Re:The Olkiluoto 3 EPR plant unit started up
by bjourne on Tuesday December 21, 2021 @08:02AM
(#29636938)
It depends on future interest rates and electricity prices.
Assuming a fixed interest rate of 5%, construction costs including interest is about $16 billion = €14 billion. Assuming an availability of 95% (maybe unrealistic for a brand new reactor) it will generate 13TWh/year. Assuming an electricity cost of €100/MWh (higher than usual but lower than current extreme prices) and a marginal cost of €26/MWh, the income/year is €0.99 billion. From this you have to deduct the interest of the loan of about €0.70 billion. So for the first year you have €0.29 billion in profit that you can use to amortize the loan.
So when the plant becomes profitable is highly dependent on what future interest rates are and how high future electricity prices will be. While current interest rates have been very low for the past few years, it may be very hard to get an investor to lend you money for a nuclear plant for only 5%. A discount rate of 7% or even 9% is often used for many commercial projects. Using those rates Olkiluoto 3 will never generate any return (barring insane electricity prices).
Assuming a fixed interest rate of 5%, construction costs including interest is about $16 billion = €14 billion. Assuming an availability of 95% (maybe unrealistic for a brand new reactor) it will generate 13TWh/year. Assuming an electricity cost of €100/MWh (higher than usual but lower than current extreme prices) and a marginal cost of €26/MWh, the income/year is €0.99 billion. From this you have to deduct the interest of the loan of about €0.70 billion. So for the first year you have €0.29 billion in profit that you can use to amortize the loan.
So when the plant becomes profitable is highly dependent on what future interest rates are and how high future electricity prices will be. While current interest rates have been very low for the past few years, it may be very hard to get an investor to lend you money for a nuclear plant for only 5%. A discount rate of 7% or even 9% is often used for many commercial projects. Using those rates Olkiluoto 3 will never generate any return (barring insane electricity prices).