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Climate change and energy

Small Reactors Could Kick-Start the Stalled Nuclear Sector

NuScale is on track to build the first commercial small modular reactors in the United States.
July 17, 2017
ariel davis

The nuclear energy industry sees big promise in going small.

Earlier this year, NuScale Energy took a crucial step forward in its prolonged effort to build 12 scaled-down nuclear reactors on an empty parcel at the Idaho National Laboratory, a sprawling research campus on the outskirts of Idaho Falls (see “Shrinking Nuclear”). The U.S. Nuclear Regulatory Commission agreed to begin the formal process of reviewing the company’s designs for the 600-megawatt plant, which could power a city the size of Boise twice over.

That gives NuScale, based in Portland, Oregon, the inside track on building the country’s first commercial reactors of this type. Known as small modular reactors, or SMRs, they also represent the first substantially new reactor design of any kind to reach this NRC milestone in decades.

But many more SMR projects are coming or under way. There are around 50 designs or concepts in various development or planning stages around the world, according to the International Atomic Energy Agency. Four are already in advanced construction in Argentina, Russia, and China.

If the early projects are built and succeed, these smaller and potentially safer nuclear reactors raise the real possibility of mass-produced mini plants that can significantly reduce the industry’s up-front costs and risks. That, in turn, could make it far easier to add a source of carbon-free energy that many experts believe will be critical to lowering the risk of climate change.

On the other hand, we won’t know how economically the plants can really operate until they’re up and running. And a shift toward smaller but more numerous nuclear reactors could raise new kinds of proliferation dangers, some observers warn.

The grand promise of commercial SMRs is that they would be compact enough to prefabricate in factories and ship to their destination, where they could be stacked together to produce whatever level of energy generation is needed. Over time, the technology could introduce new levels of predictability, reliability, and economies of scale to an industry that’s become synonymous with billion-dollar cost overruns and years of delays. It also opens the possibility that nuclear power could serve smaller markets, and even military or industrial applications, where a full-scale reactor wouldn’t make economic sense.

The most immediate advantage, however, is that they might be cheap enough to get built at all. Raising the massive up-front capital to construct new full-scale reactors has become increasingly difficult in the United States, particularly after ballooning budgets for two plants in Georgia and South Carolina ended up tipping Westinghouse Electric into bankruptcy, nearly taking its parent company with it (see “Meltdown of Toshiba’s Nuclear Business Dooms New Construction in the U.S.”). 

Small modular reactors like NuScale’s 50-megawatt module promise to be orders of magnitude cheaper. Even the company’s full-scale, 12-module configuration would cost around $3 billion, the company estimates. In contrast, Westinghouse’s Vogtle plant in Georgia, which includes two 1,200-megawatt reactors, was initially slated to cost $14 billion—and swelled to well over $20 billion.

NuScale’s inaugural power plant would be owned by the Utah Associated Municipal Power Systems and operated by Energy Northwest. If all goes well, it will begin generating electricity in 2026. That, of course, is still nearly a decade off. But the hope is that once the NRC signs off on the reactor designs, and the company establishes its supply chain and third-party manufacturing process, it will become faster and easier to line up customers and roll out reactors. Any given project site, however, will still have to go through additional regulatory permitting.

Each of NuScale’s power modules would be 74 feet tall and 15 feet wide, and they could break down into three components designed to be shipped by barge, truck, or train. They’re scaled-down and streamlined versions of traditional pressurized light-water reactors, but with novel safety features. Among other things, the reactor would be placed underground in a pool of water, which would also serve as the coolant. That would eliminate the need for additional tanks, pumps, and piping. It would also enable a passive safety system to shut the reactor down automatically and cool it without human intervention, even in the event of a sustained power loss like the one triggered by a tsunami in Fukushima, Japan.

“The safety case is second to none,” says Tom Mundy, chief commercial officer at NuScale.

A number of other companies and research institutions are pursuing so-called fourth-generation SMR technologies, including molten-salt and high-temperature gas. But in general, those face tougher technical challenges, as well as regulatory ones, and may take longer to develop.

NuScale’s main financial backer is the large engineering firm Fluor, which took a majority stake in the company in 2011. In 2013, the U.S. Department of Energy awarded the company $217 million under the SMR Licensing Technical Support Program. But the Trump administration’s budget proposal includes sharp cuts to the DOE’s nuclear programs, which could jeopardize the company’s ability to secure the remaining $47 million of that grant.

Mundy is optimistic that bipartisan support will prevail. Indeed, a number of Republican lawmakers urged President Trump in a letter in May to support the development of SMRs, stressing the imminent competition from China and Russia.

Despite the promise of SMRs, the technology is not a sure bet. Notably, even if capital outlays are considerably lower, that doesn’t necessarily mean it will yield competitive electricity costs, particularly against low-cost natural gas.

Some players have reportedly already pulled back from SMRs, including Westinghouse and Babcock & Wilcox, at least in part because of competition from cheaper energy sources.

“The cost per megawatt-hour doesn’t necessarily come down just because you’re building a smaller plant,” says Ryan Fitzpatrick, deputy director of the clean-energy program at the think tank Third Way. “There have to be cost savings derived through other processes.”

Those could include things like shorter construction times and new design features that reduce regulatory expenses. But the key to driving down costs would be setting up factories to crank out a lot of reactors, says Neil Todreas, a professor of nuclear science and engineering at MIT.

That, however, may present a bit of a chicken-and-egg challenge: securing financing to build the plants will probably require a lot of orders, but it would be hard for a company to obtain those orders before it could reliably produce reactors cheaply.

In addition, the Union of Concerned Scientists has raised separate questions about how safe and secure the plants will really be. Among other issues, the group noted that a widely distributed network of smaller but more numerous reactors could make it harder to safeguard nuclear material that, among other dangers, can be used to make dirty bombs.

In the end, SMRs may or may not end up being the ideal or most economical way to add significant nuclear generation to the grid. But in a nation where it’s become nearly impossible to build any new nuclear plants, it could simply be the technology needed to get the industry moving forward again at all, Todreas says.

“I am not sure there will be a march toward small modular reactors across the U.S. for decades, or that they will completely replace large power plants,” he says. “But certainly in the near term, they’re very important for the health of nuclear power in the U.S.”

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