Industrialisation of SMR Technology

June 2016

Dr Peter WalkdenProgramme DirectorAmec Foster Wheeler

• A Small Modular Reactor• Not Micro (>100MWe)

• Not Just Small

• Must Be Small + Modular

• Why Small?• Transport – Road, Rail and/or Sea

• Simplified site construction

• Why Modular?• Manufacturing – Production-Line Techniques

• Assembly – In-factory

• Optimised Construction and Commissioning

• Enhanced Quality Control

• Why Small + Modular?• Lifecycle Cost

• Flexible/Adaptable Applications

• New, Efficient Approaches to Risk Management

What Is An SMR?

Perhaps the Real Question is Why Big?

Is it this?

Or this?

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Power Station Thermodynamics

20

25

30

35

40

60 100 200 500 600

Historical Power Station Thermal Efficiencyvs Electrical Output

(All Fuels)

Electrical Output (MWe)

Th

erm

al E

fficie

ncy (%

)

At the expense of Agility?

Manufacturing, Construction and Through-life Costs?

Factors Driving SMR Deployment in the UK

• Market Potential• Global

• UK

• Competitors

• Business Case• Cash Flow

• Return on Investment (ROI)

• Net Present Value

• Socio-Economic Impacts

• Costs• Design and GDA Costs

• Manufacturing, Assembly and Construction Costs

• Operations Costs

• Life-Cycle Costs

• Finance• Up-Front Investment (Initiation)

• Government Support (Set-up and Through-life)

• Investors (Utilities, Institutional etc.)

Success = Product + Business Case + Investors

Market Potential

0 100 200 300 400 500 600 700

Africa

Asia & Oceania

Central & South America

Eurasia

Europe

Middle East

North America

• Global Market

• Potential ~85 GWe (to 2035)

• Barriers to Global Sales exist

• Accessible Market therefore smaller

• Sufficient size for 2-3 vendors

• Sizeable Production Run required to

recover start-up and set-up costs

• To Produce a Truly Modular

Product

• UK Potential ~7-8 Gwe

• 3rd Party Sales Required

• Degree of International licensing

standardisation required

• Unless home market sufficiently

large e.g. China)

The UK market alone is not sufficiently large to deliver economic viability

Technical Readiness Level (TRL)

• Techniques Exist for Measuring

Technical Readiness (TRL)

• TRL 9 = Fully Developed

• TRL3-6 = Feasibility/Development

• TRL1-3 = Proof of Concept

• No Fully Developed SMR Exist

• Most have TRL 3-6

Potential for Design Input and Intellectual Property (IP) Development

Design and GDA

• Design and GDA historically run sequentially

• Expensive

• Wasteful

• Time Consuming

• Preference for SMR GDA

• Design informed by fabrication, operations and regulatory requirements

• Interactive Design & GDA

• Would require changes to approach by both vendor and regulator

• Critical for SMR Success

• Early Market Entry

• International Standing

• Standard Design

An SMR Design With GDA Approval Would Have International Standing

Manufacturing, Assembly & Construction Costs

• Design for In-Factory Fabrication and

Assembly

• Using production and assembly

techniques from other industries

• Including modular buildings

• Maximise scope in controlled QA

environments

• Minimise on-site scope and site-based

risks

• A Balance

• Requires significant up-front investment

in fabrication and assembly facilities

• Large potential gains in quality, time

and cost through the product life-cycle

The UK has relevant, world-leading

expertise gained in Shipbuilding, Aerospace, Oil and Gas

Operations Costs

• New and significant opportunities for operational gains could arise from a standardised, modular design

• Fleet approach to system engineering and outage support

• Centralised, predictive fleet-wide condition monitoring support

• Leaner, more agile relationships (utility/vendor/supply chain)

• Examples exist in other markets

• Aero-engine market

• Oil and Gas facilities

• The UK has relevant, world-leading expertise informed by ~60 years experience of reactor operations

Opportunities for utility/vendor Risk Management (vs Risk Transfer)

Life-Cycle Costs

• Significant opportunities for Life-cycle

gains would arise from a standardised

design

• Designed for access and maintenance

• Designed to minimise waste volumes and

waste arisings

• Designed for optimised decommissioning

and clean-up

• Examples exist in other markets

• Aero-engine market

• Oil and Gas facilities

• The UK has relevant, world-leading

expertise informed by ~70 years

experience of the reactor life-cycle

Further opportunities for utility/vendor Risk Management

Product Finance

• Industry Accepts the Need to Invest

• Scale and Nature of SMR are compatible with

corporate balance sheets

• Recognise time and money required to exploit

advanced manufacturing techniques

• Government support required

• To assist with First of a Kind (FOAK) launch in

the UK

• Design

• Manufacturing and Assembly set-up

• To achieve economic viability (NOAK)

• To secure 3rd party sales

• The Alternative is to seek Support and/or

Product Launch Elsewhere

• Jobs and Intellectual Property (IP) will follow

• What Are the Success Criteria?

• Early Generation

• Lowest Price for Electricity

• UK Job Creation

• UK IP Ownership

• Other Factors (Pu disposition, CHP etc)

UK Competition Process and Outcomes

Technical Maturity

UK Licensing

International Licensing

IP Availiability

UK Scientific & Technical Jobs

UK Manufacturing Jobs

Production > 30 Reactors

Access to other Investment

Access to International Markets

Grid Conenction by 2025

Commercial Utility Infrastructure

Nuclear Site Licensee Infrastructure

Site Availiable

Plutonium re-use

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SMR Scorecard (Raw Scores)

Scenario A1 Scenario D Scenario A2 Scenario B1 Scenario C Scenario D

The “Home” market is usually the source of a “Launch Customer”

• What is the “Prize”?

• Single vs Multiple Vendors

• GDA “Slot”

• Access to Government

launch funding

• Market Assurances/Contract

for Difference

Summary - Factors Affecting When for the UK ?

There is a growing consensus that there is a global market for SMRs

• A range of views as to the exact size

• Probably sufficient to support 2-3 vendors

• Vendors with a large home market or who are first to market will have a

clear advantage

SMRs Offer Advantages in Terms of:

• Agility/Adaptability

• Faster and Cheaper Deployment

• Operational and Life-Cycle Gains

The Benefits of Modularisation will be Secured By:

• A Standard Design

• A Streamlined Approach to Licencing

• Designed for Fabrication, Assembly and Construction

The UK has advantages in terms of

• Being Open to Nuclear New Build

• Reactor Operations and Life-Cycle Experience

• Experience of Applying Modular Concepts in Comparable Industries

Securing Finance will require a Robust Business Case

• Cash Flow, Return on Investment (ROI), Net Present Value

Government Support will be Required

• To assist with First of a Kind (FOAK) launch in the UK

• To attract long-term investment

• What Does Success Look Like?

• Competition Success Criteria

• A Definition of the “Prize”

• Timeline for GDA Slot

• Site Availability

• Assurances Regarding UK Market Size

• Clarity on Commercial Mechanisms (CfD)

• Clarity on Available Government Funds

• Start-up

• Through-Life

What Can UK Government Do To Help?