The Nuclear Cost Drivers Project will identify and analyse historic, contemporary and future nuclear power projects to identify the factors with greatest influence on costs
The aim of the project is to better understand the factors influencing the cost of electricity from new nuclear power stations and identify potential cost reductions
The project is led by CleanTech Catalyst Ltd, working with Lucid Strategy
The ETI has launched a new project which aims to identify whether there are credible opportunities for reducing the costs of generating electricity using nuclear power.
The Nuclear Cost Drivers Project will identify and analyse historic, contemporary and future nuclear power projects to identify areas of nuclear power plant design, construction and operation to deliver potential cost reductions. This will be achieved through the development and application of a comprehensive, cost study evidence base.
It is being led by CleanTech Catalyst, Ltd. (CTC) working with Lucid Strategy. Dr Tim Stone will act as an Independent Reviewer. The project will run until April 2018.
ETI analysis has demonstrated that nuclear power has a potentially significant role to play in the UK’s transition to a low carbon economy as long as it is cost competitive within the overall energy mix and there is a market need.
In the UK, the initial challenge for the nuclear new build industry is to complete the commissioning and construction of new nuclear projects in the next 10 years within acceptable norms of budget and schedule variation.
After delivering these first new plants in the UK, the subsequent challenge will be to deliver cost reductions for follow on plants which can meet the expectations of Government, investors and consumers.
There are currently no evidence led projects which can illustrate whether the costs of generating electricity from new nuclear power stations can be reduced.
The renewables industry, particularly offshore wind, is able to show a meaningful route to getting costs down though research, development and deploying at scale.
The challenge for nuclear new build in the UK is to demonstrate that it can show a credible way of delivering reduced costs. The expectation for advanced reactor technologies is that they should deliver a step reduction in costs.
“Current new build costs vary widely around the world (high in the United States and Europe; far lower in Japan, South Korea and China) and build rates are slow. Attracting private sector investment for nuclear projects is challenging due to the quantum of investment required, and the perceived financial and construction risk. The absolute levels of capital required (and associated cost of that capital) for a meaningful share in a new build project could have a significant impact on any company’s financial performance and credit rating. Nonetheless, once built, low operating costs and high capacity factors generate reliable income for investors, security of supply and price stability for consumers.
“We look forward to working with the ETI to develop a credible evidence base and identify associated cost reduction strategies for nuclear power.
“Developing meaningful cost reduction strategies to accelerate global nuclear deployment is essential to unlock the potential £1Trillion global market for scalable nuclear technology. This will be critical to urgent and inevitable deep decarbonisation pathways in the next half century.”
Lucid Strategy Managing Partner, Eric Ingersoll adds:
“Our previous work shows that productivity is the key to delivering affordable projects. This project will provide evidence for a clear path to a clean energy led revitalisation of the UK economy.”
Independent Reviewer, Dr Tim Stone said:
“Reliable data is vital to enable an understanding of the system costs for the UK government and others who recognise the potential of nuclear as a low carbon generation source. It has long been recognised that the only two numbers which matter in nuclear power are the capital cost and the cost of capital. This important project is the first to approach the first of these on a thorough and independent basis. Given the need to electrify transport and heating, the need for a major increase in cheap baseload has been clear for a while. This project will enable governments to set deliverable aspirations for their own markets. Given what is happening in Abu Dhabi and elsewhere in the Far East, it is clear that new nuclear can be cost effective. This project should help enable the UK government and others to understand at least a large part of how this can happen.”
On the 21st November, the ETI alongside project partners Atkins, DAS and Mott MacDonald will be debating the ETI’s research programme into nuclear technology as well as looking forward to the future of nuclear in the UK at the ETI’s 10 Years of Innovation conference and exhibition. The programme will include a short presentation from CleanTech Catalyst Ltd on the approach to the delivering the ETI’s Nuclear Cost Drivers Project. Interested participants can register here.