In contrast to a conventional nuclear plant, SMRs could be added one at a time in a cluster of modules, as the need for electricity rises. The cluster's costs would be paid for over time, softening the financial impact.As the kids say, do read the whole thing.
The modules could be factory assembled and be delivered by rail to an existing nuclear plant site. In such a configuration, one SMR could be taken out of service for maintenance or repair without affecting operation of the other units.
Most SMRs would be situated beneath the ground to provide better security. Typically they would operate for many years - possibly decades - without refueling and produce far less waste than conventional reactors.
Significantly, almost all of the SMR development is being done with private financing. Companies are using their own resources to develop the small reactors, without government support from mandates or subsidies of the sort that renewable energy sources now require.
SMRs are an interesting, potentially game-changing addition to the nuclear energy market in my opinion, namely due to their ability to overcome one of the chief barriers to the rapid deployment of nuclear energy units right now: high capital costs.
Prohibitively high capital costs (most new reactors are starting with price tags around $4 billion or so) present utilities with a double-whammy of sorts: first in that raising so much capital is in itself a difficult undertaking, particularly compared to the total capitalization of the types of utilities making these investments. (This is where the typical rhetoric about "betting the farm" comes into play, despite the fact that the low fuel and operating costs and very high capacity factors make nuclear units veritable cash cows once electricity begins to flow. Ultimately, such investments require tying up a large portion of an individual utility's assets for several years before any money is generated.) Second, due to the large amounts of money involved and generally long construction times, utilities get hammered on costs by paying interest upon interest; in other words, interest accrues on money they borrow from the moment construction begins, meaning that the "cost of money" is a rather significant factor in nuclear construction. Finally, given both the large amounts of money and extended timelines involved, investors will thus typically demand a "risk premium" - similar to the kind of interest rate premium an ordinary borrower without stellar credit would have to pay on bank loans an credit cards. This too can significantly raise the cost of capital for building new units.
Each of these factors thus conspires to keep many smaller players out of the market. Instead, many have sought to invest in smaller, more scalable alternatives such as natural gas, which has nearly the opposite economics of nuclear: low capital costs (i.e., each unit is of a relatively small capacity and can be built quickly) and relatively high fuel costs as a fraction of the cost of electricity. (While nuclear's fuel cost for electricity is around 10%, natural gas can be around 70-80%). Nor has the price of natural gas ever been historically stable (at least in the last 15 years).
 |
| Unless, of course, this is your definition of "historically stable." (Source: EIA) |
Meanwhile, the "small" in SMRs also may have potentially positive implications for both cost and safety: SMRs can be potentially built into the ground, using the surrounding earth as containment, due to their relatively small size. Given the lower total power and nuclear material within the reactor, it can be said to have a lower overall "radiological footprint," meaning simplified safety planning.
Finally, the "right-size" power of SMR capacity may allow them to be sold in a greater number of markets - places both where a new full-sized reactor is too big for the needs of a community (for example, Fort Calhoun, north of Omaha, is the smallest reactor in the U.S. nuclear fleet, clocking in at only 500 MW; compare this to currently proposed new reactor designs, which begin in the neighborhood of 1000-1100 MW). Likewise, the smaller size means that for utilities only looking to incrementally expand capacity, small reactors may prove to be competitive with alternatives such as natural gas turbines.
One point which I think nuclear advocates tend to allow themselves to be blindsided to at times is in the fact that above all else, it is economics which will ultimately determine the future of the nation's electricity portfolio. Factors like politics certainly come into play (particularly such issues as energy portfolio mandates, etc.), and likewise factors such as safety can never be understated. Nor should public acceptance ever be ignored, much as it has to the industry's peril in the past. However, those ultimately committing the funds to expand energy sources are the utilities, many of whom answer either directly to shareholders or to ratepayers. In this regard, they have an obligation in either sense to produce power as profitably or affordably as possible.
Thus, the decision for utilities will always ultimately come down to economics, something that nuclear advocates cannot simply ignore. I don't necessarily doubt the assertions of fellow advocates such as Rod Adams, who assert that fossil fuels have a strong interest to defend in continuing to sell their products. (Although I will say that I also don't necessarily buy the idea that those who argue natural gas is currently more economical based on short-term factors are necessarily on the fossil fuel dole, either.) But the fact remains - for nuclear to succeed, it must be able to compete, head to head, dollar for dollar.
Nuclear energy has tremendous advantages to offer, in that is clean, abundant, and easily the most energy-dense source we have available at our disposal. Yet at the end of the day, decisions over energy investments do not necessarily come down to these factors: they come down to economics, and often (regrettably) economic return over the short-term. This may be where SMRs ultimately change the game for nuclear, then - namely, by bringing the advantages of nuclear to bear in a more economically attractive package.
This work by
Steve - thanks for your excellent piece on SMR (thanks for all your efforts at Neutron Economy). I think it is also worth noting the expected improvements in safety to be delivered by SMRs due to manufacturing processes. It is not only less costly, but much more effective to "build safety in" via strong manufacturing process control systems. That is, more effective than trying to "inspect safety in" at installation time.
ReplyDeleteUnfortunately the U.S. Nuclear Regulatory Commission (NRC) is neither budgeted nor staffed to process SMR designs through to licensing. Even if a vendor is financially capable of paying all the NRC expenses (as required by current law), the NRC doesn't have the trained staff available to focus on a new applicant. Do you have a view of the additional budget the Congress needs to authorize if SMRs are to become real in our lifetime?
The smallish activity I am aware of is the industry-created "SMR Licensing Task Force" populated by 4 utilities, 5 SMR vendors and nuclear insurer ANI. The slide decks from the two recent meetings are:
Regulatory Issues Related to Small Modular Reactors
https://info.ornl.gov/sites/gnstd/gssec/meeting5/Presentations/Session%201/AndersonV.pdf
Status of Generic Issues Related to SMR Licensing
http://pbadupws.nrc.gov/docs/ML1111/ML111180245.pdf
I note that Terrapower is not a listed member. I gather they have concluded that their future lies outside US regulation. My speculation is they will move their prototype and piloting efforts to Russia (or similar nuclear-friendly nation).
Thanks for reading, Steve! Excellent points, all. I'd actually avoided the regulatory issue on this one if only because that can easily be whole post unto itself (which I intend to cover sometime in the future). But the issues you raise are extremely important.
ReplyDeleteMy own view is that the NRC design licensing process will ultimately have to evolve to accommodate SMRs, given the vicious circle being created right now (no one will order an unapproved reactor design, the NRC won't bother to prioritize any reactor without commercial orders, and then of course there's the cost of design approval...)
But as you bring up, there's also the issue of simple staffing. I don't have much direct knowledge off-hand of the additional budgeting requirements to bring the number of staff up to the required level, but perhaps I should tap into some of my resources at the NRC to try and answer that question.
It would be very interesting to know what NRC insiders think the staffing plan should be, including how long it takes to recruit and train.
ReplyDeleteAs to funding, the US Department of Energy (DOE) is a possible source of financial support for the SMR licensing process. In fact DOE has proposed a small effort in the 2012 budget request: $67 million for "LWR SWR Licensing Technical Support". In parallel DOE has requested some $29 million for SMR Advanced Concepts R&D - which I take to mean beyond-LWR designs, which would include PRISM, Hyperion and TerraPower.
I'm very pleased to see some DOE support, though I would vote for much more funding for at least two pilot reactors. Isn't PRISM ready for a pilot?
I've often seen lists of advantages for SMRs. What are the disadvantages? One thing that comes to mind is operations. Would there be a separate control room for each reactor?
ReplyDelete@SteveK9: Excellent question. The issue of separate control rooms is currently an issue under consideration with the NRC, as far as I understand. Utilities and vendors would (obviously) like to be able to have a control room cover multiple units, however it is unclear whether this will come to pass or not.
ReplyDeleteLikewise, one of the biggest disadvantages with SMRs right now is the licensing process; at the present, vendors of SMRs are caught in a regulatory catch-22 with the NRC, in that licensing applications will not be prioritized due to a lack of pending commercial interest, however no utility is going to express commercial interest in a design which has yet to see regulatory approval. There is also the issue of the cost recovery rule for licensing review - vendors would have to put up enormous amounts of money up-front for the NRC to review new designs without any clearly delineated process for SMR designs (which arguably have different safety requirements from full-sized reactors). Licensing is thus ultimately a major issue with SMRs right now.
Aside from that, SMRs do take a penalty on neutron economy (e.g., the relative fraction of neutrons going to make useful fissions). Neutron economy is generally a factor of scale - bigger reactors in general can achieve better neutron economies becuase of their core geometries. SMRs are making a small trade-off on fuel costs (lower burnup and lower neutron economy), where costs are comparatively low (fuel) to drive down capital costs (where costs are relatively high).
There are likely other issues too, related to this - SMRs are unlikely to have the same thermodynamic efficiency as larger plants - again due to their size. However, this is a matter of balancing slight losses on one end with major gains in ability to get a foothold on capital costs (and subsequently, financing).