Government should examine costs of small nuclear power

17 December 2014

Government should work with industry to better understand the economics of Small Modular Reactors (SMRs) and set out a clear explanation of the conditions under which they might become cost competitive in the UK. It will be important to understand the future cost comparison with large-scale nuclear reactors as well as the comparison with other small-scale energy generation or demand management, according to new report from the Energy and Climate Change Committee.

Small Modular Reactors are designed in a way that allows them to be manufactured at a plant and brought to site fully constructed. They have a range of useful applications, including industrial process heat, desalination or water purification, and other cogeneration applications. The Energy and Climate Change Committee said:

"Small Modular Reactors could potentially have a key role to play in delivering low carbon energy at lower upfront capital cost compared to large conventional nuclear reactors.  That said, the commercial viability of SMRs remains unclear."


Deployment of SMRs is likely to be achieved through sharing the costs between the public and private sector and the Committee would like to see the Government steering industry towards deploying a demonstrator SMR in the UK. Government should help to establish the right conditions for investment in SMRs, for example through supporting the regulator to bring forward approvals in the UK, and by setting out a clear view of siting options. It might take six years to give regulatory approval (including a site-specific licence) for a small modular reactor. The Committee added:

"The Government should support the use of existing nuclear sites for the deployment of SMRs. These sites could potentially host a demonstrator module with minimal additional infrastructure requirements and with the support of a skilled local workforce."


Many of the barriers to deployment of SMRs in the UK are similar to the challenges of deploying larger conventional reactors, i.e. capital cost, lead times, uncertainty over both of these factors, regulatory approvals, and potential volatility in political and social support. Rigorous safety assessment will be important. Small nuclear reactors will generally raise similar questions of safety and security to those raised by large nuclear reactors. In the future, new technologies may bring with them the possibility of improved technical features in nuclear reactors, for example through enhanced safety or through reuse of waste materials.  The UK already has robust processes in place to ensure the safe and secure operation and maintenance of the plant as well as transportation and management of fuel and spent fuel. The Committee is calling on DECC to ensure that the Office for Nuclear Regulation is adequately resourced to support SMR developers in the early stages of preparing their designs for approval.

Commercial potential

In the longer term, Government should identify and help to establish future sources of commercial finance for the further development and industrialisation of SMRs. While current SMR designs have been predominantly developed outside the UK, there is scope for British industry to develop intellectual property and play a role in the deployment of the first SMRs. The challenges faced in making SMRs commercially viable represent an opportunity for our world-class manufacturing industry. Collaboration with international partners is important and the Government must ensure that UK companies are in a position to compete for these opportunities.


'Small modular reactors' (SMRs) are designed in a way that allows them to be manufactured at a plant, brought to site fully constructed, and installed module by module, thereby potentially improving manufacturing efficiency and cost while reducing construction time and financing costs.

Further information

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