Economic Feasibility of Energy Supply by Small Modular Nuclear Reactors on Small Islands: Case Studies of Jeju, Tasmania and Tenerife

Sanghyun Hong and Barry W. Brook
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Sanghyun Hong: College of Science & Engineering, University of Tasmania, Private Bag 55, Hobart 7001, Australia
Barry W. Brook: College of Science & Engineering, University of Tasmania, Private Bag 55, Hobart 7001, Australia

Energies, 2018, vol. 11, issue 10, 1-11

Abstract: Small modular nuclear reactors (SMRs) offer the promise of providing carbon-free electricity and heat to small islands or isolated electricity grids. However, the economic feasibility of SMRs is highly system-dependent and has not been studied in this context. We selected three case-study islands for such an evaluation: Jeju, Tasmania and Tenerife based on their system complexity. We generated 100,000 electricity-mix cases stochastically for each island and examined the system-level generation-cost changes by incrementing the average generation cost of SMRs from USD$60 to 200 MWh −1 . SMRs were found to be economically viable when average generation cost was <$100 MWh −1 for Jeju and <$140 MWh −1 for Tenerife. For Tasmania the situation was complex; hydroelectric power is an established competitor, but SMRs might be complementary in a future “battery of the nation” scenario where most of the island’s hydro capacity was exported to meet peak power demand on the mainland grid. The higher average generation cost of SMRs makes it difficult for them to compete economically with a fossil fuel/renewable mix in many contexts. However, we have demonstrated that SMRs can be an economically viable carbon-free option for a small island with a limited land area and high energy demand.

Keywords: small modular reactors; renewable; small island; micro grid; isolated grid (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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