ETI project has identified eight key drivers with the potential to reduce costs for future new nuclear power projects
Low carbon, low cost new nuclear energy is achievable in the UK, through a sector-wide, integrated cost reduction programme that builds on global best practices
An effective cost reduction programme could also reduce the duration and risk of nuclear projects, changing the perception of nuclear construction risk and reducing financial costs
The ETI has today released a summary report from its Nuclear Cost Drivers project which identifies eight key cost drivers and thirty five credible opportunities to reduce the cost of generating electricity using nuclear power. The full report and further insight from the ETI will be released later this year.
Through an evidence-based study of historic, contemporary and future nuclear power projects, research shows that there are a small number of understandable factors that drive the cost of nuclear plants. The analysis also highlights that there are several consistent characteristics shared amongst low cost plants and different common characteristics shared across high cost power plants. If understood and addressed they can reduce the cost of new nuclear projects.
The project, led by Clean Tech Catalyst, Ltd (CTC) and working with Lucid Strategy, found that cost reductions achieved elsewhere in the world are a result of nuclear programmes focused on improving performance and delivering cost reduction. The ETI believes that there is significant cost reduction potential in the UK, though this will be dependent on all principal actors working together to deliver an integrated cost reduction programme, including the application of learning and a focus on delivering efficiencies in direct and indirect labour supporting nuclear power projects.
A key finding from the project is that there is clear potential for a cost reduction programme to materially reduce the duration and risk of nuclear projects, helping to change the perception of nuclear construction risk whilst reducing interest rates and the cost of capital.
As long as nuclear power is cost competitive within the overall energy mix, it has the potential to play a significant role in the UK’s transition to a low carbon economy. The challenge is to realise cost reductions across a sequence of new nuclear power reactors, which can meet the expectations of Government, investors and consumers.
Unlike other low-carbon technologies such as offshore wind and carbon capture and storage, fleet deployment itself does not necessarily generate cost reduction for nuclear power plant projects. However, such cost reductions cannot be materialised without deployment of a new nuclear fleet. There is evidence of previous UK expertise in the cost-effective delivery of nuclear power projects, but this “know how” must be regenerated through an integrated programme and applied to delivering a fleet of new nuclear projects.
This report we hope will add to the evidence base which will inform UK nuclear activity in the coming years in support of the soon to be announced nuclear sector deal.
Kirsty Gogan, Director, CleanTech Catalyst added:
“Our Study set out to understand what drives the range in cost of delivered nuclear plants around the world. Our findings are clear that many transformative best practices are transferable to the UK context. This Study can help Government and Industry to quantify its ambition on cost reduction and develop a plan to get there. A sector-wide, carefully designed programme focused on delivering high quality and lower cost construction could start the UK down the path to far more affordable nuclear energy.”
In his review, independent project reviewer, Dr Tim Stone, said:
“This report, together with the model and new database has shed a great deal of light on the factors which cause some new nuclear projects to be on time and on budget, and some not. It has assembled the best data yet collected and taken a formal analysis together with carefully gathered qualitative views of the project professionals who have led a number of different projects where anonymity has enabled a great deal of transparency and honesty. The report should be required reading for anyone involved in new nuclear projects anywhere in the world and should also help to dispel myths and educate emotional views on the practical future of new nuclear projects.”