atw 2017-12
Create successful ePaper yourself
Turn your PDF publications into a flip-book with our unique Google optimized e-Paper software.
<strong>atw</strong> Vol. 62 (<strong>2017</strong>) | Issue <strong>12</strong> ı December<br />
had nothing to do with the company’s AP1000 reactor<br />
technology and that AP1000 reactors being built in China<br />
are proceeding well.<br />
In September <strong>2017</strong> Westinghouse said it remained<br />
committed to developing a 225-MW small modular reactor<br />
in the UK.<br />
Author<br />
NucNet<br />
The Independent Global Nuclear News Agency<br />
Editor responsible for this story: Kamen Kraev<br />
Avenue des Arts 56<br />
1000 Brussels, Belgium<br />
www.nucnet.org<br />
The Cost of SMRs: How Rolls Royce Aims<br />
to Compete with Wind and Solar<br />
NucNet<br />
The UK nuclear industry is hoping that claims by Rolls-Royce that small modular reactor (SMR)<br />
projects could deliver electricity for a similar cost to offshore wind will provide much-needed<br />
impetus to government plans for the country to develop a “best value” SMR and put it into<br />
commercial operation by the end of the next decade.<br />
Rolls-Royce and its consortium partners, including Amec<br />
Foster Wheeler, Arup, Laing O’Rourke and Nuvia, say the UK<br />
SMR they are developing could produce energy for as low<br />
as £ 60 (€ 66, $ 79) per MWh, which is competitive against<br />
wind and solar and significantly lower than the £ 92.50 per<br />
MWh agreed by the government and project developer<br />
EDF for the new Hinkley Point C nuclear station.<br />
According to Rolls-Royce, the capital cost of the UK SMR<br />
can be reduced from a first-of-a-kind (FOAK) baseline to<br />
Nth-of-a-kind (NOAK) over a relatively short period of time,<br />
perhaps as little as eight years. This is less than the time<br />
required to construct a single large reactor such as the EPRs<br />
planned for Hinkley Point in Somerset. The levelised cost of<br />
electricity (LCOE) generated by a FOAK UK SMR power<br />
station is forecast under £ 75 per MWh, but this reduces to a<br />
forecast £ 65 per MWh by station number five. In the<br />
medium term the target is even lower at £ 60 per MWh.<br />
The Rolls-Royce cost estimates were a boost for the<br />
nuclear industry, coming days after it emerged that<br />
offshore wind has fallen in cost over the past few years<br />
with a recent UK government auction for subsidy contracts<br />
awarding offshore wind projects due to generate power in<br />
2021-22 contracts at £ 74.75 per MWh, while those set to<br />
generate in 2022-23 were awarded contracts for £ 57.50<br />
per MWh. That price is half of what new offshore<br />
windfarms were being awarded just two years ago.<br />
However, Rolls-Royce also warned in its report that the<br />
government needs to “move forward with pace” towards<br />
establishing the conditions required for a UK SMR to<br />
flourish. The rest of the world continues to develop SMR<br />
technology and the UK is in danger of being left behind. A<br />
key role for government is to provide a fertile “ecosystem”<br />
for UK SMR development, starting with policies and<br />
support for an indigenous UK SMR market.<br />
In 2016 the government launched the first phase of a<br />
£ 250 m SMR competition to choose the best design of<br />
SMR for the UK, but the second stage of the competition –<br />
with design proposals chosen for funding – has not yet<br />
materialised. The competition followed an announcement<br />
in 2015 when the then chancellor George Osborne<br />
promised £ 250 m over five years for a nuclear research<br />
and development programme, an undisclosed sum of<br />
which was for a competition to pave the way for SMRs.<br />
Sources confirmed that officials from the Department for<br />
Business were whittling down proposals from various<br />
consortia, including Rolls-Royce, keen<br />
to work with the government to<br />
develop SMRs. The Daily Telegraph<br />
newspaper reported on 9 September<br />
<strong>2017</strong> that ministers are ready to<br />
approve the development of a fleet of<br />
SMRs. Industry players including<br />
Rolls-Royce, NuScale, Hitachi and Westinghouse<br />
have held meetings in past<br />
weeks with civil servants about nuclear<br />
strategy and development of SMRs,<br />
the newspaper said. Tom Greatrex,<br />
chief executive of the London-based<br />
Nuclear Industry Association, said<br />
with a potential global market for SMRs valued at<br />
£ 250 bn – £ 400 bn, the government must provide clarity if<br />
the energy, industrial and export opportunities of a UK<br />
SMR are to be realised.<br />
The appeal of SMR designs is that because of their small<br />
size, 300 MW or less, they are economic, factory built<br />
and shippable, flexible enough to desalinate, refine oil,<br />
load-follow wind, and produce hydrogen. And they seek<br />
to address the basic economic challenges that larger plants<br />
have struggled to overcome in recent years. Those<br />
challenges include reducing the overall capital cost,<br />
which would allow for conventional project financing;<br />
improved certainty of construction, manufacture and<br />
project delivery; and a competitive LCOE.<br />
Energy analyst James Conca, writing in Forbes magazine,<br />
identifies another key advantage of SMRs. The small size<br />
and large surface area-to-volume ratio of SMRs, like the<br />
one being developed by NuScale Power, that sits below<br />
ground in a super seismic-resistant heat sink, allows natural<br />
processes to cool it indefinitely in the case of a complete<br />
power blackout, with no humans needed to intervene, no<br />
AC or DC power, no pumps, and no additional water for<br />
cooling.<br />
Rolls-Royce says SMRs are attractive because they can<br />
produce large savings for a relatively small investment.<br />
They avoid the complex challenges associated with nuclear<br />
mega-projects that require tens of billions of pounds of<br />
investment to progress – and have a general track record of<br />
overspend and delay. By reducing plant size, and therefore<br />
capital costs, SMRs can be financed via conventional<br />
project approaches, with financing limited to under<br />
Details of the<br />
clean energy package<br />
are online:<br />
http://bit.ly/2gId2Q<br />
INSIDE NUCLEAR WITH NUCNET 715<br />
Inside Nuclear with NucNet<br />
The Cost of SMRs: How Rolls Royce Aims to Compete with Wind and Solar ı NucNet