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"two new atomic energy reactors at an estimated cost of $14 billion [...] known as AP1000s, built by Westinghouse Electric Co." From http://en.wikipedia.org/wi

by zeteo 15y ago

"two new atomic energy reactors at an estimated cost of $14 billion [...] known as AP1000s, built by Westinghouse Electric Co." From http://en.wikipedia.org/wiki/AP1000 http://en.wikipedia.org/wiki/AP1000: "China has officially adopted the AP1000 as a standard for inland nuclear projects.", "In the spring of 2007 China National Nuclear Corp. selected the Westinghouse/Shaw consortium to build four nuclear reactors for an estimated US$8 billion." So the same model is built in the US for 7 billion each, and in China for 2?

ImprovedSilence 15y ago
Regulation is a bitch. That being said, I could see passing certain demanding regulatory tests and designs in the US could add a significant amount, perhaps even a billion, but I would guess raw supplies and labour are cheaper to source in china as well?
- ScotterC 15y ago
  Going rate at the NRC (Nuclear Regulatory Commission) is 250+ $/hour to just review documents which are several hundred thousand pages long. 'One of my key concerns was the effect on the schedules for new license applications – not only do applicants have to pay $273 for every regulator hour, but they have to pay the staff and contractors that they use to apply for permission and answer regulator questions. Longer licensing processes cost more in salaries and other overhead and they push potential revenue out into the future.' http://atomicinsights.com/2011/12/audit-the-nrc.html http://atomicinsights.com/2011/12/audit-the-nrc.html
  - pjscott 15y ago
    Loan interest also accumulates over time. It's a major part of the cost of US nuclear construction, because the process takes so long.
mikeash 15y ago
I imagine that construction costs, like pretty much all labor costs, are vastly cheaper in China. Additionally, the units may not be identical. For example, Wikipedia says that the first four Chinese units are being constructed with a weaker containment structure, and there may well be other cost-cutting measures in the Chinese models, given the difference in safety environments in the two countries.
- zeteo 15y ago
  I don't think labor costs account for much of the difference. You can pay the salaries of 10,000 US construction workers for 7 years with a single billion. (I seriously doubt they need to hire that many people for one reactor.) And, due to cheap shipping these days, the cost of materials is pretty much the same everywhere.
  - mikeash 15y ago
    How about the costs to manufacture the various components? I imagine that even with a standardized design, many components get sourced locally (like pipe and such) and that labor cost factors into the overall price too. Also, did I mess up my math, or are you saying that hiring an American construction worker costs only $100,000 for 7 years? That's (barely) below minimum wage, and I don't imagine that construction workers earn minimum wage either.
    - zeteo 15y ago
      The estimate for the two reactors involves 3500 on-site construction workers [1] with a completion date of 2016 or 2017 [2]. This means 1750 construction workers employed for 4-5 years at each reactor. The average annual wage for a construction laborer is 34,040 [3]. So we're looking at labor costs of about 0.3 billion / reactor. Even if the US workers get paid double the average, and the Chinese close to nothing, labor costs only explain about 10% of the price difference. Regarding components, anything that's not built on the spot (including pipe) can and will be shipped internationally from the cheapest supplier (particularly if it's expensive). Again, we're looking at price differentials of around 10% rather than 2500%. [1]http://www.whitehouse.gov/the-press-office/obama-administration-announces-loan-guarantees-construct-new-nuclear-power-reactors http://www.whitehouse.gov/the-press-office/obama-administrat... [2]http://www.huffingtonpost.com/2012/02/09/federal-regulators-approve-nuclear-reactor_n_1266100.html http://www.huffingtonpost.com/2012/02/09/federal-regulators-... [3]http://www.bls.gov/iag/tgs/iag23.htm#earnings http://www.bls.gov/iag/tgs/iag23.htm#earnings
ScotterC 15y ago
Like what @mikeash is referring to. China is planning on building tens of these things in the next few decades. They are creating factories to pump out AP1000s on a standardized system. Vogtle is a brown field site (their are already reactors there) and like most American plants, they are all built custom made. Every one of the U.S's 104 plants are different. It made engineering maintenance hellish. This stems from many things, but the easiest explanation is location specific laws and protests. By the time you get clearance to build it, a lot of things will have changed. Hence, standardization goes out the window.
afterburner 15y ago
Things can get built pretty shoddily in China. You sure you don't want to pay extra for some quality control?

by zeteo 15y ago

ImprovedSilence 15y ago

Regulation is a bitch. That being said, I could see passing certain demanding regulatory tests and designs in the US could add a significant amount, perhaps even a billion, but I would guess raw supplies and labour are cheaper to source in china as well?

ScotterC 15y ago
Going rate at the NRC (Nuclear Regulatory Commission) is 250+ $/hour to just review documents which are several hundred thousand pages long. 'One of my key concerns was the effect on the schedules for new license applications – not only do applicants have to pay $273 for every regulator hour, but they have to pay the staff and contractors that they use to apply for permission and answer regulator questions. Longer licensing processes cost more in salaries and other overhead and they push potential revenue out into the future.' http://atomicinsights.com/2011/12/audit-the-nrc.html http://atomicinsights.com/2011/12/audit-the-nrc.html
- pjscott 15y ago
  Loan interest also accumulates over time. It's a major part of the cost of US nuclear construction, because the process takes so long.

mikeash 15y ago

I imagine that construction costs, like pretty much all labor costs, are vastly cheaper in China. Additionally, the units may not be identical. For example, Wikipedia says that the first four Chinese units are being constructed with a weaker containment structure, and there may well be other cost-cutting measures in the Chinese models, given the difference in safety environments in the two countries.

zeteo 15y ago
I don't think labor costs account for much of the difference. You can pay the salaries of 10,000 US construction workers for 7 years with a single billion. (I seriously doubt they need to hire that many people for one reactor.) And, due to cheap shipping these days, the cost of materials is pretty much the same everywhere.
- mikeash 15y ago
  How about the costs to manufacture the various components? I imagine that even with a standardized design, many components get sourced locally (like pipe and such) and that labor cost factors into the overall price too. Also, did I mess up my math, or are you saying that hiring an American construction worker costs only $100,000 for 7 years? That's (barely) below minimum wage, and I don't imagine that construction workers earn minimum wage either.
  - zeteo 15y ago
    The estimate for the two reactors involves 3500 on-site construction workers [1] with a completion date of 2016 or 2017 [2]. This means 1750 construction workers employed for 4-5 years at each reactor. The average annual wage for a construction laborer is 34,040 [3]. So we're looking at labor costs of about 0.3 billion / reactor. Even if the US workers get paid double the average, and the Chinese close to nothing, labor costs only explain about 10% of the price difference. Regarding components, anything that's not built on the spot (including pipe) can and will be shipped internationally from the cheapest supplier (particularly if it's expensive). Again, we're looking at price differentials of around 10% rather than 2500%. [1]http://www.whitehouse.gov/the-press-office/obama-administration-announces-loan-guarantees-construct-new-nuclear-power-reactors http://www.whitehouse.gov/the-press-office/obama-administrat... [2]http://www.huffingtonpost.com/2012/02/09/federal-regulators-approve-nuclear-reactor_n_1266100.html http://www.huffingtonpost.com/2012/02/09/federal-regulators-... [3]http://www.bls.gov/iag/tgs/iag23.htm#earnings http://www.bls.gov/iag/tgs/iag23.htm#earnings

ScotterC 15y ago

Like what @mikeash is referring to. China is planning on building tens of these things in the next few decades. They are creating factories to pump out AP1000s on a standardized system. Vogtle is a brown field site (their are already reactors there) and like most American plants, they are all built custom made. Every one of the U.S's 104 plants are different. It made engineering maintenance hellish. This stems from many things, but the easiest explanation is location specific laws and protests. By the time you get clearance to build it, a lot of things will have changed. Hence, standardization goes out the window.

afterburner 15y ago

Things can get built pretty shoddily in China. You sure you don't want to pay extra for some quality control?