Will Recent Policy Changes Accelerate the Advancement of Small Modular Reactor Technology?

April 2015

Though the Nuclear Regulatory Commission (NRC) has not yet approved any Small Modular Reactor (SMR) designs, there are several companies in the United States that are investing heavily in SMR technology. NuScale Power LLC (owned by Fluor Corp.) is arguably the farthest along in the process of developing the technology and is expected to submit its SMR design to the NRC for approval sometime in 2016. Earlier this year, Westinghouse Electric Company announced that the NRC provided safety approval for the company’s testing approach for its SMR design. According to Jeff Benjamin, Westinghouse senior vice president, New Plants and Major Projects, the NCR approval “… confirms the technical maturity of the Westinghouse SMR concept design.”

In an effort to accelerate the development of SMR technology, there have been several policy actions taken at both the federal and state levels. Earlier this year, President Obama signed an Executive Order that 10% of all electric and thermal energy consumed by federal agencies should come from low-carbon dioxide-emitting “alternative energy sources” by 2016 increasing to 25% by 2025. While the establishment of an “RPS standard” for the federal government is not necessarily groundbreaking, the fact that the order explicitly states that SMR technologies would qualify as “alternative energy sources” could spur additional investment. In addition to this order, the U.S. Department of Energy (DOE) has made available hundreds of millions of dollars of cost-sharing awards whereby the DOE will help to offset costs of the design, certification, and licensing of a SMR.

On the state level, legislative bodies in several states, including Washington, New Mexico, Alaska, Missouri, Iowa, and Maine have explored policy options to accelerate the advancement of SMRs. The State of Washington has probably been the most active in pursuing policy changes to accelerate investment, as illustrated by the April 1 action of the Washington House Technology and Economic Committee’s decision to pass SB5113 which would require the State’s Department of Commerce to look into how to site and build SMRs to meet future energy supply and environmental and energy security needs.

Key Points

  • While NuScale Power LLC has communicated its desire to submit its SMR design to the NRC in 2016 for approval, it has also expressed concerns that NRC’s licensing process has been less than transparent, complicating efforts to submit the first ever SMR design certification application
  • Though SMR technology has been lauded by numerous industry groups, the technology has not been proven commercially viable as illustrated by the numerous companies, most notably Generation mPower (a Babcock & Wilcox Co. and Bechtel Corp joint venture) which slowed the development of its SMR design due to the inability to secure additional investors and lack of interest in the technology by investor-owned utilities
  • In July 2013, DOE Secretary, Dr. Ernest Moniz testifying before the U.S. Senate Energy and Natural Resource Committee stated, “We believe SMRs will be part of the future model of energy worldwide…”

Key Implications

  • If proven technically feasible at a competitive cost, SMRs would provide an ideal source of baseload capacity to smooth out the intermittency associated with wind and solar generation
  • In response to the federal government’s decision to classify SMR technologies as “alternative energy sources,” states may look to alter their RPS standards to include similar language or expand the definition to include all nuclear reactors
  • Once operational, SMRs will likely accelerate the retirement of coal-fired generating capacity

More Information

This report is part of the Nuclear Minute series. To view all featured Minutes, please click here.

Contributing Author: Eric Hanson and Marcus Siwemuke

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