Power plant economy of scale and cost trends: further analyses and review of empirical studies

Technical Report · Tue Jul 01 04:00:00 EDT 1986

DOI:https://doi.org/10.2172/5508075· OSTI ID:5508075

Fisher, Jr., C. F.; Paik, S.; Schriver, W. R.

Multiple regression analyses were performed on capital cost data for nuclear and coal-fired power plants in an extension of an earlier study which indicated that nuclear units completed prior to the accident at Three-Mile Island (TMI) have no economy of scale, and that units completed after that event have a weak economy of scale (scaling exponent of about 0.81). The earlier study also indicated that the scaling exponent for coal-fired units is about 0.92, compared with conceptual models which project scaling exponents in a range from about 0.5 to 0.9. Other empirical studies have indicated poor economy of scale, but a large range of cost-size scaling exponents has been reported. In the present study, the results for nuclear units indicate a scaling exponent of about 0.94 but with no economy of scale for large units, that a first unit costs 17% more than a second unit, that a unit in the South costs 20% less than others, that a unit completed after TMI costs 33% more than one completed before TMI, and that costs are increasing at 9.3% per year. In the present study, the results for coal-fired units indicate a scaling exponent of 0.93 but with better scaling economy in the larger units, that a first unit costs 38.5% more, a unit in the South costs 10% less, flue-gas desulfurization units cost 23% more, and that costs are increasing at 4% per year.

• Research Organization: Tennessee Univ., Knoxville (USA). Construction Resources Analysis
• DOE Contract Number: AC05-84OR21400
• OSTI ID: 5508075
• Report Number(s): ORNL/Sub-85-7685/1-11; ON: DE86014410
• Country of Publication: United States
• Language: English

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CAPITALIZED COST
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