Sunday, August 21, 2005

Finnish EPR Economics

Dear Karel and others,

I got involved in a debate with one of the very few nuclear advocates in Denmark, and as our debate centres around the economy of the Finnish EPR, I would like to present the figures I have collected on the issue. Then maybe someone from the list can add or correct them.Investment: 3,25 bill. Eur (from WISE News 2003-12-13/Greenpeace)Investment period: 5 years (with large investments)Power production lifetime: 40 yearsDecommissioning costs: 1 bill. Eur (lower estimate, WISE, above)Capacity: 1600 MWCapacity factor: 85% (estimate)Operating & maint. costs: 0,9 Eur-cent/kWh (estimate)Fuel and waste cost: 0,9 eur-cent/kWh (estimate with WISE uranium calculator and present U-price)Interest rate = discount factor = 6%/year, the factor used in evaluating Danish energy investmentThis gives:- a total price at start of operation of 4.4 bill. Eur including interests and decommissioning costs discounted for 40 years from 1 bill. Eur to 0.59 bill. Eur.-an electricity price of 4.3 Eur-cent/kWh.This price is similar to windpower in better (but not the best) areas, and it is higher than the average Nordic electricity pool price in any year since this pool was established. One possible explanation for the economic rationale behind the investments is the very cheap loan that the project has received from French and German public banks. Other possible reasons:-the investors are mainly electricity consumers, and by adding this big plant to the market they might flood the market, leading to losses for the plant but cheaper electricity for the investors-among the investors are large pulp industries that might fear increasing competition for low-grade wood from renewable energy (biomass) power plants.It is of course also possible that there is no economic rationale; that the plant is not expected to be profitable in normal economic terms. Comments are welcome.Best wishes,GunnarINFORSE/OVE


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