Reactors

The role of small modular nuclear reactors in meeting climate goals

Small modular nuclear reactors could play an important role in decarbonizing power grids and meeting climate goals set by the Paris Agreement, according to a new report.
The role of small modular nuclear reactors in meeting climate goals
NuScale Power Reactor Building (Courtesy: U.S. Dept. of Energy)

Small modular nuclear reactors could play an important role in decarbonizing power grids and meeting climate goals set by the Paris Agreement, according to a new report.

Wood Mackenzie estimates that the world needs $2 trillion in capex to build new power capacity to decarbonize power grids. SMRs are an option for flexible, dispatchable power sources to accompany the rapid growth in power demand and renewable energy.

The levelized cost of electricity (LCOE) for a new SMR is currently upwards of $120 per megawatt-hour (MWh) for a typical market in Europe, the US or Japan. SMR costs can fall under $80/MWh in the 2030s with government support, technology innovation, and investments, according to Wood Mackenzie.

“As more fossil fuel-fired power plants are retired around the world, brownfield sites and transmission connections could be repurposed to be used by SMRs. But capex costs must fall 50% to compete with other flexible technologies,” said Prakash Sharma, Wood Mackenzie Asia Pacific Head of Markets and Transitions. “SMRs may still be at its infancy, but its potential is endless. They can play a role in producing low-carbon hydrogen, which is a cornerstone of almost all deep decarbonization scenarios."

At the COP26 United Nations climate summit, the U.S. Under Secretary of State for Arms Control and International Security Bonnie Jenkins announced $25 million of funding for clean nuclear energy, called the "Nuclear Futures Package."

The goals of the program are to advance large-scale nuclear power generation, demonstrate the potential of nuclear-produced hydrogen to fuel the clean energy transition, and advance innovations and research into SMRs.

Also at COP 26, U.S. Special Presidential Envoy for Climate John Kerry announced Romania's intent to build a first-of-a-kind small modular reactor plant by deploying U.S. clean energy technology.

The bipartisan infrastructure plan passed by Congress over the weekend included several provisions for nuclear research and deployment, including an order for the Dept. of Energy to develop a feasibility report for using nuclear energy to meet resilience and carbon reduction goals. The bill also authorized $6 billion of credits for nuclear energy.