HTGR Potential Market and Preliminary Economics Presentationart.inl.gov/NGNP/NEAC 2010/HTGR Potential Market and Preliminary Economics...Outline • Potential market for HTGR produced
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HTGR Potential Market andHTGR Potential Market and Preliminary EconomicsBriefing forN l E Ad i C ittNuclear Energy Advisory Committee
Phil Hildebrandt
gov
September 2010Phil Hildebrandt
ww
w.in
l.g
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Outline
• Potential market for HTGR produced energy• Evaluations of HTGRs integrated with industrial processes
P ibl b i d l f HTGR h t t i d t• Possible business model for HTGR process heat to industry• Economic analyses for industrial applications• Conclusions and uncertaintiesConclusions and uncertainties
1
Energy Production and Consumption in U.S. –gy pthe Potential Market
U.S. Primary Energy Flow by Source and Sector, 2009(Quad -- Quadrillion (1x10 15) Btu)
U.S. Primary Energy Flow by Source and Sector, 2009(Quad -- Quadrillion (1x10 15) Btu)
U.S. Primary Energy Flow by Source and Sector, 2009(Quad -- Quadrillion (1x10 15) Btu)
U.S. Greenhouse GasEmissions by Sector, 2009
(Million metric tons, CO2 equivalentAEO 2010, May 2010)
U.S. Greenhouse GasEmissions by Sector, 2009
(Million metric tons, CO2 equivalentAEO 2010, May 2010)
U.S. Greenhouse GasEmissions by Sector, 2009
(Million metric tons, CO2 equivalentAEO 2010, May 2010)
Transportation1845 Mt
Industrial
Residential1194 Mt
Commerical1034 Mt
Transportation1845 Mt
Industrial
Residential1194 Mt
Commerical1034 Mt
Transportation1845 Mt
Industrial
Residential1194 Mt
Commerical1034 Mt
Industrial1434 Mt
5507 Mt Total
Industrial1434 Mt
5507 Mt Total
Industrial1434 Mt
5507 Mt Total
1Does not include biofuels that have been blended with petroleum —biofuels are included in “Renewable Energy."2Excludes supplemental gaseous fuels.3Includes less than 0.1 quadrillion Btu of coal coke net exports.4Conventional hydroelectric power, geothermal, solar/PV, wind, an d biomass.5Includes industrial combined -heat-and-power (CHP) and industrial electricity -only plants.6Includes commercial combined -heat-and-power (CHP) and commercial electricity -only plants.7Electricity -only and combined -heat-and-power (CHP) plants whose primary business is to sell electricity , or electricity and heat, to the public.
Note: Sum of components may not equal total due to independent r ounding
1Does not include biofuels that have been blended with petroleum —biofuels are included in “Renewable Energy."2Excludes supplemental gaseous fuels.3Includes less than 0.1 quadrillion Btu of coal coke net exports.4Conventional hydroelectric power, geothermal, solar/PV, wind, an d biomass.5Includes industrial combined -heat-and-power (CHP) and industrial electricity -only plants.6Includes commercial combined -heat-and-power (CHP) and commercial electricity -only plants.7Electricity -only and combined -heat-and-power (CHP) plants whose primary business is to sell electricity , or electricity and heat, to the public.
Note: Sum of components may not equal total due to independent r ounding
1Does not include biofuels that have been blended with petroleum —biofuels are included in “Renewable Energy."2Excludes supplemental gaseous fuels.3Includes less than 0.1 quadrillion Btu of coal coke net exports.4Conventional hydroelectric power, geothermal, solar/PV, wind, an d biomass.5Includes industrial combined -heat-and-power (CHP) and industrial electricity -only plants.6Includes commercial combined -heat-and-power (CHP) and commercial electricity -only plants.7Electricity -only and combined -heat-and-power (CHP) plants whose primary business is to sell electricity , or electricity and heat, to the public.
Note: Sum of components may not equal total due to independent r ounding
2
Note: Sum of components may not equal total due to independent r ounding.Source: U.S. Energy Information Administration, Annual Energy Review 2009, Tables 1.3, 2.1b -2.1f , 10.3, and 10.4.Note: Sum of components may not equal total due to independent r ounding.Source: U.S. Energy Information Administration, Annual Energy Review 2009, Tables 1.3, 2.1b -2.1f , 10.3, and 10.4.Note: Sum of components may not equal total due to independent r ounding.Source: U.S. Energy Information Administration, Annual Energy Review 2009, Tables 1.3, 2.1b -2.1f , 10.3, and 10.4.
Vulnerabilities of fossil fuel consumption(83% of today’s energy consumption in US)
• Price volatility
• Reliance on imports
GHG i i• GHG emissions
• Use of natural resources
3
Industrial Applications – the Principal Market
The Opportunity The Opportunity —— Providing High Temperature Process Heat Providing High Temperature Process Heat d El t i it ith t B i H d b F ld El t i it ith t B i H d b F land Electricity without Burning Hydrocarbon Fuelsand Electricity without Burning Hydrocarbon Fuels
Petrochemical (170 plants in U.S. – 6.7 quads*)
Petroleum Refining (137 plant in U.S. – 3.7 quads)
Fertilizers/Ammonia (23 plants in U.S. – 0.3 quads
NH3 production)
Coal‐to‐Liquids (24 – 100,000 bpd new plants )Project 250 GWth HTGR application
NH3 production)
Oil Sands/Shale(43 – 600 MWt HTGR
Hydrogen Production(60 – 600 MWt HTGR
Modules)
4
Modules)* Quad = 1x1015 Btu (293 MM MWth) annual energy consumption
Modules)
Thermal Power Requirements for Postulated Marketq
Scoping evaluations performed for HTGR technology in industrial sector
75,000 MWth Co-Generation Supply of Process Heat to Industrial Processes
(25% of Process Heat & Power, including electricity)
36,000 MWth for Production of Hydrogen(25% of growth in the merchant market)
25 800 MWth for Oil Sands Bitumen Recovery 25,800 MWth for Oil Sands Bitumen Recovery(25% of projected growth in energy required to extract & upgrade bitumen)
249,000 MWth for Coal to Transportation Fuels(Reduces imports by 25% of 2009 imports of crude oil – 9.1 MMBPD)
110,400 MWth for Electricity Production(10% of the nuclear electrical supply increase required to achieve pending(10% of the nuclear electrical supply increase required to achieve pending Government objectives for emissions reductions by 2050)
5
Postulated Deployment of HTGR Results in Stable Energy Prices, Secure Source and Reduced Emissions
calculated fit: 2%8.00
10.00
12.00
rice
($/M
M B
tu)
DOE EIA Energy Outlook 2008
2008 $senergy HHV
DOE EIA Annual Energy Outlook 2009
AUG09 futures
Natural Gas and Crude Oil Prices exhibit high volatility
HTGR Energy Prices affected only by normalcalculated fit: 2%
2.00
4.00
6.00
ty U
ser N
atur
al G
as P
DOE EIA Energy Outlook 2004
DOE EIA Energy Outlook 2002
DOE EIA EnergyOutlook 2007
HTGR Energy Prices affected only by normal inflationary factors, (e.g., wages, material)
0.001970 1980 1990 2000 2010 2020 2030 2040
Year
Util
it
6
Emissions Reductions
CO2 emissions are reduced by ~400 million
Co-Generation & Process
Heat, 110 MtElectricity
Generation, 146 Mt
metric tons by 2050; ~7% of pending Government objectiveHydrogen
Production, 16 Mt
Oil Sands, 37 MtCoal/Biomass
to Fuel & Feedstock,
80 Mt
Natural Gas Conservation
Co-Generation & Process
Heat, 2.1 Tscf
Natural gas combustion is reduced by ~7 trillion
Natural Gas Conservation
Reduce Oil Imports by Heat, 2.1 Tscf
Hydrogen
Oil Sands, 0.7 Tscf
Electricity Generation,
3.6 Tscf
is reduced by 7 trillion scf by 2050; ~30% of U.S. consumption in 2009
Reduce Oil Imports by 25% of 2009 Rate
Reduces the need to import oil by ~2.5 million Production,
0.4 Tscf
p ybarrels per day (on an energy equivalent basis). Outflow of US dollars reduced by $150 million per day (based on an average $60/BBL price)
7
Evaluations of HTGR Integration with Industrial Processes
• Co-Generation Supply of Steam, Electricity and High pp y , y g
Temperature Gas
• Ammonia and Ammonia Derivatives ProductionAmmonia and Ammonia Derivatives Production
• Hydrogen Production
• Conversion of Coal and Natural Gas to Transportation Fuels
• Oil Recovery from Oil Sands and Oil Shale
• Electricity Production
8
Possible Business ModelPossible Business Model
9
Electricity and Steam ProductionElectricity and Steam Production
Electricity Production Price VersusPrice of Natural Gas, $/Mwhe, and Carbon Credits, $/metric ton CO2eq
Comparisonof Production Pricing for HTGR and CCGT Plants 35
Comparing Price of Steam Generated by an HTGR and a CCGT versusPrice of Natural Gas and Cost of GHG Emissions
120
140
160
e, $/M
Whe
Comparison of Production Pricing for HTGR and CCGT Plants
$50/MTCO2 CostCCGT
25
30
35
1000
lbs
CCGT, $50/MT CO2 Emissions Cost
80
100
Electricity Prod
uction
Price
HTGR
CCGTNo CO2 Cost
~$4/MMBtu
~$8.5/MMBtu
10
15
20
Price of Steam
, $/1
HTGR
CCGT, No CO2
i i
~$4/MMBtu
~$7/MMBtu
40
60
0 2 4 6 8 10 12 14 16 18
E
Natural Gas Price, $/MMBtu
0
5
0 2 4 6 8 10 12 14 16
Price of Natural Gas, $/MMBtu
Emissions Cost
Economic FactorsEconomic Factors
HTGR Plant Capital Cost $1,700/KWtCCGT Capital Cost $625/KWtDebt 80%Internal Rate of Return 15%Financing Interest 8%
10
Financing Interest 8%Financing Term 20 yearsTax Rate 38.9%
Conversion of Coal to Gasoline (MTG Process)( )
5
Gasoline Production Price versus Crude Oil PriceConventional Crude Oil Refining versus
Coal to MTG using Conventional and HTGR Integrated Processes 6.00
Comparison of Gasoline Pricing for Conventional versus HTGR Integrated Coal to Gasoline Conversion
3
3.5
4
4.5
Conventional MTG Process$50/MT CO2 C ost
HTGR Integrated MTG Process
~$110/BBL
~$125/BBL
ction Price, $/gal
3.00
4.00
5.00
Peak Gasoline Price June 2008
HTGR Price, $/gal
0.5
1
1.5
2
2.5$50/MT CO2 C ost
Conventional MTG ProcessNo CO2 Cost~$80/BBL
$110/BBL
Gasoline Prod
u
1.00
2.00
3.00
Lowest Gasoline Price December 2008
~$70/ton
Gasoline Economic Factors
0
0.5
0 20 40 60 80 100 120 140 160 180
Crude Oil Price, $/Barrel
0.00
0 50 100 150 200 250
Cost of Carbon, $/ton
co o ic acto s
HTGR Plant Capital Cost $1,700/KWtCCGT Capital Cost $625/KWtDebt 80%Internal Rate of Return 15%Financing Interest 8%
11
Financing Term 20 yearsTax Rate 38.9%
Ammonia Production
800
Comparison of Ammonia Pricing for Conventional and HTGR Integrated Processes
~$160/ton
600
700
nia, $/ton
HTGR Hydrogen Plant$160/ton
400
500
Price of Ammon
~$50/ton
200
300
0 50 100 150 200 250
Economic Factors
HTGR Plant Capital Cost $1,700/KWtCCGT Capital Cost $625/KWt
Cost of carbon, $/metric ton CO2
12
Debt 80%Internal Rate of Return 15%Financing Interest 8%Financing Term 20 yearsTax Rate 38.9%
C l iConclusions
• A large and viable potential market has been identified• The economics of each application have been scoped• The economic viability of applications is mixed & dependent on
assumptions, (e.g., policy for CO2 emissions)• There is large uncertainty in the results of the economic
evaluations:– Capital costs
O ti t– Operating costs– Financing
• Design work is needed to improve cost estimates• Market evaluations to date were to establish end-user technical
requirements – detailed market study is required
13
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