Monday, 6 March 2017

What's stopping Small Modular Reactors

Small modular reactors (SMRs) are a class of nuclear fission reactors that aim to address some of the shortcomings of existing large scale nuclear power plants. These shortcomings include the capital cost of the plant, the lead time for construction of the plant, the ability to process existing nuclear waste into fuel, requirements for the location of the power plant and the complexity of safety systems required. There are a number of different SMR designs that have been put forward over the last two or three decades that using various fuel sources, reaction physics and construction techniques. One thing they all share in common is that they have promised much and delivered little: few of them are even close to having production power plants in service.

This raises a big question in my mind: why have they failed to materialise? The benefits that the claim over the established large scale GenIII reactor and power plant designs would seem to be potential game changes in the nuclear energy industry. You'd expect a few companies at least to have made progress into a production system over the last three decades for a technology that promises so much with existing engineering and physics knowledge, but they haven't.  Why?

One reason is regulations. SMRs, like all nuclear power plants, require a huge effort to pass regulatory hurdles in most countries.  For good reasons, these regulations are very detailed, and thus expensive, to comply with. You don't want people building more dodgy reactor designs that have proved problematic in the past after all.

Thus only companies that have deep pockets can really successfully play in this field, unless governments step in to provide support. The regulations are also angled towards the large existing nuclear reactor designs we've had in the past, and its up to the SMR proponents to prove to the regulators that (if?) their reactor designs are inherently safer. The regulators need to be shown that failure modes have been removed without other new ones being introduced.  That costs money.

Unfortunately, a number of the newer GenIV SMR designs aren't being proposed by existing nuclear companies or by billionaire backed corporations. Instead, their initial designs have been proposed and developed on relatively low shoe string budgets.  To get through the regulatory barrier these potentially disruptive start ups need to attract a large amount of speculative investment, or have their ideas taken up/bought out by "one of the big boys".

The existing nuclear power companies don't really want anything disrupting their current game plans, and anyway many of them have big problems of their own financing their operations (see for example the pains of Westinghouse/Toshiba and EDF/Areva recently).  There are a few companies backed up with investment cash, and they're probably the best hope for the SMR market to develop at the moment. If even one of those gets into production and starts to turn a profit, investment capital may magically appear for some of their potential competitors.

Once past regulatory approval in one country, many of the SMR designs then rely on the promise of a production line assembly of power station modules in order to keep their overall costs down.  This is a great idea in principle - one of the reason that existing GenIII nuclear power plants cost so much is that each one is effectively a bespoke, one off project, even if they share a common basic reactor design. The production line would have to have a steady flow of orders coming in - the worst thing for a manufacturing industry is a bursty demand for its products, as it runs the risk of going bust in the lean times. 

To keep this production line going, the SMR company would need either a large market in the first country to approve its reactor design, or would need the approval in one country to smooth the path through nuclear regulations elsewhere (with "smooth" meaning "radically reduce the time and costs"). Thus getting a design approved for use in the UK, whilst a big hurdle to jump, only gives you ready access to a relatively small market.  Really these companies need to get approval in somewhere large like the USA, China or Russia to provide the steady flow of orders and income to keep them going whilst gain access to markets elsewhere.

And this really gets to the heart of the issue: so many things, with so much money involved, have to go right worldwide for SMRs to work out.  Its not a technology that can scale up from really small, cheap demonstrators and have relatively easy access to a wide range of markets worldwide. This is unlike solar PV technology for example: there you can build out power plants of different sizes, in different country all using the same factory produced PV panels and mounting hardware that can be shipped more or less anywhere.  It doesn't matter to the panel manufacturer if you're buying eight 250W panels to put on a terraced house roof in the UK, or several thousand to build a solar farm in a desert in the US as people are doing both, all over the world. You can scale the PV technology from cheaper, smaller setups with minimal governmental intervention right up to multi-megawatt power plants.  The same applies to the growing market for storage technologies - the same lithium cells are going into domestic battery packs and electric cars as are being put into utility scale grid storage systems and electric lorries and buses.

So what's the way out of this for the SMR proponents?  Will it be a technology that, like nuclear fusion, is always 20 years away?  Maybe the "small" in many SMR designs are still too big? There are some "very Small Modular Reactor" (vSMR) designs out there with less than 10MWe output.  Maybe one or more of those will crack the nut of regulation and production line manufacture for military or off-grid remote power setups that will then let the companies involved scale up to utility sized, grid connected power plants?

But really it seems to all come down to regulation and finance. Some countries appear to be moving in the direction of reassessing their regulatory framework and financing for new nuclear technologies, but it is a very slow movement and may be too slow for some of the companies pushing the more radical SMR designs. Time will tell, but it appears there may be more losers than winners in SMR, and this isn't going to be oft promised silver bullet to make new nuclear a big contributor to low carbon power transitions before 2030.

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