NuScale cancels first-of-a-kind nuclear project as costs surge

[chuckChuck]

NuScale cancels first-of-a-kind nuclear project as costs surge

By Zach Bright | 11/09/2023 06:48 AM EST
The Oregon-based company and the Utah Associated Municipal Power Systems terminated an agreement for six small modular reactors.

The country’s first expected commercial small modular reactor was scrapped by NuScale Power on Wednesday, delivering a major setback to the advanced nuclear industry.

NuScale and the Utah Associated Municipal Power Systems (UAMPS), a group of local electric utilities that had agreed to purchase power from the project, mutually decided to terminate what was known as the Carbon Free Power Project (CFPP), according to a news release. NuScale is the only U.S. developer with a design approved by the Nuclear Regulatory Commission (NRC) for a small modular reactor (SMR).
The project was supposed to consist of six 77-megawatt SMRs, generating a total of 462 MW, and come online in 2029. It was to be located near Idaho Falls, Idaho, at the Department of Energy’s Idaho National Laboratory.

DOE said it had provided $232 million for the project since 2020, before federal infrastructure and climate laws passed in 2021 and 2022. The department had backed the project with a $1.4 billion cost-share deal ([url]https://subscriber.politicopro.com/article/eenews/2020/11/04/major-us-nuclear-project-hits-trouble-009014[/url]).
But substantial cost overruns and delays from its originally scheduled 2026 operational date spooked utilities that are members of the UAMPS, leading several to withdraw from a 2019 agreement to buy 200 MW from the reactors once completed. The project previously was the subject of intense discussion among UAMPS members ([url]https://subscriber.politicopro.com/article/eenews/2023/03/01/nuscale-gets-renewed-vote-of-confidence-on-nuclear-project-00084810[/url]).
Oregon-based NuScale said in the Wednesday release that the reason it could no longer advance toward deployment was because it lacked enough subscribers. Yet the company’s president and CEO, John Hopkins, projected certainty that it will still be able to bring its SMR design into reality in the future.
“Our work with [the CFPP] over the past ten years has advanced NuScale technology to the stage of commercial deployment; reaching that milestone is a tremendous success which we will continue to build on with future customers,” Hopkins said in a statement.
A DOE spokesperson, who didn’t provide a name, called the cancellation “unfortunate news,” adding that “the work accomplished to date on [the project] will be valuable for future nuclear energy projects” and that “advanced nuclear energy technology is a critical tool to meet our ambitious net-zero goals.”
Proponents of advanced nuclear technologies like SMRs argue that one of the benefits will be a cheaper cost of carbon-free energy that can run nearly 24/7. NuScale’s Idaho-based project had a target of delivering 40 years of electricity at $55 per megawatt-hour.
But project costs climbed to $89 per MWh, according to a report ([url]https://ieefa.org/resources/eye-popping-new-cost-estimates-released-nuscale-small-modular-reactor[/url]) from the Institute for Energy Economics and Financial Analysis, which has been critical of relying on SMR technologies.
The report’s author and director of resource planning analysis, David Schlissel, told E&E News the cancellation is “absolute evidence” that “the claim that SMRs are going to be cheaper is false.”
“If it sounds too good to be true, it probably is,” Schlissel added.
NuScale’s stock price saw a significant drop ([url]https://subscriber.politicopro.com/article/eenews/2023/10/30/stock-retreat-poses-new-hazard-to-leading-small-nuclear-developer-00123538[/url]) last month. And the stock plunged in after-hours trading Wednesday.
Still, advanced nuclear advocates said Wednesday they are still confident in the viability of SMRs.
“This is one project among many that are being developed to deploy advanced nuclear technologies,” Nuclear Innovation Alliance Executive Director Judi Greenwald said in an email. “We must continue to support a portfolio of different approaches to ensure we see successful deployment of advanced reactor technologies” to meet U.S. climate goals, she said.
NuScale first got NRC approval for a 50-MW reactor design in July of last year — a design that’s different than the proposed 77-MW reactors that were canceled Wednesday. The company had also signed agreements earlier this year to develop and deploy SMRs with Nucor ([url]https://www.nuscalepower.com/en/news/press-releases/2023/nuscale-and-nucor-sign-mou-to-explore-using-smrs-to-power-electric-arc-furnace-steel-mills[/url]), the country’s largest steel producer, and Fluor a Texas-based engineering and construction firm ([url]https://www.fluor.com/projects/nuscale-power-small-modular-reactor-nuclear[/url]).
NRC did not immediately respond to a request for comment on the NuScale project Wednesday.
UAMPS CEO Mason Baker called the decision “very disappointing,” but the “best course” for the coalition of local power providers he leads, who will still need the electricity the project was set to supply.
“We are working closely with NuScale and the U.S. Department of Energy on next steps to wind the project down,” Baker added in a Wednesday statement.
UAMPS spokesperson Jessica Stewart said in the email that the group still has “ample time and opportunity to replace the energy output it planned to receive from the CFPP.”
Stewart said UAMPS’s efforts include looking at expanding a wind farm in Bonneville County, Idaho, as well as adding utility-scale solar and considering natural gas technologies that use hydrogen.

[chuckChuck]

Eye-popping new cost estimates released for NuScale small modular reactor

January 11, 2023
David Schlissel

[url]https://ieefa.org/resources/eye-popping-new-cost-estimates-released-nuscale-small-modular-reactor[/url]

Key Findings

NuScale and the Utah Associated Municipal Power Systems (UAMPS) announced costs of a 462-megawatt small modular reactor (SMR) have risen dramatically.



As recently as mid-2021, the target price for power was pegged at $58 per megawatt-hour (MWh); it’s risen to $89/MWh, a 53% increase.



The price would be much higher without $4 billion federal tax subsidies that include a $1.4 billion U.S. Department of Energy contribution and a $30/MWh break from the Inflation Reduction Act.



The higher target price is due to a 75% increase in the estimated construction cost for the project, from $5.3 to $9.3 billion dollars.


From 2016 to 2020, they said the target power price was $55/megawatt-hour (MWh). Then, the price was raised to $58/MWh when the project was downsized from 12 reactor modules to just six (924MW to 462MW). Now, after preparing a new and much more detailed cost estimate, the target price for the power from the proposed SMR has soared to $89/MWh.

Remarkably, the new $89/MWh price of power would be much higher if it were not for more than $4 billion in subsidies NuScale and UAMPS expect to get from U.S. taxpayers through a $1.4 billion contribution from the Department of Energy and the estimated $30/MWh subsidy in the Inflation Reduction Act (IRA).

It also is important to remember that the $89/MWh target price is in 2022 dollars and substantially understates what utilities and their ratepayers actually will pay if the SMR is completed. For example, assuming a modest 2% inflation rate through 2030, utilities and ratepayers would pay $102 for each MWh of power from the SMR—not the $89 NuScale and UAMPS want them to believe they will pay.

The 53% increase in the SMR’s target power price since 2021 has been driven by a dramatic 75% jump in the project’s estimated construction cost, which has risen from $5.3 billion to $9.3 billion. The new estimate makes the NuScale SMR about as expensive on a doll

[Hamloc]

From CNN: “Energy company pulls the plug on two major offshore wind projects on East Coast.”

”Macroeconomic factors have changed dramatically over a short period of time, with high inflation, rising interest rates, and supply chain bottlenecks impacting our long term capital investments.” “As a result, we have no choice but to cease development of Ocean Wind 1 and Ocean win 2.”

[chuckChuck]

Don't expect Alberta, Saskatchewan, Ontario to ever release a public comparsion of the costs of the unlicensed and unproven SMR plans.

There are no SMRs producing electricity in the free world, only a couple in China and Russia.

Here the governments that say they don't want to pick winners and losers, are on a path to pick a big loser in SMRs.

There is not a chance any will be built and producing in the next decade.

In the mean time wind and solar will continue to add much cheaper capacity and storage will ramp up. Along with backup sources like gas, hydro, connections with other provinces and states.

If nuclear is so cheap and economic why hasn't the private sector built them without subsidies in deregulated Alberta?

They will only happen in provinces where governments will force ratepayers and taxpayers to pay for the excess cost of nuclear electricity.

Show us the numbers.

[chuckChuck]

From CNN: “Energy company pulls the plug on two major offshore wind projects on East Coast.”

”Macroeconomic factors have changed dramatically over a short period of time, with high inflation, rising interest rates, and supply chain bottlenecks impacting our long term capital investments.” “As a result, we have no choice but to cease development of Ocean Wind 1 and Ocean win 2.”

Off shore wind. Onshore is much lower cost.

[chuckChuck]

If you check out Lazards unsubsidized LCOE the cost range per MWh of utility scale new wind and solar are much lower cost than anything else out there for new capacity. And nuclear is the highest.
lazards-lcoeplus-april-2023-4.pdf

[furrowtickler]

Costs of everything have increased dramatically since the Covid lockdowns that upended supply chains, labour , manufacturing , unsustainable government spending , and unreasonable government environmental climate policies causing a rapid rise in interest rates leading to high inflation.
Canada has made it worse by an ever increasing carbon tax with a compounding effect that most can’t understand.
I wonder what the costs would be to build a hydro dam now comparatively in that same time period ?
might just have to crank up the current clean natural gas power plants for cheap reliable abundant power for the foreseeable future .

[Hamloc]

If you check out Lazards unsubsidized LCOE the cost range per MWh of utility scale new wind and solar are much lower cost than anything else out there for new capacity. And nuclear is the highest.
lazards-lcoeplus-april-2023-4.pdf

I would hope wind is 1/3 of the cost of natural gas or hydro as it only produces power 1/3 of the time. Solar’s capacity factor is 1/2 of wind.

[AlbertaFarmer5]

From the article:
“If it sounds too good to be true, it probably is,”

You can say that again. In fact you did. You went on to make outlandish claims about wind, solar and storage.

[furrowtickler]

If you check out Lazards unsubsidized LCOE the cost range per MWh of utility scale new wind and solar are much lower cost than anything else out there for new capacity. And nuclear is the highest.
lazards-lcoeplus-april-2023-4.pdf

Based on 24/7 365 days a year availability?

[LEP]

Costs of everything have increased dramatically since the Covid lockdowns that upended supply chains, labour , manufacturing , unsustainable government spending , and unreasonable government environmental climate policies causing a rapid rise in interest rates leading to high inflation.
Canada has made it worse by an ever increasing carbon tax with a compounding effect that most can’t understand.
I wonder what the costs would be to build a hydro dam now comparatively in that same time period ?
might just have to crank up the current clean natural gas power plants for cheap reliable abundant power for the foreseeable future .

We wouldn't even be having a conversation about small modular nuclear if gas wasn't going to be banned by the ideologues.

Let as many private entities as possible build the solar and wind installations to supply and operate at a tendered price as the market will bear. With Saskpower gas plants as baseload.

Just take the carbon tax off gas.

[chuckChuck]

Nuclear is the highest cost option to increase capacity. Economics alone will seal its fate.

As long as there is enough backup, renewables are the lowest cost option. Its not nuclear or renewables or gas, or hydro its all of the above.

Why would you forgo all that really low cost generation from renewables when you are trying to reduce emissions?

Why would you run a gas plant during the day when solar and wind can do it at half the LCOE cost?

In a free market the lowest cost supply should win the biggest share of the supply.

Otherwise governments are picking losers. Alberta just wants to make sure it has a market for as much gas as possible.

Its really hard to generate excess profits from the wind and solar energy when both are unlimited sources that will never run out and are free fuel sources!

[Hamloc]

Chuck2, the capacity factor of wind in Alberta is between 34 and 38% depending on the year. The capacity factor of solar is 18 to 20%. So yes they should cost less to build because they only produce part of the time. What is nuclear’s capacity factor? How many acres of good cultivated land does a modular nuclear reactor cover? By comparison a solar field?
How many miles of power lines could be saved by placing modular nuclear reactors closer to where the power is needed. Windmills are generally placed out on the open plains far from the city and require considerable power line construction, an additional cost. Same with solar fields. Large tracks of land out in the country, far from the consumer.

[chuckChuck]

How many acres of good land is covered in oil and gas infrastructure with no option to say no for farmers and land owners? Coverring much much more land than solar and wind in Alberta! So why no concern about the loss of land from oil and gas?

Hamloc the Long Term Cost of Electricity LCOE measures the cost over the lifetime for each MWh. It doesn't matter whether they produce all the time if you have system backup.

They are still the cheapest source of new capacity and anyone in business knows you run the lowest cost option as much as possible to avoid burning more expensive gas that emits a lot of carbon.

My solar system saves me money over Sask Power. At the utility scale solar is far cheaper in the range of 3-4 cents per kwh.

[AlbertaFarmer5]

.

Its really hard to generate excess profits from the wind and solar energy when both are unlimited sources that will never run out and are free fuel sources!

What is an excess profit? Who gets to decide?
Did your 6000 acre farm generate any excess profits during the recent boom years?