The learning curve for serial reactor production

One assumption of the Aim High concept directly challenges an assumption of the conventional nuclear industry. That is the Aim High concept assumes that there are major cost advantages for serial reactor manufacture at factories rather than custom onsite reactor manufacture. This argument might be challenged by reference to reported Chinese cost projections for factory produced Pebble Bed Modular Reactors that were recently discussed by Brian Wang. The Chinese do not assume that early factory built PBMRs will be lower cost than on site manufactured reactors. The Chinese envision manufacturing hundreds of PBMRs in their reactor factory. Thus it would appear that the Chinese do not anticipate that PBMR production will lead to significant savings. Not even the serial production of 248 PBMRs lead to significant cost advantages for PBMR. The Chinese do anticipate a significant 30% to 40% per unit savings from experience based learning.

What then is responsible for the Chinese cost data? First, it should be observed that the PBMR has extremely low power density. Thus the PBMR pressure vessel is the same size as that of a Light Water Reactor which produces 5 times the power output. Thus the PBMR will require greater materials input for a given unit of power output than the LWR. This would suggest that PBMR components may be assembled in the factory but not the entire reactor. Even relatively small PBMRs would be too heavy and bulky for truck or rail transportation. Thus reactors would be assembled on site from factory manufactured kits. The Chinese probably anticipating on-site construction of LWRs from factory produced kits, so actual manufacturing conditions for PBMRs would not differ greatly from those of Chinese LWRs. It is also argued that PBMR simplicity would lead to lower reactor costs, but a glance at PBMR design suggest that it might not be all that simple compared to LFTR design.
Wang refers to production plans for about 250 reactors. While this is a very large number, it would not be large enough to justify the installation of large labor saving production machines. If reactors are manufactured in kit form at the factory, there would be no assembly lines. Thus many of the cost saving advantages of factory production would be lost.

The Chinese appear to anticipate that the primary savings from factory manufactured PBMRs would come from the learning curve. This would suggest low capital costs, since it would be assumed that the capital cost per unit would decrease over time as loans were paid off. Indeed financial costs, taxes, insurance and contingencies account for around 20% of Chinese reactor costs. This combined category is not significantly higher for Chinese built LWRs than for PBRs. We can assume then that manufacturing techniques for Chinese PBMRs do not differ significantl from those used to manufacture Chinese LWR, and that materials inputs will be, if anything more expensive per KW of electrical output than would be the case for Chinese LWRs. It would appear then that the cost advantages of serial production do not greatly outweigh the cost advantages of economies of scale.

Financial costs are a far less significant cost factor than they would be for reactors built in the other countries. Because financing costs are low to begin with the shorter PBMR construction time would not be translated into a significant cost savings. Finally any savings in PBMR labor cost would probably be balanced by the greater cost of materials.

It would not appear then, that Chinese PBMR costs would not provide us with a comparative insight into LFTR costs. Recent reports from China indicate that the Chinese are paying about $1.60 per watt for new reactors. This cost would appear to be less than half of the cost of reactors in Europe or North America. Recently Indian reports anticipate costs as low as $1.40 per watt for Indian manufactured LMFBRs. This would indicate a significant post-carbon electrical cost advantage for the emergent Asian economic super powers. This advantage does not stem from a potential cost savings in design or manufacturing techniques. Thus roads to greater nuclear cost competitiveness are still open to the North American, European, and North East Asian economies.



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