Small modular reactors (SMRs) are once again in the spotlight, but this time, the conversation is charged with urgency and skepticism. The promise of cheaper, more efficient nuclear energy has long hovered over the industry like a tantalizing carrot, but the reality is that no commercial SMR has yet been erected in the U.S. With tech giants like Google and Amazon eyeing these reactors to power their burgeoning AI demands, the stakes are rising. The question on everyone’s lips is whether SMRs can live up to their hype or if they’re just another mirage in the desert of energy innovation.
The nuclear sector has been on a rollercoaster ride, with safety concerns and spiraling costs continuously threatening its viability. Historically, traditional reactors have been massive, unwieldy beasts, both in size and expense. Enter SMRs, designed to be one-third the size and capable of generating up to 300 megawatts. They promise a streamlined construction process, with components manufactured in factories and assembled on-site, which is supposed to mitigate risks. Jacopo Buongiorno, a nuclear engineering professor at MIT, highlights this potential for quicker returns on investment due to reduced uncertainties. But as David Schlissel from the Institute for Energy Economics and Financial Analysis points out, the reality is that we’re still in the dark about the timelines and costs associated with these projects.
Despite the excitement, only three SMRs are operational globally—two in Russia and one in China. NuScale, the first company to gain approval from the Nuclear Regulatory Commission for SMRs in 2022, recently backtracked on its plans in Idaho as costs ballooned from $5 billion to $9 billion. This raises alarm bells about the supposed simplicity of SMR deployment. Buongiorno emphasizes that the technology is still evolving, and with each company using different forms of uranium, reliability and cost remain significant uncertainties.
AI’s insatiable appetite for energy is reshaping the landscape. Goldman Sachs projects a staggering 160% increase in data center power demand by 2030, and this surge is prompting companies like Amazon to invest heavily in SMR technologies. Clay Sell, CEO of X-energy, calls Amazon’s $500 million investment a “game changer,” indicating a shift in the energy paradigm where AI and nuclear power might become intertwined. This funding could pave the way for the first facility dedicated to manufacturing SMR fuel, a crucial step in the supply chain.
Yet, the hurdles are not just financial. The lengthy regulatory approval processes and the looming question of nuclear waste disposal remain critical challenges. While SMRs may produce less waste, studies suggest they could still increase overall nuclear waste volumes significantly. Schlissel argues for redirecting funds from SMRs to more established renewable sources like wind and solar, which have proven their worth in carbon reduction and cost-efficiency.
Buongiorno counters that nuclear energy offers a long-term solution, with a lifespan of 60 to 100 years, making it a more sustainable option in the long run. The Department of Energy is backing this notion, having earmarked $900 million for SMR development, asserting that nuclear energy is essential for the U.S. to transition from fossil fuels. The agency estimates a need for 700-900 GW of additional clean energy capacity to achieve net-zero emissions by 2050, with nuclear currently supplying nearly half of the nation’s carbon-free electricity.
As the debate rages on, the future of SMRs hangs in the balance. Will they be the key to unlocking a new era of nuclear energy, or will they remain a costly gamble in the shadows of more established renewables? The clock is ticking, and the energy sector is watching closely.