Early deployment and successful FOAKs could shape technology and policy ‘for decades to come’\n\nSmall modular reactors such as GE Vernova Hitachi’s BWRX-300 offer the potential for reliable baseload power with a small footprint and more flexible deployment. Courtesy GVH.\n\nFor small modular reactors (SMRs) to become a mainstream energy solution they must hit competitive levelised cost of electricity (LCOE) targets that range from around €52/MWh to €119/MWh, analysis has shown.\n\nLars Thurmann-Moe, a partner in the Oslo office of US-headquartered management consulting firm Arthur D. Little, said these figures would make SMRs competitive with other sources of baseload energy “under current market conditions”.\n\nLCOE estimates vary, but the International Energy Agency as has said the LCOE for advanced nuclear is $63.10/MWh. The lowest LCOE is $30.43/MWh for standalone solar and the highest is $120.51/MWh for offshore wind. Onshore wind is $36.92/MWh. \n\nUK-based Rolls-Royce SMR, which is developing a 470-MW SMR, has said it is aiming for a “highly competitive” LCOE below £70/MWh ($80.9/MWh). \n\nLCOE captures both capital and operating costs that need to be covered. It is essentially the long-term price at which the electricity produced by a power plant will have to be sold at for the investor to cover all their costs.\n\nThurmann-Moe, who is also Nordic head of energy and utilities at Arthur D. Little, said SMRs offer the potential for reliable baseload power with a smaller footprint and more flexible deployment, which makes them uniquely suited for today’s evolving grid demands.\n\nBut he warned that while vendor projections have shown promise, first-of-a-kind (FOAK) nuclear projects have consistently faced cost overruns and delays. The real breakthrough will lie in next-of-a-kind (NOAK) projects, which must unlock “the true potential of modularity” through standardisation, design repetition and streamlined construction processes.\n\n“ heating the projected cost and time savings of modular manufacturing, it’s not enough to have multiple designs in progress,” Thurmann-Moe said. “We need a single or small group of standardised designs to reach production volumes of at least 30 to 50 units to fully benefit from economies of scale.”\n\nAs global electrification accelerates across data centres, industrial sectors and electric transport, the demand for clean, reliable baseload power is surging, Thurmann-Moe said. While wind and solar are scaling rapidly, their intermittent nature and the absence of affordable, large-scale storage present a growing challenge.\n\nFaster Deployment, Lower Upfront Capital Requirements\n\nSMRs are emerging as a solution because they offer faster deployment, lower upfront capital requirements and the flexibility to be built in stages. Today, more than 40 countries are exploring nuclear expansion and SMRs are “firmly in the spotlight”, Thurmann-Moe said.\n\nUnlike traditional large nuclear plants, which are custom-built for specific sites, SMRs depend on mass-produced, standardised components. This shift demands a radical transformation of the current nuclear supply chain, Thurmann-Moe said.\n\nCritical players – including engineering, procurement and construction contractors, material suppliers and component manufacturers – must align with the modular approach. But without clear early demand, many suppliers are hesitant to invest, creating a classic “chicken-and-egg” dilemma.\n\n“ heating the full potential of SMRs can only be unlocked with a synchronised, modular-ready supply chain and early investment in manufacturing capabilities,” Thurmann-Moe said. “Otherwise, the time and cost advantages will remain purely theoretical.”\n\nHe added: “Standardisation, supply chain coordination, regulatory clarity and industrial-scale deployment will be essential.”\n\nAccording to Thurmann-Moe, there are 68 Generation III+ and Generation IV SMR designs under development. While no clear front-runner has emerged, several projects are gaining ground, he said. They include Generation III+ light-water reactors such as GE Vernova Hitachi’s BWRX-300 and Rolls-Royce’s SMR, and Generation IV designs such as TerraPower’s Natrium sodium fast reactor and X-energy’s Xe-100 high temperature gas-cooled reactor.\n\nChina and Russia have already deployed early SMRs, while the UK, US and Canada are progressing towards the first Western commercial rollouts. Russia has a floating nuclear power plant, Akademik Lomonosov, using the KLT-40S SMR, which has been commercially operating since 2020. China’s Shidao Bay HTR-PM, a pebble-bed modular high-temperature gas-cooled reactor, was connected to the grid in 2021.\n\n“The race is still open,” said Thurmann-Moe. “Early deployment and successful FOAKs could shape the technology and policy environment for decades to come.”

Analysis Shows Competitive LCOE Target For Small Modular Reactors

The article discusses the analysis of levelised cost of electricity (LCOE) targets for small modular reactors (SMRs), highlighting the need for competitive pricing to make them viable for baseload power. It features insights from Lars Thurmann-Moe of Arthur D. Little, who emphasizes the role of SMRs in addressing global energy demands while addressing challenges like cost overruns and supply chain coordination. The text also covers global developments in SMR technology, including projects in the UK, US, Canada, China, and Russia.