The value of being able to start the construction of a nuclear power plant in Chile by 2020 Online publication date: Sun, 16-Aug-2009
by Geoffrey Rothwell
International Journal of Nuclear Governance, Economy and Ecology (IJNGEE), Vol. 2, No. 4, 2009
Abstract: This paper calculates the expected value of beginning construction on Chile's first nuclear power plant in 2020. This requires (1) an appropriate regulatory authority capable of issuing site and technology licences and construction and operating permits, (2) a committed owner-operator and investors and (3) a specified system of handling fresh and spent nuclear fuel. At that time, the Net Present Value (NPV) of the project can be calculated and compared with competing alternatives. Until that time, funds must be spent on regulatory and physical infrastructure. This paper finds that Chile should be willing to invest a positive amount on this infrastructure, even though a nuclear power plant might never be built. The benefits of being nuclear power-capable arise from uncertainty in the establishment and form of international carbon dioxide (CO2) controls. The greater the uncertainty in knowing the social and environmental cost of CO2, the greater the value of holding the option to build carbon-free nuclear power plants. This paper estimates this value to be between US$60 million and US$600 million based on the planner's beliefs about binding international CO2 constraints.
Existing subscribers:
Go to Inderscience Online Journals to access the Full Text of this article.
If you are not a subscriber and you just want to read the full contents of this article, buy online access here.Complimentary Subscribers, Editors or Members of the Editorial Board of the International Journal of Nuclear Governance, Economy and Ecology (IJNGEE):
Login with your Inderscience username and password:
Want to subscribe?
A subscription gives you complete access to all articles in the current issue, as well as to all articles in the previous three years (where applicable). See our Orders page to subscribe.
If you still need assistance, please email subs@inderscience.com