Blog: The CEO Corner

Are We (finally) About to See the Dawn of the SMR?

The Canadian Government recently launched its small modular reactor action plan and announced that SMRs are officially part of the country’s Climate Change strategy. This follows $Billions of investment money by several countries earlier this year.  SMRs have received a lot of hype in the past so why are governments starting to allocate funding and accelerate permitting?

Traditional nuclear power stations generate huge amounts of clean, baseload power. However, they are expensive to build, often have major cost overruns, and are one-off designs that cannot be duplicated. Also, because they are so heavily regulated, it takes many years to move through the proposal, planning and construction stages. Admittedly, this hasn’t deterred countries like China from rolling out aggressive nuclear energy programs but it’s a major hurdle for many smaller nations, and for utility companies responsible for areas of lower population density.  High cost and time are the bane of positive change when it comes to clean energy, which is why the nuclear industry is so excited about Small Modular Reactors (SMR).

SMR designs have been around for decades and there are even some in operation. They are dramatically smaller in size and many use novel fuels and moderators such as molten sale and TRISO pellets.  Importantly, they can be constructed off site from a series of modules, which are then transported and assembled on site. They have a number of major advantages over their larger brethren:

Rolls Royce’s proposed SMR power stations would be a tenth the size of conventional nuclear sites. (Source: ICE)
  • Cost Reductions. The capital cost is a fraction of the figures required for traditional reactors which, combined with potential economies of scale, removes one of the biggest hurdles to the widescale deployment.
  • Flexible Deployment. The small size means they could be installed on brownfield sites, such as decommissioned coal-fired power stations.
  • Built-in Safety. The design and manufacturing processes mean you have a completely different safety profile. In fact, many industry experts have referred to them as inherently safe.

According the WNA, there are currently five operating SMRs (in Russia, China and India), together with two under construction and another fifteen at a near-term or advanced stage of development in countries including Russia, USA, Canada, China, South Korea and the UK. In addition, over 30 more are at an early development stage.  That’s not exactly a construction boom, however, considering more SMRs are starting to move past the pre-approval phase to the licensing phase, there’s a feeling of real change in the air.

This change is of course being driven by the greening of the world’s energy policies. A report by the International Energy Agency (IEA) has estimated that reaching the world’s climate goals without nuclear energy will not only take longer and carry a higher risk of failure, but will also cost up to US$1.6 trillion more. This “greening”, or decarbonization if you prefer, is being accelerated as countries look for ways to stimulate economic recovery in the wake of the Covid-19 pandemic.  You might call it a perfect storm for support. Let’s look at some of the 2020 news items in question:

Architectural rendering of IMSR® power plant. TERRESTRIAL ENERGY

There are also some equally telling but less prominent news items such as the Saskatchewan government recently hiring Helene de Beer as director of SMRs within their Climate Change branch.  According to a presentation recently given by the CEO of SasPower, the Province’s energy provider, they want to move their first SMR to the planning phase in 2021 and, if the economics are there, they will replace all of their fossil fuel power stations with a fleet of SMRs by the mid 2030’s. You also have an announcement by New Brunswick Power regarding an MOU to set up a vendor cluster to produce SMRs.

And then of course you have growing bilateral support from the US Congress for SMRs – partly to help decarbonize energy but primarily because of the money to be made by selling, deploying and supporting SMRs abroad.

As someone who has been in the uranium field for decades, I can honestly say that up until 2020, the talk from the SMR players was always the same: “SMRs are coming”. What was missing was political support. After many years, that support is now starting to materialize. Yes, it will take time to get more test reactors approved and deployed before major rollouts can occur but serious money is now being made available and more projects are moving through the permitting process. Assuming these SMR test deployments deliver on the economics, we could finally see the long-awaited international rollout and the corresponding uptick in uranium demand.

By Ross McElroy, CEO of Fission Uranium and Gary Haywood, VP Project Development for Fission Uranium