U.S. to fund small, modular nuclear reactors

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To develop a new generation of nuclear power, the Obama administration announced Tuesday that it will fund up to half the cost of a five-year project to design and commercialize small, modular reactors for the United States.

The Department of Energy said it aims to have these reactors, which have attracted private funding from investors including Bill Gates, in operation by 2022. It said it will negotiate the project's total cost with Babcock & Wilcox, an energy technology company based in Charlotte, that will lead the project in partnership with the Tennessee Valley Authority and Bechtel International.

"Low-carbon nuclear energy has an important role to play in America's energy future," Energy Secretary Steven Chu said in announcing the award, citing President Obama's push for an all-of-the-above energy strategy that reduces greenhouse gas emissions. He said DOE will accept funding requests from other companies developing such technology.

Small modular reactors (SMRs) are typically about one-third the size of current nuclear power plants. Although some of the technology has been used in naval propulsion plants, DOE says it's not been commercialized yet in the United States but could offer lower upfront costs, improved safety and greater flexibility. It says SMRs could be made in U.S. factories and moved to sites, including remote or small areas that cannot support large reactors, where they would be ready to "plug and play" upon arrival.

Several companies are developing small reactors, each with varying features. They include NuScale Power, Hyperion Power Generation, Toshiba, General Atomics, General Electric and TerraPower, in which Bill Gates is an investor.

The DOE co-funded project will be based in Tennessee. In a statement welcoming the award, Babcock & Wilcox said TVA is preparing an application to the Nuclear Regulatory Commission to license up to four small modular reactors at its Clinch River Site in Oak Ridge, Tenn.

Each reactor is designed to provide 180 megawatts of power -- compared to about 1,000 megawatts for many large ones. Based on advanced pressurized water reactor technology, it can be contained entirely underground.

SMRs are "very promising," says Nicolas Loris, an energy policy analyst at the conservative Heritage Foundation. He cites their potential for lower cost, clean energy and flexible use that could transform the nuclear industry, prompting greater competition. Yet he says the U.S. government should not be commercializing the technology but streamlining the licensing process.

The Obama administration has also supported large nuclear power plants. In February 2010, it announced $8.3 billion in federal loan guarantees for two new large reactors in Burke, Ga. -- the first new nuclear power construction in the United States in more than three decades.

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