electricity over long distances with speed of light

• No storage of large amounts of electricity possible, i.e. production necessary according to demand, in time and amount (equivalent to users). Therefore need of „backup“ power.



Typical Requirements for Different Power Plant Typical Requirements for Different Power Plant TypesTypes

Daytime

Peak load:Simple-cycle GTPP,Hydro storage plants

Base-load:Nuclear, Hydro Running Water, Coal Steam Plants

Intermediate-load:Combined Cycle PP,Coal Plants

0 4 8 12 16 20 24

Daily cycling of units

Renewables replace base load units be-cause of feed-in obligations, but need backup PP’s for wind shortfall

Competition between gas and hard coal fired plants:High gas prices shift CCPP to lower load factors

Regulationload

High Start-up ReliabilityLow start-up EvaluationLoad Ramp

Best EfficiencyHigh availabilityLow Generation CostsShort Outage Period

Weighting of ProductRequirements:

FlexibilityPart Load Efficiency

Operational Flexibility: Increasing Challenges for Base Load Plants

Increase in must run renewable

Increasing minimum to Maximum load requirement shifts

Predictability (Weatherforecast)



Power Production Costs by Plant Power Production Costs by Plant TypesTypes

Specific Investment(EUR/kW)

1700

850

400

580

1750

Power Plant Type

Nuclear Power(1600 MW, 36%)

Hard Coal(700 MW, 45%)

Combined Cycle (Gas)(450 MW, 58%)

Combined Cycle /CO2 –Sequestr./Liquific.(380 MW, 50%)IGCC Coal /CO2 –Sequestr./Liquific.(630 MW, 43%)

8000

7000

7000

7000

7000

Average Annual Full Load Hours (h/a)

Production Costs (EURct/kWh) *)

3.4+

4.2+

4.3+

4.8+

0.8

1.9

3.4

3.1

1.8

Variable Share / Total Costs

IGCC Coal(700 MW, 47%) 7000 1300 3.9+ 1.6

1100Lignite(900 MW, 43%) 7000 3.2+1.5

3.5-

*) Variable costs include fuel costs and O&M costs, while total costs include additionally capital costs Production costs averaged over plant operation time (Nuclear 45 years, Coal 35 years, CCPP 25 years, IGCC 30 years) Financing conditions: in general share of loans 70 %, interest on loan 6%, interest on equity 12%, discount rate 8%; for Nuclear EPR Finland interest on loan 4.5%, interest on equity 8%, discount rate 6%) Fuel prices: Hard coal: 2.00 EUR/GJ, Natural gas: 5.50 EUR/GJ, Nuclear fuel: 0.70 EUR/GJ (no price escalations)



Power Production Costs of Renewables by Plant Power Production Costs of Renewables by Plant TypesTypes

*) Variable costs include fuel costs and O&M costs, while total costs include additionally capital costs Production costs averaged over plant operation time (Hydro 45 years, Wind power 25 years, Biomass/Geothermal 30 years, Photovoltaic 25 years) Financing conditions: share of loans 70 %, interest on loan 6%, interest on equity 12%, discount rate 8%, Fuel prices: Biomass 1.30 EUR/GJ

Specific Investment(EUR/kW)

1800

900

1500

2200

6000

Power Plant Type

Hydro (Reservoir)(400 MW)

Wind Power (Onshore)(1,5 MW)

Wind power (Offshore)(3 MW)

Geothermal(30 MW, 25%)

Photovoltaic(1 MW)

5000

1900

3600

5000

2400

Average Annual Full Load Hours (h/a)

Production Costs (EURct/kWh) *)

0.1

0.7

0.9

1.6

0.4

Variable Share / Total Costs

Biomass(30 MW, 38%) 4500 2700 1.7

1800Hydro (Running Water)(30 MW) 5000 0.1

5.2

6.6

6.0

6.9

40.0

8.0

7.0



Energy Landscape: Today & TomorrowEnergy Landscape: Today & Tomorrow

Attractiveness

(security of energy supply, energy policy, environmental compliance, social acceptance)

Co

sts

of

pro

du

ced

ele

ctri

city

[€

cen

t/kW

h]

2

3

4

5

6

7

0% 20% 40% 60% 80% 100%

Gas CC

Coal SPP

Wind

Hydro

Nuclear

IGCC

Conventional Wisdom is Changing

Today (2005 – 2007)

Tomorrow (2011 – 2015)

= 1 GW/a



Nuclear Reactor Generations

+Fusion?

1950 201019901970 2030 2050

EPR / SWR1000 +New Types

Early Prototype Reactors

CommercialPowerReactorsPWR, BWR, CANDU,VVER/RBMK

Reactors with further enhanced safety and increased competitive-ness: Advanced water cooled reactors,e. g. EPR, SWR 1000,ABWR, AP1000

Fusion

Generation IV

Generation III, Generation III+

Generation II

Generation I

FutureAdditional Reactorconcepts:e. g. HTR, FR

*

* incl.. modernization, power increase and life time extension



Reasons for fifth NPP in Finland

Electricity generation costs, including emissions trading

13,87,6 5,3

10,2 13,0

40,17,2

7,4

3,5

6,58,2

10,0

2,7 13,1 23,4

17,9

16,2 7,0

50,1

23,1

19,639,2

54,2

44,344,3

23,727,3

22,8

14,9

0,0

10,0

20,0

30,0

40,0

50,0

60,0

Elspot2000

Finland

Elspot2001

Finland

Elspot2002

Finland

Nuclear Coal Gas Peat Wood Wind

Euro/MWh

Emissions tra-ding 20 €/t CO2

Fuel

Operation/Maintenance

Capital

Source: TVO

Operating hours 2200h/a

R.Tarjanne&K.Luostarinen 15.05.2003

operating hours 8000h/aReal interest rate 5,0%

prices may 2003

17

Natural Uranium & Thorium DISPOSAL

Scheme of Nuclear Fuel Cycle

Nuclear Energy for Oil and Gas Exporting countries

Simplistic line: they have oil and gas, why would they need nuclear?

Domestic oil and gas consumption is increasing rapidly, subtracting from exports

Gas availability is limited: Iran cannot export, Qatar imposed moratorium, S.Arabia has not enough for all industrial projects

Paradoxical decisions S. Arabia recently decided that all

new power plants will be oil fired, in order to save gas for industry

But that oil is subtracted from exports – besides being underpriced

Abu Dhabi is considering coal or nuclear

The GCC as a group is considering nuclear

Other countries

Egypt and Algeria have also launched nuclear programs

The trend is pretty universal Not just, and not primarily a response

to Iran’s ambiguities

Iran: a long story The nuclear program in Iran was initiated by

the Shah Attempts to deny Iran access to nuclear

energy are unfounded in international law and good sense

Iran’s pursuit of enrichment is not “rational” except as provocation

Iran: Is surrounded by nuclear powers (Russia, Pakistan,

Israel, the US in the Gulf) Suffered aggression and a very bloody war with

Iraq Has no external security guarantee

the politics and economics of international energy (spring 2009- e657)

Documents

power production costs

issuesnuclear energy

energy carrier

energy efficiency

variable costs

base load plantsincrease

base load units

backup power