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Ebook The economic risk to electricity consumers of the Pebble Bed Modular Reactor

Submitted by wulan on Sat, 12/12/2009 - 02:26

The objective of this report is to identify the measures that the National Electricity Regulator (NER) and the body that will succeed it on April 1 2006, the National Energy Regulator of South Africa (NERSA) must take to ensure that electricity consumers are not inappropriately exposed to the economic risk of the programme to develop and market a new design of nuclear power plant, the Pebble Bed Modular Reactor (PBMR).

The PBMR is a highly risky venture, with a significant probability that these risks will be borne, inappropriately, by South African electricity consumers. Large sums of money have already been spent by Eskom, of the order R1bn (see Section 4.2), but, over the next 5-10 years, electricity consumers could be asked to finance investment in the excess of R10bn for the demonstration phase of the PBMR including the purchase of the demonstration plant (see Section 4.3 and 5.2) and R36bn for purchase of commercial units (see Section 5.3).

Consumers would also be liable for the cost of decommissioning the demonstration plant and the commercial plants. No estimates for the cost of decommissioning exist but in view of experience elsewhere, it is likely that the cost of decommissioning would be of the order of several tens of billion Rand. It is essential, that NER understands these risks and protects consumers from them. NER must make it clear to Eskom, before investment takes place, how it will treat investment in the PBMR roject.

CONTENTS

1. INTRODUCTION
1.1. THE REGULATORY CONTEXT
1.2. THE AUTHOR
PART 1 HISTORY OF THE PBMR PROJECT
2. THE PBMR PROJECT

    2.1.1. The commercial arrangements
    2.1.2. The cost of the feasibility phase

2.2. ECONOMICS OF THE PBMR PROGRAMME
2.3. ECONOMICS OF THE DEMONSTRATION PLANT

    2.3.1. The partners
    2.3.2. Construction cost and cost of associated facilities
    2.3.3. The cost of capital
    2.3.4. Maximum electrical output
    2.3.5. Operating performance
    2.3.6. Operations & maintenance cost
    2.3.7. Decommissioning cost
    2.3.8. Operating life

2.4. ECONOMICS OF THE COMMERCIAL UNITS

    2.4.1. The likely world market for the PBMR
    2.4.2. The South African market for PBMRs

PART 2 IMPLICATIONS FOR THE NER/NERSA
3. THE RISKS
4. INVESTMENTS BY ESKOM ENTERPRISES
4.1. THE STATUS OF ESKOM ENTERPRISES
4.2. THE FEASIBILITY PHASE
4.3. THE DEMONSTRATION PHASE
5. PURCHASE OF PBMR UNITS
5.1. REGULATION OF THE GENERATION DIVISION

    5.1.1. The methodology
    5.1.2. Additions to the RAB
    5.1.3. Operating costs

5.2. PURCHASE OF THE DEMONSTRATION UNIT
5.3. PURCHASE OF COMMERCIAL UNITS
6. CONCLUSIONS
7. REFERENCES
APPENDIX CV: STEPHEN THOMAS (NUCLEAR POWER & ENERGY REGULATION RESEARCH)
RECENT PROJECTS AND CONSULTANCY ON NUCLEAR POWER AND ELECTRICITY REGULATION
OFFICIAL APPOINTMENTS RELATED TO NUCLEAR POWER AND ELECTRICITY REGULATION
RESEARCH ON NUCLEAR POWER ECONOMICS AND POLICY, AND ON ELECTRICITY REGULATION
PUBLICATIONS ON NUCLEAR POWER AND ELECTRICITY REGULATION

    Refereed journals
    Edited journal special issues
    Books
    Selected Major Reports and Monographs

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