Update of the MIT 2003 Future of Nuclear Power Study

8/7/2019 Update of the MIT 2003 Future of Nuclear Power Study

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Fu ure of nuclear power

U da e of he mit 2003

PROFESSOR JOHN M. DEUTCHInstitute ProfessorDepartment of Chemistry

DR. CHARLES W. FORSBERGExecutive Director, MIT Nuclear Fuel Cycle Study Department of Nuclear Science and Engineering

PROFESSOR ANDREW C. KADAK Professor of the PracticeDepartment of Nuclear Science and Engineering

PROFESSOR MUJID S. KAZIMITEPCO Professor of Nuclear Engineering and Mechanical Engineering Director, Center for Advanced Nuclear Energy Systems

PROFESSOR ERNEST J. MONIZCecil and Ida Green Professor of Physics and Engineering SystemsDirector, MIT Energy Initiative

DR. JOHN E. PARSONSExecutive Director, MIT Center for Energy and Environmental Policy Research

Sloan School of Management

Student Research Assistants:DU, YANGBO and LARA PIERPOINT


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Copyright 2009 Massachusetts Institute o Technology. All rights reserved.


4/21Update of the MIT 2003 Future of Nuclear Power Study 3

In 2003 a group o MIT aculty issued a study on The Future o Nuclear Power.1 The study was motivated by growing concern about global warming and theurgency o developing and deploying electricity generating technologies thatdo not emit CO 2 or other greenhouse gases (GHG). The study addressed thesteps needed in the near term in order to enable nuclear power to be a viablemarketplace option at a time and at a scale that could materially mitigate climatechange risks. In this context, the study explicitly assessed the challenges o a

scenario in which nuclear power capacity expands rom approximately 100 GWein the United States in 2000 to 300 GWe at mid-century ( rom 340 to 1000 GWeglobally), thereby enabling an increase in nuclear powers approximately 20%share o U.S. electricity generation to about 30% ( rom 16% to 20% globally).

The important challenges examined were (1) cost, (2) sa ety, (3) wastemanagement, and (4) proli eration risk. In addition, the report examinedtechnology opportunities and needs, and o ered recommendations or research,development, and demonstration.

The 2003 MIT study on The Future o Nuclear Power , supported by the Al red P.Sloan Foundation, has had a signi cant impact on the public debate both in theUnited States and abroad and the study has infuenced both legislation by theU.S. Congress and the U.S. Department o Energys (DOE) nuclear energy R&D program.

This report presents an update on the 2003 study. Almost six years have passedsince the report was issued, a new administration in Washington is ormulatingits energy policy, and, most importantly, concern about the energy utureremains high. We review what has changed rom 2003 to today with respectto the challenges acing nuclear power mentioned above. A second purpose

o this Update is to provide context or a new MIT study, currently underway,on The Future o the Nuclear Fuel Cycle, which will examine the pros and conso alternative uel cycle strategies, the readiness o the technologies needed orthem, and the implications or near-term policies.

Update of the MIT 2003 Future of Nuclear Power Study

1 MassachusettsInstitute o Technology,The Future o Nuclear Power: anInterdisciplinary

Study (2003).Available at:http://web.mit.edu/nuclearpower/
http://web.mit.edu/nuclearpower/http://web.mit.edu/nuclearpower/http://web.mit.edu/nuclearpower/


5/21Update of the MIT 2003 Future of Nuclear Power Study

Summary inding o changeS Since the 2003 report

Concern with avoiding the adverse consequences o climate change hasincreased signi cantly in the past ve years 2. The United States has not adopteda comprehensive climate change policy, although President Obama is pledged to

do so. Nor has an agreement been reached with the emerging rapidly-growingeconomies such as China, India, Indonesia, and Mexico, about when and howthey will adopt greenhouse gas emission constraints. With global greenhousegas emissions projected to continue to increase, there is added urgency bothto achieve greater energy e ciency and to pursue all measures to develop anddeploy carbon ree energy sources.

Nuclear power, ossil uel use accompanied by carbon dioxidecapture and sequestration, and renewable energy technologies (wind,biomass, geothermal, hydro and solar) are important options orachieving electricity production with small carbon ootprints. Sincethe 2003 report, interest in using electricity or plug-in hybrids andelectric cars to replace motor gasoline has increased, thus placingan even greater importance on exploiting the use o carbon- reeelectricity generating technologies. At the same time, as discussedin the MIT report The Future o Coal 3, little progress has been made

in the United States in demonstrating the viability o ossil uel use with carboncapture and sequestrationa major carbon- ree alternative to nuclear energy

or base-load electricity.

With regard to nuclear power, while there has been some progress since 2003,

increased deployment o nuclear power has been slow both in the United Statesand globally, in relation to the illustrative scenario examined in the 2003 report.While the intent to build new plants has been made public in several countries,there are only ew rm commitments outside o Asia, in particular China, India,and Korea, to construction projects at this time. Even i all the announced plans

or new nuclear power plant construction are realized, the total will be wellbehind that needed or reaching a thousand gigawatts o new capacity worldwideby 2050. In the U.S., only one shutdown reactor has been re urbished andrestarted and one previously ordered, but never completed reactor, is now beingcompleted. No new nuclear units have started construction.

In sum, compared to 2003, the motivation to make more use o nuclear poweris greater, and more rapid progress is needed in enabling the option o nuclearpower expansion to play a role in meeting the global warming challenge. Thesober warning is that i more is not done, nuclear power will diminish as apractical and timely option or deployment at a scale that would constitute amaterial contribution to climate change risk mitigation.

2 Summary or Policymakers.Fourth Assessment Reporto the Intergovernmental

Panel on Climate Change.Cambridge University Press,Cambridge, United Kingdomand New York, NY, USA.(2007)

3 http://web.mit.edu/coal/

The sober warning is that i moreis not done, nuclear power will diminish as a practical and timely

option or deployment at a scalethat would constitute a material contribution to climate changerisk mitigation.



1. StatuS o nuclear power deployment

Today, there are about 44 plants under construction 4 around the world in 12countries, principally China, India, Korea, and Russia. There are no new plantsunder construction in the United States. 5 The slow pace o this deployment

means that the mid-century scenario o 1000 GWe o operating nuclear poweraround the globe and 300 GWe in the United States is less likely than when it wasconsidered in the 2003 study. 6

In the United States, nevertheless, there have been a series o developments thatcould enable new nuclear deployment in the uture:

The per ormance o the 104 U.S. nuclear plants since 2003 has been excellent.The total number o kWh produced by the reactors has steadily increasedover those ve years. The feet-averaged capacity actor since 2003 has beenmaintained at about 90%. 7

Extended operating licenses. Nuclear reactors typically have initial operatinglicenses rom the Nuclear Regulatory Commission or 40 years. The earlier trendto obtain license extensions to operate existing nuclear reactors an additional20 years (total o 60 years) has continued with the expectation that almost allreactors will have license extensions. The NRC has granted 51 license extensionsto date with 19 such renewals granted between January 2003 and February 2008.8 Furthermore, modest power uprates have been granted in that period,adding about 1.5 GWe to the licensed capacity.

Changes in the NRC regulations in the 1990s created a new approach to reactorlicensing that included a design certi cation process, site banking, and combinedconstruction and operation licensing. The Energy Policy Act o 2005 authorizedDOE to share the cost with selected applicants submitting licenses to the NRCto help test this new licensing approach all actions that are consistent withrecommendations o the 2003 report.

Seventeen applications 9 or combined construction and operating licenses or26 reactors have been submitted to the NRC. Preliminary work required be oreconstruction is underway or many o these plants such as design, licensingapplications development, and procurement o long-lead items. However

nancing and rm commitment to construction remains ahead. Authority toproceed will undoubtedly be slowed by the current dismal economic situation.Several European countries have announced plans or new reactors while severalother European countries are reevaluating their stance on nuclear power plantconstruction and phase out. 10

Public acceptance or nuclear power Extension o the public attitudes researchcarried out in 2003 rein orces a trend towards greater public acceptance o nuclear power. 11

4 Forty our plants underconstruction: China (11),Russia (8), India (6), Korea(5), Bulgaria (2), Taiwan(2), Ukraine (2), Japan (2),Argentina (1), Finland (1)

France (1), Iran (1), Pakistan(1), and the United States (1).

5 However, since 2003 oneshutdown reactor (BrownsFerry I) has been re urbishedand restarted and one partly complete reactor (Watts Bar 2)is now being completed.

6 The 2007 IEO suggests thatnuclear power will grow

1.3%/year worldwide, but thatoptimistic orecast remainsbelow the 2003 Study mid-century scenario.

7 http://www.nrc.gov/reading-rm/doc-collections/nuregs/sta /sr1350/v19/sr1350v19.pd

8 http://www.nrc.gov/reading-rm/doc-collections/ act-sheets/license-renewal-bg.html

9 http://www.nrc.gov/reactors/new-reactors/new-licensing-

les/expected-new-rx-applications.pd

10 Sweden and Italy haveannounced reversals o theirprohibitions on new nuclearplant construction. France,Finland, and Great Britainhave announced plans oradded nuclear power plants.Plants are under constructionin France and Finland.

11 http://www.gallup.com/poll/117025/Support-Nuclear-Energy-Inches-New-High.aspx and http://web.mit.edu/canes/pd s/nes-008.pd
http://www.nrc.gov/%20reading-rm/doc-collections/nuregs/staff/sr1350/v19/sr1350v19.pdfhttp://www.nrc.gov/%20reading-rm/doc-collections/nuregs/staff/sr1350/v19/sr1350v19.pdfhttp://www.nrc.gov/%20reading-rm/doc-collections/nuregs/staff/sr1350/v19/sr1350v19.pdfhttp://www.nrc.gov/%20reading-rm/doc-collections/nuregs/staff/sr1350/v19/sr1350v19.pdfhttp://www.nrc.gov/%20reading-rm/doc-collections/nuregs/staff/sr1350/v19/sr1350v19.pdfhttp://www.nrc.gov/reading-rm/doc-collections/fact-sheets/license-renewal-bg.htmlhttp://www.nrc.gov/reading-rm/doc-collections/fact-sheets/license-renewal-bg.htmlhttp://www.nrc.gov/reading-rm/doc-collections/fact-sheets/license-renewal-bg.htmlhttp://www.nrc.gov/reading-rm/doc-collections/fact-sheets/license-renewal-bg.htmlhttp://www.nrc.gov/reactors/new-reactors/new-licensing-files/expected-new-rx-applications.pdfhttp://www.nrc.gov/reactors/new-reactors/new-licensing-files/expected-new-rx-applications.pdfhttp://www.nrc.gov/reactors/new-reactors/new-licensing-files/expected-new-rx-applications.pdfhttp://www.nrc.gov/reactors/new-reactors/new-licensing-files/expected-new-rx-applications.pdfhttp://www.nrc.gov/reactors/new-reactors/new-licensing-files/expected-new-rx-applications.pdfhttp://www.nrc.gov/reactors/new-reactors/new-licensing-files/expected-new-rx-applications.pdfhttp://www.nrc.gov/reading-rm/doc-collections/fact-sheets/license-renewal-bg.htmlhttp://www.nrc.gov/%20reading-rm/doc-collections/nuregs/staff/sr1350/v19/sr1350v19.pdf



2. updating nuclear generation economicS

The 2003 report ound that In deregulated markets, nuclear power is not nowcost competitive with coal and natural gas. However, plausible reductions by industry in capital cost, operation and maintenance costs and construction

time could reduce the gap. Carbon emission credits, i enacted by government,can give nuclear power a cost advantage. The situation remains the sametoday. While the U.S. nuclear industry has continued to demonstrate improvedoperating per ormance, there remains signi cant uncertainty about the capitalcosts, and the cost o its nancing, which are the main components o the cost o electricity rom new nuclear plants.

Since 2003 construction costs or all types o large-scale engineered projectshave escalated dramatically. The estimated cost o constructing a nuclear powerplant has increased at a rate o 15% per year heading into the current economicdownturn. This is based both on the cost o actual builds in Japan and Koreaand on the projected cost o new plants planned or in the United States.Capital costs or both coal and natural gas have increased as well, although notby as much. The cost o natural gas and coal that peaked sharply is now receding.Taken together, these escalating costs leave the situation close to where it was in2003. The ollowing table updates the cost estimates presented in the 2003 study: 12

12 The capital cost estimatesdo not take into accountany possible prospectivechange to the cost o capitalas a result o the current

nancial crisis or the recentdrop in commodity prices

or construction materials.Du, Yangbo and John E.Parsons, Update on the Costo Nuclear Power, MIT Center

or Energy and EnvironmentalPolicy Research WorkingPaper 09-004; http://web.mit.edu/ceepr/www/publications/

workingpapers.html

Table 1: Costs of Electric Generation Alternatives

LCOE

Fuel

Cost

w/ same cost

of capital$/kW $/mmBtu /kWh

[A]

mit (2003)

$2002

[1] Nuclear

[2] Coal

[3] Gas

u

[B] [C] [D] [E]

2,000 0. 7 .7 .

..31.201,300

00 3. 0 .1 .1

$2007

[ ] Nuclear

[ ] Coal

[ ] Gas

,000

2,300

8 0

0. 7

2. 0

7.00

8.

.2

.

8.3

7.

.

w/ carboncharge $2 /

tCO2

Base

Case/kWh/kWh

Overnight

Cost
http://web.mit.edu/ceepr/www/publications/workingpapers.htmlhttp://web.mit.edu/ceepr/www/publications/workingpapers.htmlhttp://web.mit.edu/ceepr/www/publications/workingpapers.htmlhttp://web.mit.edu/ceepr/www/publications/workingpapers.htmlhttp://web.mit.edu/ceepr/www/publications/workingpapers.htmlhttp://web.mit.edu/ceepr/www/publications/workingpapers.html



Notes:

[1A], [2A], and [3A] See MIT (2003), Table 5.3, p. 43.

[1B] See MIT (2003) Appendix 5, Table A-5.A4.

[2B], and [3B] See MIT (2003), Table 5.3, p. 43.

[1C], [2C], and [3C] See MIT (2003), Table 5.1, p. 42, Base Case, 40-year. Gas (moderate)case is reported here, which was $3.50 escalated at 1.5% real, equivalent to $4.42 levelized realover 40 years.

[1D], [2D], and [3D] See MIT (2003), Table 5.1, p. 42, Carbon Tax Cases, 40-year. We translateresults quoted in $/tC into results in $/t CO 2.

[1E] See MIT (2003), Table 5.1, p. 42, Reduce Nuclear Costs Cases. The table shows results step-wise or changing 3 assumptions, with the reduction o the cost o capital being the last step. Wegive the result or just reducing the cost o capital to be equivalent to coal and gas, without theother 2 assumptions being varied.

[4A], [5A], and [6A] From Du and Parsons (2009) Update on the Cost o Nuclear Power.

[4B] Calculated using the methodology in MIT (2003), Appendix 5 and the ollowing inputs:

$80/kgHM or natural uranium, $160/SWU, and $6/kgHM or yellow cake conversion and$250/kgHM or abrication o uranium-oxide uel. We derive an optimum tails assay o 0.24%,an initial uranium eed o 9.08 kgU and a requirement o 6.99 SWUs, assuming a burn-up o 50MWd/kgHM. We assume this uel cost escalates at 0.5% per annum, which means the averagereal price over the 40 years o delivery is $0.76/mmBtu.

[5B] We assume a coal eed with 12,500Btu/lb, so that this uel cost translates to $65/short tondelivered in 2007 dollars. We assume this uel cost escalates at 0.5% per annum, which means theaverage real price over the 40 years o delivery is $2.94/mvmBtu or $73.42/short ton delivered.

[6B] We assume this uel cost escalates at 0.5% per annum, which means the average real priceover the 40 years o delivery is $7.91/mmBtu.

[4C], [5C] and [6C] Assumptions made in this calculation are described ully in the Du andParsons (2009) Update on the Cost o Nuclear Power. For all types o generation we assume a 40

year operation and 85% capacity actor. Nuclear heat rate is 10,400 as in the MIT (2003) study.Both coal and natural gas heat rates are improved relative to MIT (2003): coal is 8,870 and gasis 6,800. We assume a general infation rate o 3%, real escalation o O&M costs o 1%, and atax rate o 37%. Nuclear is nanced at 50% debt, with a debt cost o capital o 8% and an equity cost o capital o 15%. Coal and gas are nanced with 60% debt, a debt cost o capital o 8% andan equity cost o capital o 12%. Nuclear construction has a 5 year schedule, coal constructionhas a 4 year schedule, and gas has a 2 year schedule. Nuclear and gas apply the MACRS 15-yeardepreciation schedule, while coal applies the 20-year MACRS schedule.

[4D], [5D] and [6D] As in the MIT (2003) study, the carbon intensity assumed or coal is 25.8kg-C/mmBtu, and or gas is 14.5.

[4E] Recalculates [4C] setting the assumed debt raction and the equity rate or nuclear to matchcoal and gas, i.e., a 60% debt raction and a cost o equity o 12%.


9/218 Update of the MIT 2003 Future of Nuclear Power Study

The nuclear costs are driven by high up- ront capital costs. In contrast, ornatural gas the cost driver is uel cost. Coal lies in-between.

The track record or the construction costs o nuclear plants completed in theU.S. during the 1980s and early 1990s was poor. Actual costs were ar higher

than had been projected. Construction schedules experienced long delays,which, together with increases in interest rates at the time, resulted in highnancing charges. New regulatory requirements also contributed to the cost

increases, and in some instances, the public controversy over nuclear powercontributed to some o the construction delays and cost overruns. However,while the plants in Korea and Japan continue to be built on schedule, some o therecent construction cost and schedule experience, such as with the plant underconstruction in Finland, has not been encouraging. Whether the lessons learned

rom the past have been actored into the construction o uture plants has yetto be seen. These actors have a signi cant impact on the risk acing investors

nancing a new build.

For this reason, the 2003 report applied a higher weighted cost o capital to theconstruction o a new nuclear plant (10%) than to the construction o a newcoal or new natural gas plant (7.8%).

Lowering or eliminating this risk-premium makes a signi cant contributionto making nuclear competitive. With the risk premium and without acarbon emission charge, nuclear is more expensive than either coal (withoutsequestration) or natural gas (at 7$/MBTU). I this risk premium can beeliminated, nuclear li e cycle cost decreases rom 8.4 /kWe-h to 6.6 /kWe-h and

becomes competitive with coal and natural gas, even in the absence o carbonemission charge.

The 2003 report ound that capital cost reductions and construction timereductions were plausible, but not yet proven this judgment is unchangedtoday. The challenge acing the U.S. nuclear industry lies in turning plausiblereductions in capital costs and construction schedules into reality. Will designstruly be standardized, or will site-speci c changes de eat the e ort to drivedown the cost o producing multiple plants? Will the licensing process unctionwithout costly delays, or will the time to rst power be extended, addingsigni cant nancing costs? Will construction proceed on schedule

and without large cost overruns? The rst ew U.S. plants will be a criticaltest or all parties involved. The risk premium will be eliminated only by demonstrated per ormance.



3. government incentiveS and regulationS

Both government and industry have their part to play in lowering this riskpremium. The 2003 report advocated limited government assistance or rstmover nuclear plant projects. Three principles underpinned the proposed

government assistance: First, nancial assistance or nuclear should becomparable to assistance extended to other low-carbon electricity generationtechnologies, or example wind, geothermal, and solar. Second, an appropriatedegree o risk should remain with the private sector so as to motivate cost andschedule discipline. Third, government assistance should be limited to the

rst mover cohort without the expectation o longer-term assistance. That is,di erent power generation technologies should compete based on economicsin a world where CO 2 emissions are priced, and where technologies are notmandated by required quotas or certain types o generation. The Energy Policy Act o 2005 authorized assistance or new nuclear plantconstruction including loan guarantees, insurance against delays not causedby the utility, and production tax credits or the rst 6 GWe o new plants.However, implementation o the rst mover assistance program as proposed inthe 2003 study has not yet been e ective in moving utilities to make rm reactorconstruction commitments or three reasons.

First, the DOE has not moved expeditiously to issue the regulations andimplement the ederal loan guarantee program.

Second, since 2003, emphasis has been placed on renewable port olio standards

(RPS), adopted by many states and proposed at the ederal level, as themechanism or encouraging carbon- ree and renewable technologies. RPSrequire that utilities obtain a certain raction o their electricity rom low-carbonelectricity sources. Un ortunately, most RPS programs exclude two importantlow-carbon technologies, nuclear and coal with CO 2 sequestration, con using theobjective o reducing carbon emissions with encouraging renewable energy inelectricity generation.

However, implementation o the frst mover assistance program as proposed in the 2003study has not yet been e ective in moving utilities to make frm reactor constructioncommitments or three reasons.



I such RPS remain in place and a carbon emission tax or cap and trade systemis implemented in parallel, ine ciencies may result. The RPS requires utilitiesto adopt technologies, or example wind, rather than select the most economicmethod to achieve lower carbon emissions. As a consequence, the emissionpermit prices in the parallel cap and trade system will be lower than prices

without a RPS, possibly inhibiting the introduction o low-carbon technologiesnot included in the RPS.

Third, in a change rom 2003, the nuclear industry acing increased costestimates is arguing that more assistance is needed to demonstrate the economicviability o nuclear. While some modi cation o the rst mover program islikely necessary because o the impact o the nancial crisis on capital markets,the justi cation or government rst-mover assistance is to demonstratetechnical per ormance, cost, and environmental acceptability, not to extend agovernment subsidy or nuclear (or any other energy technology) inde nitely into the uture. Consequently, any expansion o such a ederal program shouldhave limited duration. I the purpose o an expanded program is to correct or amarket imper ection, in this case the external costs o global warming, the moste cient mechanism is either a carbon emission tax or a cap-and-trade system.An ironic consequence o a parallel RPS could be a call to extend subsidies tonuclear and coal with carbon capture/sequestration because o a poorly cra tedpolicy or e ciently reducing carbon emissions.

4. Sa ety

Parallel with the improved operations has been an excellent sa ety record.Reliability and sa ety are coupled because (1) reliable operations avoid challengesto the sa ety systems and (2) the maintenance and operating practices required

or reliable operations are generally the same required or sa ety. Nuclear powerdisplays by ar the highest capacity actor among all generation technologies,providing about 20% o U.S. electricity supply with about 10% o the installedcapacity. The judgment o the 2003 study that new light water reactor plants,properly operated, meet strenuous sa ety standards discussed in the 2003 reportis unchanged.

An ironic consequence o a parallel RPScould be a call to extend subsidies to nuclear and coal with carbon capture/sequestrationbecause o a poorly cra ted policy or e fciently reducing carbon emissions.



5. waSte management

The 2003 study emphasized the importance o making progress on wastemanagement in the United States.

Interim storage o spent uel

The 2003 study conclusion an explicit strategy to store spent uel or a periodo several decades will create additional fexibility in the waste managementsystem remains valid today. While dry cask spent uel storage (SFS) has beenimplemented on a large scale at reactor sites, starting in 1986 and continuedsince 2003, no ederal operated away- rom-reactor sur ace, or near sur ace, spent

uel storage sites have been opened since they are not permitted by the NuclearWaste Policy Act o 1987 until the Yucca Mountain repository is licensed. 13

Geological Disposal o SNF

Following the requirements o the Nuclear Waste Policy Act, the DOE submitteda license application or the Yucca Mountain repository in 2008. Congressmandated and is providing the unding or the NRC to complete a licensereview. The new administration has stated that Yucca Mountain is no longer anoption or nuclear waste disposal. There is no plan or high-level wastes; but theadministration has committed to a comprehensive review o waste management.In conclusion, the progress on high-level waste disposal has not been positive. The U.S. Environmental Protection Agency has developed the repository

standard or protection o public health and sa ety. A ter decades o debateand lawsuits, it appears that the standard is generally accepted which issigni cant progress.

The 2003 study urged a broadening o the DOE waste management program orYucca Mountain to other potential mined repository disposal sites and to otherpotential technologies such as bore-hole disposal. The 2003 study recommendedthat the U.S. should undertake a signi cant R&D program or long-termintegrated waste management that includes improved repository per ormance(such as alternative engineered barriers) and examination o alternatives. Thecentral concern was that the ederal programs have had a narrow ocus and have

not explored an adequate range o technical options.

The need remains or a broader program that creates an understanding o therange o waste management options, is coupled with uel cycle modeling, andprovides a basis or robust long-term waste management policies. This is acentral objective o the ongoing MIT Nuclear Fuel Cycle Study . It should benoted that both open and closed uel cycles require the geological disposalo some radioactive waste.

13 A private uel storage acility has been issued an NRClicense but has not been built.



6. uel cycle iSSueS

Uranium resource availability

Long-term uel cycle and nonproli eration policy considerations depend upon

the uture availability and costs o natural uranium ore. The 2003 study arguedthat uranium was not likely to be a constraint in the development o a very largenuclear enterprise using a once-through uel cycle or this century. The lastdomestic 14 and international 15 resource evaluation programs were completed inthe early 1980s. Since then there have been major advances in our understandingo uranium geology. Because o the importance o uranium resources in uturedecisions, the 2003 study recommended undertaking a signi cant globaluranium resource evaluation program to increase the global con dence inuranium resource assessment. No such program has been initiated.

Since the 2003 MIT report, the OECD/IAEA has published its most recent (2007)Red Book update 16 on uranium resources, production and demand. Alsonoteworthy is the 2006 publication o a retrospective review 17 o the last orty years o Red Book issues. In brie , resources are rising aster than consumption.Table 2 shows Red Book identi ed resources, undiscovered resources, andthe number o reactor years o uel provided by those resources. Based onthe total projected Red Book resources recoverable at a cost less than $130/kg(2006$) o about 13 million metric tons (hence about an 80 year supply or800 reactors), most commentators conclude that a hal century o unimpededgrowth is possible, especially since resources costing several hundred dollars perkilogram (not estimated in the Red Book) would also be economically usable.

Using a probabilistic resources versus cost model to extend Red Book data,we estimate an order o magnitude larger resources at a tolerable doubling o prices. Since 2003, the spot price or natural uranium spiked due to a variety o

actors, including the temporary shutdown o major producing mines and themanagement o uranium inventories. However, this does not appear to refectthe underlying resource economic reality indicated above.

This rein orces the observation in the 2003 MIT study that We believe that theworld-wide supply o uranium ore is su cient to uel the deployment o 1000reactors over the next hal century.

14 U.S. Department o Energy,National Uranium ResourceEvaluation (NURE) ProgramFinal Report, GJBX-42(83),(1983).

15 OECD, Nuclear Energy Agency, International AtomicEnergy Agency, WorldUranium Geology and ResourcePotential, International Uranium Resources Evaluation,Miller Freeman, San Francisco,CA (1980).

16

Uranium 2007: Resources,Production and Demand,OECD NEA No. 6345, 2008(Red Book)

17 Forty Years o UraniumResources, Production andDemand in Perspective, 2006,The Red Book Retrospective,OECD, NEA No. 6096, 2006



Table 2. World Uranium Red Book Resources and Implied reactoryears of operation 1

r s c ss

i f r s s

Metric tons

Number of 1-GWe Reactor Years @ 200 MT/GWe-yr

u S s

1,700

1

Cumulative resources extractable at costs



(1) The conclusion o the 2003 study with respect to economics is generally accepted: given the assumptions about uranium resource availability andnew plant deployment rates, the cost o recycle is un avorable compared to aonce-through cycle, but, the cost di erential is small relative to the total costo nuclear power generation.

(2) With respect to reprocessing and waste management, the 2003 study concluded We do not believe a convincing case can be made on the basiso waste management considerations alone that the bene ts o partitioningand transmutation will outweigh the attendant sa ety, environmental, [and]security considerations and economic costs.

There is no basis to change that conclusion today. A major task or theongoing nuclear uel cycle study is to assess economic, waste management, andnonproli eration actors in the relative attractiveness o an open versus a closed

uel cycle, in the long-term, likely greater than hal a century in the uture.

With respect to reprocessing and wastemanagement, the 2003 study concluded We donot believe a convincing case can be made on thebasis o waste management considerations alonethat the benefts o partitioning and transmutationwill outweigh the attendant sa ety, environmental,[and] security considerations and economic costs. There is no basis to change that conclusion today.



7. non-proli eration

It is widely agreed that expansion o commercial nuclear power must occurwith an acceptable low risk o trans er o nuclear material or technology thatcould move a nation to, or close to, acquiring a nuclear weapons capability or o

making weapons-usable ssionable material available to subnational groups. Themost sensitive elements o the uel cycle are enrichment and reprocessing. In thecase o enrichment, uel enriched rom natural abundance 0.7% U-235 to thecommercial level o 4 to 5% must undergo urther isotope separation to reachthe highly enriched level, normally taken to be >20% or U-235, necessary

or nuclear devices. On the other hand, reprocessing, as practiced today in thePUREX (Plutonium and Uranium Recovery by Extraction) process, chemically separates plutonium rom irradiated uel and the separated plutonium (at theisotopic mixtures obtained rom conversion o U-238 in normal reactor burn-up) is readily usable in weapons. Today, there are about 270 tonnes o separatedplutonium rom reprocessing o commercial nuclear uel around the world.

The 2003 study emphasized that the expansion in global nuclear deploymentenvisioned in the mid-century scenario could include a signi cant numbero emerging countries (where electricity growth is expected to be most rapid)becoming users o nuclear power. Forty countries have expressed interest innuclear power in recent years and over 20 countries are actively consideringnuclear power programs. 20 Many o these countries are located in regions o political instability, thus underlining the importance o separating potentially sensitive uel cycle technology ront-end enrichment and back-end spent uelmanagement rom power reactor operations.

The 2003 study proposed that nuclear supplier states, roughly the G-8, 21 o eruel cycle services to new user states on attractive terms in order to slow the

process o additional states, especially new users with only a ew reactors,building enrichment and reprocessing acilities. Other groups have made similarproposals and, since 2003, the Bush Administration took a leadership role inadvancing this approach, leading, or example, to the Nonproli eration statementat the G-8 Gleneagles, Scotland summit on July 8, 2005. 22 This is a signi cantadvance in international nonproli eration policy since the 2003 study.

Another positive development is the initiative taken by the International Atomic

Energy Agency, supported by private organizations such as the Nuclear ThreatInitiative and then by several countries (including the United States and thePersian Gul states), to establish a nuclear uel bank. The uel bank is intendedto provide security o nuclear uel supply, so that countries have less reason topursue enrichment or reprocessing acilities.

20 http://www.iaea.org/Publications/Booklets/NuclearPower/np08.pd

21 The G-8 countries are Canada,

France, Germany, Italy, Japan,Russia, the United Kingdom,

and the United States.

22 Available at: http://www.g7.utoronto.ca/summit/2005gleneagles/nonproli .pd
http://www.iaea.org/Publications/Booklets/NuclearPower/np08.pdfhttp://www.iaea.org/Publications/Booklets/NuclearPower/np08.pdfhttp://www.iaea.org/Publications/Booklets/NuclearPower/np08.pdfhttp://www.iaea.org/Publications/Booklets/NuclearPower/np08.pdfhttp://www.g7.utoronto.ca/summit/2005gleneagles/nonprolif.pdfhttp://www.g7.utoronto.ca/summit/2005gleneagles/nonprolif.pdfhttp://www.g7.utoronto.ca/summit/2005gleneagles/nonprolif.pdfhttp://www.g7.utoronto.ca/summit/2005gleneagles/nonprolif.pdfhttp://www.g7.utoronto.ca/summit/2005gleneagles/nonprolif.pdfhttp://www.g7.utoronto.ca/summit/2005gleneagles/nonprolif.pdfhttp://www.iaea.org/Publications/Booklets/NuclearPower/np08.pdf



However, the G-8 initiative on providing uel cycle services remains untried.Since 2003 there have been three unrealized opportunities where the G-8 nuclear

uel cycle initiative could have been help ul: (1) Russia leasing uel to Iran or theBushehr reactors now under construction, (2) United States convincing Brazilto abandon its plans or its new Resende enrichment plant, and (3) Using the

U.S.-India agreement to encourage India to scale back its plans or PUREX uelreprocessing. Irans enrichment program is the centerpiece or internationalconcern about use o the nuclear power uel cycle to reach nuclear weaponsthreshold status.

Since 2004, the DOE developed the Global Nuclear Energy Partnership (GNEP), a ramework that encompasses itsdomestic and international R&D activities on advanced uelcycles. Internationally, the purpose was to limit the spread o

enrichment and reprocessing technologies through an arrangement o supplierand user countries. Domestically the purpose was to develop technology ora closed uel cycle: the ultimate vision includes separation o spent nuclear

uel into multiple streams, abrication o advanced uel containing uranium,plutonium, and minor actinides, production o electricity, and destructiono the actinides in ast reactors. The objective is to achieve a closed uel cyclethat extends uranium resources, reduces long-lived isotopes in waste, and isproli eration resistant.

Whatever the merits o this closed- uel cycle vision, it will be more expensivethan todays once through uel cycle, and involve a multi-billion dollar ederalR&D and demonstration e ort over several decades. Initially DOE undertook

an R&D program to explore uel cycle options. DOE then launched the GNEPprogram that included deployment o closed uel cycle acilities. The un ortunateeature o GNEP is a premature move to reprocessing commercial reactor spentuel, signaling exactly the opposite to the restraint on reprocessing being urgedor new nuclear power users. Congressional doubts about the wisdom o quick

deployment o reprocessing technology led to a reassessment o the GNEPe ort. A key objective o the ongoing MIT Nuclear Fuel Cycle study is to provideanalysis to assess the cost, bene ts, and timing o di erent uel cycles.

The G-8 initiative on providing uel cycle servicesremains untried.

The un ortunate eature o

GNEP is a premature move toreprocessing commercial reactor spent uel, signaling exactly the opposite to the restraint onreprocessing being urged or new nuclear power users.



8. technology opportunitieS and r&d needS

The 2003 Future o Nuclear Power study included judgments about nucleartechnology needs and recommendations or DOEs nuclear RD&D program.The 2003 study emphasized the importance o ocusing on technologies

relevant to near term nuclear power opportunities and avoiding large-scale demonstration and development projects or advanced uel cycles andreactors that would not be commercialized or many decades. Comments ondevelopments related to some technology ndings and recommendations in the2003 study ollow:

(a) Reactor technologies The 2003 study recommended ocusing on lightwater reactors and some R&D on the high temperature gas reactor(HTGR) because o its potential or greater sa ety and e ciency o operation. In contrast, the DOE has placed emphasis on ourthgeneration reactors (GenIV) suitable or breeding, transmutation,and production o hydrogen. The GenIV program does includeHTGR R&D at a level o unding o $74 million as requested by thePresident or FY08. The ocus is on demonstrating a high temperaturereactor, suitable or providing electricity and high quality processheat or CO2 ree hydrogen production and other process heatapplications. Signi cant progress has been made in uel developmentwhich is the basis or HTGR enhanced sa ety, enhanced e ciency,and the high temperature capability. The changes in direction area result o expressions o interest by the chemical and re nery industries; in contrast, the 2003 report emphasized the importance o

demonstrating HTGR technology or commercial power applications.In the request or 2009, the DOE budget started an LWR Technology development program, which will partially examine issues o extending the li e to 80 years and partially improve the power outputo uture LWRs. This program is expected to grow to a level o $50Mper year.

(b) Fuel cycle R&D The 2003 study recommended lab-scale researchon new separation technologies at a modest scale. Initially, theDOE program through the Advanced Fuel Cycle Initiative adoptedthis strategy. However, with the adoption o the GNEP program

the emphasis was on near-term deployment that implied usingnear-term advances o existing technology and large-scaledemonstration projects.

(c) Modeling and simulation The 2003 study emphasized the needor greater analytic capability to explore di erent nuclear uel cycle

scenarios based on realistic cost estimates and engineering dataacquired at the process development unit scale. The DOE programhas moved in this direction but much remains to be done.



(d) International uranium resource assessment Reliable estimates o the supply o natural uranium ore are important or estimating theeconomics o closed versus open uel cycles and the timing when atransition to a closed uel cycle might be desirable. As reported, theDOE has not launched such a project.

(e) Waste management The 2003 study urged that the DOE broadenits waste program beyond its almost exclusive ocus on the YuccaMountain Project to include a range o waste managementalternatives. The 2003 study also emphasized the need or modeling toimprove understanding o waste management and the entire uel cycleli e. The DOE has not moved signi cantly in this direction since 2003.

(f) Fissile material protection, control, and accounting (MPC&A) The2003 study noted the need to develop MPC&A systems that wouldbe suitable or use internationally so as to reduce the risk o materialdiversion rom commercial uel cycle acilities.

In total, the 2003 study recommended growing the annual nuclear R&D undingto approximately $450 million in the designated areas. The DOE nuclear budgethas grown to that level but the distribution o new unds is not well aligned withthe needs highlighted in the recommendations o the 2003 study.



concluSionS

The central premise o the 2003 MIT Study on the Future o Nuclear Power was that the importance o reducing greenhouse gas emissions, in order tomitigate global warming, justi ed reevaluating the role o nuclear power in

the countrys energy uture. The 2003 study identi ed the challenges to greaterdeployment and argued that the key need was to design, build, and operate aew rst-o -a-kind nuclear plants with government assistance, to demonstrate to

the public, political leaders, and investors the technical per ormance, cost, andenvironmental acceptability o the technology. A ter ve years, no new plantsare under construction in the United States and insu cient progress has beenmade on waste management. The current assistance program put into place by the 2005 EPACT has not yet been e ective and needs to be improved. The soberwarning is that i more is not done, nuclear power will diminish as a practicaland timely option or deployment at a scale that would constitute a materialcontribution to climate change risk mitigation.

acknowledgementSThe authors would like to thank Honorable James K. Asselstine, Jacques

Bouchard, Kurt Gott ried, John Grossenbacher, Steve Kra t, Honorable RichardA. Meserve, Albert Machiels, Daniel Poneman, John H. Rowe, HonorablePhil Sharp, Steven R. Specker, Honorable John H. Sununu, and others ortheir comments. The authors are grate ul or the support o the Electric PowerResearch Institute and o the Idaho National Laboratory.


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Documents

Update of the MIT 2003 Future of Nuclear Power Study