A Tool to Quantify
Capital Cost Reduction
Pathways for Advanced
Nuclear Reactors
Systems Analysis & Integration
Campaign

Prepared forU.S. Department of Energy
Systems Analysis & Integration Campaign
And Integrated Energy Systems
Campaign (IES)
Chandrakanth Bolisetti, AbdallaAbou-Jaoude, Botros Hanna,and Levi M. Larsen (INL)
Jia Zhou (ANL)
Koroush Shirvan (MIT)Updated June 11, 2024

A Tool to Quantify Capital Cost Reduction Pathways for Advanced Nuclear Reactors
June 11, 2024

1A TOOL TO QUANTIFY CAPITAL COST REDUCTION
PATHWAYS FOR ADVANCED NUCLEAR REACTORSThis is a brief overview of the ‘Nuclear Reactor Capital Cost Reduction Tool’ available at this link. Areport, ‘Quantifying Capital Cost Reduction Pathways for Advanced Nuclear Reactors’, has been issued.
This report discusses the framework within the spreadsheet tool and provides detailed information on themethodology and assumptions behind the model.

OBJECTIVE
The framework is developed as a tool to showcase different pathways to reducing the capital cost ofadvanced reactor plants. The intent is to relatively quantify key cost drivers and visualize the evolution ofcosts as plants are built, not to predict the exact cost of future plants. The Department of Energy
Advanced Nuclear Liftoff Reporta emphasized the importance of driving down capital costs to achieve
widespread deployment of nuclear plants to decarbonize the US electricity grid. The report also
highlighted the value of utilities and other companies forming large consortia, placing committed orderbooks of nuclear plants, and incorporating the lessons learned from recent nuclear power plant
construction projects. The framework described here builds on these key recommendations by attempting
to relatively quantify specific pathways toward the cost reduction of advanced nuclear reactors.

MODEL ASSUMPTIONSThe starting point for the framework was two advanced reactor designs referred to as ‘Reactor
Concept A’ and ‘Reactor Concept B.’ The former is a 4-reactor pack with a large plant output, while thelatter is a smaller, single unit plant. These two designs were selected to highlight design-specificconsiderations and how they impact costs. The model correlates cost and construction duration estimatesfrom the open literature for these two concepts to a set of ‘levers’ that can be adjusted in the spreadsheet
to compute the evolution of costs from the first plant to the last plant in the order book for a given reactor
concept. The levers affecting the capital cost are collectively intended to represent the decision-making ofstakeholders such as plant owners, investors, and the government. The framework helps visualize theimpact of such high-level decision-making on the capital costs of the plants in the order book. Theframework is based on several simplifying assumptions regarding scheduling overruns, the number ofactivities performed at the site versus a factory, the subjectivity of contractor proficiencies, andcorrelations between various levers. The model performs a deterministic calculation and does not quantify
the significant uncertainties involved in nuclear plant construction. All assumptions and underlying
relationships are documented in the report.

OVERVIEW OF FRAMEWORK INPUTS
The tool is in the form of an Excel spreadsheet with a sheet named ‘Dashboard.’ At the top of thesheet, users can select different values for the levers listed and described below:•••

Number of firm orders: This determines the size of the order book for a given reactor concept. It
directly impacts equipment costs for all units within the order (including the first).
Include 1st plant in averages: This lever allows the user to choose to ignore (FALSE) or include(TRUE) the impact of the first plant in the overall order book average (e.g. if investment in thefirst-of-a-kind [FOAK] is already accounted for separately).
ITC Amount: This represents federal investment tax credits (ITC) that can be claimed by thegeneration owner after project completion. A value of 40% is considered suitable for the firstreactors if they include the bonus credits (e.g., if repurposing a coal plant).

a U.S. DOE. 2023. “Pathways to Commercial Liftoff: Advanced Nuclear.” https://liftoff.energy.gov/wp-

content/uploads/2023/05/20230320-Liftoff-Advanced-Nuclear-vPUB-0329-Update.pdf.

Quantifying Capital Cost Reduction Pathways for Advanced Nuclear Reactors
June 11, 20242•
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Number of Plants Claiming ITC: This determines how many plants, starting from the first, canclaim ITC depending on the speed of construction and assumed expiration timelines for thecredits.
Interest Rate: This represents the cost of borrowing money used to finance a project using debt.
This is provided as a percentage. This lever may account for any subsidized low-interest rate thata company may qualify for the clean energy investment (e.g., from the DOE Loan Program
Office). Also, note that the framework assumes that 100% of the capital investment is debt.
Design Completion: This indicates the percentage of design completed when construction of theplant begins. Historically, FOAK plants have started construction with an incomplete design.
When construction begins with a lower design completion, there are typically more licensing
amendments and rework, resulting in delays and cost increases. This lever has been identified in
the past studies as one of the most significant contributors to cost and schedule overruns.
Design Maturity: This indicate how many NPP designs currently being considered for
deployment require new components that have never been built before and potentially result in
supply chain delays. This novelty is represented by the design maturity lever. In the framework,
this lever can be provided as one of three options: most components are new and therefore design
maturity is low (value of 0), most components are deployed in the non-nuclear industry but neverin nuclear and therefore design maturity is medium (value of 1), or most components havealready been deployed in nuclear and therefore design maturity is high (value of 2).
Supply Chain Proficiency: This represents the proficiency of the supply chain. Proficiency
could be interpreted as a combination of a contractor past experience and performance, as well as
the methods or technologies used by the contractor to accomplish the tasks. A score between 0-2(with decimal increments; 0 representing lowest proficiency and 2 representing highest) can be
assigned for this lever by the user. Note that this study does not intend to judge the proficiency ofthese contractors and only intends to highlight the impact of this parameter on cost and schedule.
A/E Proficiency: This represents the proficiency of the architect/engineering (A/E) contractor.
Similarly to above, a score between 0-2 (including decimal increments) can be assigned for thislever by the user.
Construction Proficiency: This represents the proficiency of the construction contractor. Again,a score between 0-2 (including decimal increments) can be assigned for this lever by the user.
Number of plants to achieve best proficiency: For each of the supply chain, A/E, andconstruction proficiency, the maximum proficiency can be assumed to be reached after a certain
number of units are deployed. A default value of 3, 4, and 5 units, respectively, is assigned thatcan be adjusted by the user.
Cross-Site Standardization: This represents the percentage of the design that is standardized
between different sites. Typically, elements of the plant design (especially civil works, whichconstitute account 21 – Structures and Improvements) change due to site-dependent parameterssuch as topography and local natural hazards (earthquake, tsunami, etc.). Reducing these changes
through technologies like seismic isolation will increase standardization between different sites.
Modular Civil Construction: A ‘TRUE/FALSE’ toggle to represent if the construction
leveraged modular methods such as steel composite (SC) walls.
Commercial BOP: This lever determines if the balance-of-plant (BOP) can be commerciallysourced from non-nuclear vendors (TRUE) or if it is safety-related and subject to nuclear
qualifications (FALSE).
Non-Safety Related RB: This lever represents the safety-related classification of the reactor
building (RB). While the RB is typically safety related, advanced reactor technologies withsuperior passive safety features (e.g., TRISO-fueled reactors) can potentially make the case for
not needing the RB for safety function.

A Tool to Quantify Capital Cost Reduction Pathways for Advanced Nuclear Reactors
June 11, 2024

3OUTPUT OVERVIEWS
For a given selection of levers, the tool computes the construction duration, Overnight Capital Cost(OCC), and Total Capital Investment (TCI) for each of the units in the order book. A series of plots arethen generated to visualize the impact of cost reductions from the first to the last plant in the order book.
The plots also show the impact of ITC on capital investment, the cost contribution of various accounts(direct, indirect, financing, etc.), and a waterfall chart showing the relative contribution of various leversand variables in the cost reduction. Figure 1 shows the inputs and several of the outputs for a sample
scenario. The levers are shown on the left and sample outputs – OCC and the waterfall chart – are shownon the right. The tool also computes the expected timeline for constructing all of the plants in the orderbook sequentially, assuming a 75% overlap between each subsequent unit. Under the selected levers in
Figure 1, constructing the first five units requires 15 years for Reactor Concept A. Note that this does notaccount for any plants that could be constructed in parallel (but likely may not benefit from experiences
gained from concurrent units).

Figure 1. Illustrative example using a select set of levers from the tool to output the overall cost reduction
for a 13-unit order book.
The results of this framework should not be interpreted as definitive cost estimates. Rather, they
provide a useful quantitative analysis of the relative impact of various levers on the capital cost reductionin advanced nuclear plants. Particularly, the framework quantifies the importance of large, committedorder books as identified in the Advanced Nuclear Liftoff Report. Placing larger order books can help
spread the costs (and therefore, financial risk) across several plants and owners. This helps overcome theinitial investment impasse stemming from the expected cost overruns with the first plants.