| dc.description.abstract | The primary purpose of this thesis is to determine the feasibility of incorporating small
modular reactors (SMR) into the Norwegian energy mix, considering Norway's role in a larger
integrated power market with direct grid connections to several European countries. Three
analyzes were conducted to evaluate this: Initially, we conducted a literature review to
determine if there is room for nuclear energy in the Norwegian energy mix and to compare
nuclear energy with other relevant sources on a variety of financial and socioeconomic metrics
to determine its potential value relative to relevant alternatives. Finally, we conducted a
profitability analysis to determine the potential value creation of an SMR project. This
approach aims to provide a nuanced perspective on the potential of allowing nuclear energy
production in Norway.
The primary findings suggest that SMR technology has significant potential in the Norwegian
energy mix. With the green transition, the market analysis predicts a substantial increase in
energy demand through 2050. In addition, the energy prices observed over the past few years
are likely to decrease by 2030. With the current energy policies, however, there is a substantial
risk of deviations between demand and supply, thereby severely jeopardizing the power
balance and causing volatile power prices. Potentially resolvable by the addition of a stable
and to a large extent dispatchable energy source, such as SMR. The comparative analysis
demonstrates that nuclear energy has acquired an undeservedly negative reputation, despite
appearing to be one of, if not the most environmentally friendly and secure energy source
available today. In addition to being highly cost-competitive with sources such as offshore
wind and solar, especially when the need for energy storage and external costs is considered.
Our analysis of profitability is based on several assumptions. Seeing as SMR is a new and
untested technology, its validity is difficult to assess. Nevertheless, based on these
assumptions, our findings indicate that SMR projects would require reasonable financing in
order to create shareholder value due to their substantial initial investment. With the long and
stable cash flow, however, our base case estimates indicate that a project could achieve a
payback period of approximately 20 years, with an accumulated positive net cash flow of
between 60 and 70 billion NOK. Which, with discounting effects included, results in a net
present enterprise value of 2-3 billion NOK. In addition, a levelized cost of electricity of
around 65 øre/Kwh is achieved, which is particularly competitive compared to offshore wind. | en_US |
