The role of economics in SMR progress and deployment

Diane speaking at SMR workshop

NEA’s Head of Division, Nuclear Technology Development and Economics, Diane Cameron, welcomes the participants to the NEA workshop which explored the economics of SMRs on 27 February in Ottawa, Canada. 

Global momentum behind the adoption of small modular reactors (SMRs) as a competitive, low-carbon energy source in the pursuit of net zero goals continues to grow. Nuclear Energy Agency analysis indicates that SMRs can play a crucial role in fulfilling the commitment made by 25 countries at COP28 to triple installed nuclear capacity by 2050 in support of net zero targets.

In this context, the NEA organised a workshop in Ottawa, Canada, which convened government, financial industry, economics experts, policymakers, research institutions and the nuclear sector to discuss the economic status of SMRs and their role in the transition to a low-carbon energy future. The workshop explored key policy priorities and opportunities for international co-operation to expedite deployment of SMRs. 

Assistant Deputy Minister of Natural Resources Canada, Debbie Scharf, and President and CEO of CANDU Owners Group, Rachna Clavero, opened the workshop with the NEA’s Head of Division, Nuclear Technology Development and Economics, Diane Cameron. 

Five key areas were discussed during the workshop, including the role of SMRs in pathways to net zero; policy frameworks and energy markets to accelerate SMRs for net zero; understanding SMRs’ key construction cost drivers; achieving the economies of multiples; and SMR business models and delivery strategies for serial deployment. 

The workshop highlighted that while nuclear energy has often been associated with high upfront costs and long construction timelines, SMRs offer the potential for significant cost reductions and faster deployment. By leveraging economies of scale, standardised designs, and streamlined regulatory processes, SMRs have the potential to deliver reliable, affordable, and sustainable energy solutions. 

The financing of SMRs was a focal point of discussions, with some of the panels looking at what role governments and industry will both need to play for both SMR development and deployment. Learning from other industries was a key discussion takeaway, with all stakeholders agreeing that the SMR sector can learn from other industries and apply lessons to its own approach for serial construction and large-scale deployment.

The workshop underscored the importance of policy frameworks in enabling the widespread adoption of SMRs. Governments play a critical role in providing incentives, funding research and development, and establishing clear pathways for licensing and approval. By creating a conducive environment for investment and innovation, policymakers can unlock the full potential of SMRs and accelerate progress towards net-zero emissions targets.

The outcomes of this workshop will contribute valuable insights to the first NEA Accelerating SMRs for Net Zero Summit scheduled for September 2024 during the Roadmaps to New Nuclear conference in Paris. This summit, as the capstone of the NEA's new initiative on Accelerating SMRs for Net Zero launched at COP28, will bring together senior government officials and industry leaders to discuss key policy priorities and international co-operation aimed at expediting the deployment of SMRs.

For the latest progress report on the pathway to deployment for SMRs, download the NEA SMR Dashboard

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