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1. • Risk assessment scenario and approaches for nuclear
power ..Project Structuring
• Challenges and issues in control and monitoring
existing proposed reactor designs for project structuring
• Consideration of high level uncertainties in the risk
study of a nuclear power plant: Project Cost Risks
• Small reactors and risk dispersion, Small Reactor
Advantages
Himadri Banerji, Former CEO, Reliance Energy –
Chairman & Managing Director, EcoUrja, India
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 1

3. Nuclear capacity additions are on the rise again
Source: World Nuclear Association, Ernst & Young analysis, May
Presented by Dr. Himadri Banerji 2nd
2010 Annual Nuclear Power June 21st to
24th 2011 Singapore 3

4. Asia Pacific region sustained nuclear
new build through the 1990s
and leads current construction plans
Source: World Nuclear Association, Ernst & Young analysis, May 2010
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 4

5. Name Location Type Rating Status
MWe
Tarapur Atomic Tarapur BWR 2X160 Oct 1969
PHWR 2X540 Jun 2005-06
Rajasthan Rawalbhatta PHWR 1x90 Apr 1973
Atomic PHWR 1x187 Apr 1981
PHWR 2x202 June 2000
PHWR 2x202 Dec 2009-Feb 2010
Madras Atomic Kalpakkam PHWR 1X170 Jan 1984
PHWR 1X202 Mar 1986
Narora Atomic Narora PHWR 1X220 Jan 1991
PHWR 1X220 Jul 1992
Kakrapar Kakrapar PHWR 1x220 May 93
Atomic PHWR 1x220 Sep 1995
PHWR 1x700 Under Construction
PHWR 1x700 Under Construction
Kaiga Atomic Kaiga PHWR 4X220 2000-2011
Koodanakullam Koodanakullam, VVER 1X1000 Under construction
1X1000 Feb 2011
Prototype Fast Kalkappam FBVR 1X500 Under Construction

6. Uncertainty in Lifecycle Nuclear Project Costs
Spent Fuel and Decommissioning
To enable an expansion of nuclear power, it must overcome critical
challenges in cost, waste disposal, and proliferation concerns while
maintaining its currently excellent safety and reliability record.
In the relatively near term, important decisions may be taken with far
reaching long-term implications about the evolution of the nuclear fuel
cycle—what type of fuel is used, what types of reactors, what happens to
irradiated fuel, and what method of disposal for long term nuclear wastes.
Immediate concerns are nevertheless the inherent uncertainty in fixing the
cost of the project for Spent Nuclear Fuel Management and fixing the
Decommissioning Budget and thus closures of financing of nuclear projects
pose great risks to investors.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 6

7. Impact of construction delay on levelised cost (6.7% WACC)
Source: own calculations based on IEA(2006)
Compared to other power generation technologies, new nuclear build is
characterised by long lead times (3 years for project preparation, 5 to 6 years for
construction), and high front end cash outflows ( € 3 to € 4 bn for a first-of-a-kind
plant of 1500MW, €2 bn for a standard plant, to compare to an investment cost of
€200 millions for a large CCGT of 600 MW).
It is also likely to have high cost estimation and schedule risk around the forecast
baseline lead time, based on past experience construction cost and time overruns.
Besides, the scale of the proposed investment in a nuclear plant represents a project
of considerable scale on both a stand-alone basis as well as in comparison with
construction costs of an average power plant.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 7

8. COST INDEX
SAFETY INDEX
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 8

9. Stakeholders in Nuclear Power Project
Government - which is responsible for overall energy policy and, in some
cases, financing
Market - formed by electricity customers wanting electricity at a competitive
price
Utility (generator) - which is ultimately responsible for developing the complete
project
EPC contractors - engineering, procurement and construction companies
which are responsible to the owner for delivery according to schedule and budget
Vendors - which are responsible for supplying equipment and technology to
either the owner, the EPC contractor or as part of a joint venture or consortium,
according to schedule and budget
Safety Authority - which is responsible for addressing all matters related to
protecting public safety and the environment, from the design stage to plant
operation and fuel management. Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
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24th 2011 Singapore

10. Focus areas for project owners to maximize their chances of success.
Robust Business Plans
Risks Mitigated or transferred away from the
Different Scenarios and Contingencies plant investor through different contractual
and organisational arrangements.
Use of State Guarantees and
Significant risk transfers from plant investors
onto governments, consumers, and for the first
Risk Sharing Agreements new reactors, onto vendors are likely to be
needed to make nuclear power attractive to
Sustainability Assurance to Stake holders investors in liberalised markets.
Commitment of Funds
Presence of Strong Governance
Use Risk Management Tools Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 10
Project Management Practice

11. Risk Management Framework
This integrated risk management (RM) approach generates benefits that
include the following:
•Clearer criteria for decision making.
• Making effective use of investments already made in probabilistic safety
analysis (PSA) programs by applying these analyses to other areas and
contexts.
• Cost consciousness and innovation in achieving nuclear safety and
production goals.
• Communication improvement — more effective internal communication
among all levels of the NPP operating organization, and clearer communication
between the organization and its stakeholders.
• Focus on safety — ensuring an integrated focus on safety, production, and
economics during times of change in the energy environment
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 11

12. Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 12

13. Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 13

14. Table 2: Risk control and monitoring in nuclear power projects
Presented by Dr. Himadri Banerji 2nd
Table 2 shows ways in which the risks of Annual Nuclear Powerbe monitored and controlled, to match Table 1.
nuclear projects can June 21st to
24th 2011 Singapore 14

15. Small is Beautiful
STRATEGY OF DISPERSION OF SMALL REACTORS
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 15

16. There are eight primary sources of nuclear costs which
pose major project risks:
The cost of the land upon which the nuclear power plant (NPP) is built.
Costs related to designing the NPP
Cost related to the materials from which the NPP is built.
Labour costs related to manufacture and construction.
The cost of obtaining regulatory approval AND PERMITS LIKE WATER ETC
Investment related costs (interest, etc.)
Transportation and Access related costs
The cost of the electrical transmission system that connects the NPP to the
grid
Lost Opportunities for CombiningDr. Himadri Banerji Improving Efficiencies
Presented by Cycles and 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 16

17. The cost of the land upon which the
nuclear power plant (NPP) is built
Land related costs can be lowered if the investor already owns the land. In the
case of NPPs, land costs can be lowered if the NPP is built on a pre-existing NPP
site.
Other, for example transportation related investments may not be required, and
access to water is very likely to be available.
NPPs can also be located on the site of obsolete coal fired power plants slated
to be shut down for technological or environmental reasons.
The same advantages of the NPP location would apply to the coal powered site,
and additional facilities – for example the turbine hall, parking lots,
administrative buildings, workshops, transformer farms, etc. - can potentially be
recycled.
The layout and size of an existing coal fired power plant may not be
appropriate for adaptation for a large nuclear plant, but a cluster of small
reactor approach would allow for far greater flexibility in facility layout,
and would be far more easy to accommodate. 2nd
Presented by Dr. Himadri Banerji
Annual Nuclear Power June 21st to
24th 2011 Singapore 17

18. Costs related to designing the NPP
Small reactors, especially advanced technology small reactors, offer
advancements in siting flexibility.
For example, clusters of small reactors can be located in former salt mines.
Serial production lowers design costs.
Design costs are largely fixed.
Design costs can be divided among all of the units produced.
If one reactor of a particular design is produced, then the recovery of the
cost of that design would be through sale of that unit.
If hundreds of units are produced, the recovery of the design cost can be
divided between all of the units.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 18

19. Costs related to designing the NPP
Clusters of Small Reactors
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 19

20. Costs related to designing the NPP
Finally, design simplification can lower nuclear costs.
The Generation IV Molten Salt Reactor design offers revolutionary design
simplification. In the Molten Salt Reactor the fuel is dissolved in the
coolant.
Thus much of the core structure is eliminated. Because the Molten Salt
Reactor features a negative coefficient of reactivity, the reactor is highly
stable without operator control input.
Control rods can be partially or completely eliminated.
These simple features lower manufacturing costs. And lessen
manufacturing time.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 20

21. Cost related to the materials from which the NPP is built
The material input into a NPP per watt of output typically decreases as
total reactor output rises.
Traditionally this has lead to the economies of scales argument, which
maintains that the larger the reactor output, the lower the per watt cost.
There are, however, problems with this assessment.
While it is true that larger size usually means lower material costs per unit
of electrical output, there are exceptions to this rule, especially with
respect to advanced nuclear technology.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 21

22. Cost related to the materials from which the NPP is built
For example:
The greater thermal efficiency of a reactor of similar core size might lower output
cost per unit of heat, compared to that of a similar sized, but less efficient design.
Reactor safety issues may effect materials input.
Light Water Reactor cores and heat exchanges operate under very high pressure.
They require significant amounts of material to prevent steam explosions.
LWR outer containment structures are typically massive, and thus require large
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 22

23. Cost related to the materials from which the NPP is built
A more compact reactor core may lower material requirements.
Thus if two reactors have the same output, the one with the smaller core
is likely to require fewer materials.
Underground reactor siting could potentially lower reactor structural
costs, by offering protection against terrorist attacks from aircraft and at
surface levels with lower materials inputs.
.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 23

24. Cost related to the materials from which the NPP is built
Small generation components can lower material requirements.
Thus supercritical carbon dioxide turbines are much smaller than steam
turbines used in conventional reactors.
Small turbines require fewer materials, and can be housed in smaller
turbine halls, which in turn require less material and labour input to
build.
Thus a small advanced technology reactor with a compact core and
high thermal efficiency, that operates at a one atmosphere pressure
level, and can be sited underground might require fewer materials
inputs per unit of electrical output than a much larger conventional
reactor
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 24

25. Reactor Design Lowers Manufacturing Costs
In addition manufacturing costs can be lowered by simplifying reactor
design. Passive safety features can in some instances lower nuclear
costs.
For example thermo-siphoning of reactor coolant, may save the cost of
manufacturing and installing coolant pumps.
Gravity feed emergency coolant systems save on manufacturing costs
in several ways,
They do not require backup generators or pumps, thus many of the
expenses of older emergency coolant systems can be saved.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 25

26. mPower Reactors from B&W
The B&W mPower reactor, with its scalable, modular design, has the
capacity to provide 125 MWe to 750 MWe or more for a 4.5-year operating
cycle without refuelling, and is designed to produce clean, zero-emission
operations.
Babcock & Wilcox Nuclear Energy, Inc. will lead the development, licensing
and delivery of B&W mPower reactor projects.
Features of the B&W mPower reactor include:
Integral nuclear system design
Passive safety systems
Underground containment
4.5-year operating cycle between refueling
Scalable, modular design is flexible for local needs
Multi-unit (1 to 10+) plant
Used fuel stored in spent fuel pool for life of the reactor (60 years)
Country shop-manufactured
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 26

27. Labour costs related to manufacture and construction.
Labour costs can be lowered by shifting work from the field to a
factory. The more labor which can be performed in a factory, the lower
the over all costs.
Modular production is consistent with factory manufacture. Factory
manufacture lowers labor costs in several ways.
First serial production leads to the division of labor, which in turn
typically increases labor productivity.
The division of labor decreases the skill set required from individual
workers.
Decreased labor skill sets decrease labor wage expectations.
Factory work settings, as opposed to field work settings also decrease
wage expectations.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 27

28. The cost of obtaining regulatory approval and permits like for
water
The current nuclear regulatory environment favour serial
manufacture.
Once an example of a particular nuclear design is approved by the
NRC is approved, the approval of all subsequent reactors using the
design is automatic.
Environmental aspects of subsequent application, however, receive
the same attention, since they vary from facility to facility.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 28

29. The cost of obtaining regulatory approval and permits like for water
In addition to NRC license requirements, other licenses or permits may be
required.
For example, the use of cooling water from rivers and lakes is not automatic,
and usually requires regulatory approval.
One of the advantages of recycling coal fired power plant sites, is that water
access permits may already exist, and potentially can be transferred.
But what if obtaining a water use permit is not possible?
With small reactor designs air rather water cooling is practical, with
relatively modest efficiency penalties.
With efficient advanced reactors, the efficiency benefits may far outweigh
the efficiency losses related to air cooling.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 29

30. Investment related costs (interest, etc.)
Interest accrues as nuclear power plant construction, and accrued interest may
amount to a significant percentage of NPP capital costs, especially if the
construction project stretches to half a decade or more.
Small factory built reactors are expected to have shortened construction times,
compared to large conventional reactors.
Simplified advanced reactor designs are also expected to shorten NPP
construction time.
These shortening construction time can decrease the interest component of
capital costs significantly.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 30

31. Investment related costs (interest, etc.)
Interest charges may reflect the market's assessment of project risks.
The greater a projects assumed risk, the higher the interest premium the
market will assess.
By decreasing a project's size, and lowering projected
manufacturing/construction time, nuclear project builders can offer the
market lower perceived risks.
Lower perceived risks, will lead to interest discounts compared to higher risk
large nuclear projects.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 31

32. Transportation and Access Related Costs
Small, factory manufactured reactors offer advantages in transportation costs.
Conventional reactors include a number of very large and heavy components,
that present transportation challenges.
Components such as pressure vessels and steam generators may require
special and highly unusual transportation arrangements if they are transported
overland.
Special huge road transportation vehicles, some capable of moving no more
than three miles an hour may disrupt highway uses in large areas over several
weeks as they transported conventional reactor steam generators and pressure
vessels to reactor sites.
In contrast, small reactor cores may be moved by trucks or by rail as ordinary
freight.
In areas where water shortages represent acute problems, small reactor access to
reliable water supplies is unnecessary. Air cooling will enable small reactors to
operate with out a reliable water supply. Himadri Banerji 2nd
Presented by Dr.
Annual Nuclear Power June 21st to
24th 2011 Singapore 32

33. The cost of the electrical transmission system that connects the NPP
to the grid
Small reactor clusters located at recycled coal fire power plant locations
potentially have greatly simplified grid connections.
Not only can they be located near to the cities they are intended to serve, but
grid hook-up is facilitated by existing transformer farms, and grid
connections.
Because they can be located close to served cities new transmission lines will
not cover long distances, thus lowering grid expansion costs.
Large reactors may require new transmission lines that are hundreds of miles
long, in order to move surplus electricity to market.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 33

34. Small reactor clusters located at recycled coal fire power plant
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 34

35. Lost Opportunities for Combining Cycles and Improving Efficiencies
In addition to the above savings, and potential savings mentioned above there
are other potential savings that may be available with small reactors.
For example, with advanced nuclear technology, for example molten salt
reactors, combined Rankine (steam) and Brayton (gas) cycles are possible.
A bottoming desalinization cycle could be offered to the system, thus offering
formidable efficiency from small reactor packages.
A high temperature reactor can provide top cycle heat for industrial processes,
as well as producing middle cycle electricity generation, and bottom cycle heat
for electrical generation.
By adding a second generating cycle, small reactors can lower their electrical
generation costs.
Desalination would add a further revenue stream from the reactors operation
through the sale of portable water.Nuclear Power June 21st2nd
Presented by Dr. Himadri Banerji
Annual to
24th 2011 Singapore 35

36. Benefits in Risk Management By shifting to Small Reactors
Shifts from conventional nuclear technology, to some advanced nuclear
technologies, also offer significant potential savings.
‘Some advanced technology savings are available to both large and small
nuclear power plants, but the flexibility of small NPPs may mean that at
least in certain situations
Small advanced nuclear power plants may offer very significant potential
savings in comparison to large conventional NPPs.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 36

37. State of Development
Three main options are being pursued:
1.Light water reactors,
2.Fast neutron reactors and also
3.Graphite-moderated high temperature reactors.
The first has the lowest technological risk,
but the second (FNR) can be smaller, simpler and
with longer operation before refuelling.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 37

38. A 2009 assessment by the IAEA under its Innovative Nuclear
Power Reactors & Fuel Cycle (INPRO) program concluded that
There could be 96 small modular reactors (SMRs) in operation
around the world by 2030 in its 'high' case, and 43 units in the
'low' case, none of them in the USA.
Presented by Dr. Himadri Banerji 2nd
Annual Nuclear Power June 21st to
24th 2011 Singapore 38

39. Status of Development of Small Reactors
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Annual Nuclear Power June 21st to
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