Demystifying decarbonisation: Small Modular Reactors, big opportunities
The energy transition and drive to net zero affects every person and every business. Our cross-practice international team of lawyers at Stephenson Harwood can help you both navigate through these challenges and help your business make the most of the opportunities no matter where you are on your journey.
Part of the journey is understanding the constantly evolving jargon that often surrounds the topic of climate change and energy transition. Our demystifying decarbonisation series breaks down the key terms, policies, regulations and drivers that businesses need to know.
What are Small Modular Reactors (SMRs)?
SMRs are nuclear reactors which operate on a smaller scale than traditional nuclear power plants.
In numbers, SMRs have a maximum electricity output of 300MW and can produce 7.2 million kWh per day. By contrast, grid scale power plants have an electricity output of over 1,000 MW and can produce 24 million kWh per day. For context, total installed electricity capacity in the UK is approximately 75GW. It would take just 250 SMRs (with a capacity of 300MW) to deliver the whole country's current electricity needs.
Like their traditional counterparts, SMRs use nuclear fission to generate heat which can be used to generate power.
What makes SMRs so attractive?
SMRs offer certain advantages over traditional nuclear power plants. As they are smaller, they need less space and less cooling water – this allows for more flexibility on site location. Their modular construction means that SMRs can be built in a series of parts. This enables cost efficiencies in production (through economies of scale) as well as installation (as the components can be factory-assembled and then transported to the site as modules or even larger units).
SMRs provide electricity as well as heat for industrial sites, district heating systems and hydrogen production. The localised nature of SMR nuclear energy deployment makes SMRs an increasingly popular option for supplying energy-intensive sites such as data centres. The rise of AI makes this power demand even more pressing. The potential of SMRs in this space has been recognised by companies such as Google, which announced in October that it has commissioned the construction of seven SMRs to provide power for its data centres in the USA. SMRs are also well-placed to offer skilled job opportunities, particularly in areas with closing fossil fuel-fired plants.
Russia's invasion of Ukraine highlighted the UK's and much of Europe's reliance on imported energy. SMRs offer a resilient, low-carbon power source to help meet increasing electricity demands and improve energy security.
What is the UK doing about SMRs?
The Government has pledged its ongoing commitment to nuclear energy as a core element of its Net Zero by 2050 strategy. Alongside larger-scale nuclear projects such as Hinkley Point C, SMRs will play a key role in the Government's ambitions to quadruple nuclear power capacity to 24GW by 2050.
As part of this, the Government is currently reforming planning rules to open up more potential sites for SMRs in England and Wales. For more information on these reforms please contact a member of our Planning Team.
So far, only Russia and China have managed to connect SMRs to their grid, in 2019 and 2021 respectively. Like the USA, South Korea, Japan, Canada and various EU countries, the UK is still in its SMR development phase. In February, Great British Nuclear (GBN) entered the final stage of its competition to select the UK's SMR technology providers. The four finalists are GE-Hitachi Nuclear Energy International LLC, Holtec Britain Ltd, Rolls-Royce SMR Limited and Westinghouse Electric Company UK Ltd.
Each of the designs has been subjected to rigorous analysis, with an evaluation of deliverability, safety, and the technology's ability to support the roll out of a fleet of SMRs in the UK.
Although GBN considers all four designs to be viable options for development, GBN confirmed in February that it expects to make its final decision on the two preferred UK SMR technology providers this Spring.
GBN’s Chair, Simon Bowen, said:
“This is an exciting moment for Great British Nuclear and the UK as we reach the final stage of the technology selection process for the Small Modular Reactor programme."
“Nuclear energy is vital for economic growth and delivering secure, reliable, home-generated power that is capable of meeting future demand, enabling Net Zero, and reducing the UK’s dependence on importing fossil fuels.”
For further information on SMRs, please contact a member of the Projects, Energy and Infrastructure Team.
Our Energy Transition team
At Stephenson Harwood, we have market-leading expertise in three sectors that will be the key pillars in the Energy Transition:
- Energy,
- Transportation and Trade, and
- the built and natural Environment.
Our Energy Transition team is international, with specialists spread across eight offices in Europe, Asia and the Middle East. When coupled with our strategic relationships with other key independent law firms, this means we can support our clients wherever their business interests are based.
Authored by Molly Macaire, Trainee Solicitor, Archie Campbell, Partner and Jonathan Cripps, Partner
