Steel For Fuel N° 031 of 56 16 Dec 2024
It’s time to build! (light water reactors)
by Andy Lubershane, Partner and Head of Research, Energy Impact Partners
In this note
The question
Should the United States expand nuclear power by repeating the large reactor design it has just finished, or by building small modular reactors?
The answer
Repeat the large one. A Department of Energy report puts the next Westinghouse AP-1000s at about 45% less time and money and as low as $60 per megawatt-hour with current federal support, and Lubershane knows of nothing else offering firm, power-dense, zero-carbon energy at that price. He does not argue against small modular reactors; what he puts outside the case is Gen IV, the designs using coolants other than water, which in his view are additive rather than a substitute for Gen III+ deployment in the 2020s and 2030s.
03The argument
The case is repetition rather than novelty. Southern Company has just finished the first new large reactors the country has built in about thirty years, both AP-1000s, and building the same thing again should be cheaper and faster for reasons needing no nuclear physics: supply chains benefit from scale, and people learn by doing. The Department of Energy’s report reaches the same conclusion and supplies the figures in the answer above.
Then the puzzle: not one new AP-1000 is announced or under development in the United States, while small modular reactors keep drawing interest. He finds that odd, because nearly all the nuclear experts he knows expect the first few projects of any small design to cost more than another set of AP-1000s, provided those AP-1000s are reasonably well executed. That proviso is the whole issue. Large projects are perceived as carrying much higher overrun risk, and an overrun on a large project is by definition a bigger sum; that perception, plus small reactors fitting more neatly onto existing nuclear sites and retiring coal plant sites, is what he credits for their wedge into the market. He records the perception without arguing that it is wrong.
Two further arguments push the same way. The international market still skews large, and enough AP-1000s are announced abroad, by his own tally, to give Westinghouse and its critical suppliers a better chance of pulling ahead on deployment cost. Exports are geopolitical too, and he says it will be nearly impossible for the United States to remain competitive as a reactor technology exporter without a meaningful level of deployment at home. Gen IV designs, those using coolants other than water, he credits with real progress and grants they can theoretically serve applications light water cannot, but he still believes they are unlikely to compete with light water technology as a globally relevant power resource for several decades. Since what matters to the climate is the total stock of atmospheric carbon, he wants to start with what can be built with confidence now.
04What you need to know first
- Light water reactor
- One using ordinary water as both coolant and neutron moderator. The AP-1000 is one, a pressurized water reactor, as is the generation before it; Gen IV is the post’s label for designs using other coolants. “Generation III+” marks substantial gains in passive safety over that earlier generation; the 1000 marks scale, and he is explicit that nothing about an AP-1000 is small or modular.
- Levelized cost of energy
- All-in cost per unit of electricity over a plant’s life, used to compare generating technologies.
- Commercial liftoff
- , in the report’s sense: a reasonably robust supply chain plus standalone economic competitiveness.
05Details worth keeping
- The post is built around one chart from that report, which cannot be reproduced here; its headline numbers are in the prose.
- On exports he calls Russia a leading technology player in one of the few fields where it remains one, helped by generous state financing and a loose regulatory environment on non-proliferation, with South Korea, France and China also active.
- He reads GE-Hitachi’s BWRX-300 as the small design closest to liftoff in North America, and footnotes the projects behind that count: TVA’s Clinch River and Ontario Power Generation’s Darlington, both named as using the GE-Hitachi design, plus a permit application from AEP and a request for proposals from Dominion, both in Virginia.
- A footnote excludes Watts Bar Unit 2 from the thirty-year gap: finished in 2015, but begun in 1973.
06Claims worth citing
All figures as stated on 2024-12-16, the cost ones dependent on federal policy in force at that date.
- The next set of AP-1000s would take about 45% less time and money, and with Inflation Reduction Act incentives and Department of Energy loan financing could reach a levelized cost as low as $60 per megawatt-hour. (Department of Energy, “Pathways to Commercial Liftoff: Advanced Nuclear”, cited by Lubershane)
- A new small modular design needs roughly 5 to 10 committed orders to reach commercial liftoff. Same report, cited by Lubershane
- An AP-1000 produces over 1,000 megawatts. Lubershane
- GE-Hitachi has two near-term projects, three planned for the mid-2030s, and potential for two more through competitive processes. Lubershane
- Twenty-six new AP-1000 units are announced outside the United States. Lubershane’s own tally
- China’s Belt and Road initiative calls for exporting at least 30 domestically designed reactors by 2030. Lubershane
- Kairos won a 500 MW deal with Google plus federal regulatory approval for a demonstration reactor, and X-Energy announced a 960 MW deal with Amazon and Energy Northwest. Lubershane
07Where it’s contested
Nobody argues back; there is no second voice. His confidence markers sit on the load-bearing parts.
- The proviso is the whole case. The expert ranking holds only if AP-1000 projects are reasonably well executed, and he states that once without returning to it.
- The comparison is other people’s, attributed to the nuclear experts he knows rather than to analysis presented here, and he offers no evidence that the overrun perception is mistaken.
- The $60 figure is policy-dependent, and the post does not ask what becomes of the case without those incentives.
- Two judgments are marked as his own: that the GE-Hitachi design appears to have reached an inflection point, and that Gen IV will not compete for several decades, the latter given as belief with no figures.
- The puzzle goes unanswered. Having asked why no American utility is ordering an AP-1000, he explains the reluctance without saying who should carry the risk instead.