A comprehensive Techno-Economic Assessment (TEA) by the Atkins consultancy and Ernst & Young on small modular reactors (SMRs) found that integral pressurised water reactor (IPWR) technology has the potential to contribute to the low carbon generation of electricity in the UK around 2030 under certain conditions.
The study, commissioned by the UK Department of Environment and Climate Change (DECC) before it was merged with the Department for Business, Energy and Industrial Strategy (BEIS), and dated July 2016, was released by BEIS on 7 December.
The TEA was open to all SMR technologies under development and included IPRWs, PWRs, high-temperature gas reactors (HTGRs); molten salt reactors (MSRs); sodium-cooled fast reactors (SFRs) and lead-cooled fast reactors (LFRs). Countries that presented at least one design to the TEA include the USA, China, South Korea, the UK and South Africa and a partnership between countries. The study said it is likely that first of a kind (FOAK) SMRs will be deployed in some of these countries in the next decade but added that, despite this international momentum, there remains a "great deal of uncertainty" with regards to the economics of both SMRs and competing technologies.
While IPWR technology has a high level of technical readiness, “all other technologies require a significant investment in R&D before they will be commercially deployable”. However, some “may offer technical advantages and greater cost competitiveness compared with IPWRs, possibly through the development of intrinsically safe designs with less complex systems”. With well-funded R&D programmes, the HTGR and SFR could be ready for commercial deployment between 2035 and 2050. “Other reactor technologies are less likely to be deployed in this timeframe, given the amount of outstanding technical challenges.”
DECC commissioned the TEA programme “to understand the potential costs and benefits that SMRs could bring to the UK”. A previous feasibility study conducted by National Nuclear Laboratory said SMRs present an opportunity for the UK to regain technology leadership but recommended more detailed analysis of UK requirements.
The study identified factors would contribute to a technically feasible and economically viable SMR programme in the UK:
- low construction cost in line with the most cost-effective vendor estimates;
- widening the pool of investors willing to finance new nuclear and achieving a lower capital cost than large reactors by reducing perceived technology risk;
- taking a ‘fleet deployment’ approach, planning for modularisation early on and providing investor certainty around the volume of UK SMR deployment of a particular design;
- advancing the international harmonisation of SMR licensing to enable an efficient export market;
- having manufacturing facilities in the UK, with a standardised SMR design and an order book.
The estimated Levelised Cost of Electricity (LCOE) for IPWRs was compared against costs for large nuclear, offshore wind and combined cycle gas turbine (CCGT) deploying in 2031 but the study warned that, for new technologies, cost estimates are uncertain. The LCOE for a generic FOAK IPWR SMR is estimated at between £86 ($115)/MWh and £124/MWh, with a central estimate of £101/MWh, excluding the costs of the generic design assessment (GDA). The estimated SMR FOAK LCOE (excluding GDA costs) is 30% higher than DECC’s estimate for large nuclear, 7% lower than offshore wind and between 16% lower and 3% more than CCGT (depending on the carbon price). SMRs could also be used for generating district heating, which could create additional revenue. The higher initial cost of SMR relative to large nuclear reflects the premium on FOAK costs and the reduced economies of scale for SMRs. However, SMRs have the potential to see technology costs reduce at a faster rate than large nuclear costs because SMR deployment “involves a higher pace and volume of reactor production.” Also, “stronger learning could be achieved for SMRs with their greater proportion of factory build (45 - 60%)” compared with large reactors (30- 35%).
The study said that, if the UK chooses to develop an existing IPWR design, it could be ready to begin GDA within the five years. “If a non-IPWR design is chosen, it is unlikely that existing technologies will be ready for regulatory assessment for 10 to 15 years” in the case of HTGR or SFR designs provided R&D programmes are in place and well resourced. The timescale would be longer for other technologies such as MSR or LFR.