Assessing the Attractiveness of SMR: An Application of INCAS Model to India

Abstract

Small Modular Reactors (SMRs) have the potential to be an important component of the worldwide nuclear renaissance. Whilst requiring more diluted investment than Large Reactors (LRs), SMRs are simpler build and operate as well as being suitable for deployment in harsh environmental conditions. In addition, useful by-products such as desalinated water and process heat are generated. The economic competitiveness of SMRs with respect to LRs must be carefully evaluated since the economies of scale label these reactors as not economically competitive. As such, a variety of financial and economic models have been developed by the scientific community in order to assess the competitiveness of SMRs. One of these, the INCAS model (Integrated model for the Competitiveness Assessment of SMRs), performs an investment project simulation and assessment of SMR and LR deployment scenarios, providing monetary indicators (e.g. IRR, LUEC, total equity invested) and not-monetary indicators (e.g. design robustness, required spinning reserve). The work in this paper investigates the attractiveness of SMRs for a given scenario, the Indian state, through application of the INCAS model. India is the second most populated country in the world with rapid economic growth and a huge requirement for energy. There is also both good public acceptance and political support for nuclear power in India, important factors favoring the deployment SMRs in particular. India seems particularly suitable for SMR deployment because (i) its energy intensive industrial sites are located far from existing grids, (ii) rapid growth in the region and (iii) the requirement for plants to provide fresh water for the population, as well as for agriculture and industry. The results show that SMRs have roughly the same financial performance of LRs, however they have a competitive advantage as a result of non-financial factors such as co-generation application, higher local content and better management of the spinning reserves in a country with an electricity deficit.