Chancellor Jeremey Hunt whipped up a storm when he publicly confirmed government support for small modular reactors (SMRs) in the budget last month.
Just days after Hunt classed nuclear power as “environmentally sustainable” and launched the first competition round in a packed House of Commons, firms have flocked to get involved and make their mark in the prospective industry.
London-based start-up Newcleo has laid out plans to raise £900mln to build small reactors in the UK on the back of the news.
US-based developer Last Energy then announced it had signed a deal to sell 24 of its mini nuclear plants to UK customers, with these set to cost just £100mln each.
Rolls-Royce Holdings PLC (LSE:RR.), a key player in the industry and the only firm with SMR tech currently going through the UK’s regulatory process, said it welcomed the government’s new stance, meanwhile.
What it may not welcome is heated-up competition, though, with Newcleo among six rival firms to have already applied for entry into the UK’s stringent SMR design assessment process, and the announcement likely to prompt more – including Last Energy.
Cavendish Nuclear/X-Energy, GE-Hitachi Nuclear Energy, GMET Nuclear, Holtec Britain, UK Atomics, mark the others to have submitted applications for their tech, though none are set to match the size and output of Rolls-Royce's.
Hunt boasted the move to support mini-nukes could secure as much as a quarter of the UK's energy needs by 2050, but given larger and more traditional European pressurised reactors (EPRs), like Hinkley Point C and Sizewell C, are already in the pipeline, it may be fair to ask why smaller reactors are needed and why not stick with what we know?
SMRs vs EPRs
Small modular reactors are the nuclear industry’s answer to cutting costs and timings across the board, given their larger alternatives can rack up a hefty price tag and don’t shy away from flirting with delays.
Hinckley point C in Somerset, for instance, had price estimations upped to £32.7bn last month by operator EDF Energy, having been forecast to cost around £18bn in 2016.
Timelines laid out in the late noughties by the government also plotted Hinkley Point C to be producing electricity for the grid “well before 2020,” which, needless to say, is a little off the currently anticipated opening date of 2027.
Sizewell C in Suffolk, meanwhile, is projected to open at some point in the early 2030s, costing between £20bn and £35bn. However, construction is yet to begin.
Since five of the UK's six working nuclear stations are also set to close within the next half-decade, albeit despite delayed decommissioning by EDF and partner Centrica PLC (LSE:CNA), a fairly large hole in the country's required energy output will be left.
So, when Rolls-Royce claims its SMRs will cost just £1.8bn a piece and can be constructed in a fraction of the time, between 4-7 years, with 80% of components sourced from British suppliers, it’s no wonder the government’s ears have pricked up.
Rolls’ SMRs, using pressurised water tech similar to that in nuclear submarines, will also have a similar lifespan to EPRs of “at least” 60 years, providing enough power for up to 1mln homes.
Sizewell C and Hinkley Point C are anticipated to power around 6mln homes each meanwhile, meaning six Rolls-Royce SMRs could equal the output of one EPR after costing just £10.8bn to build.
That would “address size, complexity, uniqueness and frequency of build,” public body UK Research and Innovation found in a February report.
Last Energy also said that by modularising reactors it could cut costs, with its smaller reactors, which will power 40,000 homes each, set to be built in similar factory environments.
Scepticism does remain though, with think tank Nuclear Consulting Group chairman Paul Dorfman explaining the rollout of Rolls’ and other's SMRs would be no easy task.
“SMR technology is defined as reactors that generate up to 300 MW power. But at 470 MW, the Rolls Royce design is simply not an SMR,” he said to the UK Parliamentary Welsh Select Committee in February.
“[It’s] about a third the size of the very large EPR reactor design.
“This matters because the Rolls design will need big sites, standard nuclear safety measures, exclusion zones, core catchers, aircraft crash protection, and security,” again, likely pushing up costs.
Highlighting NuScale's SMRs, set to be built in the US after receiving the regulatory nod in January, he pointed out costs had doubled over the lifespan of the project.
It had initially sought to produce power at US$55/MWh, but now expects it to cost near US$90/MWh.
Submitting evidence to a UK parliamentary committee in August, Dorfman added: "The key idea behind SMRs is to attempt to replace these economies of scale with the economies of modularisation. But this is by no means a given.
"We see exactly the same in wind power. One of the main reasons why offshore wind costs has come down so much is the move to larger wind turbines."
Whether SMRs do indeed cut costs remains to be seen therefore, with the government's promised formation of a public body, Great British Nuclear, aiming to bring the most appealing prospect of the new tech to life.
That is, cutting costs along a supply chain that can offer "predictable deployment" and "replication," in the words of UKRI director Rich Deakin, a challenge EPRs are yet to successfully to address.