As we go into a new nuclear power era, with public support stronger than it has been in decades, energy companies and startups worldwide are looking for innovative ways to deploy nuclear power faster. While conventional reactors are prohibitively expensive for most companies to build, as well as take decades to develop, there has been great optimism around the use of small modular reactors (SMRs). Several smaller companies, as well as governments, are investing in SMRs to boost the nuclear power capacity, promising companies access to clean nuclear energy without the need to wait decades to get connected. However, most SMR developers are facing challenges that have caused delays to the launch of new nuclear projects, with several issues left to overcome before we see the widespread use of SMRs.
SMRs are advanced nuclear reactors that have a power capacity of up to 300 MW(e) per unit, which is equivalent to around one-third of the generating capacity of conventional nuclear reactors. SMRs, which can produce a large amount of low-carbon electricity, are much smaller than conventional reactors and modular, which allows them to be factory-assembled and transported to site for installation.
As SMRs are much smaller than conventional reactors, they can be used on sites that are not suitable for traditional nuclear energy plants. The fact that they can be manufactured at a dedicated facility before being sent to site means they are much cheaper and faster to construct. Their modular structure means that a company can invest in one SMR and then add additional SMRs later to meet any increase in power demand. SMRs, particularly microreactors, can also be extremely useful in rural areas that are difficult to connect to the main grid.
SMRs are also extremely safe as their design is typically simpler than conventional reactors. They operate at low power and pressure, meaning no human intervention or external power or force is required to shut down systems, boosting safety margins. They require less fuel to power, and power plants based on SMRs only need to be refuelled every three to seven years, compared to every one to two years in conventional plants. All these benefits have made them extremely attractive to energy companies and startups looking to develop their nuclear power portfolio, as well as companies looking to power operations using clean energy sources.
Several energy companies and startups, such as Terrapower - founded by Bill Gates, are developing SMR technology. The founders of Terrapower decided the private sector needed to take action in developing advanced nuclear energy to meet growing electricity needs, mitigate climate change and lift billions out of poverty. Several SMR projects are also being backed by government financing. For example, in the U.S., the Department of Energy announced $900 million in funding to accelerate the deployment of Next-Generation Light-Water SMRs. In addition, many companies, such as Microsoft, have signed purchase agreements with energy companies to use SMRs, or are developing their own SMR strategies, to power operations with clean energy.
While there is huge optimism around the deployment of SMR technology, many of the companies developing the equipment have faced a plethora of challenges, which has led to delays and massive financial burdens. At present, only three SMRs are operational in the world, in China and Russia, as well as a test reactor in Japan. Most nuclear energy experts believe SMRs won’t reach the commercial stage in the U.S. until the 2030s.
NuScale cancelled plans to launch an SMR site in Idaho in 2023 after the cost of the project rose from $5 billion to $9 billion owing to inflation and high interest rates. This is a common issue, as companies must predict the costs of a first-of-a-kind project. Once one SMR site is launched and companies can establish tried-and-tested methods of deployment, a second site is expected to be cheaper and faster to develop. A trend that will continue as companies gain more experience. Eric Carr, the president of nuclear operations at Dominion Energy, explained, “Nobody exactly wants to be first, but somebody has to be.” Carr added, “Once it gets going, it’s going to be a great, reliable source of energy for the entire nation’s grid.”
Another issue is access to uranium. Russia is currently the only commercial source of high-assay low- enriched uranium (HALEU), which companies require to power their reactors. In late 2022, Terrapower announced it would be delaying the launch of its first SMR site in Wyoming due to a lack of fuel availability. However, the U.S. is developing its domestic production capabilities. The Biden administration is expected to award over $2 billion in the coming months to uranium enrichment companies to help jumpstart the supply chain. Meanwhile, Terrapower announced this summer that it is finally commencing construction on its Wyoming SMR site and is working with other companies to develop alternate supplies of HALEU.
By Felicity Bradstock for Oilprice.com
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