Small Modular Reactors (SMRs) not viable, and no cure for climate change

NOT THE SOLUTION  Mark Cooper, Ph.D.  Senior Fellow for Economic Analysis  Institute for Energy and the Environment  Vermont Law School  May 2014  “…..: When it comes to making the case for SMRs as one of the cornerstones of the 21st century, low carbon electricity sector is remarkably weak.First, the viability of SMRs is dependent on the very economic processes that have eluded  the industry in the past. The ability of the small modular reactor technology to reverse the cost  trajectory of the industry is subject to considerable doubt. The empirical analysis of learning  processes in the “Great Bandwagon Market” discussed in Section I and the failure of regulatory  streamlining, advanced design and standardization in the “nuclear renaissance” certainly question the  ability of the new technology to produce such a dramatic turnaround. As a result, even under the  best of circumstances, the SMR technology will need massive subsidies in the early stages to get off the ground and take a significant amount of time to achieve the modest economic goal set for it.

Second, even if these economic processes work as hoped, nuclear power will still be more costly than many alternatives. Over the past two decades wind and solar have been experiencing the  cost reducing processes of innovation, learning and economies of scale that nuclear advocate hoped  would benefit the “Renaissance” technology and claim will affect the small modular technology.  Nuclear cost curves are so far behind the other technologies that they will never catch up, even if  the small modular technology performs as hoped.

Third, the extreme relaxation of safety margins and other changes in safety oversight is likely to receive a very skeptical response from policymakers. This is just the latest skirmish in a 50 year  battle over safety. The push to deploy large numbers of reactors quickly with a new safety regime recalls the mistake of the early “Great Bandwagon Market.”

Fourth, the type of massive effort that would be necessary to drive nuclear costs down over the next couple of decades would be an extremely large bet on a highly risky technology that would  foreclose alternatives that are much more attractive at present. Even if the technology could be deployed at scale at the currently projected costs, without undermining safety, it would be an  unnecessarily expensive solution to the problem that would waste a great deal of time and resources, given past experience.

Finally, giving nuclear power a central role in climate change policy would not only drain away resources from the more promising alternatives, it would undermine the effort to create the physical and institutional infrastructure needed to support the emerging electricity systems based on  renewables, distributed generation and intensive system and demand management.

The paper concludes that the prudent approach to resource acquisition is to build the institutional and physical infrastructure that achieves the maximum contribution from the more attractive resources available in the near and mid-term. With a clear path of more attractive  resources, we do not have to engage in the hundred year debate today, although there is growing  evidence that prospects for high penetration renewable scenarios for the long terms are quite good.  The available and emerging alternatives can certainly carry the effort to meet the demand for  electricity with low carbon resources a long way down the road, certainly long enough that the  terrain of technologies available may be much broader before we have to settle for inferior options like nuclear power…


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