UK to confirm funding for mini-nuclear reactors for carbon-free energy | Energy industry
The government stands ready to approve funding for a fleet of Rolls-Royce mini nuclear reactors that the Prime Minister hopes will help Britain meet its carbon-free electricity target by 2035.
A consortium led by the UK engineering firm has already secured £ 210 million in support from private investors for the Small Modular Reactor Project (SMR), an amount the government is expecting. Confirmation is expected ahead of the October 27 spending review, according to well-placed sources.
The consortium, known as the UK SMR, is renamed the Rolls-Royce SMR to coincide with the blessing of Westminster.
Tom Greatrex, Chief Operating Officer of the Nuclear Industry Association (NIA) said, “Match funding for Rolls-Royce would be a huge signal to private investors that the government wants SMRs to hit net zero alongside new major stations. It would also show investors that the government believes in nuclear power as a green technology. “
Government support will pave the way for the consortium’s multi-billion dollar plan to build 16 SMRs across the country, the first of which could be online by 2031.
Any reactor that is easy to build and install will have a capacity of 470 megawatts (MW), enough to power nearly 1.3 million households based on average household usage.
Boris Johnson visited the Rolls-Royce Bristol facility on Friday, where he was given a tour of the facility by the engineering firm’s chief executive Warren East. Neither Rolls-Royce nor No. 10 wanted to comment on whether the future of SMRs was discussed during the visit, but the company this week touted the technology as a means of providing carbon-free electricity to make sustainable aviation fuel.
SMRs are seen as an integral part of the Prime Minister’s pledge to eliminate fossil fuels from power generation by 2035, a landmark promise he made last month ahead of the UK hosting the Cop26 climate summit in Glasgow.
Rolls-Royce is advised by HSBC, which has helped it raise £ 210 million from private investors, a condition for the government to raise the same amount.
The confirmed support for SMRs could signal a concerted effort within the government to reverse the planned decline in UK nuclear capacity. About 20% of the country’s electricity comes from 13 nuclear reactors with an output of 7.8 GW. But more than half of that capacity comes from reactors slated to decommission by 2025, and plans to replace them have stalled.
Toshiba withdrew from a facility in Moorside, Cumbria in 2020, and Hitachi withdrew planning permission for a project in Wylfa Newydd, Anglesey this year. While Hinkley Point C is set to start generating electricity in 2026, only one new project, Sizewell C, is currently in the works with no final investment decision made.
Britain’s ability to build new nuclear reactors was further hampered by the government’s refusal to allow further involvement of the state-backed China General Nuclear. CGN owns a 20% stake in Sizewell C, but ministers have been looking for ways to remove it from the project before moving into construction. The Chinese company should take a lead role in the Bradwell reactor in Suffolk, which is now very unlikely.
Economy minister Kwasi Kwarteng said last week that weaning the nation off of fossil fuels would require building at least one new nuclear project alongside renewables like wind and solar.
The prediction will likely depend on whether the Treasury Department, which Kwarteng’s division has clashed over budget support for utilities, backs a new funding model for the industry.
Industry players are keen to see the government approve the Regulated Asset Base Model (RAB), which will provide private investors with more reliable revenues from nuclear power plants – which typically require tens of billions of pounds to build – by adding the cost to household energy bills.
Greatrex said the RAB funding “could finally mobilize the funds for nuclear power plants large and small to restore a backbone of clean, reliable UK energy to our energy system”.
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Rolls-Royce has announced that it will create 6,000 jobs in the UK within five years if the government supports its SMR plans. It has also reportedly held conversations with customers overseas, including companies like Amazon that operate energy-hungry data centers.
In addition to Assystem, SNC Lavalin / Atkins, Wood, BAM Nuttall, the Welding Institute and Nuclear AMRC, the nine-member consortium also includes the National Nuclear Laboratory and the construction company Laing O’Rourke.
Small modular reactors were first developed in the 1950s for use in nuclear powered submarines. Since then, Rolls-Royce has developed reactors for seven classes of submarines and two separate land-based prototype reactors.
Rolls-Royce has not returned a request for comment.