Annular fuel can be used as a means to upgrade the power density in future and current reactors. This study determined the economic impact of the manufacturing and use of this higher energy density fuel. An evaluation of the manufacturing costs associated with annular fuel indicated that there should be minimal if any manufacturing cost impacts. While each rod would use more material (uranium and zirconium) than a standard solid-pellet-based fuel, fewer rods are required for each assembly.
Several uprate options were compared to a new build of a Generation III 1117-MW(electric) plant (option 1) on the basis of rate of return (ROR) on investment, which was calculated at 6.9%. Option 2 was the uprate of an operating Generation II power plant from 1200 to 1800 MW(electric) including steam generator replacements, which resulted in an ROR of 6.3%. Option 2 was also evaluated assuming that a shutdown to upgrade was coordinated with a previously scheduled replacement of steam generators. Assuming that 3 of the 12 months required for uprating the plant are already paid for by the steam generator replacement, the ROR of this option then rises to 13.0%, which makes it the best option available. Option 3 was the building of a new Generation III plant with an output of 1717 MW(electric) using annular fuel, which had an ROR of 11.5%. This was compared to a new 1717-MW(electric) Generation III plant with low energy density standard fuel, which yielded an ROR of 10.8%.
It was concluded that the use of annular fuel, when complemented with other changes in the fuel such as longer rod lengths, higher fuel density, and core reflectors that would increase the amount of fuel in the core and increase its neutron efficiency, could improve the rate of return on invested capital for new plants by getting more capacity from a smaller-sized nuclear island, which reduces the capital cost per installed kilowatt.
Note that this study did take into account replacement power and unused fuel value at the time of transition from standard to annular fuel, but not costs associated with the changes required to the power system outside of the plant boundary, which would be site dependent. When replacement power and fuel displacement costs were not included, the ROR for the 600-MW(electric) uprate option 2 rose to 11.6%. This result indicates that large 50% uprates may make sense if low-cost replacement power during the transition outage is readily available and if a fuel management program before the uprate can minimize the residual value of the displaced standard fuel. It is also clear that with sufficient lifetime, uprating plants, regardless of the method used, results in better plant economics because of the economy of scale effect.