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Title: Financing Strategies For A Nuclear Fuel Cycle Facility

Abstract

To help meet the nation’s energy needs, recycling of partially used nuclear fuel is required to close the nuclear fuel cycle, but implementing this step will require considerable investment. This report evaluates financing scenarios for integrating recycling facilities into the nuclear fuel cycle. A range of options from fully government owned to fully private owned were evaluated using DPL (Decision Programming Language 6.0), which can systematically optimize outcomes based on user-defined criteria (e.g., lowest lifecycle cost, lowest unit cost). This evaluation concludes that the lowest unit costs and lifetime costs are found for a fully government-owned financing strategy, due to government forgiveness of debt as sunk costs. However, this does not mean that the facilities should necessarily be constructed and operated by the government. The costs for hybrid combinations of public and private (commercial) financed options can compete under some circumstances with the costs of the government option. This analysis shows that commercial operations have potential to be economical, but there is presently no incentive for private industry involvement. The Nuclear Waste Policy Act (NWPA) currently establishes government ownership of partially used commercial nuclear fuel. In addition, the recently announced Global Nuclear Energy Partnership (GNEP) suggests fuels from several countriesmore » will be recycled in the United States as part of an international governmental agreement; this also assumes government ownership. Overwhelmingly, uncertainty in annual facility capacity led to the greatest variations in unit costs necessary for recovery of operating and capital expenditures; the ability to determine annual capacity will be a driving factor in setting unit costs. For private ventures, the costs of capital, especially equity interest rates, dominate the balance sheet; and the annual operating costs, forgiveness of debt, and overnight costs dominate the costs computed for the government case. The uncertainty in operations, leading to lower than optimal processing rates (or annual plant throughput), is the most detrimental issue to achieving low unit costs. Conversely, lowering debt interest rates and the required return on investments can reduce costs for private industry.« less

Authors:
;
Publication Date:
Research Org.:
Idaho National Laboratory (INL)
Sponsoring Org.:
DOE - NE
OSTI Identifier:
911579
Report Number(s):
INL/CON-06-01127
TRN: US0800020
DOE Contract Number:
DE-AC07-99ID-13727
Resource Type:
Conference
Resource Relation:
Conference: 14th International Conference on Nuclear Engineering,Miami, FL,07/17/2006,07/20/2006
Country of Publication:
United States
Language:
English
Subject:
22 - GENERAL STUDIES OF NUCLEAR REACTORS; CAPACITY; CAPITAL; EXPENDITURES; FINANCING; INTEREST RATE; LIFETIME; NUCLEAR ENERGY; NUCLEAR ENGINEERING; NUCLEAR FUELS; NUCLEAR WASTE POLICY ACTS; OPERATING COST; OWNERSHIP; PROCESSING; PROGRAMMING LANGUAGES; RECYCLING; financing strategies; Keywords needed; recycle

Citation Formats

David Shropshire, and Sharon Chandler. Financing Strategies For A Nuclear Fuel Cycle Facility. United States: N. p., 2006. Web.
David Shropshire, & Sharon Chandler. Financing Strategies For A Nuclear Fuel Cycle Facility. United States.
David Shropshire, and Sharon Chandler. Sat . "Financing Strategies For A Nuclear Fuel Cycle Facility". United States. doi:. https://www.osti.gov/servlets/purl/911579.
@article{osti_911579,
title = {Financing Strategies For A Nuclear Fuel Cycle Facility},
author = {David Shropshire and Sharon Chandler},
abstractNote = {To help meet the nation’s energy needs, recycling of partially used nuclear fuel is required to close the nuclear fuel cycle, but implementing this step will require considerable investment. This report evaluates financing scenarios for integrating recycling facilities into the nuclear fuel cycle. A range of options from fully government owned to fully private owned were evaluated using DPL (Decision Programming Language 6.0), which can systematically optimize outcomes based on user-defined criteria (e.g., lowest lifecycle cost, lowest unit cost). This evaluation concludes that the lowest unit costs and lifetime costs are found for a fully government-owned financing strategy, due to government forgiveness of debt as sunk costs. However, this does not mean that the facilities should necessarily be constructed and operated by the government. The costs for hybrid combinations of public and private (commercial) financed options can compete under some circumstances with the costs of the government option. This analysis shows that commercial operations have potential to be economical, but there is presently no incentive for private industry involvement. The Nuclear Waste Policy Act (NWPA) currently establishes government ownership of partially used commercial nuclear fuel. In addition, the recently announced Global Nuclear Energy Partnership (GNEP) suggests fuels from several countries will be recycled in the United States as part of an international governmental agreement; this also assumes government ownership. Overwhelmingly, uncertainty in annual facility capacity led to the greatest variations in unit costs necessary for recovery of operating and capital expenditures; the ability to determine annual capacity will be a driving factor in setting unit costs. For private ventures, the costs of capital, especially equity interest rates, dominate the balance sheet; and the annual operating costs, forgiveness of debt, and overnight costs dominate the costs computed for the government case. The uncertainty in operations, leading to lower than optimal processing rates (or annual plant throughput), is the most detrimental issue to achieving low unit costs. Conversely, lowering debt interest rates and the required return on investments can reduce costs for private industry.},
doi = {},
journal = {},
number = ,
volume = ,
place = {United States},
year = {Sat Jul 01 00:00:00 EDT 2006},
month = {Sat Jul 01 00:00:00 EDT 2006}
}

Conference:
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