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ECONOMICAL VIABILITY OF THE NUCLEAR OPTION IN MEXICO

ECONOMICAL VIABILITY OF THE NUCLEAR OPTION IN MEXICO. Instituto Nacional de Investigaciones Nucleares. Installed Capacity. 45,576 MW. Fossil Fuel 66.8% Gas 32%. CFE-2005. Electricity Generation. 215.63 TWh. Gas 52%. CFE-2005. Nuclear contributes with about 5% since 1996.

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ECONOMICAL VIABILITY OF THE NUCLEAR OPTION IN MEXICO

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  1. ECONOMICAL VIABILITY OF THE NUCLEAR OPTION IN MEXICO Instituto Nacional de Investigaciones Nucleares

  2. Installed Capacity 45,576 MW Fossil Fuel 66.8% Gas 32% CFE-2005

  3. Electricity Generation 215.63 TWh Gas 52% CFE-2005 Nuclear contributes with about 5% since 1996

  4. Forecast for Electricity Gross Consumption 2000-2014 An increase of about 60% from 2005 to 2014

  5. Required Capacity • There should be an addition of 22,126 MW • 6,184 MW already Committed • 15,942 MW Non Committed • 9,764 Technology already specified • 6,178 Free Technology

  6. The Case for Nuclear • High Volatility of Gas Prices • Concern for CO2 Emissions • Balanced Fuel Mix • Economical Competitiveness

  7. Levelized Cost Methodology • Quantifies the unitary cost of electricity (the kWh) during the lifetime of a power plant • The methodology considers the total electrical energy that the power plant will deliver in its lifetime

  8. Levelized Cost Methodology • Levelized cost is the sum of: • Investment cost: which is the one generated during construction • Production cost: is the one generated during the life of the plant, it includes • Fuel cost and • Operation and maintenance costs

  9. Levelized Total Generation CostBenchmarking OECD-2005

  10. Scenarios

  11. Assumptions

  12. Generation Cost (DR)

  13. Capital Cost (DR)

  14. Nuclear Generation Cost Assuming Delays

  15. Levelized electricity generating cost assuming different capacity factors

  16. Cash Flow* *Without fuel costs

  17. Present Value of the Cash Flow (DR 8%) Gas1 4.44 $/mmBTU; Gas2 5.20 $/mmBTU; Gas3 7.00 $/mmBTU

  18. Generating Cost variability Due to Fuel Price Gas price at 0% is 4.44 USD/MBTU and Nuclear Fuel Cost is 6.80 USD/MWh –40% it is about 2.50 USD/mmBTU for the Gas price

  19. Summary • Even with delays of up to 3 years nuclear is competitive with the gas option, and it is still cheaper when gas price is greater or equal to 7 USD/mmBTU. • Considering an 80% capacity factor, instead of 90% results in an increase of 4 USD/MW in the levelized cost.

  20. Summary (cont.) • When the price of gas is not less than 5.20 USD/mmBTU, the levelized cost of nuclear generated electricity is lower than the cost resulting from using natural gas, as long as construction time is not longer than 7 years.

  21. Conclusion • Nuclear power is competitive in all the scenarios considered, and it should be given serious consideration in the definition of Mexico’s additional electrical capacity program.

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