How the Private Sector Is Shaping the Future of Nuclear Energy

Power lines in Hinsdale, N.H., lead away from the Vermont Yankee nuclear power plant in Vernon, Vt., in 2013. (Brian Snyder/Reuters)
We should remain optimistic about the future of nuclear energy in America.

NRPLUS MEMBER ARTICLE L ast week, the future of nuclear energy got an immense boost. U.S. officials greenlit America’s first-ever commercial small modular reactor, to be constructed in eastern Idaho by a company called NuScale Power. The first will be built by 2029, with eleven more to follow by 2030.

Nuclear energy already provides 20 percent of American energy production, representing 60 percent of all clean energy in this country. Yet nuclear energy has stalled for several decades now, having fallen by 9 percent in terms of global energy generation since 2006. Of the 60 plants in operation in the United States, nine have already announced that they are closing, 16 are “at risk” of closure, and five are already gone. Together, this represents 15 percent of all carbon-free energy production in America.

Yet NuScale Power’s recently approved design marks a landmark achievement for the future of nuclear energy: the move towards smaller, more high-tech nuclear reactors — a type dominated by private-sector competition. These small modular reactors (SMRs) represent a real chance for energy innovation in the United States, and an opportunity to lead the world. As we increasingly seek to move away from fossil fuels and toward carbon-free forms of energy, SMRs will play a crucial role. We simply cannot rely on renewables such as solar and wind energy alone yet, meaning that competitive, new-generation reactors can fill that gap and reverse the trend of nuclear decline.

Not everyone is convinced by the potential of SMRs. One of the most common criticisms is that it is still very expensive, and that it will take decades to achieve any viable commercialization — with numbers such as $11.5 billion and 25 years being thrown around.

This interpretation, however, assumes that the government is leading the charge on these new-generation nuclear plants. Indeed, the old model of state-led nuclear research, demonstration, and commercialization, propelled by the Department of Energy, can be cumbersome, inefficient, and costly. But the opposite is true for SMRs. Advanced-reactor development and innovation is in fact being led by the private sector and supported with smart investments at key junctions by federal policies, such as the Nuclear Energy Leadership Act. As showcased by the Breakthrough Institute’s “How to Make Nuclear Innovative” report, these smaller, more entrepreneurial firms are leading on advanced nuclear innovation, far outpacing typical government timelines. Their success now depends on whether they can easily access initial markets to sell their energy. It would be eminently sensible for local, state, and federal governments to aid that transition.

It’s clear why SMRs are seen as attractive investments by the private sector. Because of their smaller size, most SMR parts can be factory-made off-site, and then shipped to the reactor’s location. Smaller reactors also require less funding for the first build, making them more economically viable investments for a wider range of utility companies. Moreover, their smaller scale also vastly simplifies the engineering, helping make the reactor easier to model and safer, as well as speeding up the licensing and commercialization processes. Advances in computing technology can also simplify, cheapen, and accelerate the plant-modeling process through high-tech simulations.

Smaller, advanced nuclear reactors also provide more options than larger, conventional ones. For example, they are much easier to place than larger plants. This could overcome the challenges of transporting energy over large distances. These challenges have hamstrung the potential of renewable-energy sources such as wind and solar, which require long-distance transmission lines to transport generated energy from remote locations to urban centers. Small modular reactors can be sited where energy is needed, from urban centers to far-flung mining communities in Alaska.

Their small size makes SMRs more flexible than larger reactors as well. For example, where large reactors typically follow a standard size and output, SMRs can be scaled and adapted to the local energy needs where they are sited. As the U.S. slowly decommissions all of its coal-fired plants, an additional benefit of smaller reactors is that they can actually directly take the place of such decommissioned coal plants, located on previously developed plots of land that are no longer in use — also known as brownfield sites. 90 percent of these coal plants are considered “small” in size, under 500 MWe (megawatt electric) and many as low as 100. SMRs are defined as nuclear energy reactors below 300 MWe and could fit there; large reactors operate at over 1000 MWe.

Because of their scalability, moreover, SMRs can implement designs that track energy demand, and respond accordingly with maximum economic efficiency. This could usefully complement renewable-energy development, which is inherently unreliable due to the intermittent nature of sun and wind. As such, nuclear could provide the base-load energy to the grid, and then adapt to demand as and when it rises or declines.

The widespread economic and environmental benefits of SMRs suggest that the government should support the private sector in its innovation drive by not getting in the way aside from targeted and specific support. With the right policies in place, these new SMRs will not only assure future abundant energy, but they will also create an entirely new industry of exportable technological innovation. SMRs such as NuScale’s could create 7,000 jobs, generate $1 billion in annual sales, and power over 50,000 homes, according to one study.

It is therefore crucial that we continue to encourage the private sector to pursue new-generation nuclear innovation. We should reform and modernize the licensing process to adapt to the changing nature of small-scale nuclear startups. We should also pursue more public-private partnerships, in which our national laboratory system gives private nuclear startups access to technical resources, necessary equipment, and detailed expertise. This should be accompanied by further targeted R&D funding, along the lines of the Nuclear Energy Leadership Act.

Last week’s groundbreaking approval of the first-ever commercial small modular reactor in the United States fits a wider trend of private-sector leadership on nuclear innovation. We should strive to harness this further, and to remain optimistic about the future of nuclear energy in America.

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