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 Infopetro -> Industry in Focus


Taiwan Mulls Conversion of Under-construction Nuclear Power Plant to Gas-fired

  11/02/2012

The Economic Committee of the Taiwanese legislature passed a non-binding resolution Monday calling for the conversion of the yet-to-be-completed Longmen nuclear power plant to a gas-fired power plant, with the proposal still under review and subject to final approval at a later stage.

Confirming local media reports, an official from the Atomic Energy Council -- the nuclear energy regulatory body in Taiwan -- said Wednesday that both the Ministry of Economic Affairs and state-owned Taipower are evaluating the possibility of such a conversion.

Taipower is in charge of the construction and operation of the Longmen nuclear power plant, which upon startup will be the country's fourth nuclear power plant.

"Safety concerns, especially subsequent to the Fukushima nuclear crisis in Japan, prompted the government to re-examine its nuclear policy," the AEC official said.

Shou-Chung Ting, the legislator from Taiwan's Nationalist Party who initiated the resolution, was quoted by Taipei Times on Tuesday as saying that a nuclear disaster would devastate the country's densely populated north. The Longmen nuclear plant is only 20-30 km away from Taipei.

Construction of the Longmen nuclear power plant is around 94% complete and with test runs still pending, the initial expectation was for the plant to begin commercial operations by the end of 2013, according to the AEC official.

"The proposal for [nuclear-to-gas] conversion was raised by the legislator and we respect his decision... We are now doing a detailed cost and feasibility study for this," a Taipower official said.

The official added that primary evaluation of the research has shown that the conversion process would be "very challenging."

Meanwhile, no exact timeline has been set for the completion of the study or finalization of the resolution, various sources said Wednesday.

However, if the conversion process is officially rolled out, the Taipower official said it could take at least 10 years for the newly proposed thermal power plant to begin commercial operations.

This is taking into account the fresh environmental impact assessment process and planning stages that would have to be passed first, on top of the actual time needed to construct the thermal power plant itself.

More importantly, there is also the concern of whether such a lengthy and time-consuming redevelopment process would affect the country's ability to meet its growing energy demand.

POTENTIAL CHALLENGES FOR NUCLEAR-TO-GAS CONVERSION

Besides addressing safety concerns, there are other issues such as capital costs, power output and carbon emissions that have to be taken into consideration if the Longmen nuclear plant is to be converted to a thermal power plant, the AEC official said.

Significant investment has already been pumped into the nuclear power project, with a report from Taipower showing that more than NT$270 billion (around $9 billion) has been spent.

"After the conversion [from nuclear to thermal power], it's unclear if power output from the new gas-fired plant would be enough to cater to the country's energy demand... Furthermore, the cost of power generation will be increased by NT$2/kWh," the AEC official added.

In relation to the project conversion cost, the Taipower official also pointed out the additional spending on imported fuel as Taiwan has limited domestic energy resources, hence natural gas will likely be sourced as imported LNG.

"More capital will be required if the need to build a new LNG receiving terminal arises... Even in the case that we can get gas supplies through existing LNG import terminals operated by CPC Corp., new pipelines need to be constructed [connecting the terminals to the power plant]," the Taipower official said.

Although cost-cutting measures have been suggested by the legislature in terms of re-modeling existing nuclear facilities, such as turbines, so that they can be used in a thermal power plant, the Taipower official said there are many constraints in doing so as well.

"Most of the equipment in a nuclear facility is customized and too specialized... At the end of the day, it's not that easy or even almost impossible to recover the sunk cost [of NT$270 billion]," he added.

Taipower estimates that another NT$90 billion will be needed to replace the nuclear facility with two gas-fired units with a total capacity of 2.7 GW.

In addition, legal problems could arise as land use permits for the current Longmen nuclear plant site might be revoked as the land will be used for a different purpose from that originally agreed with the landowners, according to the same report from Taipower.

Separately, CPC, the sole LNG importer in the country, has yet to make any concrete plans to supply natural gas to the proposed new thermal plant as the nuclear-to-gas conversion plan has yet to be officially finalized, a company official said Wednesday.

(Platts Nov. 2012)



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