4 ms·

Given that it has cost around $11 Billion and has taken 13 years, but has around a 60 year life span (much longer than older ones) and then the costs with decom

Given that it has cost around $11 Billion and has taken 13 years, but has around a 60 year life span (much longer than older ones) and then the costs with decommissioning, how long will it take to be economically worth it? (let alone make an operating profit or be environmentally beneficial)

pasiaj 5y ago
At current energy prices in Finland, it would take less than 1/10 of the time expected. (Of course the current price is a bit of an anomaly.)
- eb0la 5y ago
  I am not sure if it is just a bit. Gas supply in Europe is having issues: - Gas supply from Algeria via Morocco is closed. - Russia is sending less gas as usual (and profiting from it). Demand from gas in Europe remains the almost the same, but supply isn't.
  - fuoqi 5y ago
    - Force long-term contracts to be tied to spot prices instead of oil. - Do not fill storage assuming lower prices in autumn. - Intentionally delay certification of a pipeline from one of your main suppliers. - Act very surprised when the aforementioned supplier does nothing to stop spot prices explosion due to the external circumstances and even fans the flames a bit. - Make questionable remarks which accelerate the rise of gas prices even further. - Demand (sic!) from the supplier additional gas not covered by existing contracts, even though it's clearly not in his interest. I wonder why does the EU has gas supply issues?
    - zajio1am 5y ago
      > Intentionally delay certification of a pipeline from one of your main suppliers. The pipeline is not certified because it breaks existing legislation. It is up to pipeline developers/owners to fix this issue.
      - fuoqi 5y ago
        Do you really think that Nord Stream 2 AG lawyers are that stupid? Note that the application was filled in June 2021, BNetzA begun certification procedures in September 2021, and only almost two months later (suddenly!) they have found that you need a German company. Ok, let's say that BNetzA indeed was simply not familiar enough with the new legislation passed by EP in May 2019 and by Bundestag in November 2019 (sure, you need almost two whole years to read it reaaally carefully). Also let's forget that those changes to the Third Energy Package were effectively aimed only at Nord Stream 2. And while we at it, also let's forget about the really questionable Baerbock's declarations (Minister for Foreign Affairs). But now we have an official statement from BNetzA what in the best case scenario certification will not end until summer of 2022. In other words, it will take the maximum possible time allowed by the procedures, meaning that the properly working pipeline will not be used for almost a whole year. So if this does not look to like an intentional delay, then I don't know what to say.
        zajio1am 5y ago
        > Do you really think that Nord Stream 2 AG lawyers are that stupid? Nord Stream 2 AG is a subsidiary of state-owned Gazprom. They probably think that if they put enough political pressure, they could negotiate an exception.
  - doikor 5y ago
    Finland also has the unique problem of most of the imported electricity having to come through Sweden and the national grid of Sweden is not up to the task (one of the reasons for really high electricity prices in Finland at the moment)
fuoqi 5y ago
Assuming electricity cost $110 MWh and OPEX of the reactor on the level of $25 MWh with 90% capacity factor without accounting for interest (since it's near zero nowadays), it will take slightly more than 10 years for the reactor to pay for itself. Realistically, with decommissioning I would say it will be 15-20 years. So in addition to positive impact on economy due to lower electricity prices and improved reliability, for at least 40 years it will produce a pure profit. Also in reality it probably will operate for 80-100 years.
- Gwypaas 5y ago
  That seems like extremely low numbers. From what I've found the range seems to be $123-$204 / MWh, or $0.123 - $0.204 per KWh https://www.lazard.com/perspective/levelized-cost-of-energy-levelized-cost-of-storage-and-levelized-cost-of-hydrogen/ https://www.lazard.com/perspective/levelized-cost-of-energy-... For Hinkley Point C, another EPR we have the following, a guaranteed strike price of $140/MWh. EDF has negotiated a guaranteed fixed price – a "strike price" – for electricity from Hinkley Point C of £92.50/MWh (in 2012 prices),[25][83] which will be adjusted (linked to inflation – £106/MWh by 2021[77]) during the construction period and over the subsequent 35 years tariff period. The base strike price could fall to £89.50/MWh if a new plant at Sizewell is also approved.[25][83] High consumer prices for energy will hit the poorest consumers hardest according to the Public Accounts Committee.[86] In July 2016, the National Audit Office estimated that due to falling energy costs, the additional cost to consumers of 'future top-up payments under the proposed HPC CfD had increased from £6.1 billion in October 2013, when the strike price was agreed, to £29.7 billion'.[87][88] In July 2017, this estimate rose to £50 billion, or 'more than eight times the 2013 estimate'.[9] https://en.wikipedia.org/wiki/Hinkley_Point_C_nuclear_power_station#Cost_to_consumers https://en.wikipedia.org/wiki/Hinkley_Point_C_nuclear_power_...
  - fuoqi 5y ago
    Note that in my comment $25 MWh was only about OPEX (fuel cost, personnel, etc.), while your cost includes CAPEX, interest, and probably payments to a decommission fund. The number is based on 2013 estimate of the US Department of Energy (IIRC at the time it was $23 MWh), so it may be indeed different for ERP. Though if it's sufficiently higher than OPEX of the old US reactors, then I would say there is a problem with the ERP design.
chinathrow 5y ago
I am sure that decomissioning costs are not available and if so, not exact - as learned from other plants.
AnssiH 5y ago
> Given that it has cost around $11 Billion [...] Note that due to the fixed-price nature of the original supply contract, the total cost of the plant was "only" €5.7B ($6.4B) to the owner/operator (TVO). The $10B-$11B is the estimated cost to the plant supplier (Areva NP/Framatome), i.e. they made a huge loss. Finnish source of numbers: https://www.kauppalehti.fi/uutiset/olkiluoto-3-alkaa-tuottaa-sahkoa-viimein-lokakuussa-laitoksen-hinta-on-nyt-5-7-miljardia-euroa/cc791f7a-0889-458e-8944-8c491d4a2525 https://www.kauppalehti.fi/uutiset/olkiluoto-3-alkaa-tuottaa... (paywall)
bjourne 5y ago
It depends on future interest rates and electricity prices. Assuming a fixed interest rate of 5%, construction costs including interest is about $16 billion = €14 billion. Assuming an availability of 95% (maybe unrealistic for a brand new reactor) it will generate 13TWh/year. Assuming an electricity cost of €100/MWh (higher than usual but lower than current extreme prices) and a marginal cost of €26/MWh, the income/year is €0.99 billion. From this you have to deduct the interest of the loan of about €0.70 billion. So for the first year you have €0.29 billion in profit that you can use to amortize the loan. So when the plant becomes profitable is highly dependent on what future interest rates are and how high future electricity prices will be. While current interest rates have been very low for the past few years, it may be very hard to get an investor to lend you money for a nuclear plant for only 5%. A discount rate of 7% or even 9% is often used for many commercial projects. Using those rates Olkiluoto 3 will never generate any return (barring insane electricity prices).
tov247 5y ago
My question is how much non-nuclear could have been generated for the same price
- ftth_finland 5y ago
  Between none and very little, unless you are seriously suggesting building new gas power plants. Neither solar nor wind works during these cold winter days when power usage is at its highest. There’s nowhere to build new hydro. Coal is being banned.

pasiaj 5y ago

At current energy prices in Finland, it would take less than 1/10 of the time expected. (Of course the current price is a bit of an anomaly.)

eb0la 5y ago
I am not sure if it is just a bit. Gas supply in Europe is having issues: - Gas supply from Algeria via Morocco is closed. - Russia is sending less gas as usual (and profiting from it). Demand from gas in Europe remains the almost the same, but supply isn't.
- fuoqi 5y ago
  - Force long-term contracts to be tied to spot prices instead of oil. - Do not fill storage assuming lower prices in autumn. - Intentionally delay certification of a pipeline from one of your main suppliers. - Act very surprised when the aforementioned supplier does nothing to stop spot prices explosion due to the external circumstances and even fans the flames a bit. - Make questionable remarks which accelerate the rise of gas prices even further. - Demand (sic!) from the supplier additional gas not covered by existing contracts, even though it's clearly not in his interest. I wonder why does the EU has gas supply issues?
  - zajio1am 5y ago
    > Intentionally delay certification of a pipeline from one of your main suppliers. The pipeline is not certified because it breaks existing legislation. It is up to pipeline developers/owners to fix this issue.
    - fuoqi 5y ago
      Do you really think that Nord Stream 2 AG lawyers are that stupid? Note that the application was filled in June 2021, BNetzA begun certification procedures in September 2021, and only almost two months later (suddenly!) they have found that you need a German company. Ok, let's say that BNetzA indeed was simply not familiar enough with the new legislation passed by EP in May 2019 and by Bundestag in November 2019 (sure, you need almost two whole years to read it reaaally carefully). Also let's forget that those changes to the Third Energy Package were effectively aimed only at Nord Stream 2. And while we at it, also let's forget about the really questionable Baerbock's declarations (Minister for Foreign Affairs). But now we have an official statement from BNetzA what in the best case scenario certification will not end until summer of 2022. In other words, it will take the maximum possible time allowed by the procedures, meaning that the properly working pipeline will not be used for almost a whole year. So if this does not look to like an intentional delay, then I don't know what to say.
      - zajio1am 5y ago
        > Do you really think that Nord Stream 2 AG lawyers are that stupid? Nord Stream 2 AG is a subsidiary of state-owned Gazprom. They probably think that if they put enough political pressure, they could negotiate an exception.
- doikor 5y ago
  Finland also has the unique problem of most of the imported electricity having to come through Sweden and the national grid of Sweden is not up to the task (one of the reasons for really high electricity prices in Finland at the moment)

fuoqi 5y ago

Assuming electricity cost $110 MWh and OPEX of the reactor on the level of $25 MWh with 90% capacity factor without accounting for interest (since it's near zero nowadays), it will take slightly more than 10 years for the reactor to pay for itself. Realistically, with decommissioning I would say it will be 15-20 years. So in addition to positive impact on economy due to lower electricity prices and improved reliability, for at least 40 years it will produce a pure profit. Also in reality it probably will operate for 80-100 years.

Gwypaas 5y ago
That seems like extremely low numbers. From what I've found the range seems to be $123-$204 / MWh, or $0.123 - $0.204 per KWh https://www.lazard.com/perspective/levelized-cost-of-energy-levelized-cost-of-storage-and-levelized-cost-of-hydrogen/ https://www.lazard.com/perspective/levelized-cost-of-energy-... For Hinkley Point C, another EPR we have the following, a guaranteed strike price of $140/MWh. EDF has negotiated a guaranteed fixed price – a "strike price" – for electricity from Hinkley Point C of £92.50/MWh (in 2012 prices),[25][83] which will be adjusted (linked to inflation – £106/MWh by 2021[77]) during the construction period and over the subsequent 35 years tariff period. The base strike price could fall to £89.50/MWh if a new plant at Sizewell is also approved.[25][83] High consumer prices for energy will hit the poorest consumers hardest according to the Public Accounts Committee.[86] In July 2016, the National Audit Office estimated that due to falling energy costs, the additional cost to consumers of 'future top-up payments under the proposed HPC CfD had increased from £6.1 billion in October 2013, when the strike price was agreed, to £29.7 billion'.[87][88] In July 2017, this estimate rose to £50 billion, or 'more than eight times the 2013 estimate'.[9] https://en.wikipedia.org/wiki/Hinkley_Point_C_nuclear_power_station#Cost_to_consumers https://en.wikipedia.org/wiki/Hinkley_Point_C_nuclear_power_...
- fuoqi 5y ago
  Note that in my comment $25 MWh was only about OPEX (fuel cost, personnel, etc.), while your cost includes CAPEX, interest, and probably payments to a decommission fund. The number is based on 2013 estimate of the US Department of Energy (IIRC at the time it was $23 MWh), so it may be indeed different for ERP. Though if it's sufficiently higher than OPEX of the old US reactors, then I would say there is a problem with the ERP design.

chinathrow 5y ago

I am sure that decomissioning costs are not available and if so, not exact - as learned from other plants.

AnssiH 5y ago

> Given that it has cost around $11 Billion [...] Note that due to the fixed-price nature of the original supply contract, the total cost of the plant was "only" €5.7B ($6.4B) to the owner/operator (TVO). The $10B-$11B is the estimated cost to the plant supplier (Areva NP/Framatome), i.e. they made a huge loss. Finnish source of numbers: https://www.kauppalehti.fi/uutiset/olkiluoto-3-alkaa-tuottaa-sahkoa-viimein-lokakuussa-laitoksen-hinta-on-nyt-5-7-miljardia-euroa/cc791f7a-0889-458e-8944-8c491d4a2525 https://www.kauppalehti.fi/uutiset/olkiluoto-3-alkaa-tuottaa... (paywall)

bjourne 5y ago

It depends on future interest rates and electricity prices. Assuming a fixed interest rate of 5%, construction costs including interest is about $16 billion = €14 billion. Assuming an availability of 95% (maybe unrealistic for a brand new reactor) it will generate 13TWh/year. Assuming an electricity cost of €100/MWh (higher than usual but lower than current extreme prices) and a marginal cost of €26/MWh, the income/year is €0.99 billion. From this you have to deduct the interest of the loan of about €0.70 billion. So for the first year you have €0.29 billion in profit that you can use to amortize the loan. So when the plant becomes profitable is highly dependent on what future interest rates are and how high future electricity prices will be. While current interest rates have been very low for the past few years, it may be very hard to get an investor to lend you money for a nuclear plant for only 5%. A discount rate of 7% or even 9% is often used for many commercial projects. Using those rates Olkiluoto 3 will never generate any return (barring insane electricity prices).

tov247 5y ago

My question is how much non-nuclear could have been generated for the same price

ftth_finland 5y ago
Between none and very little, unless you are seriously suggesting building new gas power plants. Neither solar nor wind works during these cold winter days when power usage is at its highest. There’s nowhere to build new hydro. Coal is being banned.