slide 1 doc.ppt 0144 new nuclear power ed cummins westinghouse electric company june 29, 2006
TRANSCRIPT
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A Nuclear Renaissance is Beginning
Major Driving Factor
- Price of natural gas more than doubled.
- Volatility of natural gas prices
- High long-term projections for natural gas prices Additional Considerations
– Energy security
– Uncertainty in the future emissions regulations (monetization of airborne pollutants such as carbon and mercury)
– Availability of advanced nuclear plant designs– Relative stability of regulatory environment– Public policy (political) support (Energy Legislation in the U.S.)
Challenges- Spent fuel disposal- Resource availability (human and supply chain)- Project Management
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U.S. Government Support
“To build a secure energy future, we need to expand production of safe, clean nuclear power.”
President George W. Bush
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New Plant Licensing Process Early Site Permit
- ESP is a partial construction permit .
- ESP addresses site safety issues, environmental protection
issues and plans for coping with emergencies.
- Independent of the review of a specific nuclear plant design
- Three ESP applications submitted in 2003 (Dominion,
Exelon and Entergy).
- Southern Company has scheduled an ESP application
in August 2006.
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New Plant Licensing Process Cont’d.
Combined License (COL) - COL authorizes construction and conditional
operation of a nuclear power plant. - COL application should include information required for
a construction permit and operating license. - Must include the proposed inspections, tests and
analyses which the licensee shall perform and associated acceptance
criteria (ITAAC) .
- The NRC must also find that the ITAAC have been met before
granting authorization to operate.
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Nuclear Power 2010 Dominion pursuing COL for ESBWR at North Anna. NuStart Project Status
- Two sites selected for COL Application - Bellefonte (TVA) for AP1000 and Grand Gulf (Entergy) for ESBWR.
- GE filed an application for design certification of ESBWR in August 25, 2005.
- Design certification of AP1000 was issued in December 2005 .
- Engineering work needed for COL applications under way.
Submit COLs in the fourth quarter 2007. Obtain COL license in 2010. Plant operation 2015.
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United States New Plant Market Status
Commitments for COL License
AP1000NuStart (TVA) 2 unitsDuke 2 unitsProgress 2 units North CarolinaProgress 2 units FloridaSCANA 2 unitsSouthern 2 units
12 unitsESBWR
Dominion 2 unitsEntergy 2 units
4 unitsEPR
Constellation 1-2 units
ABWRSouth Texas 2 units
Power Companies Evaluating Technology Florida Power and Light AMEREN UE Texas Utilities
Strong preference for passive plants Preference for design and licensing maturity of AP1000
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2005 Energy Policy Act
President Bush signed the comprehensive energy bill into law, called 2005 Energy Policy Act. on August 8, 2005.
Nuclear Related Provisions
- Federal risk insurance that would pay up to $2B if there
are delays in full power operations of the first six
advanced power reactors receiving NRC’s new combined
construction and operating licenses. This covers
100% of the cost of delay for the first two new plants, up to
$500M each, and 50% of the delay costs up to $250M
each for plants three to six.
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2005 Energy Policy Act Cont’d. Nuclear Related Provisions (continued)
- Federal loan guarantee of up to 80% of the project cost.
- Production tax credit for new reactors of 1.8 cents per kilowatts-hour for nuclear generated electricity over eight years. Implementing rules share benefits among qualifying new plant projects.
- All decommissioning funds are taxed at 20% rate (reduced from the current rate).
- Extension of Price-Anderson Act through 2025 (accident insurance).
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AP1000 Schedule to Commercial Operation
Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4201420132004 2009 2010 2011 20122005 2006 2007 2008
Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 420162015
COL Engineering
Early Procurement Activities
Pre-Construction Site Activities
Construction
Startup
FOAK Design Details
AP1000 DC
Commercial
Operation
COL Issued
Place Order
Submit COL
FDA
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Westinghouse developed AP600, its first passive safety reactor
system in the early 1990s (1,300 man-years of design and testing). NRC issued AP600 design certification in 1999 following extensive
licensing review of more than 130 man-years and independent
confirmatory testing of critical systems. Westinghouse embarked on AP1000 development to improve cost
competitiveness. Half billion dollars and over 15 years invested in the development
of passive technology.
Westinghouse Fifteen Year Investment in Passive Technology
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AP1000: No Technology Risk
AP1000 power generation systems (fuel, NSSS, turbine generator, support systems) are of “traditional design” and involve no new or novel technology. Operating experience is directly applicable.
“Passive” safety systems are, in general, very simple consisting largely of tanks, pipes and a few air or DC operated valves.
Expected performance under accident conditions validated by extensive testing (>$40 MUSD) and regulatory review.
Modular construction techniques well proven in non-nuclear applications (ship building, off-shore drilling platforms)
Mature in design and licensing – 60% complete
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The Westinghouse AP1000
A compact station• 3415 MWt. Primary system•1117 MWe•2-loops, 2 steam generators
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AP1000 Provides Safety and Investment Protection
1 x 10-4 (a) 5 x 10-5 1 x 10-5 (a) 5.1 x 10-7 (a)
Core Damage Frequency per Year
U. S. NRCRequirements
CurrentPlants
US UtilityRequirements
AP1000Results
Note (a) CDF includes random and internal hazard events from at-power and shutdown conditions.
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AP1000 Simplifications Safety
– Use of passive safety systems Design
– Reduced number of components and bulk commodities Procurement
– Standardization of components Construction
– Extensive use of modules reduces on-site construction– Multiplexed I&C communication reduces cables
Operation and Maintenance– Use of proven systems and components– Man-machine interface advancements
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Passive Safety – What is it all about?
Passive Safety Systems utilizes naturally occurring physical phenomena such as natural circulation of air, water and steam.
Gravity and gas pressure drive the flow of cooling water.
Natural heat transfer occurs through conduction, convection and evaporation.
Flow and cooling occur in accordance with nature’s laws – There are no pumps and motor-operated valves.
A few valves align the passive safety systems upon actuation signals.
Greatly reduced operator dependency
AC electrical power is not required for plant safety.
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The AP1000 is Smaller and Dramatically Simpler than Evolutionary Plants
74147A
Sizewell B AP1000
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Standardization
Standardization has been a key element of New Plant Commercialization for 20 years – NPOC Strategic Plan.
The Utility Requirements Document standardized the Power Company requirements for New Plants.
Design Certification commits the Plant Supplier and the Nuclear Regulatory Commission to a “Standard Plant”.
NRC approach to Design Centered Combined Construction and Operating License (COL) enhances standardization.
NRC will “punish” departure from Design Centered review with “extended” licensing schedule.
Economics provide incentives for Standardization Beyond Design:
– Operations - Supply Chain– Engineering - Maintenance
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Standard Plant Design Scope Since the start of the AP600 program, Westinghouse has
maximized the scope of the Standard Plant:
– Forced Draft Cooling Tower for non-safety related Essential Service Water System
– Spring Mounted Turbine Table Top is not sensitive to Site Soil Conditions.
– Use of Broad Set of Environmental interface criteria established by the URD (snow, rain, temperatures, wind, soil conditions)’
Standard Plant is described in AP1000 Design Control Document, Chapter 1.2.
The Scope of Standardization includes the entire plant. Passive Plant Standardization is enhanced by:
– No need for Safety Related AC Power
– No need for Safety Related Ultimate Heat Sink (Intake Structure)
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Standard Plant Market ApproachReduced risk to both buyers
and sellers
Lower power generation cost
Shorter construction schedules
Enhanced public confidence
Smoother regulatory review
Improved perception/
acceptance of financial markets
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0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Year
Pro
du
ctio
n C
ost
(2
00
5 c
en
ts/k
wh
)
Nuclear 1.72
Coal 2.21
Gas 7.51
Oil 8.09
Source: Global Energy DecisionsUpdated: 6/06
Production Costs = Operations and Maintenance Costs + Fuel Costs
U.S. Electricity Production Costs
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.
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
1980 1985 1990 1995 2000 2005
Year
Gas
Pri
ce ($
/MM
Btu
)
Source: DOE/EIA – Electric Power Monthly
Natural Gas PriceU.S. Electric Generation
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80%
35%12%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Nuclear Coal NGCC
Co
st P
rop
ort
ion
O&MFuelCapital
Generation Fuel Cost
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68%
50%
14%0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Nuclear Coal NGCC
Co
st
Pro
po
rtio
n
O&M
Fuel
Capital
Generation Capital Cost
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Electricity Regulatory EnvironmentNuclear plants can be implemented in either
regulated or unregulated electricity markets.
All power companies committed to obtaining AP1000 COL licenses operate in regulated markets (Southern, Duke, Progress, SCANA).
In regulated markets, the plant owner obtains a predetermined regulated return on investment. The price of electricity is set by the regulator to achieve this return.
Regulators evaluate and approve generating capacity additions based on consideration of (cost, fuel diversity, fuel volatility and security of supply).
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Electricity Regulatory Environment-Cont’d.
New nuclear plants have been proposed in unregulated markets (Dominion and Constellation).
Market based owners of nuclear plants sell electricity at the “market price” and obtain a return on investment based on the difference between market price and the production costs.
Uncertainty in market price leads unregulated power companies to seek long-term power purchase contracts.
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Electricity Pricing Under Regulation Is Based On Recovering Utility Revenue Requirements
Electricity Price =Revenue Requirements / Electricity Generation (kwh)
Revenue Requirements =Operating Costs + Rate Base x Allowed Rate of Return
Operating Costs =O&M + Fuel + Depreciation & Amort. + Taxes + Fees + Accruals
Rate Base =Gross Investment - Accumulated Depreciation
Allowed Rate of Return =Value Determined by State or Federal Regulatory Commissions
•The price of electricity is established by the regulator to provide generating plant owners on agreed return.•New nuclear plants are approved if the expected cost of electricity is less than for alternate generating sources “Least Cost Plan”.
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Deregulated Market Pricing Example:Plants are Dispatched in Order of Bid Price
0
5
10
15
20
25
30
35
40
1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000
Cumulative System Capacity (MWe)
En
erg
y P
rice
($/
mw
h) Plant Bid Price
Each Plant Assumed to be 1,000 MWe
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Deregulated Market Pricing Example: At a 5,000 Mwe Demand Level All Plants Operating Receive $15/mwh
0
5
10
15
20
25
30
35
40
1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000
Cumulative System Capacity (MWe)
En
erg
y P
rice
($/
mw
h)
Contribution to Fixed Cost& Profit
Plant Bid Price
Each Plant Assumed to be 1,000 MWe
Marginal PlantMarket Clearing Price
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Load Duration CurveNERC Regions
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0%10%20%30%40%50%60%70%80%90%100%
Percent of Hours > Load Value
Per
cent
of P
eak
Load
ERCOT
FRCC
NEPOOL
The Demand for Electricity Is Driven by the Shape of the Load Duration Curve for Each of the Regions
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Analyzing 2006 Wholesale Electricity Costs in New England
2006 Regional System Plan (RSP06) estimated how certain actions can affect costs
RSP06 will model a number of scenarios to determine their effect on prices, including:
– Addition of a 1,000 MW base load resource
– Addition of a 1,000 MW clean-coal generator
– 5% load growth without generation addition Nuclear base loads impact is similar to coal. A low
cost generator is added to the generation mix. Owners return is based on integrated difference in
market price and generating cost.
Change in wholesale price-5.7%
-5.6%
5.8%
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0
10
20
30
40
50
60
70
80
Nuclear Coal -Low
Coal -High
NGCC -Low
NGCC -High
Lev
eliz
ed C
ost
($/
mw
h)
O&MFuelCapital
$2,400-3,200/kwe Breakeven with NGCC
$1,800-2,300/kwe Breakeven with Coal
Nuclear Breakeven Capital Cost
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Market Based Nuclear GenerationDispatching Resources
ISO uses least expensive mix of resources to meet minute-to-minute power needs of the region.
– Impact of additional units depends on size of ISO and characteristics of electric load.
Most expensive needed resource sets market clearing price for all (Uniform Clearing Price Auction).
– Sends a clear signal to investors and the region on what resources should be developed.
– Responds immediately to changed market conditions.
– Encourages marginal-cost based offers so that the most efficient units are dispatched.
Marginal cost for nuclear fuel cost $5.0/MWK
O&M costs are treated as fixed at about $10.0 MWH.
Return on capital is dependent on cost of plant and capacity factor.
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Summary
The current resurgence of interest in nuclear power in the U.S. is based on several factors:
– Need for additional base load generation in the 2010-2015 period
– High price of natural gas makes nuclear plants the lowest cost generation source.
– Uncertainty in Environmental Legislation (carbon, mercury, other pollutants) results in reluctance to build coal plants.
– Concern about carbon emissions is expected to result in carbon taxes or emission free incentives.