The Potential Market for HTGRs

Temperature ranges for process heat applications

There are good prospects for the market for high temperature gas reactors and in several key sectors. The potential for deployment of 510 GWt of HTGR technology has been identified to fulfill the following industrial needs for process heat.

· Cogeneration – This is the supply of electricity and steam to major industrial processes in petrochemical, ammonia, and fertilizer plants, refineries, and other industrial plants. For instance, there are 23 plants in the U.S. which produce fertilizers and ammonia, 170 petrochemical plants, and 137 major petroleum refining plants.

· Hydrogen – The production of hydrogen includes supply for industrial uses and the merchant hydrogen market.

· Enhanced recovery – The upgrading of bitumen from oil sands (e.g., Alberta, Canada) requires reliable supplies of steam, hydrogen, and electricity. Similarly, the conversion of coal to liquid fuel and petrochemical feedstocks has the same set of requirements.

· Electricity – surplus electricity can be supplied to the plant or the grid.

According to the U.S. Energy Information Administration (EIA), in its 2010 Annual Energy Review, industrial use of energy accounted for 20% of all uses domestically. In terms of energy sources, 37% came from petroleum, 25% came from natural gas, and 21% came from coal. The EIA did not record any significant use of nuclear energy for process heat applications by U.S. industry.

Primary Energy Flows by Sector 2010 Source: EIA/DOE

Process heat applications from a nuclear plant will vary with temperature. Overall, as a practical matter, cogeneration of electricity and steam can be accomplished at temperatures in the range of 350-600C. Temperatures above this level require more advanced, and more expensive, materials.

HTRs can be used for petroleum refining at temperatures of 250-550C. Oil shale and oil sand processing can be carried out at temperatures of 300-600C.

These numbers show that HTRs are an ideal technology to replace small-to-medium coal-fired plants scheduled to be retired due to new environmental requirements.

Direct heating growth applications are emerging for industrial manufacturing processes such as ethylene cracking, and steam methane reforming and water-to-hydrogen thermal processes for hydrogen production.

These growth areas can extend the market potential for the above target applications. New market applications such as carbon conversion for production of synthetic transportation fuels and feedstock are other areas that are expected to emerge over the next decades and prior to mid-century.

In addition, a higher temperature capability can be applied to advanced energy conversion cycles for more efficient and cost effective power generation.

The market potential is enormous domestically; it is magnified further with the potential in the export marketplace. There are three reasons for this potential; (1) high temperature output above the level of conventional light water reactors, (2) providing competitive, long-term and stable prices for energy to customers, and (3) inherent safety.

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Why Are These People Talking About Nuclear Power And Industry?

What if we could find a low carbon alternative for burning natural gas for industrial applications and avoid millions of tons of CO2 emissions? Nuclear energy has been a workhorse provider of electric power in the U.S. for decades – now producing about 20% of our electricity. Electric power in some ways dominates the discussion on climate and energy security. A newbie who just dropped into that debate – featuring renewables vs coal vs oil vs natural gas vs nuclear – might think that if somehow we could just lick this electric power issue, all of our problems would be solved. Turns out that’s not even close to true of course.

(Click here for a graphic on primary energy consumption by source and sector 2010 – chart courtesy of U.S. Energy Information Administration)

In fact, electric power accounts for only just about 38% of all of the energy we use. That’s significant, but even if we substantially crank up the percentage of nuclear in that sector, we still are not making a huge dent in the big energy picture. The transportation and industrial sectors of our economy actually account for about 47% of our energy consumption and THAT is exactly where we’re most dependent on oil and natural gas and exactly where renewables are the least likely to have a major impact. See the attached graphic, but it turns out that around one third of natural gas usage is associated with industry (somewhat more than for each of the residential/commercial and electric power sectors). Over 70% of petroleum (our largest single energy source) is used in the transportation sector and and somewhat over 20% in industry.

As mentioned before, Light Water Reactors simply don’t have hot enough outlet temperatures (limited to around 350C) to make them relevant to substituting for natural gas in industry or for converting coal or other carbon stocks into liquid fuels. However, High Temperature Gas Cooled Reactors not only have the outlet temperatures necessary (750 degrees C and above), but also have the safety characteristics that make co-location possible.

But that same drop-in newbie might ask: “Looks to me like natural gas prices are low and supplies are plentiful, why bother?” Well, haven’t we been down this road before? Most of us over 40 (or is that 30?) instinctively know that as we switch out our existing coal generation to natural gas and maybe move toward more natural gas fueled transportation technology, etc. we’re no doubt hastening the day when gas prices will be going up. So why not try to do a bit of a nuclear end-run around this bad dynamic and plan ahead?

If it’s true that renewables such as solar and wind need not apply for the heavy energy lifting and feedstocks required by the industrial sector (that’s an argument for a different day) and that ultimately we need to wean ourselves as much as possible from fossil fuels for reasons of cost, supply and maybe even climate (maybe even that’s an argument for another day), then it seems apparent that nuclear energy is really the only significant remaining option.

And, it turns out, that in some places in the world, High Temperature Gas Reactor technology could be economically competitive for industrial applications today

For several years now, the NGNP project has been evaluating this technology in a wide range of industrial applications. For example, the HTGR technology is a technically viable low-carbon substitute for the burning of natural gas and other fossil fuels to supply steam, electricity and high-temperature heat to industrial applications.

Near-term deployment of an HTGR could significantly reduce process heat dependence on fossil fuels. These reactors could also increase long-term price protection against volatility in fossil fuel markets and increase energy security for large, capital intensive, and high production chemical production facilities.

Like the energy from more conventional LWRs, HTGR power costs will be stable and secure, insulating the industries from the volatility in natural gas pricing. Further, this competitive energy pricing will remain stable over the HTGR plant lifetime of several decades.

There is an environmental benefit as well. Every 750 MWt of installed HTGR capacity could avoid one million metric tons of CO2 emissions per year when compared to a similarly sized natural gas plant.

The use of HTGR technology in place of natural gas may also free up more of this domestic resource for more productive uses as feedstock for plastics and chemical manufacturing, creating multiples of GDP vs simply burning as fuel.

NGNP studies integrating the HTGR technology with petrochemical processes (e.g., production of ammonium and ammonium products, extraction of nonconventional crude, production of hydrogen). show that the HTGR technology could help reduce GHG emissions when compared with conventional processing.

Further, technical and economic analyses shows that HTGR technology used for co-generation of process heat and electricity is competitive with natural gas as in the $6 to $7 per MM BTU delivered price range.  This means it is competitive today in most of the world where natural gas is tied to oil parity (Europe, Japan, Korea, Middle East, etc) and likely to be in the U.S. in the time frame of its commercialization (2025+).   A  future price for carbon will make this technology even more competitive as it is estimated that for each $10 cost per ton of carbon, that the competitiveness of the HTGR will improve by $0.50 per MM BTU.  A $50 price for carbon, for example, makes the HTGR competitive with natural gas in the $2.50 to $4.50 per MM BTU range for process heat applications.

The NGNP Industry Alliance believes that the key economic drivers that have made HTGR technology of interest to industry are viable to today in most of the world and will continue to be viable in the future. The price of HTGR produced energy is competitive with alternative sources of energy across much of the globe and the Alliance believes it will be competitive in the U.S. at or near it time of commercialization. . Find out more … see

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Underappreciated Answer To Some Of Nuclear’s Woes

 Even the most ardent supporters (this writer included) of nuclear energy recognize that it has some issues. It has a safety perception issue particularly post-Fukushima. Current LWRs (great reactors by the way!) are limited to electric power production and hence limited in their ability to address some of our most fundamental energy problems. In terms of economics, large LWRs are just too expensive for many utilities.

This is the first of a series of short posts on the features and benefits of the High Temperature Gas-Cooled Reactor (HTGR). These posts will address a wide variety of topics. Examples include safety, how nuclear can power major industries; nuclear and liquid transportation fuels, the technology and market niches for the design, the potential for exports, a profile of potential users, and the respective roles of industry and government in bringing about commercial success.

Safety – A Break from Convention

Simply put, HTGR design insures that there are no circumstances, including complete abandonment by plant operators, where a harmful release of radioactivity can occur.

How is this possible? The essential features of modern HTGR safety are:

  • extremely robust fuel with multiple ceramic coatings;
  • a reactor core with a limited power level; and
  • fundamental simple physics that shuts the reactor down in abnormal temperature conditions.

Further, HTGR control rod insertion into the core (not essential for public safety and only utilized for power output control) is achieved through automatic gravity-alone insertion.

How the HTGR handles decay heat

So, even if HTGR operators go home and don’t return after an accident, decay heat (the heat that melted the Fukushima and TMI cores), ultimately passes out of the reactor and into the ground without temperatures ever coming close to failing the fuel.

No water, other coolant or external power is required for the reactor to stay safe. It just sits there and gradually cools down.

Importantly, HTGR reactor materials (helium coolant, ceramics and graphite), including the reactor fuel, are chemically compatible and in combination with each cannot react or burn to produce explosive gases like hydrogen (to a public that remembers the images of Fukushima, this has got to be important!).

The helium coolant inside the reactor is chemically inert and cannot burn, cause corrosion, or degrade the fuel or any parts of the reactor.

Spent fuel from an HTGR is stored in casks in underground dry vaults that are cooled by natural circulation of air. No active cooling system is involved. Steel and concrete shielding prevent any release of radiation.

The next blog post in the series will describe the needs of industry for process heat and how an HTGR can meet them.

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NGNP Selects Areva advanced reactor design

An industry consortium is focused on process heat applications

The Next Generation Nuclear Plant Industry Alliance Ltd. (NGNP Industry Alliance) announced this week that it has selected the AREVA Generation IV reactor concept as the optimum design for next generation nuclear plants.  The AREVA design is a high-temperature gas-cooled reactor (HTGR) and would provide a source of nuclear energy with inherent safety features and zero greenhouse gas emissions.

“Commercialization of next-generation nuclear technology is a critical component of securing clean sources of energy for the future,” said Fred Moore, Executive Director of NGNP Industry Alliance.  “HTGR is the game changing technology for clean, safe nuclear energy production.” 

The AREVA HTGR technology’s capability and modular design would support a broad range of market sectors, providing highly-efficient energy to industries such as electrical power generation, petrochemicals, non-conventional oil recovery and synthetic fuel production (see NGNP list of member organizations).

Areva focus on customer requirements

In a simultaneous statement Feb 15, Areva COO Mike Rencheck said the industrial end-use requirements have been the primary consideration for selection of this advanced technology over other small reactors.  He said, “The co-generation aspects offer long-term predictable energy supply.”

In a conference call with nuclear energy bloggers held Friday Feb 17, Areva Chief Technology Officer Finis Southworth explained that the “NGNP Alliance wants a sharper focus on technology for process heat.”

He said that ten years ago the quest for a new design for a high temperature gas cooled reactor (HTGR) has dual objectives – hydrogen production and process heat.  The reasons he said are that existing light water reactor (LWR) designs are not well suited to non-electric energy markets.

Since then R&D has gone down two somewhat separate paths divided by the materials sciences challenges associated with reactor outlet temperature.

For the NGNP Alliance, choice of the Areva design, a reactor outlet temperature of 750C provides sufficient heat to produce conventional steam temperatures of 400-550C for applications like oil refinery distillation and chemical processing.

Southworth said the primary heat is carried from the reactor in a closed loop by helium and the steam is super heated but not super critical.

He added that at temperatures above 750C the materials challenges become more significant and so do the costs. That’s why for now the current technology roadmap, conceptually speaking, uses the lower temperature. (For more details readers are referred to the NGNP Briefings on HTGR Technology)

Competitive advantages of NGNP

Members of the NGNP Alliance, including major petro-chemical manufacturers, are heavily dependent on fossil fuels for process heat. They have three long-term concerns – environment, energy security, and price volatility.

Southworth pointed out that about 20% of U.S. energy consumption goes into process heat applications.  He said that the effect of replacing fossil fuel with nuclear energy, for process heat applications, will make industry products that depend on them more competitive.  The key reasons are reduced regulatory risks in terms of environmental issues, increased dependability in terms of energy supply, and stable pricing of the energy to produce process heat.

According to the U.S. Department of Energy, every 750 MWt of installed HTGR capacity will offset 1 million metric tons of CO2 emissions per year when compared to a similarly sized natural gas plant.

History of NGNP
The Energy Policy Act of 2005 called for development, construction, and operation of a prototype HTGR by 2021.  DOE set up a project office at the Idaho National Laboratory that included some of the R&D activities.  Based on and RFP, DOE selected three firms to conduct design and engineering studies – General Atomics, Westinghouse, and Areva.

Both the Idaho lab and the NGNP Alliance determined that the only practical differentiation among the designs is tied to capital costs.  The Alliance said the prismatic design offers a 30% cost savings over one using pebble bed technology.

Next Step – Licensing

The NGNP Alliance is developing a regulatory strategy to identify key issues related to getting a license from the NRC.  Southworth said the combination of licensing and building a first-of-a-kind unit could take 10-12 years to get one operating at a customer site.

He estimates that with start-up schedules, the first customer would be reaping benefits from the technology in the time frame of 2024-2027. it could be sooner depending on the outcomes of design and regulatory processes and actual construction of a first-of-a-kind unit.

Areva envisions that the HTGR will be installed at customer suites in clusters of up to four units.  A key regulatory issue will be whether the NRC will establish a rule that will authorize a single control room to manage multiple units. It all depends on how the agency sees this issue from the perspective of plant safety.

He added the Alliance and the NRC realize there is a need to develop a regulatory framework for some aspects of the technology such as ceramic core components and helium coolant.

“This is part of the open discussion with the NRC,” Southworth said. It is included in the Alliance’s pre-application dialog with the agency.

Fuel Cycle

The fuel for the HTGR uses TRISO fuel particles with 18 month cycles.

“The reactor uses a lot less fuel than a 1000 MW reactor, “Southworth said, and he added, “it’s about three tons compared to 100 tons.”

Spent fuel management will be carried out by putting the spent fuel into dry ground cooling after which it can be sent to a permanent disposal facility.  Unlike a conventional LWR, there is no water in the cooling system nor is there wet storage of spent fuel.

Comparative costs to build and operate one?

Areva told the nuclear bloggers the total cost, including R&D, for the first unit will be about $4 billion, but Southworth said the “nth unit” will have actual construction costs of about $1 billion.  Comparing process heat costs, he added that the “nth of a kind” HTGR will supply process heat at about $6-10/mbtu.

While natural gas prices in the U.S. are unusually low, about $3/mbtu, that isn’t always going to be the case and no one knows what the price will be by 2025.  Natural gas prices are much higher in Europe. Southworth said he’s seeing prices for natural gas in Europe and Asia as high as $12-15/mbtu.

According to a Bloomberg wire service report for 02/17/2012, the day of the nuclear blogger conference call, the price of natural gas in the U.K., which benefits from its North Sea resources, was $9.16/mbtu.  Crude oil rose to $103/barrel, the highest price since May 2011.  It’s clear from these data why energy price stability for chemical firms with 50-year planning horizons for capital projects is so important.

One potential customer, a member of the Alliance, is Dow Chemical.  Southworth noted the firm uses the energy equivalent of one million barrels of oil a day.  It wants to replace oil as the fuel with energy from an HTGR to produce process heat.

Another advantage is that at certain times related to changes in plant production cycles, surplus energy from the NGNP reactor can be converted to electricity, albiet at a 20% higher cost then conventional LWR.  Even so selling this electricity to the grid at market prices will help defray the cost of operations.

Success will be measured in terms of securing long-term energy supply with nuclear energy generated process heat located at the customer site and not from an oil well 8,000 miles away.

It will take some time to get there, but with the announcement this week, the NGNP Alliance says it is on its way.

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