“The one thing I’m consistently hearing from industrial application end users is that they don’t want to own and operate a nuclear plant.” – Todd Abrajano, CEO U.S. Nuclear Industry Council
Amid growing demand for low carbon baseload electricity, nuclear power is increasingly seen as a clean and reliable option. But multi-year regulatory approval processes, lack of capital and chronic cost overruns in building new plants have made power companies reluctant to build.
For many in the nuclear power industry, getting smaller is a way to address these issues. Small Modular Reactors (SMRs) are nuclear reactors composed of prefabricated components, typically 300 megawatts or smaller. They are designed to be cheaper and more flexible than large nuclear power plants. In addition, they are equipped with advanced safety features such as automatic shut-down technology.
SMRs offer the ability to speed up regulatory processes and construction time. This in contrast to most nuclear reactors that are designed only for a specific site. This will substantially reduce costs. The designs of SMRs are modular says Abrajano, top executive of U.S. Nuclear Industry Council, an industry lobby group. Most construction can be done in-house and assembled on site. This takes much less work and much less custom design.
Russia and China have taken the lead in this area. They are the only countries that already have SMRs operational . Western countries are trying to catch up. They see large new markets for both domestic energy production and exports. Today, more than 80 SMR designs are under development in 19 countries, including America, Britain, Canada, Japan and South Korea. This according to the International Atomic Energy Agency.
A report by Natural Resources Canada predicts that the global market for SMRs could exceed $150 billion by 2040. According to Valuates, a market analysis company global, the SMR market was $4.13 billion in 2023. It is expected to reach $10.23 billion by 2030. That represents an annual growth rate of about 14 percent.
Companies and military are seriously considering SMRs
While electricity production is often the domain of energy companies, the business community is becoming more interested in SMR’s. Tech companies are signing contracts for a stable and reliable supply of electricity. They often choose nuclear energy as such a source. Various tech companies are looking at SMRs to power their data centers.
- In September Microsoft signed a deal with Constellation Energy to restart the Unit 1 reactor at Three Mile Island. This reactor will supply electricity exclusively to Microsoft for 20 years.
- On October 14, 2024 Google placed an order for SMRs for a total capacity of 500 megawatts for carbon-free electricity for its energy-intensive data centers at Kairos Power. This deal is the first where a tech company has commissioned the construction of a SMR. The first is expected to go online by 2030, the rest by 2035.
Other potential customers for SMRs are oil and gas companies, steel companies, and chemical companies. In March 2023, Dow and X-energy signed a joint development agreement for a SMR at Seadrift, the company’s industrial site in Texas.
SMRs are the ideal choice for companies that want a smaller, dedicated electricity source on-site instead of relying on the electricity grid. However, these companies lack the expertise to operate these plants. They also do not want to take responsibility for the waste problem or be liable for the ownership of a nuclear reactor. This presents the following opportunities according to Abrajano. They will need a grid operator that manages the SMR. Several other companies are now emerging as pure-play development companies looking for locations and customers. They will either own and operate these reactors and sign long-term power purchase agreements or find another way to bring a SMR online through a grid operator.
The military apparatus is also a market for SMRs. A White House fact sheet from May 29th reports that small modular nuclear reactors and microreactors can provide defense installations with resilient energy for several years, despite threats from physical or cyberattacks, extreme weather events, pandemic biological threats or other emerging challenges that can disrupt commercial energy networks. SMRs can be used to provide uninterrupted electricity to large military bases as well as operational bases in remote locations. Microreactors are currently used for submarines and aircraft carriers. They can be transported on an 18-wheeler.
The convenience of SMRs and microreactors means they can be transported to, for example, areas that have lost electricity due to a natural disaster. While the grid is being restored, smaller reactors can provide essential facilities with electricity such as hospitals and supermarkets. The ‘left’ of the political center is pleased because a SMR is a low-carbon energy source. The ‘right’ is pleased because a SMR can provide a continuous source of baseload electricity to meet escalating demand.
Now that the nuclear electricity industry is ready to bring this new technology to the market, it is also being assessed whether the required infrastructure and human talent are still in place. In America, there are 54 facilities containing 94 nuclear reactors. The average age is 42 years.
Meanwhile, China has made significant progress in expanding its nuclear fleet. In the past decade, the country has added more than 34 gigawatts of nuclear capacity. There are now 55 operational reactors with 23 additional reactors under construction, according to the Energy Information Administration (EIA). China has added the same amount of nuclear capacity in the past 10 years compared to the U.S. that has taken the past 40 years to achieve this. With the last 3 in the past 20 years.

The electricity price, like the gas price, has also found support well above the low point in February. A higher floor has formed. Now, a higher peak above €105 per MWh is still needed.
Baseload electricity price year of delivery 2025 (eur/MWh) – week cloud candle, log scale
