Projected Costs of Generating Electricity - OECD Nuclear Energy ...

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BPE will be established not as a binding force but as a tool providing market participants with appropriate information and market based solutions. The government of Korea revised the Fifth Long Term Power Development Plan (5 th LPDP) and released the First Basic Plan of Long Term Electricity Supply and Demand (1 st BPE) on 17 August 2002. Electric demand forecasts According to the 1 st BPE, the annual growth rate for electricity sales is expected to be 3.3% on average from 2001 to 2015. The annual growth rate for peak load is expected to be 3.4% on average for the same period. Consequently, total electricity sales are expected to be 311 056 GWh in 2005, and 391 950 GWh in 2015. For those years, annual peak demand is expected to be 51 859 MW and 67 745 MW, respectively. Survey result on investors’ generating capacity addition and retirement KPX performed a survey to collect information on generating capacity addition and retirement from generating companies and potential investors in the mid and long term period. Generating companies and investors intend to build 97 generating units, totalling 41150 MW, prior to 2015. The survey indicated that the capacity addition of coal fired plants increased 3 400 MW and that of LNG fired increased 4 300 MW, while oil fired and hydro decreased 4 000 MW and 230 MW respectively, compared with the generating capacity additions in the 5 th LPDP. Generating companies intend to retire 6 570 MW between 2002 and 2015. (With plant life extension, the retirements are 2 910 MW less than in the 5 th LPDP). Electric industry restructuring plan in Korea Overview In 1994, the Korean government carried out a two-year evaluation study of KEPCO’s organisation to estimate the potentials of efficiency increase in the power sector. The result of this study suggested restructuring and gradual privatisation of the company. Accordingly, in 1997, an Electricity Industry Restructuring Committee was established within the government, and prepared the Draft Plan for Restructuring of the Electricity Supply Industry. On 21 January 1999, taking into consideration this plan, the Ministry of Commerce, Industry and Energy (MOCIE) announced publicly the Basic Plan for Restructuring of the Electricity Supply Industry. According to this plan, the restructuring should: ● ● ● Implement a competitive market structure with full competition on the generation side and limited retail competition, leading ultimately to full retail competition circa 2009. Unbundle the existing vertically integrated utility, KEPCO, into five to seven generation companies (GenCos), a transmission company and multiple distribution companies. Retain nuclear generation assets in public ownership until a decision on whether or not to offer them for sale is determined at some future point. The restructuring plan announced by the government involved a gradual transition to wholesale competition with the introduction of retail competition taking place after the year 2009. The plan established that, in the initial period, KEPCO’s generation assets would be divided into a number of companies for divestment and/or privatisation. 130
Current status of restructuring The current electricity market, which began operation on 2 April 2001, is referred to as the first stage of restructuring and the Generation Competition Market. In this phase, multiple GenCos, one transmission/ distribution company (KEPCO), and several IPPs exist in the market. The transmission and distribution sectors remain as part of the KEPCO. The Electricity Business Act (the Act) calls for the creation of a Korean Electricity Commission, consisting of up to nine members and a Chairman, to act as the industry regulatory authority. Under the Act the Commission is an advisory and arbitration body. The MOCIE Minister appoints the members and has the authority to make important decisions after deliberation and resolution by the Committee. KEPCO’s fossil and hydro generators have been divided into five groups that are being established as separate generating companies, first as KEPCO subsidiaries and eventually as separate, private companies. The five groups/companies are similar in size and composition, with each having one large, baseload coal-fired plant and several smaller plants. The nuclear plants will remain together in a KEPCOowned subsidiary. Transmission and distribution (T&D) will remain within KEPCO. Korea power exchange The Korea Power Exchange (KPX) called for in the Act has been created as an independent entity. KPX has assumed responsibility for finishing the work that was begun by KEPCO to design and implement a power pool. The Act provides that KPX operates an integrated spot market/dispatch system, in which the dispatch instructions to generators are based on the quantities determined in KPX’s market process. Such an integrated process provides a good basis for an efficient, reliable market that should prevent many of the serious problems encountered in the Californian market system. The KEPCO/KPX/consultant process has produced a set of rules for the initial Cost-Based Pool (CBP). In the CBP, KPX determines system operations and market prices/quantities using regulated, cost-based offers from generators to supply energy. The CBP determines a single, Korea-wide System Marginal Price (SMP) for each hour representing the avoidable cost of the most expensive generating unit needed to meet demand in a notional unconstrained dispatch, in other words, a hypothetical dispatch indicating which generators would run if there were no transmission constraints. Cost estimates and generation technologies Nuclear Korea established an overall nuclear technology self-reliance programme in 1984. Through this programme, Korea has developed Korean standard nuclear power plants (KSNP, PWR 1 000 MW) by use of accumulated experience in construction and operation of NPPs. In addition to KSNP, Korea started a programme for development of the Advanced Power Reactor (APR), the second generation of KSNP. The key objectives of the APR development programme are enhancement of safety and economics. These reactors, KSNP and APR, are expected to be main elements in Korean export of nuclear technology. The cost estimates of nuclear generation provided in this study were based on two units of KSNP at a site. The notable difference from the OECD/NEA method is that the O&M costs include decommissioning, spent fuel treatment and rad-waste treatment. The decommissioning cost was estimated at 161.9 billion won of 1 January 1992 for a 1 000 MW class reactor. 131
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NUCLEAR ENERGY AGENCY INTERNATIONAL
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ORGANISATION FOR ECONOMIC CO-OPERAT
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Table of Contents Table of Contents
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Figures Figure 3.1 Specific overnig
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The introduction of liberalisation
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150 USD/MWh at a 5% discount rate a
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The technologies and plant types co
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locations and/or very favourable co
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conclusions of the study were used
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Chapter 2 Input Data and Cost Calcu
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equipped with emission control devi
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Table 2.2 - Exchange rates (as of 1
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Table 2.4 - Coal plant specificatio
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Table 2.7 - Wind and solar power pl
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Table 2.10 - Other plant specificat
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Figure 3.1 - Specific overnight con
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exchange rates, the coal prices var
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Construction time Gas-fired power p
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USD/MWh 70 60 Figure 3.5 - Levelise
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O&M costs The specific annual O&M c
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Cost ranges for coal, gas and nucle
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Ratio 1.9 Figure 3.12 - Cost ratios
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Table 3.11 - Overnight construction
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Table 3.14 - Projected generation c
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Except for the offshore plant in th
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At 10% discount rate, the levelised
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At 5% discount rate, hydroelectrici
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Table 4.6 - Projected generation co
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A CHP plant typically supplies heat
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Figure 5.2 - Levelised costs of ele
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lower unit capital and operating co
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cost calculation for some 130 power
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It should be stressed that the plan
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Concluding remarks The lowest level
Page 82 and 83: Portugal Mr. António B. Gomes EDP
Page 84 and 85: Table A2.1 - Nuclear plant investme
Page 86 and 87: Overnight Capital Costs: Constructi
Page 88 and 89: Table A2.7 - Gas-fired (including C
Page 90 and 91: Table A2.10 - Wind plant investment
Page 96 and 97: Cost structure of supported green e
Page 98 and 99: The highest investment cost arises
Page 100 and 101: The expected development of the per
Page 102 and 103: ● ● Autoproducers. These firms
Page 104 and 105: Canada The electricity market situa
Page 106 and 107: Natural gas - combined cycle gas tu
Page 108 and 109: Denmark Basic data Denmark has abou
Page 110 and 111: In the future, both an increase in
Page 112 and 113: nuclear operator Teollisuuden Voima
Page 114 and 115: these power generation methods. Two
Page 116 and 117: Figure 5 - Competitiveness of vario
Page 118 and 119: 2004. It envisages the gradual incr
Page 120 and 121: Table 4 - Gross electricity supply
Page 122 and 123: ● ● ● ● ● ● ● ● ●
Page 124 and 125: Electricity generation costs The to
Page 126 and 127: photovoltaic device. Finally the su
Page 128 and 129: Table 1 - Installed electric power
Page 130 and 131: Japan Consumers in Japan are suppli
Page 134 and 135: Coal Coal fired power plants have b
Page 136 and 137: A new sewage treatment plant with a
Page 138 and 139: The interconnections between Portug
Page 140 and 141: In order to respond to these basic
Page 142 and 143: efficient energies and is reducing
Page 144 and 145: Liberalisation Basic restructuring
Page 146 and 147: External costs for electricity prod
Page 148 and 149: At the beginning of plant operation
Page 150 and 151: and high ash, moisture and sulphur
Page 152 and 153: The White Paper did not contain pro
Page 154 and 155: Table 7 shows the projected load fa
Page 156 and 157: other investment options available
Page 158 and 159: The impurities contained in coal ar
Page 160 and 161: “ultra-supercritical” condition
Page 162 and 163: unmineable coal seams. All three pr
Page 164 and 165: Light water reactors require enrich
Page 166 and 167: concerns. Consequently, the natural
Page 168 and 169: generators and power electronics el
Page 170 and 171: conventional fossil-fired plants. B
Page 172 and 173: ● ● very effective and is used
Page 175 and 176: Appendix 5 Cost Estimation Methodol
Page 177: into account in the real price of g
Page 180 and 181: ● ● ● ● Factors under the c
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and small power plants. Although th
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The general approach remains useful
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Two US economic analyses of nuclear
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assume future prices follow a rando
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The effects of price risk on techno
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The option to delay is embedded in
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Appendix 7 Allocating the Costs and
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Further Fourier’s law for heat tr
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Figure A7.4 - The energy conversion
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This yields: β = 0.153 α. If α e
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It is emphasised that depending on
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1 st oil shock 2 nd oil shock Saudi
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Table A8.2 - Expected lower and upp
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Reliability in electricity systems
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is also highly dependent on the typ
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In the ILEX study 5 and in another
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an increasing share of wind is the
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able to work out the optimal operat
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Appendix 10 Impact of Carbon Emissi
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costs of generation. The introducti
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price at 3.5 €/GJ are the next fa
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Figure A10.5 - Steam coal price var
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The longer term impact on investmen
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Appendix 11 List of Main Abbreviati
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