An industrial consortium led by Rolls-Royce, the UK aircraft manufacturer, and the British taxpayer will jointly pump £ 405 million into the development of a fleet of mini-reactors as part of a new push into nuclear power designed to help the government to help meet its net zero carbon targets.
Rolls-Royce says it has obtained funding from the US energy company Exelon Generation and privately owned BNF Resources, an investment instrument backed by members of France’s rich Perrodo family and oil group owner Perenco. The three partners will invest a total of £ 195m in a new business, Rolls-Royce Small Modular Reactor, over three years.
The funding will result in a £ 210 million commitment from the government, which will be announced on Tuesday by Business Secretary Kwasi Kwarteng.
Kwarteng said: “This is a once-in-a-lifetime opportunity for the UK to deploy more low-carbon energy than ever before and ensure greater energy independence.”
British Prime Minister Boris Johnson supported the new technology being developed, known as small modular reactors (SMRs), as part of his 10-point plan for a “green industrial revolution” last year.
The technology is seen within the government as a way to Strengthen Britain’s energy security, create manufacturing jobs and help meet Johnson’s “leveling” agenda designed to ensure that prosperity and jobs are more evenly distributed across the UK.
The government’s support for Rolls-Royce comes three years after the British engineering group threatened to close the SMR program unless it received a long-term commitment to the technology.
Other Western countries, including the US and France, are also striving for their own SMR technology for use in their domestic markets as well as a new source of exports.
SMR developer NuScale of the USA announced at the COP26 conference in Glasgow last week that it had entered into an agreement to build small-scale reactors in Romania. French President Emmanuel Macron last month allocated € 1 billion in state funds to help state-backed utility EDF develop its own SMRs by early next decade.
Rolls-Royce and its partners will use the initial funding to place its SMR design through the UK’s strict nuclear regulatory regime. The process is expected to take up to four years, but will keep the consortium on track to complete its first 470MW plant by the early 2030s. Each mini-power station will be able to generate enough low-carbon electricity for about 1 million homes.
Unlike full-scale nuclear power stations, the SMR would have a footprint of just two football fields. But the main difference is that the small, modular design makes it possible to build the parts in factories ready for quick assembly at the chosen location, which makes it much cheaper than the traditional large reactors.
Rolls-Royce estimates that at least 16 SMRs can be installed at operational and mothball core sites in the UK. As part of the development phase, it will also identify potential manufacturing sites for SMR modules.
The company has previously said it expects the first five SMR reactors to cost £ 2.2bn each, dropping to £ 1.8bn for subsequent units. It estimates that by 2050, the program could create as many as 40,000 jobs in the UK regions.
The group said the new venture would continue to seek further supporters. It said it was in talks with a potential fourth investor, which would increase the consortium’s commitment from £ 195 million to £ 250 million. Other companies, including Jacobs of the U.S. and the UK’s Laing O’Rourke, previously named as part of the consortium, will become supply chain partners, Rolls-Royce said.