Techno–economic investigation into nuclear centred steel manufacturing
Mammen, Siju Abraham
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With the rising electricity, raw material and fossil fuel prices, as well as the relatively low selling price of steel, the steel industry has been put under strain to produce steel as cost–effectively as possible. Ideally the industry requires a cost–effective, stable source of energy to cater for its electricity and energy needs. Modern High Temperature Reactors are in a position to provide industries with not only electricity, but also process heat. Therefore, a study was conducted into the economic viability of centering the steel industry on nuclear power. This study considered 3 technology options: a nuclear facility to cater for solely the electricity needs of the steel industry; a nuclear facility producing hydrogen for the process needs of the steel industry; and a nuclear facility co–generating electricity and process heat for the steel industry. An economic model for each of the 3 scenarios was developed that factored in the various cost considerations for each of the 3 options. In general, this included the construction costs, operational and maintenance cost, build time and interest rate of the financed amount. For each option, the model calculated the cost of production per unit output. The outputs were electricity for option 1, hydrogen for option 2, and both electricity and process heat for option 3. Each model was optimised based on a realistic best case scenario for the capital and operational costs and respective best case cost per unit outputs for each of the options were calculated. Using the optimised cost model, it was shown that electricity produced from nuclear power was more cost effective than current electricity prices in South Africa. Similarly, it was shown that a nuclear facility could produce heat at a more cost–effective means than by the combustion of natural gas. Hydrogen proved to be not cost effective compared to reformed natural gas as a reducing agent for iron ore. Based on the cost savings, a cash–flow analysis showed that the payback period for a nuclear power plant that produced electricity for the steel industry would be around 12 years at 0% interest and 15 years at 5% interest. Due to the long payback period and lack of certainty in the steel industry, any steel manufacturer would opt for purchasing electricity from a nuclear based electricity utility rather than building a facility themselves. Savings of over $70 million/year were achievable for a 2 million tonne/year electric arc furnace. Overall this analysis showed that electricity generation is the only viable means for nuclear power to be integrated with the steel manufacturing industry.
- ETD@PUK