Small Modular Reactors: Miracle, Mirage, or Between?

In his February TED talk “Innovating to Zero,” Bill Gates voiced his concern for our inability to meet growing world energy demand while simultaneously limiting our effect on the environment. He observed that we badly need “miracles” in low and zero-emission power generation technology in order to stabilize the earth’s mean surface temperature over the next century. Such a technology, he insisted, must be deployable on an international scale and competitive in the existing market. In the quest to find such a miracle, some are betting on small modular reactor (SMR) technology.

While a handful of possible miracles are in the works, ranging from smarter wind farms to large-scale solar plants to an array of innovative nuclear reactor designs, from an engineering perspective, the nuclear route seems the most likely to yield a game-changer soon. Most recently, in fact, the SMR design’s inherent scalability and supposed affordability have been hyped as an answer to Mr. Gates’ call. Yet, while industry, government, and public enthusiasm for the SMR is certainly welcome, many of the details which may prevent the design from delivering our miracle often go unaddressed. Rather than deeming the SMR a mirage or praising it as a miracle, a more comprehensive discussion on the topic is needed, one which identifies the technology’s unique position as a potentially breakthrough stepping stone toward solving our pressing energy demand and climate change problems.

The SMR design is not new, but its proposed applications as a central player in the energy industry are. Small reactors providing less than 300 megawatts (MW) gave birth to nuclear power generation more than a half-century ago. Over time, engineers sought to consolidate reactor capacity in order to take financial advantage of economies of scale, logistical advantage of centralized control mechanisms, and regulatory advantage of the reduced number of waste storage sites. But despite these advantages, the challenges facing nuclear power have not been overcome in the US. Now the small reactor, newly envisioned as one block in a modular set, advertises assembly line-like production to combat capital costs and licensing hoops; plug-and-play implementation to reduce construction time; and individualized operation capability to enable progressive up-rating and potential load-following.

But such hype, while well-intentioned, can lead to unproductive over-enthusiasm. Recently, the American Society of Mechanical Engineers Energy Committee (ASME EnComm), a collection of industry leaders, academics, and regulatory experts, discussed the realities and progress of the design. SMR research is active, advanced, and wide-spread; pressurized water reactors, high-temperature reactors (HTR), liquid-metal reactors, and molten-salt reactors, all under 300 MW, are currently being tested in Russia, Japan, Argentina, the US, China, and South Korea. NuScale, an American company, even claims to have strong interest from national and international customers, prior to the 2012 release of its product.

Judging only by this promising activity, it is tempting to dub the SMR a miracle. But the majority of these diverse designs have yet to be demonstrated. In fact, the demonstration stage of the South African project, Pebble Bed Modular Reactor (a HTR), stalled and faded in 2010 after losing government funding due to lack of customer interest. The importance of demonstration, especially in the highly-regulated US industry, cannot be overstated.

But even in the stages before the crucial demonstration step, skepticism over the SMR’s promises abounds. The ASME EnComm noted regulatory, financial, operational, and logistical challenges. Treading the uncharted waters of Lego-like power plant construction will not be easy. In a traditional plant, one reactor provides heat for one or a few steam turbines. In an SMR-based plant, each module drives one turbine with its own controls and operators. As such, few of the costs associated with these systems scale down with reactor capacity. The turbines do not come in a complimentary plug-and-play form either – they would have to be built on site. And while decentralization enables partial operation and online refueling, it also introduces the challenge of module co-operation, the need for numerous highly-trained operator personnel, and brand new reviews by the Nuclear Regulatory Commission (NRC). This goes without mentioning the urgent and increased need for a more dynamic national approach to waste storage.

Licensing questions remain too. The one-time approval of a module before its mass production, bypassing a regulatory damper for each unit, is a highly-desirable advantage of SMR design. But if a utility would like to increase its capacity over two decades by incrementally adding more modules, will it face the choice between building licensed, though dated, technology or waiting again for a license to build with state of the art modules? Furthermore, as addressed in my past article, “Putting the Cart Before the Horse with Nuclear R&D” and its comments, the waiting time even for a traditional design license is considerable. With each new SMR innovation, from an individualized control room to coolant choice, the licensing duration increases by as much as a decade, pushing the vital demonstration step further away. Additional costs associated with these regulatory complications and non-scalable systems could combine to nullify the SMR’s affordability argument.

However, the SMR’s advertised perks should not be dismissed altogether; the ASME EnComm discussed great and real potential in the design. The SMR will open the nuclear power generation market to “small” buyers once regulatory barriers are overcome. Companies and communities, for instance, alongside billion-dollar utilities, could help to diversify the country’s energy portfolio. More, well-distributed power sources would lead to a smarter and more reliable energy grid and eliminate the need for sprawling and expensive transmission infrastructure. Aging coal furnaces in power plants could also be phased out by dropping SMRs in their place to spin the turbines.

From an international leadership perspective, the SMR may be one of the few remaining technologies which the US stands to commercialize more successfully and rapidly than its competitors. Interest among nations like China and India in SMR technology development is weaker than in the US, principally because their rapidly growing energy demand and comparably quick nuclear implementation policies are conducive to constructing large reactors.

Thus, the SMR should be considered neither a miracle nor a mirage, but is aptly-viewed as a medium: a stepping-stone for technological innovation and implementation as the nuclear industry adapts to the needs of national and international markets. The design’s reemergence illustrates the long-dormant industry’s newfound vitality and responsiveness. Reacting, in the US, to harsh regulatory standards and high resulting upfront costs, the industry is adjusting to curtail price tags and expand the buyer’s market.

In order for the SMR to help initiate the growth of a more robust nuclear future, though, demonstration is absolutely essential. Government support to this end is certainly welcome, but commercial realization is most likely to start in a remote location for which SMRs were originally intended, and spread as experience grows and costs come down.

Mr. Gates’ miracles will not be borne out of thin air – they must be cultivated. The SMR seed should be one of many the government aggressively nurtures, with the hope that industry, academia, and policy makers keep a watchful eye on its maturation. We might find that the advent of hype-driven public support, a substantial amount of research funding, and a growing market of environmentally-concerned customers, are just the right nutrients to bear our miracle.